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Estd 4.22.2023
Based on the guidance in our pricing strategy book Price to Scale, if you offer a free plan then automatically downgrading your free trial users into that plan is generally the better approach rather than locking them out. Here’s why:
• Keeping users engaged – By automatically transitioning trial users into a free tier, you continue to offer them value and maintain engagement with your product. This ongoing interaction not only helps retain them but also opens the door for future upsells as they become more familiar with your platform.
• Smoother customer experience – For many customers, being locked out after a trial can be frustrating and may make them less willing to reengage later on. A free plan, even if limited, offers a lower barrier to return and build trust over time.
• Conversion opportunities – Our book illustrates how companies using a freemium model have seen that the steady conversion of free users to paid subscription tiers can offset short-term revenue dips, as more users have the chance to experience the product and eventually upgrade.
In summary, as outlined in Price to Scale, an automatic downgrade to a free plan tends to be the customer-friendly choice that reinforces ongoing engagement, reduces friction, and creates a pipeline for converting users into paying customers over time.