Sept. 12, 2024
Have you ever signed up for a free trial, only to feel scammed and bamboozled and get charged unexpectedly? With the prevalence of free trial scams in today's digital world, more and more people are falling for these tricks and getting lured in by these seemingly 'good' deals, only to end up with a subscription they never wanted and a bunch of surprises on their bank statements. In this post, we'll cover the different tactics and sketchy practices these companies use to bait and trap people, and we'll also cover the things you can do to take advantage of these deals safely. Armed with knowledge about these scams, you'll be able to protect yourself financially and have a safe and positive online shopping experience.
Free trial scams are a type of fraud that is increasingly common in today's digital world, and they exploit consumers' desire for 'free' things. Often the product/service comes with a lot of fine print and hidden charges that the consumer is unaware of at the time of initial purchase, and only becomes aware of after the free trial period is over, leaving them with unwanted subscriptions and more financial stress.
What sets free trial scams apart from legal, ethical free trials is that they request your credit card information when you sign up. They may advertise it as a 'free trial', but they want your payment details either way, and this is so that they can charge you automatically once the trial period has expired. Often, consumers believe that they will simply cancel before they are charged, but the nature of scams often means that they are in for a rude awakening once their card is charged for what they believed was free.
Free trial scam operations often also rely on negative option billing. That means they automatically bill you for a subscription unless you cancel. This might come as a shock because many people assume that if they don't sign up, they won't be charged. But this isn't always the case. Companies use negative option billing to line their pockets—and they're banking on you forgetting to cancel once the free trial is over.
And believe it or not, complaints about free trials and negative option subscriptions are trending upward. These are real people having real experiences, and it just goes to show you have to be vigilant and keep an eye out for the shady-looking stuff.
You've got to know how to recognize a scam so you can steer clear, and you've got to do your research to really get a handle on things.
Free trial scammers use all sorts of tricks to trick people. One big thing they do is make their product seem much more effective than it actually is. And they use misleading ads to make people think their product will be the holy grail, so then people sign up.
In addition to all that, companies have sneaky cancellation policies. They have a convoluted cancellation flow so people can't quickly cancel their subscriptions. That way, they're locked into a subscription they didn't want. They'll also have pre-checked consent boxes to sign you up for stuff. These consents will allow these companies to charge you without you explicitly agreeing to it, and they're pretty much bypassing the consent since the language isn't clear.
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There are a few different varieties of trial scams, but the most common are "rebill" scams. Imagine you're in the market for a weight loss product and you're offered a trial of weight loss pills for just $5.99. Great deal, right? Not if you see an $89.99 charge on your credit card the following month, or the month after that.
That's a pretty straightforward example, but rebill scams are common in so many other industries. I've seen them with skin cream, cosmetics, male enhancement pills, and even software products. There are also high-priced coaching programs that have a low barrier to entry, like $1 or $7, then you're charged hundreds of dollars every month because you missed the fine print.
Another common scam is ads that promise everything for the super-low price of... whatever it is. Usually it's one of those only-pay-a-little-bit-now types, like shipping, and that always seems to be lying. They make it look like a good price on the outside but, usually in the fine print, the actual price is revealed. For instance, many of them have auto-renewing subscriptions or really short trials, and if you don't cancel during the trial period or don't meet the conditions, they'll charge you or ship you more stuff. Not only are they not telling the truth about the product, but they're dishonestly making free trials sound like a good deal to people who are probably in a bad spot and looking for something easy to help them out. The Better Business Bureau (BBB) reports receiving nearly 37,000 complaints related to free trial scams over the last three years.
Another thing you often see with free trial scams is fake celebrity endorsements. They'll use celebrities' names and images without permission to try to make their product look legit. And it does! We're more likely to have faith in a brand that a favorite celeb endorses. But the products behind these endorsements are almost never effective. So people are getting scammed, not just on the products they're ordering, but also potentially conned out of their money, with the hidden fees and charges that almost always accompany these "deals".
Some free trial scams will bait and switch you by calling it a free trial. But when you go to claim the offer, they'll hit you with a charge for shipping, or they'll charge you for something else every month. They'll say that it's a "free trial," but you've unknowingly signed up for a recurring subscription. And if you don't cancel your order within a minuscule window, they'll charge you a lot for shipping. Without telling you for how long, scammers can rope you into something you didn't want with no way to back out. Victims reported an average loss of $186.
Scammers love high-pressure sales tactics that pressure you to make a purchase on the spot. That includes countdown timers that create a false sense of urgency and scarcity, rushing you to buy before you've had a chance to think the offer over. FOMO (fear of missing out) is a real thing, and it can be hard to think clearly and make a good decision. Once they've lured you in, they make it difficult to get out of unwanted deals, since they have deceptive return policies and very short timelines that just frustrate you and cost you money.
Also, many scams will play on your emotions. Whether it's scarcity (last-minute offers) or emotion (sad or happy ads), scammers know how to make you act on impulse -- which often means signing up for something you otherwise wouldn't have. For example, a marketing campaign might use sad stories to make you feel like you have to buy the product right now in order to solve your problems. It's that kind of emotional manipulation that makes these scams so effective in the first place -- it creates an environment in which you're not thinking rationally, you're thinking out of fear or joy.
So now that you understand the different types of free trial scams and how they work, you're better equipped to be aware and protect yourself financially. The more you know, the easier it is to navigate the sometimes-rough waters of online shopping, especially when it comes to "free trial" type deals.
Free trial offers might look like an easy way to try a new product without making a big commitment, but most of them are scams with hidden terms. Learning to recognize the real thing is the only way to avoid the headache and loss of money that others have experienced.
From 2017 to 2019, consumers submitted more than 58,400 complaints about free trial scams. That's a lot of complaints—and a lot of people who've gotten tangled up in unscrupulous trial offer practices. They notice a product offering a trial and think, 'Sweet! I can try this free and don't have to pay yet!' and sign up without looking into the terms and conditions. Then they're billed out of nowhere a few weeks later. The fact that they're able to lodge a complaint at all is a good reminder that even consumers who think they're "on to" a sales pitch can still fall for a marketer's tricks.
I've seen reports that people have lost nearly $1.4 billion to free trial scams. That's a lot of money. I mean, a lot of money. That's billion with a "b". And these scam victims are regular people like you or me. They think they're getting something good for free, but they're getting scammed when they're charged after the free period ends. The baddies are essentially using fake free offers to do automatic billing. They might offer you a free trial of something really great, and then charge you $100/month for it. Lots of folks have reported losing a median of $140, so many people are losing a lot more than that.
When we think of free trials gone wrong, the classic example is when the FTC cracked down on a company that was fined $10 million for not informing people about post-trial charges. It's a major step toward reining in unfair business practices, and it shows just how seriously free trial scams are being treated by regulators. The case also serves as a lesson to companies that they should be transparent about ongoing charges, and that a free trial should truly represent what it's like to subscribe.
A lot of people end up getting charged for stuff they didn't want because they signed up for a free trial and didn't understand what they were signing up for. A lot of that comes from the tricky marketing and confusing terms that mean you don't really know what you're really buying. Scammers will use things like fine print to hide or not tell you about an ongoing financial commitment as part of a trick to make it seem like you're getting a great risk free deal. The trickiest part is, because of the games these companies are playing, it can really trick you and take you by surprise into making a choice.
People who fall for free trial scams end up in a difficult loop of a cancellation process that requires them to cancel the offer before they get charged each month. And those charges can really pile up. People say they're frustrated when they try to cancel because companies make it difficult by using tactics like long phone wait times or confusing online steps to confuse them into giving up. This leaves people in the dark while the company still profits from these ongoing charges they never agreed to pay for.
Navigating a free trial scam is a real reminder of how cautious and aware you have to be. You have to fully trust those companies and know where the hidden charges could be, so you don't see an unexpected charge on your bill.
Offering free trials is a great way for businesses to onboard a ton of customers—giving them the chance to use the product with no risk, and see if they even like it. If they do, it's a win-win! But there's a catch.
Free trials are beneficial because they build trust with your prospect. When you let someone try your product risk-free, they're more willing to take a closer look at what you're offering because it's risk-free. With a no-risk experience, you're more likely to convert users because people are more likely to pay for something if they have a good experience with the product.
For example, software companies use free trials to demo how well their software works. As a user, you might not believe the software works well or won't buy the software based on marketing or testimonials, but by trying the software, you can really see what the software is and how well it works. This first experience builds trust and will be a higher converting as free trial users become paying users.
Free trials? They build trust, keep your customers more engaged, and make them a customer for life. Giving your customer a test run--try-before-they-buy--lets them understand your product more and gives them even more oomph to advocate for your product.
The more engaged your customer is, the more likely they are to be a superfan of your product and share it with others, which increases customer acquisition even more.
Let me illustrate: for example, if you're a digital learning provider and you give users free learning sessions, that time, users are actually in the product, they're consuming content, they're having that interaction with the instructors and with the other learners. They're really living the product experience and most likely building a community around their product and their brand, so they'll be a retained user, stay on your platform and remain your customer. You had them at hello, and you have a customer that's an advocate for your brand.
Free trials can be a great thing, but they also pose a significant risk—abuse. Abusive users are people who sign up for a trial who never intend to pay for your product. They'll use it, but they'll never pay for it. And you'll be left footing the bill to provide your product with minimal to no benefit to you.
For example, if you have a subscription-based business of any kind (like a video streaming service) and you are getting a lot of users making new accounts each time to use your free trials, you'll be out a lot of money. If left unchecked, this could result in a potentially catastrophic loss in revenue and require additional resources to police and limit this kind of activity.
Free trials are hard to get right. Then you need a good follow-up strategy in place so you can help guide your user through your experience. When you do that, they'll see everything your product has to offer and be more likely to convert and become a paying customer after their trial. The first part of the trial is crucial. The easier and better your onboarding, the more likely your user will be satisfied and convert to a paying customer.
Now you need a way to follow up with your user after the trial, whether that's with personalized emails or targeted offers that will give them a little push and help them convert to a paying customer. The more feedback you can get during and after the trial, the more insight you'll have into what your user experience is really like and what you can do to improve your product and make your customers even happier.
When it comes to free trials, companies need to walk a line between attracting new customers and setting themselves up for a bad customer experience. Free trials can easily go wrong, and a company can do a lot more damage to their own brand if users are left feeling overwhelmed, confused, or unsupported during their trial.
For example, if a company gives you a super hard-to-use software and there's basically no support to help you through a trial, it's just going to annoy people and leave a bad taste in their mouth. You really have to reduce the friction of the trial so that people feel valued, informed, and prepared to confidently purchase your product when the trial period ends. That's how you create good word of mouth and a good image for yourself in a crowded field.
Free trials can be risky for consumers who don't know how to play the game. Companies offer tantalizing deals and many of us snap up "free" stuff. But a few easy tips can help you avoid unexpected charges and ensure your rights are respected.
Before you sign up for a free trial of anything, review the terms and conditions. I know, I know -- it's so boring to read the fine print, but you need to do it so that you know how to cancel, when to cancel, and if there are other charges. The devil is in the details. Sometimes companies will hide an automatic renewal in the terms and charge you after the trial period. For instance, the cancellation process could be made confusing on purpose, so you're not able to easily cancel and end up paying for something you didn't want!
Look for clear language on how to cancel, when to cancel, and under what circumstances. If the terms are difficult to understand or unclear, you may want to avoid signing up altogether. This is how consumers get taken advantage of, and it feels good to buck the system.
One of the easiest yet most effective ways to avoid surprise charges from free trials is to use a calendar. When you sign up for a trial, jot down the end date on your calendar immediately. That way, you're aware of when the trial ends and can cancel in time. You might forget, but a calendar is like insurance for your budget.
Even better: set up several calendar reminders, like 2 weeks and 1 day before the trial ends. That way you have plenty of time to think about whether you actually want the service, and have time to consider other options or cancel without worry.
Before signing up for a free trial offer, take a few moments to look into the company offering the service. A quick search can yield a lot of information about the company's history, reputation, and other customers' experiences. Look for reviews, look for complaints, look for reports of others' customer service experiences when they tried to cancel.
Knowing what sort of company you're dealing with can help you avoid falling prey to a scam that will charge you in perpetuity for the privilege of using a sub-par service. Knowing what others have experienced can help you decide more easily whether or not it's worth the risk to give it a try. A decent company will have things like clear policies and a supportive customer service team.
Another red flag to look out for when you're signing up is a lot of pre-checked checkboxes, because that means you're getting signed up for more offers or autorenewals unless you uncheck them. A lot of sites do this to improve their conversions, but it's a cost to the customer, who's now signed up for a product they never meant to buy in the first place.
As you're checking the boxes to sign up, just be sure you uncheck anything that says it's any kind of a signup at all for another product or an auto-renewal. This will help you have more control over any future charges, and you won't see any surprises on your credit card statement.
Checking your bank statements regularly is an effective way to help ensure you're not billed for something you didn't want or didn't mean to sign up for. It can also help you catch other potential issues, so it's just a good habit to get into. Look for monthly charges that may be related to something you forgot to cancel or any unauthorized transactions.
If you spot any charges that you believe you didn't agree to, act as soon as possible. You'll want to reach out to the company to dispute it first. If that doesn't work, you can reach out to your credit card and dispute it there. Monitoring your money is a big part of consumer advocacy.
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Free trial scams often have warning signs that include needing your credit card upfront, confusing cancellation policies, negative option billing, and misleading advertising. Watch out for offers and deals that sound too good to be true, high-pressure tactics, or claims that seem too good to be true.
Negative option billing is when a customer is billed automatically after signing up to use a service, and they're only supposed to be billed if they do sign up, but then they end up being billed anyway after the free trial period; it's a little complicated.
Scams promise more than they deliver, fake celebrity endorsements, bury real charges in insane fine print, and use other dodgy or dubious tactics. They might also tout an amazing trial with murky terms about auto-renewal and massive charges after the trial.
How can you protect yourself from scams? Always read the terms and conditions (seriously, who does that?) and how much you're going to be charged before you hit submit, set calendar reminders to cancel, Google the company's name to see if there are any bad reviews, unselect any boxes that are already clicked for you when you're signing up, and check your bank statement for any unauthorized charges on a regular basis.
Reportedly people lost nearly $1.4B to deceptive "free trial" offers overall. Plus, most victims wind up with unauthorized charges or subscription fees (often concealed until post-trial) that they didn't budget for.
If you see any unauthorized charges on your bill, try contacting the company first to have the charges reversed. If you're not satisfied with the results, contact your credit card company and have them reverse the charge. Keeping good records of all communications will help your case and help you protect your rights as a consumer.
People who are woke can smell the scams from a mile off and understand the risks inherent in free trials. By being alert to the warning signs and knowing what looks 'off', people can protect themselves, make smarter decisions, and not get scammed by free trials.
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