Try Before You Buy: The Reverse Trial Approach to PLG User Acquisition
In today's tech products, companies often face the decision of whether to go with the free trial or freemium model.
There is a new acquisition model just emerged on the scene recently, that allows you to get the best of both worlds, called *reverse trial model*.
Let’s first unpack trial & freemium models👇
When a company uses either free trial or freemium model, there are both advantages and disadvantages to consider.
On one hand, a free trial allows users to try out a product without committing to a purchase, which can be attractive for those who are unsure about whether they want to commit.
That means a lot less friction to get started with the product and higher volume of the TOF leads.
One downside to free trials is that they have a time limit, which may not give users sufficient time to fully experience the value prop of your product, have the Aha-moment, or build the habit.
On the other hand, a freemium model allows users to access a basic version of the product for free, but they must pay to access advanced features or remove limitations.
This can be an effective way to generate revenue in the long-term, but it can slow down your conversation rates.
They’re getting stuff for free and it’s enough for some users, why upgrade?
✨New✨ Reverse Trial Model:
Pros:
You get a lot more TOF leads since there’s less friction (no need to enter cc).
Can be effective in attracting users who are hesitant to commit to a purchase without experiencing full value prop first.
Cons:
It relies on users remembering to upgrade to a paid version at a later date. This means that companies must put in the work to keep their product or service top-of-mind for users and encourage them to upgrade.
Could be challenging to monetize, as it relies on users choosing to upgrade to a paid version at a later date.
Example 1: Vidyard gives users a choice to either activate their reverse trial of the paid plan or start with the free plan.
Example 2: Pipedrive allows you to get started with the reverse trial on any of their paid plans.
The end of the trial period is a crucial point in determining the success of a reverse trial model.
One key decision that must be made is whether users will be automatically converted to a paid plan or downgraded to a freemium version.
There are several factors to consider at this stage, including whether payment details have been collected, what happens to trial features and data when a user is downgraded to a freemium plan, and how users are notified of the change.
For instance, Vidyard automatically converts trial users to a paid plan at the end of the trial period.
If payment details are not obtained upfront, the user's account may be suspended or automatically downgraded to a freemium plan.
The End
The reverse trial model, also known as the "pay-later" model, flips the traditional trial model on its head.
It allows users to continue using the product or service for free, with the option to pay for additional features or to unlock premium content at a later date.
The reverse trial model can be effective in attracting users who are hesitant to commit to a purchase without experiencing full value prop first.
However, it may also be more challenging for companies to monetize their products using this model, as they must rely on users remembering to upgrade to a paid version at a later date.
Ultimately, the best model for a company will depend on your product and target market.