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Regarding your last point: One thing I did in my B2C startup that helped tremendously with this is to have all customers pay monthly up-front, with no contracts
by notdonspaulding 4y ago
Regarding your last point: One thing I did in my B2C startup that helped tremendously with this is to have all customers pay monthly up-front, with no contracts and no free trials. I think most folks avoid this because it "leaves money on the table" but it does 2 important things:
- Brings clarity to your relationship: "If you aren't finding value in the product, or think you can find better value elsewhere, you can leave at any time."
- Keeps you honest. Because you can't hide your failure to deliver a valuable product behind contractually-obligated revenue.
I'm not against contracts at all, and the larger your customer or the more involved your customer relationship gets, the more necessary they become, but even in bigger engagements I shoot for the contract to be payment up-front or in regular installments with easy offramps should the customer stop seeing value in the engagement. The important bit is that if a customer wants out, you should let them out, and it should not cause _you to lose any money or any sleep_.
I don't know how widely applicable that is to other businesses, but for mine, it's a helpful way to structure the relationship.
- XCSme 4y agoI do provide a free trial because it lowers the friction for users trying my product. I sell a self-hosted software, so the main push-back against such software is that installation could be too complex. The main purpose for trial in this case is to let customers test the installation for free and if it works for them as expected they can then purchase a license.
- WA 4y agoI have a B2C app with a prepaid model as well since 2011. It works like a charm. Very easy to understand, no confusion. Refunds are maybe 1 per month. I haven't had a single credit card chargeback ever and I think only 2-3 PayPal "conflicts" in more than 10 years. (But this, of course, also depends on the kind of customers you have). But I do offer a 30 days free trial.