

Should You Require a Credit Card Upfront for a Free Trial? - toumhi
http://www.saasfoundry.io/blog/should-you-require-a-credit-card-upfront-for-a-free-trial/

======
Turing_Machine
Individual conversion rate isn't the whole story, either. There are people
like me (and I suspect many others here) who will play with just about
anything that looks interesting, whether we have an actual long-term interest
or not. Asking for a credit card up front will lose most of those people. No
big deal, you think? Well, those people also tend to be the ones who tell
their friends about your new site, and whose friends trust them to make such
recommendations.

~~~
mathattack
I like that they did use real #s in addition to polemics. You're right in that
they didn't capture influencers. It would be good to see metrics on that too.
I do know that I refuse to try anything requiring a credit card # - I wind up
forgetting too often. But my data point is just an anecdote.

------
lotsofcows
Personally, unless I really, really, really need whatever service you're
offering, I close the window if any of the following are requested: 'phone
number; credit card; "secure" password; social network logon.

~~~
aestra
Add "Full Name" to that list.

You're not getting my damn name unless there's a _really_ good reason for it.
I don't want to give you my first and last name to upload some funny cat
pictures or whatever.

[http://www.zephoria.org/thoughts/archives/2011/08/04/real-
na...](http://www.zephoria.org/thoughts/archives/2011/08/04/real-names.html)

[http://infotrope.net/2011/07/25/preliminary-results-of-my-
su...](http://infotrope.net/2011/07/25/preliminary-results-of-my-survey-of-
suspended-google-accounts/)

------
olegp
We are having this very same debate internally now at
[https://starthq.com](https://starthq.com)

I'm thinking that individual users should be put on a free trial without the
CC being asked up front. However, group plans that will be paid for by IT
managers will be CC up front.

The reasoning behind this is that by asking for the CC up front from managers,
we will 1) make them value the service more 2) retain more of them as
customers.

What do you think?

~~~
toumhi
In most cases it doesn't make sense to artificially lower your signup rates
like that, except if your onboarding process is very costly. If that's the
case then your focus should be on lowering these costs, or focus on better
acquisition (you're spending marketing dollars attracting the wrong crowd),
and not on shooting yourself in the foot by adding unnecessary friction.

Putting a CC up front doesn't make your prospects value the service more, it
gives them a higher barrier to cross in terms of trust. You need a well-
recognized brand to be able to make it work IMO. Some people are just not
comfortable giving their credit card if they don't know you.

Also, check the references I quote in the blog post, according to the studies
conducted by Totango, requiring a CC upfront results in lower end-to-end
conversion rates.

Check also [http://www.quora.com/Conversion-Optimization/In-what-
scenari...](http://www.quora.com/Conversion-Optimization/In-what-scenarios-is-
it-more-effective-to-require-a-credit-card-up-front-from-users-when-signing-
up-for-a-trial-account) , there are good answers that elaborate on this.

~~~
thibaut_barrere
FWIW, I measured the very same 0.6% conversion rate for upfront CC on
[https://www.wisecashhq.com](https://www.wisecashhq.com).

I will instead to a test for a week or two, without CC info, but with an in-
person onboard when possible (unless overloaded), and most likely share that
back on HN.

~~~
toumhi
Thanks for sharing Thibaut :-)

What do you mean by "in-person onboard"? Chat assistance? Welcome call?

~~~
thibaut_barrere
I currently offer a "one-hour free cash flow coaching session" via ScreenHero
or Skype etc.

What I do in that hour largely depends on the newcomer: sometimes it will be
more on the features themselves (when the user is already cash flow
proficient), most of the time I underline the benefits that are not
necessarily obvious and require "education" (eg: mastering cash flow
translates into ability to reduce your work load, make time to build a saas
product, reduce pressure, schedule purchases, take holidays, realize that you
could work less - or more etc).

I can also finetune depending on the country of the new user, understand their
real underlying needs etc.

I've also started a newsletter/blog to "educate" people (I don't like that
world too much)
[https://www.wisecashhq.com/blog](https://www.wisecashhq.com/blog) and it
works decently, because some mention the blog during the coaching session.

So this is what I do so far :-)

I'm working more at "optimizing the funnel" than looking for coverage, because
I'm in the learning phase.

It turns out that those "coaching sessions" bring a lot of value not only to
the new WiseCash user, but as well for me, in terms of customer development,
understanding the needs, and figuring out what I will say on my homepage
later.

------
chrismorgan
_Update: this has been fixed, so I 'm happy now. :-)_

I utterly _hate_ , _loathe_ and _despise_ the scrolling and keyboard hijacking
on this article. (Yes, I really do feel that strongly about it.)

I pressed Space and what happened? I got taken an entire page down, rather
than not quite an entire page.

So I pressed Shift+Space to go back up and what happened? I got taken
_another_ page down, rather than back to the top.

So I pressed Ctrl+PageUp to go to the previous tab so that I could report
these issues and what happened? I got taken one page up instead.

Scrolling with my laptop's trackpad isn't working smoothly at all, and quite
unpleasantly. Ditto with the arrow keys. The whole experience, in fact.

 _Please_ remove this behaviour and let browsers do what their users expect.

~~~
toumhi
Hey, sorry about that.

I'm using a wordpress theme that probably does a bit too much of this and I
hadn't realized (I just launched the blog a couple of days ago). I've tracked
down and removed the scrolling effect already and will look into other
unintended hijacking.

~~~
chrismorgan
Thanks for fixing it. Now it acts as it should and I'm happy once more :-).
(It might be worth while passing such feedback as mine on to the author of the
theme.)

~~~
toumhi
You're welcome.

Yes, especially considering it's one of the best-selling themes on theme
forest :-)

------
phorese
You should also consider the possibility that your potential customer _does
not have_ a CC. Here in Germany, that applies to quite a lot of people (sry, I
have no numbers).

~~~
sdfjkl
Even more so across eastern Europe. But then, if you only offer CC payments,
there's no point in having a trial for users that can never become paying
customers, is there?

~~~
phorese
Absolutely, but shouldn't the response to that be "I guess we better offer
more payment options" instead of "let's ignore all CC-less people"?

Besides, a free trial might even be incentive enough for someone to get a CC
just so they can use your app! I know it was for me when I found something I
couldn't pay for otherwise.

~~~
runako
There's ~1.5 billion credit cards out there. By definition, every startup is
going to ignore pretty large segments of the addressable market (e.g. people
who only speak languages not familiar to the starting team). Starting with an
addressable market of 1.5 billion is not a bad thing.

Payments are complex and can be extremely localized. This is IMHO not a battle
for an early-stage startup to fight. Credit cards are as close as there is to
a de facto international standard; go with those to start.

Also -- in my experience, people without CCs reach out and ask for alternate
arrangements if they want your service. This is an appropriate time to make
sure that e.g. companies that require a complex PO process are spending enough
to make it worth your time.

~~~
phorese
Thanks for the comment

> _Starting with an addressable market of 1.5 billion is not a bad thing._

(On the other hand, that means ignoring, what, 3 billion adults? But of course
you're right, it's unfeasible to cover every available form of payment)

------
hmottestad
@toumhi Please turn off your inertia scrolling. I am on a Mac and inertia
scrolling is already activated, but it is much smarter so that if I stop
scrolling but keep my fingers on the trackpad then it doesn't use inertia
scrolling. The scrolling on saasfoundry.io however just keeps going. Very
annoying.

EDIT: toumhi contacted me by email and has now fixed the issue :)

~~~
toumhi
Hey, I sent you an email. Not sure what's wrong here. You just scroll once and
go to the bottom of the document then? Maybe some hyperactive css rules?

EDIT: OK, should be fixed now. There was a nicescroll jquery plugin in there,
which was providing extra scrolling. Thanks for the heads up!

~~~
hmottestad
Thank you toumhi for fixing this :)

------
Kiro
I think this is a dark pattern that actually works. You sign up for a free
trial with a CC where they promise you can cancel anytime. Your plan is to
cancel before the trial is over but you forget it and start paying. It happens
to me all the time.

~~~
smackfu
It "works" in the sense that you get a couple of months of payments in
exchange for the customer thinking you are scummy. If you want to be scummy,
it seems like there are more direct ways to get people's money.

~~~
im3w1l
What are these more direct ways?

~~~
smackfu
Just scam them directly, is what I mean. Instead of building a product.

------
netcan
First, every site will get a completely different result. Keep in mind that
just dropping in a cc requirement into your a sign up process created around
frictionless trials will probably fail. To get a person's payment details, you
need to do more work upfront. You can't have 2 second landing page->signup for
people who have never heard of you before. They won't give you a CC just to
find out what you do.

Credit card frost has two big advantages:

1- It's easier to optimize. The conversion process is simpler and more
controlled. With a fricitonless trial, improving your process of herding
people into a free trial can be like pulling on a string, it gets shorter on
the other end. You signed up more unengaged/uninterested people, so your
trial->payment rates are lower. Obviously, this is only an advantage if you
put a lot of effort into the optimization.

2- It takes advantage of some human psychological tendencies. (a) Once they
make the credit card details commitment, they are much more likely to
thoroughly try out the app. (2) Entering CC details is like paying for
something. They get the positive psychological effect of a purchase. When
people buy something they want to justify and reenforce their decision, to
themselves and to others. They are yours to lose at this point. If you do a
good job on #1, you will have gotten this advantage at a discount, because the
friction can be much lower than _actually_ paying. They are yours to lose at
this point.

There is no canon here. There are lots of advantages and disadvantages to each
strategy that apply in different measures to each case.

------
j_s
Why Free Plans Don’t Work [2010]

[https://news.ycombinator.com/item?id=1613852](https://news.ycombinator.com/item?id=1613852)
[114 comments]

A lot of lifestyle entrepreneurs have recommended getting the card for a long
time.

------
im3w1l
What about this? 1 day free trial without credit card, with 29 additional free
days when you enter it.

~~~
mrclark411
Desk.com had a variety of this (you got a free 30 days no matter cc or not)
then could continue to use the free plan if you entered your CC. They had a
bunch of a la carte features that they hoped to make easy to upsell to.

------
lazyant
It depends on the service; if it can be used for malicious purposes (hosting,
emailing spam etc) or it carries a liability then definitively ask for a
credit card.

------
chromaton
How about doing it in 3 stages: 1\. Brief free trial (1-2 days) with no CC
required. 2\. Next, your typical 30 day free trial, but require a CC. 3\. Paid
service.

------
andrew_wc_brown
Anecdotal evidence vs Anecdotal evidence. I guess its a matter of picking your
preference.

