If your Web App is getting a lot of "test sales" you almost certainly have a value perception issue.
During the last SaaS Pricing Page Design Workshop (as it is called now) we had some questions come up that we did not have time to address. I took time after the event to ensure all questions were answered and sent to all attendees in a timely fashion.
Here is a question that came in and I thought you might be interested in in my response. Feel free to comment if you have similar experiences and would like to weigh in.
Q. We are having "test sales" - they only stay one month and then cancel. Is it a perception problem? Does the customer not "get" what the system is for? They sign-up for the free trial, convert for 1 month, and then cancel.
A. At some level it is a perception issue - the goal is to figure out what that is and fix it. It is likely you are attracting the wrong crowd. Perhaps you're limiting features in the trial that they think they need, they sign-up and find out the features either aren't what they need or they don't work. As much as it is painful to hear, maybe your product doesn't do what you say - or think - it does. And never under estimate the power of a bad product - or poor user experience - to keep people from using it!
It could be that you collect their credit card information up front and auto-bill them at the end of the trial. When that happens they cancel the subscription but don't ask for a refund and don't do a charge back. They just leave. Watch out - this could become a problem at scale. Too many charge-backs and you're merchant account will be cancelled.
My suggestion is for you is to be proactive during the trial. Ensure that the customer who signed up is actively using the product. I would suggest a combination of actually talking to them and monitoring their progress within the system. A phone call after they sign-up for the trial to make sure they have everything the need, an email pointing them to How-To videos, customer support forums, etc. And then actions base don their behavior from there on out. You don't want this:
1. They signed-up
2. They gave their credit card
3. They verified their email
4. They logged-in once
5. They never came back
6. Their credit card was billed for 1 month
7. They cancelled
8. They disappeared
Each one of those list items contains at least one touch point for you and you should be leveraging those opportunities to connect with your customers - even if it is less "scalable" right now - meaning more human interaction - so you can figure out why they're churning out and of course, to prevent it.
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Go get this amazing video series for only $297 right now. As soon as you get it, immediately watch the 35-minute Value Pricing Basics for SaaS & Web Apps video; it will truly change the way you look not only at pricing, but your entire marketing strategy, your customers, and your offering as a whole!
