Should you do a free or paid pilot?
Or the 'secret' third option?
One of the most asked questions in response to The Product-Market Fit Scale was:
“Should I do a free or a paid pilot?”
Great question!
Short answer: paid
Long answer: there actually are 3 options
The short answer: paid
Go paid if you can. Customers paying full price is the best signal you can get for product-market fit. Rob Snyder will agree with me here.
The long answer: There are 3 options
There are merits to both. First, let’s define a pilot
Not all experiments are pilot
I define pilots as:
An experiment that allows you to test the minimum required value adding component of your proposition: your product or service.
Not all experiments are pilots. A smokescreen test is not a pilot, but a Wizard of Oz experiment can be a pilot. Pilots are about attempting to create the minimum value-add for your customer with your solution.
Option 1: Free pilot
Acceptable reasons to do free pilot:
Your prototype is very low quality and you don’t feel comfortable asking money for that. You are barely sure it works.
Your aim is to validate technical function over market demand.
If you promise yourself you will only do 1 free pilot to learn, then move on to paid.
Bad reasons to do a free pilot
I’m scared of asking for money
Better get used to it
I don’t know my price yet
What will your next pilot be? Struggling to decide? Leave a comment below!
Option 2: Fully Paid pilot
Paid pilots have more upsides than downsides. Because we are trying to find hair-on-fire problem owners, having a paid customer shows you have found them.
⚠️ Pro-tip: Offer 100% money back guarantee to lower the threshold. It’s about the act of paying.
Good reasons to do a paid pilot
Your MVP is good enough
You want actual valuable signals that show product-market fit
You don’t care about the extra responsibility
You need to validate your revenue model
Bad reasons to do a paid pilot
I can’t think of any
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Option 3: A discounted pilot
There’s a third option: offering a pilot discount of 50% to 75%. Be clear about the length of this.
“Normally this would cost $100 per month, but for the first month we give you a beta discount of 50%”
Also here, you can offer a 100% money-back guarantee.
Reasons to do a discounted pilot
You want to validate if it’s worth any money
Your MVP is good enough
It’s your first pilot ever
Bad reasons to do a discounted pilot
Scared asking full price will drive customers away
Summary
Do a paid pilot full price if you can
If too early, do a discounted
If MVP is not ready, do a free pilot
Need help designing your pilot?
Check out the Startup Pilot Canvas
The timing couldn’t be better