By using a reverse trial strategy, Elena Verna outperformed other common sales tactics.
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TL;DRWhat’s the fast marketing tactic?What was the result?Why does it work?Get more tactics like this
TL;DR
The author: Elena Verna, Partner at 20VC.
The goal: Maximize sales for SaaS companies.
The tactic: Utilize the reverse trial method.
The result: More conversions from freemium to premium.
What’s the fast marketing tactic?
Elena Verna specializes in B2B product-led growth & sales and has an alternative proposal for your SaaS operations.
While some SaaS organizations are only accessible through a paid subscription, many offer a free trial to hook users. An alternative configuration is having two levels of use, a limited free tier and the premium unlimited tier.
Elena is a proponent of a fourth tactic. Users are offered a free trial of the full premium service as their first point of contact with the company. After the trial period has elapsed, they will automatically be demoted to the free, limited service.
If the user then wants to return to the premium tier, allowing them access to all the features and usage they previously had access to, they would have to sign up and begin a paid subscription.
A final element of this system is the concept of a trial restart. In this case, after dropping down to freemium, if the user has not signed up for premium after a certain period of time, they are able to participate in another free trial of that upper tier.
What was the result?
In the course of Elena’s work, she has seen the reverse trial tactic increase conversion from freemium to premium from between 10 – 40%.
Why does it work?
The reverse trial is effective because it creates a sense of loss. If the user was barred from using the SaaS program because they weren’t inclined to pay, they will quickly forget about it – you can’t lose what you never had. Even with freemium, a user may enjoy the benefits of freemium and while they have never sampled the premium features they will see freemium as better than nothing and a happy middle ground between not having access to the SaaS and paying a fee for it.
Driving the user down a path where they have experienced the full functionality of premium and then relegating them to the free tier means that their feeling towards the freemium will more likely be one of frustration at its limitations. This will psychologically make them more likely to convert to a paid subscription.
The reverse trial is also distinct from systems where a free trial is offered on a SaaS that only has one tier of use. In that case, the user who doesn’t convert to a subscription after the free trial will then stop using the service and in time forget about it. The user who has simply dropped down a tier rather than disappeared from the service is still kept in touching distance of converting through their continued use.
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