Switch to a no-credit card flow in free trial
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Pros
- You will get more signups.
- You will get fewer subscriptions cancelled immediately after the first charge.
Cons
- Your users are less committed to trying and might even forget they had signed up.
- The sales team has to qualify the leads because your product won’t.
- You will be providing customer support to non-paying users.
Christoph Janz’s model helps to decide whether it’s better for your business to request credit card information upfront or not.
Postpone email confirmation
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Case study
For Snappa, by changing when users were required to activate their email address resulted in a 20% boost in MRR.
Examples
PandaDoc asks users to verify their email only after they have created their first document and are ready to send it out.
Optimize your signup flow
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How to
- Measure number of clicks, number of input fields, click-through rate (CTR) and drop-off rate (100%-CTR) at every step of the funnel.
- Find which step has the highest drop-off rate.
- Experiment with different tactics to reduce friction and improve click-through rate.
Tactics:
- Don’t ask users for things you don’t need until you need them.
- Give users clear directions of what you want them to do and why.
- If your form is long, split it into multiple pages.
- Whenever possible pre-populate fields with smart defaults.
- Offer one-click third-party OAuth signup.
- Add a progress bar to tell users where they are within the process.
- Explain to users the benefits of providing the requested information.
- Explain the benefits of signing up and address common objections.
Talk to 5 of your most and least engaged users
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How to
- Identify 5 of your most and 5 of your least engaged users.
- Email them and ask for 30 minutes chat. You can incentivize them with your app credits or some form of cash.
- First, you need to establish what was their motivation for using your product. Ask them about the time when they started using your product and what was their goal?
- Then you need to find out if their current usage aligns with their initial motivation or how it has changed. Ask them when was the last time they used your product? What were they trying to accomplish, and why?
- If you find their answers short and missing many details, ask them to walk you through the steps they took.
- Focus on the differences in the answers between your most and least engaged customers.
Build triggers so your users can build habits
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Case study
Calm Sleep is an app that helps people to fall asleep. Here is how it gets users to build a habit of using their product.
When user experiences the app for the first time, Calm Sleep offers to set a bedtime alert. That reinforces internal trigger – users’ desire to sleep, with an external one – bedtime notification. Together, those triggers spark an action – opening the app at the right moment. Action leads to a reward – better sleep. The more times user goes through the Trigger-Reward loop, the closer they get to form a habit.
Remind users of your product value
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Examples
Send milestone/progress emails to remind how far you’ve come together.
Remind users who are about to leave of the value they’ll lose.
Increase the number of entry points where your users can receive value from your app.
Encourage annual subscription
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Why annual subscriptions?
- Longer contracts give users fewer opportunities to cancel the subscription. (once a year instead of every month)
- Annual contracts give them more time to fully master your product and integrate it into their workflow.
- Annual contracts attract more high-value customers who are likely more invested in using your product.
- Annual contracts give you more cash flow upfront to invest in your product.
“Businesses with a high proportion of annual plans will have a shorter payback period because you collect the cash up front! This is a key lever for businesses to pull, especially D2C companies that go after affluent consumers, or really any B2B product. You’re effectively getting a ‘loan’ from your current customers to buy more future customers. The typical path is making annual plan = 10x monthly, but I’ve seen as low as 6x just to have the positive cash cycle to grow. One of the highest-ROI ‘optimization’ hacks for mid-stage companies is running in-app promos, emails, etc. to get people from monthly to annual plans.”
—ChenLi Wang
How to
- Price annual plan with a discount compare to monthly plan.
- Run in-app promos and emails to get people from monthly to annual plans
Ask users why they're leaving, and offer a solution
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Example
First, Audible will ask you why are you cancelling
Depending on the answer, they might offer a solution. For example, If you didn’t love one of your listens, you can exchange it for another.
