How to increase your b2b subscription rates when they’re super low
This one is for those of you who know the pain of building and selling HR, recruitment, learning, or people software. Equally, if you run a marketplace business - this to can help you to reduce some of those pesky mistakes.
“Why are people signing up, rinsing your content and canceling on the penultimate day?”
“Let’s just make them put their card details at the beginning!”
“Just do what Duolingo is doing…”
“Just shove the word AI in it… that’ll do the trick”.
Peter Druker says: “People rarely buy what your company thinks it’s selling”. Emphasis on the thinks.
As business owners, marketers, sales people we have this tendency to believe that people are obsessed with our brands. That they spend a significant amount of time thinking about our product…but that’s rarely the case.
And what often happens is a misalignment which sees us create marketing/growth plans from the business’ perspective - not the customers’.
The end result is mediocre go to market launches which you’ll then spend the next few months trying to fix. Or worse still, a ‘feature your way into a growth’ mindset.
A few years ago, I was working as marketing lead for a b2b online learning platform. The offering was unlimited viewing of 150 courses to help support young professionals. The platform offered b2b users a 7-day free trial, delivered via a SaaS model.
The sign-up rates were okay - I mean, not groundbreaking - but okay. When it came to ramping up our growth targets - a result of securing investment - we weren’t really sure how to grow in a scalable way.
The business operated within founder-led sales mode, which meant a handful of sign-ups a day but no way to really build a predictable and repeatable approach.
So, I tried to optimise the traffic we were getting. I’d write campaigns or landing pages, but I’d get stuck. I wasn’t really sure what to include. We’d use analytics programmes to see what people were doing and how long they were hanging around.
The recordings were scary.
I’d sit there, watching their activity thinking:
“Why aren’t they doing what they’re SUPPOSED TO DO?!”
Do you know what it feels like to watch someone engaging with your product for the first time? Painful.
Then we’d look under the bonnet to look at the performance metrics.
It was scary viewing.
Free trial to paid users were low.
People were coming in, watching the content and canceling the day before payment was due.
And MRR wasn’t where we needed it to be to deliver on this bet that this new segment was the one for us.
Most embarrassingly, to report on engagement, we’d look at stats like new sign ups and those who logged in after day 3 - thinking, for some reason, this signaled growth.
How to increase your subscription rates if you have a b2b / b2b2c model.
Luckily, I came across a handful of theories and learning that helped us to unlock why our customers were subscribing…
… and why others were cancelling as fast as they could.
Here are the five steps I learned to help drive the subscription usage rates of our b2b platform:
Market to both sides of the business model
Drive traffic and attract better fit leads (obvs)
Keep your eye on the free trial sign-up process - who’s pulling it down?
Continue to remind people of the value you deliver
Have a plan for when they achieve the outcome they set out to do
Market to both sides of the business model
The business model determines your approach to increasing subscription rates. I mentioned we had both B2B and B2B2C audiences. An HR Director/L+D Manager would purchase the subscription, buying it on behalf of the team they wanted to support.
If marketing to this audience wasn’t a challenge in itself, then there was the B2B2C aspect: engaging the employees with the platform. Which proved a little challenging sometimes as, more often than not, they are not involved in the buying process.
If you’ve got a similar model where your success is determined by both types of users getting value, don’t dismiss an audience just because they don’t buy.
For us to build a case to ensure people renewed their annual subscription contract with us, we needed to evidence both ‘sides’ or customer segments were engaged and getting value.
That meant regularly talking to and interviewing both to understand what their struggle was, and what they saw our platform helping them to achieve. Each had their own competitive set, each had their own desired outcomes, and each had their own metrics for us to work towards.
Another consideration is the customer acquisition hook you use to acquire new users. You’ll know them as free trials, freemium, sand box, upgrades etc. If you’re feeling fancy you can dabble into reverse trials. (Read more on customer hooks and why they can impact your sign up rate).
General rule of thumb; if your offering is niche / has a small tam, sam, som - don’t touch freemium. You’ll hurt your growth prospects.
Drive traffic and attract better fit leads (obvs)
The only way you’re really going to do this is by identifying the channels your ideal customers use to research and buy an offering like yours, and to know what questions they’re asking themselves at each stage.
I realise that I’ve made that sound a helluva lot easier than it sounds, but, if you talk to your ideal customers who purchased recently, they’ll be able to recollect what channel they were using and when.
At the problem unaware stage - the part where something happens and starts the ball rolling - they’ll likely resonate with a podcast, an interview, or something said at an event.
At the solution unaware - they’ll likely be able to articulate what problem they have to solve and will use something like referrals or Google.
At the solution aware stage - where they know about you, they’ll likely be comparing you to two or three other competitors. Your competitors aren't who you think they are.
Try it for yourself:
Ask recent customers what was happening when they realised they had a problem to solve, and then probe to understand what they did next and what they searched for. This will open up the channel discussion.
Ask them what was going through their mind, why they discounted some solutions and proceeded with trials for the next. This will help you understand what true competitor you’re actually trying to go against.
Keep your eye on the free trial sign-up process - who’s pulling it down?
It’s likely that you have a bunch of users signing up, but the thing is, you don’t need to cater to them all. Just the ones that match your ideal customer profile.
An ideal customer or ideal client profile isn’t just a list of traits, it’s an understanding of what they want to achieve with your product and the competitor they’re sizing you up against.
The aim isn’t to point them to your latest feature; no no no. It’s to create a sign up and trial experience that connects them to their desired outcome.
Steps:
Draw up your ideal client profiles - one B2B and one B2B2C. Ensure you consider what they were struggling with, how they’ll evaluate you between a competitor, and what repeated usage looks like. You should be able to get a lot of this from your existing data.
Look at their individual trial to paid rates. Anything between 5-7% is good, based on industry stats such as these.
Review the progress they need to make, and what features / workflows they need to complete to ensure they are getting value from the platform.
Be prepared to create separate onboarding campaigns, based on the sign up info you provide. Avoid these product onboarding mistakes.
Continue to remind people of the value you deliver
There are many different ways you can do this - email marketing allows for drip campaigns and nurture campaigns. In-platform tool tips allow you to signpost users.
Whether you offer a monthly or annual subscription - this is a step you can’t afford to miss. Successful subscription marketing is all about reminding people of value. And by this, I don’t mean spam them or send them updates regarding your latest feature.
Free trial sign-ups will require different comms to those in onboarding or those who aren’t as engaged. A successful email marketing strategy aligned to the desires and outcomes isn’t ‘send a message from your CEO on day one’ and ‘send a feature email on day 3’.
Have a plan for when they achieve the outcome they set out to do
Eventually, your users will get to a point where they don’t really need you any more. You’ve helped them to achieve what they needed to do so. Don’t think of it as churn; you’ve helped them to be successful. It’s not that people aren’t happy with your proposition, they’ve come and they’ve conquered.
BUT… perhaps there’s an opportunity to keep them using and keep them subscribed.
Here are ways to expand the usage of existing (happy customers):
Talk to them to understand the context they work in, are there any new technologies within their tech stack you need to integrate with
Do they need to delegate the admin of your platform? Create support paths for new line managers.
Identify new struggling moments, and decide if you need to introduce a new feature.
Stuck with your subscription marketing? Want to improve your falling sign up rates? Check out my marketing services! Let’s chat.
