By offering free trials, companies establish good will with new consumers by allowing them to enjoy the full value of its services and influence their purchase decision by demonstrating their product.
By eliminating the risk involved in signing up for a service that a consumer might not enjoy when the free trial period runs out, it entices consumers to try it out with no strings attached.
In an effort to win customers amid increasing competition in the digital television market, Showmax Kenya last month launched a 14-day free trial allowing consumers to access its service without entering any payment method details to qualify, which amounts to a unique approach in its industry.
“We run a number of trial options all of which have the same goal of introducing this new category of Internet TV, making it as easy as possible as well as totally risk-free for consumers to test out Showmax,” said Richard Boorman, Showmax head of communications.
Showmax, an Internet-based subscription video on demand service that supplies international and local TV shows and movies, only requires its consumers to sign up on its website with a mobile phone number.
They then receive a voucher code through a text message that is entered on the website allowing them 14 days of free access to more than 20,000 TV show episodes, movies, kids’ shows and documentaries on the platform.
Its charges are Sh880 per month for its full content catalogue including popular shows such as Game of Thrones and Power.
However, an approach where consumers are not required to fill in their personal details to access a free service, raise the risks of repeat registrations.
“We have got a number of checks in place to prevent repeat registrations - as an example, the customer is asked to include a mobile number to which a trial voucher is sent, and we obviously then keep a record of the numbers used,” said Boorman.
By offering free trials, companies establish good will with new consumers by allowing them to enjoy the full value of its services and influence their purchase decision by demonstrating their product.
By eliminating the risk involved in signing up for a service that a consumer might not enjoy when the free trial period runs out, it entices consumers to try it out with no strings attached.
A study on the conversion rates of different free trial models used by companies, conducted by Totango, a US customer success platform, found that companies that did not require credit card information for a consumer to access free trials had higher conversion rates.
“We looked at both models, credit card and no credit card, separately. We did a direct comparison of the models and an example for each scenario where we assume that you start with 10,000 website visitors and see how many people will end up as happy, paying users after 90 days. Companies that required a credit card as part of the free-trial signup process see very different conversions than those that do not require a credit card,” reported Totango.
Companies that required a credit card in order to sign up for a free trial saw 200 signups, of these 100 converted to paying consumers when the trial period was over but only 60 were retained after 90 days.
By contrast, companies that did not require a credit card to sign up for a free trial saw 1,000 signups, and of these 150 converted to paying users and 120 were retained after 90 days.
The lack of restriction, in that consumers were not asked to sign up using a credit card, played an important role in acquiring consumers who were later retained.
The companies also pro-actively reached out to at-risk customers to offer help, thus reducing the churn rate and non-use of its services.
In addition to these tactics, offering a discounted rate to the new consumers after the free trial has expired can also help in converting them to paying consumers and retaining them for the long run.
In the case of Showmax, it is offering first-time paying consumers access to its services at Sh250 for three months.
- African Laughter
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