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How to Improve SaaS Free Trial Conversion Rates

SaaS Free Trial Conversion Rates

Free trials are one of the most effective ways to get new users to check out your SaaS product. In an increasingly crowded marketplace, the free trial sales model is becoming more popular as companies struggle to find ways to acquire enough users to keep up their growth rate without sinking their budget.

Something that’s commonly overlooked with free trial plans is the strategy behind them that moves the non-paying customers to paid plans. After all – it’s not much of a sales model if none of your subscribers are going to pay you.

Companies often implement a free trial sales model without considering best practices for building and maintaining a profitable SaaS free trial conversion rate. Without considering different strategies for using free trials to effectively move non-paying customers to paid plans, many SaaS companies prematurely abandoned free trials altogether.

Let’s take a look at the ins and outs of the free trial sales model and how to improve your SaaS free trial conversion rates.

Is a free trial sales model right for you?


Free Trial Sales Model

Giving away free things in any industry is a proven way to build a relationship with people who don’t know, like, or trust your company yet. In the B2B SaaS industry, building trust is essential as choosing the wrong product can have a negative impact on many areas of a customer’s business.

While many SaaS companies see incredible results with free trials, every business is different, and in some cases it might not make much sense to implement a free trial strategy.

For instance, if your SaaS product can’t deliver clear results during a reasonable free trial window or the customer can’t get a complete picture of how your product benefits them during that time, you should probably think twice about offering free trials at all. The purpose of offering a free trial is to show prospective customers the value of purchasing your product, and if that isn’t something you can show them during the free trial period, you’re likely going to have a low free trial conversion rate no matter what you do.

Another example would be enterprise-level software, or a complicated SaaS product that requires in-depth training to be used properly. If your product is too complicated for users to pick up and learn on their own, a free trial isn’t going to work well when it comes to converting them to paid customers. Instead of offering free trials, it might make more sense to offer free demos to the decision makers of businesses you consider prospective customers.

The downside of free trials


Free Trials

Free trials can attract a lot of users that sign up for your product with a passing interest, only to forget about it shortly afterwards. Maybe it was the weekend, or something else came up. They were going to get back to it, but – you know. Life gets in the way.

This is the reality for 40-60% of the people who take up free trial offers. It’s a significant percentage of potential recurring revenue, and it’s these people who you need to take into consideration when you’re figuring out how to capture user attention, demonstrate value, and improve your free trial conversion rate by moving users from free to paid subscriptions.

Structuring your free trial

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SaaS Free Trial

The most common elements in a free trial model are:

  1. Opt-in with no credit card

  2. Opt-in with a credit card

  3. Limited functions/features

  4. Limited users

  5. Limited trial time

Opt-in with no credit card

This is everyone’s favorite method of free trial – from a user perspective anyway. There’s low friction and instant gratification.

It’s so easy, in fact, that many of the people attracted by this free trial model only have a passing interest in a product and were never serious about it as a solution, let alone a solution they would pay for. Free opt-ins can generate more leads, but they won’t necessarily be better leads.

Opt-in with a credit card

This model can cause a lot of friction for a trial user. Many of us have been burned at some point by entering our credit card details into a “free” service, then forgetting to actively opt out of the trial account – only to be stung with a hefty bill when the new month rolls around. Psychologically, this is viewed as being a bit of a sneaky tactic. If you’re looking to build trust in a new customer from the outset, credit card opt-ins can be a sticking point for a lot of people.

Free trials should be as frictionless as possible, and having to give away sensitive information up front isn’t one of the best ways to start a relationship.

On the other hand, the people that are willing to give up their credit card details on a free trial are more likely to be serious about upgrading to a plan once their trial is over.

Generally speaking, we can expect a higher SaaS free trial conversion rate from the “opt-in with a credit card” model when directly comparing to the “opt-in with no credit card” model, but we can also typically expect fewer leads altogether from this model. With that being said, testing your trials with and without a gated credit card entry point is the best way to analyze the number and quality of the leads coming into your free trial.

Limiting features on a free trial

Some companies prefer to limit the features on their free trials – dangling their paid premium features just out of reach of excited new subscribers. The problem here is that a new trial user will never get to experience the full value of a potentially amazing product before they buy. It might be these very features that could sway the