Turbo-charge your SAAS revenue with these 10 smart tactics
The struggle for optimizing the free-to-paid conversion rate is one of the most common causes for stress for SAAS marketers. Happened to speak to three of them over the fortnight, in three different contexts. Here’s what I gathered from the brainstorming –
The benchmark for SAAS conversion rates, according to Lincoln Murphy, vary between 25% (no card required free trial) and 60% (card required free trial). Conversion rates for freemium offerings are typically in the single digits.
Here I must clarify that card-required trial, which collects payment information in the sign-up stage and automatically bills after the trial ends, may yield higher conversion rate, but usually elicits strong opinions on either side of the debate. And that’s understandable. Anyhow, if you are going for it, the opt out feature must, must and must be straightforward. Period.
Now, when challenged with a conversion rate lower than the benchmark, most of the marketing spends tend to lean towards promotional schemes. Great schemes, laced with a sense of urgency, do work. But, when they don’t, stress sets in.
Other possible tactics are usually overlooked. What could be other alternatives –
- User-test to investigate the roadblocks in the user journey. Do not make it easy to sell, make it easy to buy. Create tutorials if needed.
In my next post, I will share with you an interesting experience of how we elevated conversion rates through user tests for a voice-based subscription service in a low-literacy setting.
- Refurbish your social proof. This is closest to the proverbial ‘word of mouth’.
- Trigger personalized emails (obviously, automated) in response to user activities. The trick lies in identifying the right signals to trigger an email without annoying the customer. You must monitor performance of each trigger. One of the high performing emails is the one sent before the trial period ends. Incentivizing the super-active users to convert may be another.
- Revisit the unlocked features. Whether to lock some free features only as premium, or allow free trial to all features with a limitation is a matter of debate. Choose wisely.
- Be a tease. Revisit your value proposition of ‘why premium’. It’s alright to show your customer what they’re missing.
- Optimize the free trial period. If it is too long users may not convert at all. The ticket size of the product should dictate whether the free trial period should be 7 days / 14 days or 30 days.
- Revisit the monetizable features. Trial limitations should be set over functionalities that are most valuable for the user. Must be chosen wisely.
- Review the cancellation policy. Every paying customer wants a clear, no strings attached cancellation policy.
- Little bit of human support may be required. Streamline your helpline.
- Monetize the rest. Even after all the tactics deployed you’ll still have a large pool of users who’ll never convert to a paying customer. Try finding ways to monetize them. Showing ads to non-paying users is probably the most common method.
Some tactics may need to be deployed together, for example, if the trial period is longer your email touchpoints may need to be more than what it is for a shorter trial period.
Expert #SAASMaerketers may have a few more tricks up their sleeve. Please do enlighten.