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Converting Free Members into Paying Members

How do you convert free members into paying members? Free members can be found in most subscription businesses. It has become the standard in subscription businesses to give members the opportunity to get a free trial period before deciding whether they want to pay for the membership.

At least within the type of memberships where the cost of providing a free trial is small. This applies, for example:

  • SaaS companies like SleekNote, where one subscribes to software
  • Online companies like Netflix, where one subscribes to digital content.

Free Members and Double Conversions?

A free trial is a great way to lower the barrier to membership creation and provides many more members.

The challenge though, is that with a free trial, in practice you have to convert your members TWICE:

  • First from leads to free members
  • Next, to become paying members

Especially the last conversion can frustrate many business owners, because the member has already chosen to become a member, so why don’t they continue as paying members and get access to far more benefits?

7 Strategies

Converting free members into paying members requires, among other things, a good onboarding process so they start using their membership from day one and quickly explore value from it.

But there are also a few strategies you can use that more or less cunningly convert more free members into paying.

I’ll talk about 7 different strategies, each of which in its own way creates an incentive for members to pay for membership. They can easily be combined, and in practice you should test several different strategies to get factual knowledge about which ones work best in your subscription business.

1: The Unwanted Binding

The easiest – but certainly not recommended – way to get them to transition from free to paying member is to tie them up so they don’t have the opportunity to get out of the membership during the free period.

It certainly gives you 100% conversion from free to paying member, but also reduces the number who create a free membership – if they even notice the commitment before signing up! If they only discover the bond when they want to resign, you will have an even bigger problem, namely some very dissatisfied members who may speak very negatively about your business to others and who are guaranteed to never come back.

Bindings can rarely be recommended today, unless there are very strong arguments for the binding, e.g. a very expensive start-up price. And if so, remember to make it VERY clear that there is a binding, as well as the length of it.

2: The Locked Door

This conversion strategy is about showing free members all the benefits that the paying members have. However, if they try to access them, they are told that they must upgrade to be a paying member in order to gain access. In other words, they need to “level up”. Often, the locked benefits are shown in, for example, a gray color, to show the free riders that they do not yet have access to these benefits.

This strategy can lead to a lot of conversions, because we humans do not want to miss out, but would like to have access to more benefits than “our neighbor”.

However, some free members will also be so annoyed by constantly meeting a locked door that they resign altogether. It is a shame, as they might have become paying members in the long run, but just weren’t ready for it yet.

3: The Burning Platform

A third strategy is to make the free period time limited. This means that free members must make an active choice about whether they want to continue or not, because the alternative – just to continue as now – is not an option.

This strategy has already been implemented in several subscription businesses. For example, 7 days at Sleeknote or 30 days at Netflix. But it is not the case in all subscription stores, some offer a time-unlimited free membership, such as Danish Goodtalks

If this FREE membership ends in, for example, 50 days, a portion of the free members will convert to become paying. The rest will be lost, which is a shame, of course, but the gain from “urge” the other frees to pull themselves together to become paying can be far greater.

To learn more about how to create a succesfull subscription business, take a look at my Best Seller book. You can order it right here

Click here to read more of our articles on subscription business

Skrevet af Andreas Dirksen

skaber succesfulde abonnements forretninger

6. July 2022

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