In 2020, users spent more money than ever on mobile apps, including in-app subscriptions. The top 100 non-game subscription-based applications grew their revenue to $13 billion – that’s a 34% increase compared to last year.
What user acquisition and engagement strategies can you follow to skyrocket your app’s KPIs? Here are a few research-based ideas and the best case studies.
Instead of an Intro
In this article, we will be talking about mobile apps that are subscription-based. With such a model, users pay to get access to content from an application for a certain period. The most popular subscription apps include YouTube (videos, music, live streams), Disney+ (series, movies, TV shows), Tinder (dating), and Pandora (streaming, radio, podcasts).
User acquisition, in the case of subscription apps, is a marketing strategy for gaining new customers. UA is an endless circle of data analysis, the development and integration of creative ideas, and testing. Video ads are a powerful user acquisition tool. Through a vibrant clip, Perfomante will highlight the main features of your subscription app and draw the attention of potential customers.
Types of Subscription Models
There are three different types of subscription-based apps.
- Pay-to-use – you won’t be able to use the application without paying a fee (Netflix has various subscription plans).
- Pay-to-upgrade (‘freemium’) – with this model, you can use the app for free, but only the people who pay for subscription have access to special features (Dropbox offers 2 GB for free, those who need more storage would have to pay).
- Pay-to-pay-less – the use of the application is free of charge, but if you subscribe, you’ll be able to save money or get bonuses (Uber Pass is a monthly membership that has several benefits).
5 User Acquisition & Engagement Strategies for Subscription Apps
Spotify Premium and Kindle Unlimited, for example, offer a 30-day free trial. Pay-to-upgrade and pay-to-pay-less applications follow this strategy as well. The marketers want the users to get a better understanding of what the app has to offer and make a deliberate purchase afterward. Typically, the conversion rate for non-card-required free trials of SaaS companies is 25%. To skyrocket that number – go for card-required free trials (a 60% conversion rate).
Influencers can show the benefits of the subscription-based applications and then offer a discount code or a free trial period. Audible, for example, dominates on YouTube with sponsored content. It is an online podcast and audiobook platform owned by Amazon that gains 34.49% of its traffic from YouTube. Audible partners with well-known influencers (PewDiePie, Grace Helbig, Rosanna Pansino) and offers a 30-day free trial period to their audience.
Choosing the right influencer helps introduce your app to a new audience and, potentially, increase the number of subscribers.
According to Storemaven, the apps that know how to utilize seasonal content see a 15-20% increase in app store conversion rates. Holidays, sports seasons, or the launch of a new chapter to a game – these are cool opportunities to come up with a unique feature that will soon disappear and never come back. Only subscribers should have access to these perks.
Making it easy for people to share their achievements on their social media networks is a great way to encourage bragging.
Duolingo is a freemium app that specializes in language education. The application has its own currency (earned for completing different activities), as well as point-based rewards and a scoreboard. Moreover, users can earn pretty badges. You are not only learning a new language, but you also have a chance to compete with other students and then share your achievements. Even though less than 3% of people subscribe to the app’s premium offering, they brought around $180 million in total bookings in 2020.
Monetization of non-paying users
Thankfully, there are ways to monetize even the users who will likely never convert into paying customers.
Encourage the audience to share referral codes – the existing user gets a cool bonus, while you get a chance to acquire a new user. Airbnb’s referral program is one of the most successful marketing campaigns of its kind. The last version of the program was added on iOS and Android. It allowed people to import Gmail contacts and then send customized invitations to their friends. “Give your friends $25 to travel”. The renewed referral program drove 900% year-on-year growth for first-time bookings and the daily signups and bookings increased by 300%.
Ask the users to write a review and rate the application. The number of reviews and the rating affect your app store rank. Moreover, 55% of people check what other users said before making an in-app transaction.
Ultimately, the non-paying individuals that share their referral codes and leave reviews can help you find paying customers.
App Store’s commission rate for a subscription app is 15%, while the developers of other applications can count on a standard 70/30 split. Google Play Store offers a reduced 15% commission for subscriptions after 12 months.
Helpful Tools for Subscription App Developers
With Adjust’s app subscription and revenue tracker, you can measure the subscription funnel, analyze the full customer circle, and use the information to prevent churn and boost LTV.
Billsby is a subscription billing software that integrates with your preferred business tools (allows advanced API options too). Billsby Value Score helps get a deeper insight into your customers.
Beamer can create in-app notifications for you. The widgets to choose from include pop-ups, snippets, a top bar, and tooltips. You can also schedule the notifications and, later on, measure the engagement level.
No matter what type of subscription-based application you are working with, there is a suitable user acquisition and engagement strategy for you. Maybe, it’s worth trying all of them out? 😉