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Why I'm going back to capturing credit cards up front

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Re: Why I'm going back to capturing credit cards up front

#21

Post by dmix »

DenisM wrote: post #19
dmix wrote: post #2

I also tried every sort of SaaS signup process (CC-first, every type of free-trial, etc) with my app ( https://carelogger.com ). I actually agree CC upfront is better overall than not. Depending on the audience of course (some business users don't have access to CC's without approval from finance dept). That being said. I found a higher conversion rate via what I call "resource-based" trials. One's not based on time…

I think it's called "freemium"?

Freemium = offering a free service (sometimes with ads) with premium upgrade options.

That's different from a "free trial", because there really is no way to use our app for free on an ongoing-basis without paying for it.

Re: Why I'm going back to capturing credit cards up front

#22

Post by michaelt »

bdunn wrote: post #13
Guvante wrote: post #12

Earlier quoted context omitted.

Most places will refund you if you miss the deadline by a day. As long as you do that it isn't sketchy.

OP here. I'll refund the last month's payment regardless when canceling, no matter how long you've been a customer. The goal isn't to trick people into paying. The goal is to make it feasible for one person (me) to support a product by attracting those who have a business case for using it.

Presumably you track user visits/logins/sessions.

What fraction of paying customers have never visited/logged in since you started charging them?

Re: Why I'm going back to capturing credit cards up front

#23

Post by mikeash »

waqf wrote: post #10
pionar wrote: post #6

Earlier quoted context omitted.

Either I'm misreading your comment (entirely plausible), or you're misreading the article. I read that as a snarky way of saying that people aren't really missing the "expiration" emails, they're just too lazy to do anything about it.

Right, the article was saying that. But the article was jumping to an unreasonable conclusion, because of course you never hear from the people who missed the "Billing receipt" emails. I assume that was GP's point.

Indeed. There are going to be four kinds of people:

Miss both e-mails.

See both e-mails.

See the reminder, miss the receipt.

Miss the reminder, see the receipt.

All four kinds of people exist, no doubt, but you'll only hear from the last kind.

Re: Why I'm going back to capturing credit cards up front

#24

Post by to3m »

nhance wrote: post #16
racbart wrote: post #15

Earlier quoted context omitted.

This actually looks shady. If you're not going to charge me, then why the hell do you want my CC number?

Think about it this way. If you're not ready to pay, then why the hell are you trying my service? It's not a charity, it's a small amount of money each month.

Ha! There's a very simple answer to that: because your service might be shit. And I'm not handing over anything until I've proven to my satisfaction that it is not.

Of course, your business is not there to make me happy, so it's up to you what you do. Just surprised that this question even gets posed when it has such an obvious answer ;)

Re: Why I'm going back to capturing credit cards up front

#25

Post by jrochkind1 »

racbart wrote: post #15
jrochkind1 wrote: post #3

Another possibility that's not discussed: Get the CC number up front, but still require an 'opt in' after trial expiration to begin charging. You won't start automatically charging, you'll require the user to do something -- but the 'something' is just clicking a single 'yes, start charging me' button, with no need to enter the CC at that point, cause they entered it up front. I have no idea if that will work to get…

This actually looks shady. If you're not going to charge me, then why the hell do you want my CC number?

AWS does this -- you need to create an account, with a credit card, even before using their 'free' tier.

I thought I remmebered this, and just confirmed it. Go to http://aws.amazon.com/free/ in an incognito window. Click on 'get started for free'. Pretend you don't have an Amazon account and create a new one -- you have to create a new account with a credit card, before finishing up and going on to 'get started for free.'

However, with Amazon, I'm pretty sure that they won't charge you if you don't cancel in X days. They'll only charge you if you later opt in to a non-free service. (But am I wrong there?)

Nobody thinks it's shady, but then, it's a large company everyone's heard of.

I assumed the reason in part was to lower any barriers to later signing up for a paid component of the API, wit one click.

I understand why OP is doing it, but I still totally think it's shady to have you sign up for a free trial, and then start charging you at a certain calendar date unless you explicitly and manually opt out. At least, if you're doing this, you better be very very clear that's what you're doing when you get the initial sign up -- but the clearer you are, the more harm you're probably going to do to your conversions.

This is why most services these days, seem try to give a trial limited on resources of some kind rather than calendar. You get up to 4 Widgets on the free plan, you have to upgrade to the paid plan for 5. Get ads on the free plan, upgrade to paid to not have em. Get 4k page views a month on the free plan, etc. You get public repos on the free plan, need to upgrade to paid for private. Etc.

Note that the services that offer that kind of free trial seem especially beloved.

Can you think of popular and beloved cloud services that offer a time-limited free trial after which they will automatically start charging you unless you explicitly opt out? I can't think of any.

Even the new york times, when they give you an initial X month subscription at 25 cents a day or whatever, and then when it's time to renew it's gone up like 500% -- you still have to actually opt in and choose to renew your subscription at full price, they don't just charge your credit card.

Re: Why I'm going back to capturing credit cards up front

#26

Post by derefr »

dmix wrote: post #2

I also tried every sort of SaaS signup process (CC-first, every type of free-trial, etc) with my app ( https://carelogger.com ). I actually agree CC upfront is better overall than not. Depending on the audience of course (some business users don't have access to CC's without approval from finance dept). That being said. I found a higher conversion rate via what I call "resource-based" trials. One's not based on time…

Another way to think of this is that you're creating a time-based trial, but on a "clock" that only ticks down while the user is getting value from the product.

(Not logged in ⇒ trial never expires) = no surprised and pissed-off users.

Re: Why I'm going back to capturing credit cards up front

#27

Post by jrochkind1 »

bdunn wrote: post #13
Guvante wrote: post #12

Earlier quoted context omitted.

Most places will refund you if you miss the deadline by a day. As long as you do that it isn't sketchy.

OP here. I'll refund the last month's payment regardless when canceling, no matter how long you've been a customer. The goal isn't to trick people into paying. The goal is to make it feasible for one person (me) to support a product by attracting those who have a business case for using it.

It occurs to me I'd have a much less negative reaction to what you're doing if instead of calling it a "free trial", you called it "first month is free" (like landlord rental deals), or "will refund your money in the first month if you aren't satisifed," or something like that.

Now, these end up being essentially the same thing, but if you marketted it like that would it hurt conversions? I don't know. But if it _would_ then it would definitely make me suspect that many of your conversions are accidental, and accidental conversions are the shady part, right?

Re: Why I'm going back to capturing credit cards up front

#28

Post by eCa »

GrinningFool wrote: post #8

The problem for me as a potential user is that I no longer trust some.random.dude.com with my CC info. I have no way to know if they're storing it locally unencrypted or if they're using a trustworthy third party provider. I'm down to maybe three places that have my CC on file. Everyone else, I enter it - every month - at time of payment. I don't exactly like this, either - there is still the possibility that a poorl…

I always [1] use a virtual credit card [2]. It's only possible for the merchant to charge a specified amount during a specified time.

I create a new card for every purchase, but long standing relationships (ie my VPS provider) gets a longer lasting card so I don't have to update it every month.

[1] The only time I ever enter my true CC is when bying something that requires a physical card (some airlines, certain tickets).

[2] similar to http://www.visaeurope.com/en/cardholders/virtual_cards.aspx but branded by my bank

Re: Why I'm going back to capturing credit cards up front

#29

Post by fishtoaster »

nhance wrote: post #16
racbart wrote: post #15

Earlier quoted context omitted.

This actually looks shady. If you're not going to charge me, then why the hell do you want my CC number?

Think about it this way. If you're not ready to pay, then why the hell are you trying my service? It's not a charity, it's a small amount of money each month.

> If you're not ready to pay, then why the hell are you trying my service?

To find out if I like your service enough to pay for it?

Re: Why I'm going back to capturing credit cards up front

#30

Post by eCa »

jtdowney wrote: post #20
GrinningFool wrote: post #8

The problem for me as a potential user is that I no longer trust some.random.dude.com with my CC info. I have no way to know if they're storing it locally unencrypted or if they're using a trustworthy third party provider. I'm down to maybe three places that have my CC on file. Everyone else, I enter it - every month - at time of payment. I don't exactly like this, either - there is still the possibility that a poorl…

It wouldn't even need to be a poorly written component. There is a good chance they would log the card number along side the transaction in their database.

Unless they are PCI compliant [1] they really (really) shouldn't, and would deserve any (and all) kind of hurt that's coming to them.

[1] https://www.pcisecuritystandards.org/

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