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Ecommerce Insights: Free Trials Aren’t Dead

Although some merchants think free trials are a relic of the past, many consumers prefer the option to test a product before buying. When done correctly, free trials are a win-win for ecommerce businesses and consumers.

Woman receiving subscription free trial package

As ecommerce grows more competitive, businesses are testing out new strategies to attract and retain consumers. While some tactics are more effective than others, there’s one tool that consistently works — free trials.

It’s no secret that free trials attracted scrutiny from the Federal Trade Commission (FTC). In the past, some companies lacked transparency around automatic renewals and other terms of service, forcing consumers into unwanted subscriptions. Now that the FTC closely monitors free trials and fines rulebreakers, many merchants hesitate to offer the service.

Don’t let increased oversight deter you from offering consumers a way to test and assess your products. 80% of surveyed retail subscribers who signed up after March 2020 first obtained their subscriptions via a free trial, according to our November 2021 Subscription Commerce Conversion Index. Consider the following reasons free trials can boost ecommerce revenue and create long-term customer relationships.

Most ecommerce subscribers used a free trial before committing.

A Good Ecommerce Product Sells Itself

An enticing product trumps any marketing tactic. Instead of launching intricate campaigns to increase brand awareness and product sales, offer free trials to allow curious prospective customers to experience the product for themselves. Once trial customers realize the worth of your products or subscription program, they’ll be more likely to make future purchases.

That statement is true now more than ever. According to the November 2021 Subscription Commerce Conversion Index, more than 54% of consumers kept their subscriptions after their free trials ended — the largest percentage ever measured in that category.

This can also set you apart from competitors that don’t offer free trials. The more you’re willing to prove that your product is worth buying, the more consumers will try it for themselves.

Free Trials Can Boost Average Order Value

Giving away free products, even limited quantities, can certainly become costly. However, the long-term revenue earned from free trials can outweigh the cost.

Offering free trials of new products to current customers is an effective way to introduce them to other products — ultimately boosting average order value. It also gives curious prospective customers the extra push to try a product they had their eye on but weren’t willing to spend money to try it.

Additionally, merchants can use free products to incentivize customers to spend more at checkout. For example, if a merchant aims for an average order value of $75 and a customer only has $60 worth of products in their cart, the merchant can motivate the customer to spend an extra $15 by enticing them with a free trial once they spend $75.

Subscriber signing up for free trial

Free Trials Can Improve Churn Rates and Customer Lifetime Value

Although some merchants suspect free trial users simply want free stuff, these users are just part of the cost of attracting valuable long-term customers who are genuinely interested in trying out the product to see if it suits their needs.

In fact, subscribers who start out with a free trial may be less likely to unsubscribe shortly after because they’ve already had a chance to tryout the product before committing to a purchase.

Free trials can also be useful for re-engaging customers who are about to churn. By offering a free trial or sample, merchants can show at-risk customers they appreciate their business and are eager to keep them happy.

Free Trials Provide Helpful Feedback

Even if they don’t convert to a paying customer, free trial consumers can be a valuable resource when it comes to collecting feedback. Make sure to check in during and after their trial to gain insights. Although you may not turn a profit on that consumer, the feedback can still be helpful for improving your product and customer experience.

Although the free trial model comes with added risks, it has high potential to be a win-win for consumers and businesses alike. It allows curious consumers to sample products while giving businesses a chance to increase revenue and build customer relationships. When done correctly, free trials are absolutely worth the investment.

Interested in offering free trials to boost ecommerce revenue and customer relationships? Sign up for a sticky.io demo and get started.