What (or WHO) is getting in the way of your trial to paid conversion rate?
Nope, you’re not mad. It shouldn’t be that difficult to add a question to your sign-up process.
“We have sign-ups but I couldn’t tell you who or what they are”.
“I think I know who the leads are but I’m not allowed to make any changes”.
“I want to suggest a new way of doing {X} but I’ve been told they’ve already tried it and it didn’t work”.
It’s frustrating. You come in to head up a new team and, very quickly, you’re faced with hurdles. Hurdles or, rather, red flags that’ll get in the way of achieving growth and, instead, keep you running on that hamster wheel of generating leads at any cost.
It’s easy for me to look at it this way now I work with startups on a consultancy basis. I’ve lucky, I can look at things through a totally different lens.
But, if you’re serious about investing in more marketing, whether that’s in pursuing a particular channel or building product traction in a new sector, you’ve got to ask yourself some hard questions.
Have you really got a grip on what’s working at the moment?
And if you don’t, what’s getting in the way? Knowledge, politics or resources?
If you’re going to make a dent in your startup’s marketing you have to change your mindset going into this process.
“We have sign-ups but I couldn’t tell you who or what they are.”
I’ve been that head of marketing who has come in to help the founding team to untangle things. It was a messy process and looked a bit like this:
You lift the hood and see what’s really underneath… (eww…)
You quickly realise that there’s a quick fix. Yes, you may have lost some data, but that’s okay.
To implement the quick fix, you realise that you need to make friends with someone in engineering/product and ask them to change something.
You’re faced with either a sigh or a long speech about why it’s a silly request because the company has always done it this way.
It’s a few weeks later and you’re still not collecting the data you need because you’re trying to make some other reporting “fix” work instead.
(At this point you wonder if it’s worth it.)
I digress. Let’s get back to the process.
How I improved our free trial to paid conversion rate:
a journey through a lack of knowledge and combating egos.
Here are the steps I followed when working on a SaaS learning platform.
Work out your current conversion rate by audience
Agree the completed milestones to understand who far people are getting with your product experience
Segment your sign ups - i.e. break them down by type of user
Review their activity - which go on to become paying users and which churn?
And out of the engaged users that you want to keep, which traffic source are they coming from and what do they expect the platform to do?
Work out your current conversion rate by audience
Free Trial-to-Paid Conversion Rate =
Number of paid sign-ups / Number of free trial usersThe formula is super simple, take the number of paid sign-ups and divide by the number of free trial users. Things that will impact this include your acquisition model, time scale, user group, source, and industry.
We used Chargebee at this point to manage our subscriptions as well as a proprietary report in the back-end. (Show-off).
Of course, we had a few audiences being in the business of b2b2c so we had to extrapolate the numbers to work for both employers (b2b) and end users (b2b2c).
But that said, it wasn’t as straightforward as I’m making it out. Yes, we were able to largely tell the difference between a B2B and B2B2C user but that was the extent of it. There was no real reporting on what the end-user was expecting or how it’d even been positioned to them.
Here, it was the knowledge that was working against us.
We’d been told as a startup not to focus on the details at the early stage, but initially, I feel we went way too broad with our reporting. And that shot us in the foot at the beginning.Agree on the completed milestones to understand how far people are getting with your product experience
This is a really important step. Too many teams are focused on people becoming paying subscribers; they get clouded by revenue and not what the end user is looking to do or solve.
Milestones for me are the completion of workflows or the physical action of completing a task.
This does not include things like “logging in” rather, it’s things like uploading a video, creating a transcript and sharing with others. Or, uploading contacts, creating a basic email and sending a campaign.
For us, we had an appetite to look further into the activity. However, a relationship with devs who weren’t too interested in helping us meant we had to accept “logging in” as a core metric at the beginning.
3. Segment your sign-ups - i.e. break them down by type of user
A little more friction is not always a bad thing. Segmenting your sign-ups is probably one of the most simple ways to get a feel for what’s working and why.
By this I mean finding a way to align sign-ups by cohort. For example, “Head of Sales” “SME Recruiters” or “Real Estate” are a good start. Or, perhaps where they are in the research process… whatever segmentation works for you. If you’re stuck here’s some info on how to choose the right market.
So, if you haven’t done so already, ask a qualification question in the sign up process. Canva asks what you’ve come to them to do today. Adobe will ask if you’re a student or a small business. Hubspot asks how many people are on your team.
It’s okay, it’s fairly standard and won’t harm things as long as it’s connected to the use of the product.
We’re in marketing. We’re in the business of collecting data. We’re not going to ask to add 100 additional lines of code, we just want to see who’s coming in and what they’re doing.
I’ve had pushback mainly from devs in this instance, when it comes to asking for a question in the sign-up process. And it came to me as no surprise that there are a ton of articles on how marketing can make changes without dev’s involvement.
In this instance, all I can suggest is to reiterate that you’re trying to help solve an end user’s problem. To do that, you need to provide an experience closely tailored to the product feature(s) that will help them to solve it. Oh, and you’re all working to the same end goal. Obvs.
4. Review their activity - which go on to become paying users and which churn?
You get your sign-up question added to the experience. What happens next?
It’s likely the results you first get will leave you scratching your head or running for the hills. At least that’s what happened to me.
When we started connecting the data, I thought we’d likely have two or three audiences coming in and using us.
What actually happened was quite different:
There was a ton of users who signed up and use the platform… but they didn’t conform to my buyer persona(s).
The users I thought would get the most value are not engaging in the way you’d expected them to do so.
There was a lot of dud sign-ups and creepy competitor accounts created. Naughty.
Whilst we are faced with a lovely mess of data because the users are not interacting with our product in the way we WANTED THEM TO… we realise that we need to look at this another way.
Chants “growth mindset” whilst gripping teeth.
Next up, we need to look at their activity. Which of your cohort became paying users and which “failed” to convert?
Let’s consider engagement within your platform. And by this, I don’t mean someone doing something on the first day, I mean going back to this concept of actioning something meaningful. Completing a task or workflow, not adding their gravatar to their profile.
This ask to view what they are doing may be outside of the realm of marketing for your organisation. However, if marketing doesn’t have a feel for these numbers or involvement with and influence on the user journey, I’d shut up shop now. Because it’s likely your success metrics are out of your control.
5. Out of the engaged users that you want to keep, which traffic source are they coming from and what do they expect the platform to do?
I worked at this company a few years ago, and the sales team would moan “leads from PPC didn’t work”. A lead would come in and they’d refuse to follow it up because it didn’t automatically turn into a converted demo request.
They assumed that we, the marketing team, had put the same message out into every channel we used. Of course we didn’t, certain channels carried different messages to reflect the way our audience researched and bought a product like ours.
I’ve written about how to choose the right marketing channel previously, as well as provided examples of the real experience of building it in a startup.
Let’s take it back to the example I’ve been discussing.
If we are looking at reporting on the free trial to paid conversion rates of our users, then of course we need to consider both the traffic source and the message we are using. These will likely pull in people at different stages of the buying process. They’ll expect a different promise of the product based on the level of research they’ve conducted.
That’s an action for you - see what campaigns are bringing in those people who stay around and get value from your product.
Summary
Marketing’s place in a startup can be blurry for some people at times. Some see us overstepping the mark, and we should go “back to our lane”. However, the way startup growth is changing, and I can’t see growth and marketing being separate for much longer. Especially within b2b.
As for the challenge of what or who is getting in the way of you implementing really important changes to drive this growth… well… the bad news is you’re always going to have these challenges appear. Especially as you scale.
I guess the message for this edition is to expect this pushback and consider appropriate ways to get around these obstacles. Welcome to scale-up land, right?
