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When I collected cards upfront for Planscope, I sent out an email 3 days before their 14 day trial ended. The next email they'd get would be an invoice email wh
by bdunn 13y ago
When I collected cards upfront for Planscope, I sent out an email 3 days before their 14 day trial ended. The next email they'd get would be an invoice email when their trial expired, and they'd continue to get these emails each month when they were billed.
When Gmail rolled out tabs, I started getting a lot of people who were unexpectedly billed. My "trial expired emails" were usually lumped into the Promotions tab, which doesn't have as much urgency attached, and thus there was definitely a spike in cancelations after that first invoice (people always see those invoice emails; they sometimes miss the "trial expiring and your card will be billed" emails :-)
When you take cards upfront:
* You'll get much higher trial to paid conversion rates. Mine was about 45%
* You'll get a lot of cancellations after that first bill goes through. If you calculate churn based off of "paid accounts who cancel", it will be artificially inflated. Try tracking it against customers who have paid you at least 2x.
* If you want to make your life a bit easier, automatically refund people who cancel within a given window after their first bill.
* Please don't bill people without sending them an email invoice. It's just wrong.
* Don't stake your business on one-off customers. If someone wants their money back, give it back (within reason, obviously. I'll by default refund the last month.) I've had people come back when they really needed Planscope, refer others, etc. And plus, chargebacks are messy.
I'm no longer collecting cards upfront, and I've finally got MRR growth back on track. I made the mistake of simply changing the signup form / billing code without making heavy modifications to the marketing site and onboarding flow, which caused a huge drop in growth after that change.
- dangrossman 13y ago> I'm no longer collecting cards upfront, and I've finally got MRR growth back on track. I made the mistake of simply changing the signup form / billing code without making heavy modifications to the marketing site and onboarding flow, which caused a huge drop in growth after that change. That'd be a great topic for a blog post. I don't know how to make that switch myself; I tried once and it wasn't a success.
- bdunn 13y agoGreat idea. I ALMOST went back to the safety of CCs upfront (http://planscope.io/blog/why-im-going-back-to-capturing-credit-cards-upfront/ http://planscope.io/blog/why-im-going-back-to-capturing-cred...) but ended up sticking with it. And I'm glad I did, because growth is significantly higher and there are fewer cancelations. The big takeaway: People do more research before plugging in their credit card. If it's relatively low friction to sign up for a trial of your product, you need to make sure your onboarding flow isn't just about how to use your product, but why (e.g. the typical responsibility of your features / tour pages.)
- gacba 13y agoSo wait--you said you almost went back to collecting CC's up front, and that article says it was a better fit than the no-CC trial, so what data did you collect to say otherwise? You're arguing both sides Brennan. :) I'm confused as hell as to which worked and why.
- bdunn 13y agoSorry, should have been more explicit: For most of Planscope's history, I captured credit card upfront. Growth was decent, but I wanted to see what would happen if I dropped that requirement. So I did, and growth plummeted (very few signups were converting.) My gut reaction was "REVERT!" (which is where that blog post stemmed from), but after talking with a few people I figured that maybe it's not as simple as just changing how signing up works... maybe I need to tweak a lot of other stuff. So I did, and now that it's been in production for a few months growth has eclipsed the card upfront rate.
- gacba 13y agoSo what all did you tweak to make it work? If you'd prefer not to be public about it, message me in the Academy (this is Dave Rodenbaugh)