One of our clients, Ian is a stock trader (and might I add a very good one). Ian has been working the stock market for a number of years and has an enviable portfolio which he's build up through years of learning, experience and dare I say it experiencing failure. (You often learn more from what you lose than what you gain.)
So how does this relate to free trials?
Well, a few weeks ago, Ian decided to try out a stock trading program which claimed, "Who Else Wants To Find Out In Advance When Stocks Will Turn And How Far They Will Go… Using a simple and Effective Trading Method? Introducing a BREAKTHROUGH METHOD which can be used by STOCK and OPTIONS traders all over the world!"
Sounds pretty good, doesn't it?
I'm not going to go into the nitty gritty of what the product does - as that isn't relevant to this story.
What is interesting is that the system costs $127 USD to use on an on-going basis, but they offer a RISK-FREE trial that will cost you only $1.97 for 30 days.
Of course after 30 days if you don't cancel your subscription, they will automatically charge you $127 on an on-going basis.
As an aside, if you'd downloaded my "Skinning the Marketing Cat" report which you can download from http://tinyurl.com/hunrg, you'd already know about this strategy - offering a low cost or free trial and forced continuity.
The strategy in itself is excellent. You get people to try your stuff for a low introductory price and if they like it, you automatically keep billing them.
What wasn't excellent is the way this particular company handled Ian's request for a cancellation.
Ian had given the system a workout and decided that it was not for him. He knew he had 30 days in which to evaluate the system, but got distracted, and the days rolled on.
Around day 27, Ian decided to cancel the subscription, so sent an email to the support people as per their instructions.
He got no response.
He tried again and found that the organisation was filtering his emails as they thought they were S*PAM!
He followed up with a phone call only to get a very terse response telling him that he'd got instructions on how to unsubscribe, so why didn't he use them?
By now it was day 31 and the organisation charged his credit card with the $127.
Calls to the organisation asking for the amount to be refunded were ignored and Ian felt he was being given the run-a-round and this was an excellent way for the organisation to make money off him. (Ignore the first refund request - charge the card and then maybe stop before the 2nd bill.)
Fortunately for Ian, the organisation is based in Australia (where Ian lives). So he contacted the Department of Fair Trading who felt there was a case), and faxed them a formal letter of demand, asking for his credit card to be credited.
The response was immediate. There was an immediate email telling him that the card had been credited and it was…
What's the lesson here?
Whatever you do in business, make sure you deal fairly with your clients. Make sure that you honour your agreements and if a client asks for a refund under the terms of your agreement, promptly do so.
Is Ian going to use these people again? I don't think so. Is he telling all the traders he knows about his bad experience and why they should be wary of this organisation - absolutely.
Remember, negative publicity travels far further and faster than good publicity.
So do yourself a favour and look after your clients.
Rashid Kotwal is an international speaker and author who specializes in on-line and off-line strategies for direct response marketing and sales optimization. He works with sales organizations want to get more business, faster and with less wasted effort. You can find more information at
Sales & Marketing Consulting and
Get Clients Online Fast.
Copyright Rashid Kotwal.
