Rethinking Pilots
27 Jul 2024Pilots can be a challenging proposition for software companies. While they might seem like a good way to attract new customers, they often come with significant downsides. Pilots are typically offered at a lower cost than standard plans, leading to lost revenue. Additionally, once the pilot period ends, you face the task of convincing the customer to continue using your service.
Instead, I’ve developed an alternative approach that has proven to be more effective: offering a flexible monthly plan with an attractive initial discount. Here’s how it works:
1. Monthly Plans with No Commitment
Rather than a traditional pilot, I offer customers a monthly subscription that they can cancel at any time. This eliminates the pressure and uncertainty that comes with the end of a pilot period.
2. Attractive Initial Discount
To incentivize customers to choose a plan larger than the cheapest option, we offer a 50% discount on their first three months, only allowed for plans more expensive than the cheapest plan. When this discount is applied, it actually makes the larger plan cheaper than our cheapest plan for the initial period. This encourages customers to fully utilize all features and integrate the tool more extensively during what would traditionally be the pilot phase.
3. Encouraging Extensive Use
By making the more comprehensive plans more financially attractive, customers are motivated to explore the full potential of our software and implement it on a larger scale from the outset. This wider adoption during the discount period often leads to better integration and reliance on the tool.
4. Seamless Transition to Paid Plans
We find that most customers remain on the more expensive plan even after the discount period ends. The larger rollout and deeper integration during the initial months make it easier for customers to continue with the higher-tier plan. The key advantage here is that the default path is for customers to remain subscribed, reducing the need for a hard sell to continue the service.
Conclusion
This approach shifts the focus from a risky pilot to a more secure and profitable customer onboarding process. By offering a flexible monthly plan with a compelling discount, we not only attract more customers but also encourage them to stay on higher-tier plans long-term. This strategy ensures a smoother customer experience and a more stable revenue stream for the company.
By rethinking the way we handle pilots, we create a win-win situation where customers feel less pressure and are more likely to stick around, benefiting both their operations and our bottom line.