When Free Isn’t Free Enough

I once found myself in the middle of a conference call with the CEO of a young Internet company that provided a great service – the website allowed customers to securely file emergency contact information and medical files online for an entire family (pets included).  Backed by a monster server, and a 24/7 call center, the business was a slam-dunk in giving caretakers peace of mind should any emergency arise.

The company wanted help in creating more compelling content for their website, with the goal of converting more visitors into customers. At the time of our conference call, web stats showed that while visitors were steadily on the rise and that most people were following the content all the way through to the sign-up page, they bailed out about halfway through the sign-up process.

The CEO was flummoxed and frankly, so was I.  The company even offered a two-month free trial.

As we sat there talking, I kept flipping back and forth between the homepage and the sign-up page.

CEO: “I don’t get it.  Our service costs less than $35 a year, yet the process comes to a screeching halt when visitors have to sign up.  What’s the hang up?”

MM: “Well, your service is still a fairly new business model and perhaps with all that you’re promising, it seems too good to be true. I see that you guys offer a free trial.”

CEO: “We do… you can see it on the sign-up page. We give two months for free.”

MM: “That’s great – so why aren’t you advertising this on your homepage… heck, on every page of the website? Surely there are those folks who are a bit more impulsive and will want to check it out right away.”

CEO: “You’re right – we’ll get on that, first thing. Where do you think we should put the info about the $4.95 handling fee?”

Handling fee?  HANDLING FEE?!

In a world where individuals are barraged with advertising and special offers everyday, consumers are highly sensitized to hidden fees and obligations. The customer’s first reaction to a “free trial” with a $4.95 handling fee – especially when it’s buried in the middle of the sign-up process – is going to involve the click of a mouse away from your site (probably preceded by a phrase like, “Uh, screw that!”).

Hyped advertising or offers with strings attached, either intentional or unintentional, will do more harm than good.  In the case of this company, I recommended either offering a “two month trial for $4.95” or, better yet, removing the handling fee entirely, depending on what their marketing budget could handle.

Make sure that free is really free,  or don’t do it at all.

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5 Responses to “When Free Isn’t Free Enough”

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  1. Michele,

    Your recommendation is particularly salient given this report from Consumer Reports magazine, which found that unexpected/hidden fees top the charts for things consumers consider to be daily annoyances.

  2. I’m with Setphen. It’s annoying. It also sends an instant message to your brain – “Look Out! Don’t trust this company.” Yes, it’s only $4.95, but that’s not the point. There is an instant sense of uneasiness that ruins the positive customer experience.

  3. A bit off-topic, and for that I apologize: This may simply be naivete talking, but above and beyond the “handling fee” (what, exactly, are they handling? Do they take floppy disks from the web server to the main server every time someone signs up?), what is the purpose of a two-month free trial for this company?

    This is the kind of service where it’s not going to be useful at all until it’s very, very abruptly essential. Free trials make sense for a service where you’re going to be using it routinely, but from your description, this is a set-and-forget service. The net result of the two-month free trial is that at the end of two months, users are going to be startled to find a charge on their credit card from a company they’ve forgotten they signed up with.

    I guess my point is that free doesn’t just have to be free – it has to make sense.

    (A better solution for this company: allow users to put in their data and show them how easy it is for an authorized person to find their emergency contact information and what it will look like when they do. Then say, “If you think this seems useful, it’s only $35 a year to sign up, and we’ll keep the information you just gave us – which, of course, you can update at any time. If this isn’t up your alley, just click the ‘No thanks’ button, and we’ll completely remove your information from the server.” That’s the “free trial” you want to give them: demonstrate the utility, then let them opt out completely if they want to.)

  4. Rick Henkin says:

    Have you ever experienced the frustration of trying to buy a product on a website and you can’t even find out the total price (shipping, handling, sales tax, etc.) unless you fill out a long registration form of unnecessary information? How did that make you feel about the company? Did it foster a lot of goodwill toward them, or did you say, “Forget this, I’ll try another website.”? (I probably wasn’t quite that genteel when it happened to me). If you’re like me, you probably checked out some other websites.

    It’s really all about customer service and being upfront and genuine. I’m sure these guys weren’t trying to be deceptive, but it sure came off that way. Free is free.

  5. Renee Malove says:

    Thank you SO much for pointing this out. Hidden fees are frustrating for everyone, but when you’re a parent it just seems like you’re inundated with them. I know I personally would have given the site a wide berth if that popped up, just like I do all those “free” book offers that want your credit card information-just in case you can’t get the books to the post office in time.

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