We grudgingly owe a lot of what we’ve done at TweetReports, philosophically speaking, to a guy named Wayne who Michael and I used to work for ten years ago. Wayne was a nice guy but had a particular way of doing business: his way. Any other way of operation or any other suggestion was frowned upon, and people got fired for suggesting something as simple as “Isn’t there a better way?”
We grumbled a lot over beers and tee boxes back then about how much of a dummy he was and how, if we ever got the chance, we were going to do it right. We were going to run a company by the people and for the people — and the people would appreciate that — and pay us because what we were trying to do made sense. It wouldn’t just be business as usual.
Then, with all that money, we wouldn’t have to hire employees. We could just hire robots like the one Pauly got for his birthday in Rocky IV to do all of the work for us. We’d just collect the money and occasionally walk around the office with loaded shotguns just so the robots would remember who was boss.
Admittedly some of the revolutionary ideas tended to get off track as the night went on and the drinks were refilled.
Ten years later, older, wiser and soberer — but with a continued creative entrepreneurial spirit — we launched TweetReports.com with some of the most advanced search features and in-depth Twitter analysis tools available. We started with one idea and kept refining and adding but, all the while, making sure that Joe Average business owner could use and understand what they were seeing.
Along the way we would shake our heads at companies that would employ a perversion of the freemium model: sign up for a free account and company X would show you a part of what you could get if you had a paid account and then claim it as full functionality. But it really wasn’t.
We also disliked the idea of requiring users to commit to a $ubscription in order to get a free trial. You know what I’m talking about. Where the user provides payment information upfront and, when the free trail ends, they’re automatically charged for your first month of service.
No way we’re going to do that.
We decided to buck the system of how everyone else was doing business and create a new way. A way that would be better for our customers. So we created a two-fold “free” method.
A free account with one of our more revolutionary features, tweet bookmarking (save, tag and search within your bookmarked tweets), and visibility of all the other tools — or — pay a dollar for a full functioning, kitchen sink, bells whistles and everything included 14-day trail account.
Just a buck! Surely for a product as superior as ours, people would pay a buck for a two week evaluation.
And it’s not like we wanted charge a buck so we could make a buck. We just wanted to charge enough prevent spammers from signing up for hundreds upon hundreds of accounts and, hopefully, cover some overhead to boot. After all, this Twitter tool endeavor is bootstrapped.
That way, people would see the full potential of our search and monitoring tool and how it can help their business. Then, if they chose to upgrade to a paid account when their trial ended, we’d offer a discount. If not, their account would revert to a free membership and they’d still have plenty of great features to use.
Most importantly, they wouldn’t be automatically charged a monthly fee because they simply forgot to cancel their free trial before it expired.
To us, taking money from someone who didn’t want to spend it doesn’t seem fair or the right thing to do — it’s just bad Ju-ju. And it’s a horrible way to start a relationship with a customer, even if they decided to not use our services.
And the cool thing is you don’t even need an account to use our Twitter search tool — anyone can use it for free. Just type in a search and hit Enter.
The idea was pure genius. Revolutionary!
This showed pride and confidence in our product. It was like making a movie with Warren Beatty and Dustin Hoffman — how could it not work? The whole idea was conceived around doing the right thing for our customers.
Please allow me to express our success mathematically:
Lead Balloon x Crickets = Our Success.
Yep, didn’t quite work like we thought. We got a few free accounts and a grand total of two people paid a dollar to try the full functionality.
After a year of R&D and development we made enough money on our revolutionary idea to buy half a Venti latte… ten years ago… from Starbucks.
So if what we thought was the right thing to do for our customers ended up not being the right thing to do for them or our business, then the $60,000 question became, “What is the right thing to do?”
So we did what every bootstrapped, Twitter social media monitoring service should do.
We asked people on Twitter.
The feedback was very enlightening.
First and foremost, people told us that they shouldn’t have to pay — anything — to try a service.
Secondly, they didn’t want to go through the hassle of providing payment information for only $1.
The end result? We listened.
Enter The New Plan: Version 2.0
If what we were doing wasn’t working — and people were very clear about what they did and didn’t want — we would change our sign-up and monetization model to fall in step with more conventional thinking — to a point.
So version 2.0 allowed people to sign-up for a full-featured 14-day trial, for free.
It included every tool we had in the toolbox. No credit cards, no PayPal accounts, no 25-year-old pop culture Ishtar references. If a user decided to not upgrade to a paid account after 14-days, their account would turn into a free “Basic” account. No commitment. No automatic payments.
The Twitter-ati had spoken. We listened. And everyone was happy!
Sure, we got tons of people signing up for free accounts. Some of them actually logged in to use it. And even a few big-hearted folks reported programming bugs and offered great suggestions for improving the service (we really love them!).
Although we saw a huge spike in spam, bounced emails and fake accounts, we didn’t see an increase in conversions to paid accounts.
Apparently, giving away a free 14-day trial without requiring a commitment by the user is a great way to build inflated, non-active, account numbers but does very little to actually build your business.
The other issue we faced was educating potential users that we were truly providing a no-obligation, no payment, free trial where they could use all of the search and brand monitoring features we have to offer.
Ironically, very few people believed it.
They were so conditioned to how everyone else did business, it appeared they couldn’t make the leap that there was another way. In fact, we had users tell us there was something wrong with our sign-up process because we didn’t ask for their payment information. Seriously.
On top of that, no matter how many times we said, “TweetReports is a free Twitter search tool. Anyone can use it to search at any time.” no one seemed to believe it. Granted, our paid accounts include advanced analytics and reporting, but the core search engine is absolutely free.
Enter The New, New Plan: Version 3.0
If history teaches us anything, it’s don’t try to recreate the wheel. Then, of course, if developers never tried to create something better, different, and more useful, you’d be reading this via smoke signals.
So we tried to create a better process that’s a win/win for both the customer and the business. What we failed to understand was there were two possible reasons why so many online services use the same sign up model;
The first is where we initially landed; Everyone was using the same model because it’s simply what everyone does.
When we realized what the second reason was, we moved forward with our new, new plan — which was really an old plan but new to us.
Offer three subscription accounts. Each includes a free 7-day trial. And when the trail ends, the automatic subscription payment kicks-in.
Yep, it the same sign-up model so many other online services were using — that we didn’t like — nor wanted to use. But the truth is, the “other” reason why so many businesses use this model is because it works.
Customers are familiar with it. Everything is clearly spelled out. So when they sign-up, they know exactly what will happen and when. It also means the people who do sign-up up are genuinely better leads. And better leads mean more conversions. And that’s exactly what happened.
We’ve seen more sign-ups and more conversions than with any of the other two “revolutionary” methods (the numbers are actually kind of scary).
Now, everyone is happy.
What we learned
- No one likes to buy anything sight unseen. People want to be able to try a service without paying. As an example, just imagine what would happen to the fashion industry if people weren’t allowed to try on clothes or shoes before buying them.
- Listen to your customers. I mean really listen. But listening doesn’t mean you have to implement everything they ask for. Otherwise, you’ll spend all your time and resources building a better mousetrap only to give it away for free — because that’s what they asked for.
- Study your competition — even other similar type services that aren’t direct competitors. Watch what they do and how they do it — especially if they’re successful and have been around for while. Chances are, they already made plenty of mistakes. Which means what they’re now doing works. It’s an invaluable way to avoid potential pitfalls.
- Don’t be afraid to try something new or create something different. Even if it means going completely against what everyone else is doing. Most importantly, don’t be afraid to fail. Just fail quickly, learn from it, and adapt what you’ve learned to your business. Repeat.
What are your thoughts about the Freemium model and “free” trials that require payment information upfront. Love them? Hate them? What would you do different?
What do you think about our initial efforts? Now that we’ve changed to a more traditional model are you more likely to give TweetReports a test drive?
Let us know your thoughts, we’re always looking for feedback and improvement ideas. We welcome suggestions from anyone willing to share — except Wayne. We’ve had enough of that guy.