Thoughts on paid trials?

Alex Farmer

Recently, @Mollie Luckhurst posted about free trials, but I also wanted to start a discussion about paid trials!  Who's had good/bad experiences using paid trials to attempt to increase conversion?  

My thoughts: 

Revenue recognition

If the business recognizes a trial (or even a trial that rolls into a fully paid contract with an exit clause) as ARR you have a massive churn problem brewing.  Every failed trial booked as ARR contributes to churn, which incentivizes CSMs (owners of churn number) to swarm on making trial accounts successful (converting them, which should be the job of sales) and neglects paid customers, which leads to an even greater churn problem!  So, I'm a strong believer paid trials can count as revenue, but not recurring revenue!  And sales might not like it if they're commissioned on recurring revenue only, but its the right incentive to fully complete the sale (see below).

Depends on the product

That said, it does depend on the product.  If its a high-volume, self-service sales process where you pick your plan and enter your credit card details, then trials make total sense and in fact its almost perfectly designed so that customers self-select if they need a sales person engaged - ie: sales teams need to engage with those that select trials to convert them, those that sign-up in full don't need any sales resources.

Harder to make work well with enterprise B2B SaaS

But I've seen the same logic apply upmarket to complex B2B sales where I think it largely does more harm than good.  That sales cycle is much more complex and requires budget sign-offs, scoping documents etc.  Trials in this scenario can be incorrectly used to short-cut "proper selling" of the solution.  Sales teams want to close deals and sometimes too often say "don't worry about all your questions, lets just do a trial!", which is a pretty lazy way of trying to speed up a deal - the customer isn't sold yet!  So, the burden on "proper selling" is now on CS, product, onboarding teams, which increases customer acquisition cost and probably leads to fewer converted deals.  So for B2B enterprise SaaS, if we have to do trials to prove value, they should be self-contained in the sales org.  You gotta pay to get the CS, product, onboarding teams, who need to focus on making existing customers successful.

Will Pagden

My thoughts, if implemented well can be really powerful but many companies don’t put enough focus into it therefore it can cause serious harm, particularly to the CSM who manages the converted account. 

Matt Myszkowski

Generally, I am not a fan of trials (paid or otherwise) and the involvement of a CSM. The value & impact of the CSM is derived from long-term, sustainable and scalable relationship building. If a trial of whatever length limits the ability for the CSM to engage and demonstrate value, then they will be set-up to fail from the start.

Thankfully at SAP we do not support trials, but even short-term contracts (a year or less) are very rarely signed off for exactly the same reason.