How to choose between freemium and free trial: those already on an email list) may reduce the need for an opt-out version (and sign-up friction for legitimate prospects). Nonetheless, sharpening targeting for user acquisition or offering a trial only to some users (e.g. For some, opt-out free trials are essential-you may have more leads than you can manage or face rampant trial abuse. A credit-card wall has consequences, not all of them desirable: It will keep out bad and good prospects, and it will tank your sign-up conversion rate. Those near-term sales, while enticing, may erode a brand and hurt retention. If the user does not cancel by the end of the trial, they are billed automatically.Īn opt-in free trial typically generates more trials because it reduces friction at signup however, an opt-out free trial generates a higher percentage of sales (often of the “Gotcha!” variety), as some users forget to cancel in time. At times, a nominal fee such as $1 is charged, often to placate payment processors or to cross the penny gap early on. Credit card information is taken at the start. They can explore the product until their trial expires, at which point they’re prompted to sign up-pay or get out.Ģ. Users sign up for free without including any payment information. There are two ways to structure free trials:ġ. In an interview with HubSpot’s Kieran Flanagan, Ty Magnin of Appcues suggests that a free trial is the “demo of 2018.” That is because most SaaS products are accessible immediately via a browser or app and automate onboarding: they’re self-paced, time-limited demos. If freemium still seems like a barrier to acquisition, you’ve got plenty of money in the bank, and you’re crossing your fingers for a buyout by Google or Facebook, a fully free product may make the most sense.Ī free trial gives users full access to a product for a limited period. While not freemium products-there is no paid version to which you can upgrade-they represent one end of the free vs. Instagram) with other means of monetization, like advertising. iTunes), but access to them is an entry point to an ecosystem that incentivizes future purchases (e.g. Some freemium products are fully functional (e.g. Freemium versions can also include advertisements as a limitation on the experience (e.g. Not every restriction removes functionality.

Dropbox), or caps the number of users (Canva).ģ.Ědvertisement additions. The freemium version limits storage or server access (e.g. This is the most common form of a freemium product-a no-frills version of its premium counterpart (e.g. Restrictions come in many forms:ġ.ğeature limitations. Let us look at both the models carefully.Ī freemium strategy offers perpetual access to a restricted version of a product.

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