Winning Strategies for Subscriber Acquisition
The best things in life are free, or so the saying goes. In subscription commerce, free trial subscriptions are a proven customer acquisition tool. By letting prospective subscribers sample your product or service, they can experience your offering before deciding whether or not to subscribe. Offering free trials is particularly popular with digital goods, such as streaming video services, SaaS solutions, or other services accessed via the internet. But many businesses that ship physical goods to subscribers, such as “box of the month” businesses, also provide prospects with a free trial experience before asking them to commit.
Recurly supports free trials in a number of different ways.
Cardless (or card-required) free trials
Recurly has a free trial option built into our solution, and our customers can choose whether or not to require payment information when prospects sign up for a free trial. This type of “cardless” free trial reduces friction in your prospects’ sign-up experience. It also supports new subscriber acquisition, as various studies have shown that trial sign-ups increase when prospects are not required to provide payment information.
In addition to improved acquisition, another benefit of our cardless free trial feature is that Recurly has created this feature at the subscription-plan level. This means that our customers can create two different plans—one with a free trial that requires payment information and one that does not—and then test both to see which yields the best results.
Authorize and capture
If requiring subscribers to provide payment information to access the free trial, one way to improve trial conversion rates is by configuring authorize and capture. Authorize the subscriber’s credit card to ensure it is valid and sufficient funds are available before giving them access to the free trial. At the end of the free trial, the payment for the subscription can be “captured” from the credit card.
In addition, using this feature within the checkout process has an additional benefit for businesses that ship physical goods to their subscribers. With this feature, you can authorize the card when you collect a subscriber’s payment information and then ‘capture’ the funds when you ship the box. This allows you to confirm that you have sufficient inventory to fulfill the order before you actually charge the subscriber’s card.
Trial Performance report
When offering a free trial—or implementing any other best practice—it’s crucial to utilize data to measure the success of your strategy, iterate on that strategy, and measure again. To provide better visibility into subscription trial success, Recurly provides a Trial Performance report in Recurly Analytics.
With this report, Recurly customers on our Professional and Enterprise plans can track trial conversion rates over time and delve into the reasons why their trial subscribers didn’t convert. For example, perhaps they cancelled their subscription before the trial ended, or perhaps there were issues with successfully processing their payment.
Using this report, you measure the effectiveness of free trials on different plans and gauge the effectiveness of different trial lengths along with card-required vs. cardless trials. Businesses using Recurly can also confidently test different engagement and personalization strategies, knowing they can track conversion rates for each test scenario.
Research on subscriber acquisition
Making it as easy as possible for your prospects to test out your product or service via a free trial can be a winning strategy. Our research on the effectiveness of subscriber acquisition tactics found that free trials tend to have impressively high conversion rates: 66% for B2B companies and 56.8% for B2C companies. Other subscriber acquisition tactics, such as coupons, may also be extremely effective.
For additional insights on subscriber acquisition and to fine-tune your own efforts to grow your subscriber base, view Recurly’s research which provides broad benchmark data on both coupons and free trials, how they’re used, and what are their impacts.