Leave a comment
Get the GH Bookmarklet

Ask GH

Hey GrowthHackers! I have a simple question: Should I ask my users for Credit Card upfront (during the registration step)? If your answer is "YES," could you share some articles/data with me on this subject?

Ideas to test from this discussion (click “save this idea” to add it to your idea backlog in free version of GrowthHackers Projects)

  • SM

    spencer mann

    about 3 years ago #

    The worthless yet always correct answer: Depends on your business model.

    The more relevant answer: Yes.

    I lead the growth team at Lucidchart (www.lucidchart.com), and I have played around with this question in 2 ways.
    1) Should we take new registrations through a payment page during their registration? - YES - Doing so bounces ~15% of our new registrations but contributes significantly to first payments. (You never get payments you don't ask for)
    2) Should we require credit card information before providing a trial of premium features (free version still available)? YES - We are just wrapping up 4 months of testing on this question, and have seen a significant boost in payments with very little negative impact on engagement. Interestingly, payment quality also increased with this change.

    • AP

      Albert Palka

      about 3 years ago #

      Thank you for the insights! We're working on https://codebeat.co/ and are testing different settings at the moment; credit card input on registration is one of them.

    • DS

      Dan Smith

      about 3 years ago #

      Adding to Spencer's comment and again the usual disclaimer about model dependency, showing traction with real paid subscribers > free. Learning and growing the paid model first gives a lot of flexibility to go back and figure out what a freemium model for acquisition could look like.

      • AP

        Albert Palka

        about 3 years ago #

        Ok, but what happens when your traction (visitors/paying users) is fairly low; too low for A/B tests? Do I do it anyway and run it for like 4-12 weeks with a new design or do I keep it as it is and wait for the traction to increase through other channels?

  • JB

    John Bonini

    about 3 years ago #

    To piggyback off Spencer, it really does depend.

    I'm John, and I head growth at Litmus. (www.litmus.com)

    For starters, it's helpful to consider the value of free users to your organization. Is their a viral element inherent to your product, ala "Powered by MailChimp" on all outbound emails?

    For applications that operate in the background (like Litmus), it's harder to engage that viral element through a free product.

    We recently experimented and moved off away from the no payment model in favor of requiring payment info prior to a free trial of our features, and while we saw a material decrease in overall signups, we've seen a significant increase in paying customers. It works for us.

    Like anything else, test it!

    • AP

      Albert Palka

      about 3 years ago #

      Thank you for your comment, sir. Static Code Analysis doesn't have that viral element either, hence my question. Great discovery by the way.

  • PL

    Pierre Lechelle

    about 3 years ago #

    Hi Albert,

    The answer really depends on your audience, what they're used to and the product you're selling. I've seen two use cases:

    1. The paywall reduces sign up so much that revenue decreases

    2. The paywall only let the most engaged users through with an increase in revenue

    As @bonini84 puts it, revenue isn't always the end game so factor in your analysis other metrics that are relevant to your product.

    In both cases, you'll want to try that for yourself and see what happens.

    I wrote a more in-depth answer in an article about free trials (http://www.pierrelechelle.com/saas-free-trial).

    Hope it helps

    • SM

      spencer mann

      about 3 years ago #

      I agree with all the comments above. One additional idea we have had success with is to segment our users during the registration process and only pass the high quality ones through the payment page. We do this by predominantly displaying our paid levels and then showing a free option below, see here: https://www.lucidchart.com/users/registerLevel. Users who click on standard levels see a payment page, users clicking on free do not. This has helped us mitigate the registration loss of a payment page.

  • KK

    Kelly Kuhn-Wallace

    about 3 years ago #

    In B2B and testing free trial with payment details v. free trial without payment details? Take care to mark both groups and track them in your analytics over time--a looooong time. What you see at the 6-month mark is meaningless if you're a SaaS.

    A fresh alternative to the Free Trial is a mini-subscription (paid). Offer a 3-week subscription for a fraction of the regular price. If the user chooses not to continue the subscription at the end of the 3-weeks, refund their cash. If the user signs up, apply their minisub against their first payment. You can test tying the refund to the completion of your in-app onboarding or basic user training.

    • AP

      Albert Palka

      about 3 years ago #

      Great idea. However, I'll have to check what's the refund policy and if we don't have to pay the payment processor an extra fee for that. Cheers!

  • AM

    Anurag Mehra

    about 3 years ago #

    I've gone through your website. As you're offering a Free Trial, I would suggest you not to ask for Credit Card details at the time of registration. You can even promote it by saying "No Credit Card Required" like my company has been doing on our website https://www.revechat.com/

    • AP

      Albert Palka

      about 3 years ago #

      Anurag, thank you for your reply. My question is: Have you tested credit card requirement too? Why have you decided not to take the credentials upfront? Has the % of users increased/decreased (both registered and paying).

  • AM

    Andrew M. Warner

    about 3 years ago #

    It depends on your business model. It depends on your audience.

    I agree with both of those but I say that if they made it to the registration process, why not try to get their credit card details? If you offer something that's really beneficial to them, that you know will help them achieve X, then they should have no problems entering their information .. even if it's for a trial or a free version.

  • OM

    Ollie Muskinja

    about 3 years ago #

    There is something that might be more interesting. In different regions (mostly EU) credit card is not the preferred payment option. Multiple local payment options are not on the rise (iDEAL, giropay, SEPA, etc.) and are used more than credit cards. So, my point is that there should be added credit card alternatives on the website because consumer know than that they can pay with their local payment method (local payment options, local currency and preferred language) what can significantly reduce checkout abandonment and increase conversion rates. Not to mention that lot of these payment options does not have chargeback option and no MID is needed.

Join over 70,000 growth pros from companies like Uber, Pinterest & Twitter

Get Weekly Top Posts
High five! You’re in.
SHARE
9
9