Trial conversion economics for subscription products.
Inputs
Trial program economics
Effective paid CAC—
Paying conversions / mo
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Subscriber LTV
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LTV:CAC ratio
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Monthly P&L
Component
Amount
About this calculator
Free trial economics is where many subscription brands quietly lose money without realizing it. The mistake: optimizing for trial signups (the vanity metric) while the trial-to-paid conversion rate quietly drifts down. The result: rising trial CAC, falling effective paid CAC, and a program that\'s burning cash even though signup volume looks healthy.
This calculator builds the full free-trial P&L: trial signups × trial CAC = monthly trial cost. Trial × conversion rate = paying customers. Effective paid CAC = trial cost ÷ paying customers (typically 3-7× higher than trial CAC alone). Compare to subscriber LTV (price × margin × lifespan) to compute LTV:CAC ratio.
The strategic insight: the credit-card requirement is the single biggest lever. Free trial without cc converts at 5-10%. Free trial requiring cc (with default-pay-after-trial) converts at 25-50%. The 3-5× conversion lift more than offsets the 30-40% drop in signup volume, producing better effective CAC. Brands that don\'t require cc are usually optimizing for signup volume that doesn\'t convert.
Pair with the LTV:CAC Ratio calculator (the bedrock metric), Subscriber Payback Period (how fast trial dollars come back), and Cancel Save-Offer ROI (extending lifespan after first cancel attempt). Most successful trial programs aim for LTV:CAC of 3×+ with payback under 6 months — both metrics computed on effective paid CAC, not trial CAC.
Frequently asked questions
What's a healthy trial-to-paid rate?
Software / digital: 15-25% if free trial requires credit card, 5-10% if no credit card. Physical subscription (consumables, supplements): 30-50% on free trial that requires cc, 10-20% on no-cc. Brands that hit 40%+ usually have either a sticky product or strict cc requirement.
Should I require a credit card?
Yes for most cases — it 3-5× the trial-to-paid conversion rate. Without cc, only people who explicitly opt in convert; with cc, the friction reverses (default is paid, friction to cancel). Some products work without cc (premium content unlocks where the value is fully demonstrated) but most should require it.
How long should the trial be?
7-14 days for digital products. 14-30 days for physical subscription boxes. Shorter trials force faster commitment but also give less time to show value. Test conversion at 7, 14, 30 days — most products have a sweet spot around 14 days.
What's the CAC math during trial?
You acquire the trial signup at $X (typical CAC $30-60). Only N% convert to paid. So effective CAC per paid customer = trial CAC ÷ trial-to-paid rate. At $40 trial CAC and 25% conversion, paid CAC = $160. This is often higher than founders model.
Should I run paid trials instead?
Sometimes, especially for premium subscription products. $1 trials, $5 starter kits, or first-month-half-price all cap downside vs free trials and self-qualify buyers. Conversion rates from paid trials are typically 60-80% (vs 15-50% for free trials) but signup volume drops 60-90% — math depends on whether you need volume or quality.