ABOUT ROCKETSHIP HQ: Website | LinkedIn  | Twitter | YouTube


FULL TRANSCRIPT BELOW

“Build an amazing product” they say – but what the hell does that objectively mean?

Today’s episode is an extract from our new case study: Growing to 4X UA budgets profitably, with 150% ROAS post-ATT. This case study is a deep dive of 11 different strategies that our team employed to grow a wellness app 4X – you can click on the link in the show notes to swipe the exact strategies we used, and unlock growth for your own apps, even in a post ATT world(you can also check out this and other case studies over at rocketshiphq.com/casestudies ).

In today’s episode I talk about the 3 key types of product metrics that we typically recommend reviewing to evaluate the scalability of a subscription app. 

Why evaluate these product metrics? Because if the product metrics are not strong enough, nothing you do in your marketing will make a difference to scaling.

And we don’t want to cop-out with platitudes like ‘build an amazing product’ – and I want to share the exact metrics we review and evaluate to assess scalability. These were the key metrics we evaluated at the start of the engagement with the wellness app that is the subject of our case study.

Without further ado here we go on the 3 key types of product metrics that we evaluate.

🛤 Trial to paid conversion rates

As nearly every subscription app has a free trial, this is a critical metric. As the vast majority of trials happen in the first 24 hours, the trial to paid conversion rate determines how strong the upfront monetization of the app is.

While reviewing your trial-to-paid conversion rate, it’s also important to look at your trial-to-paid conversion rate in the US only – as this is the most important geo for the vast majority of apps – and there is a lot of variability among conversion rates for other geos.

We typically look for a conversion rate of at least 40% as a benchmark for healthy subscription apps to ascertain scalability.

🏖 Retention of paying users

Again, this is a critical set of metrics for subscription apps – the first paid transaction offers a good signal of monetization, but what happens post the first transaction is what impacts the investability of a product.

Without strong retention, a user might start a trial but cancel right after. Or they might convert to a paying user, but cancel after a month – either because they did not find enough content in the app, or because they didn’t find the app to be valuable enough.

Which is why retention of paying users is critical. What metrics do we use to evaluate this?

We typically look for a minimum of month 1 retention of 60% for monthly plans, and year 1 retention of 30% for annual plans to ascertain scalability of the app.

💰 Monetization, LTV and unit economics

 Trial to paid conversion rates and retention are important metrics – but they don’t give the full picture – what truly matters is whether your unit economics enable you to scale.

Monetization metrics are critical because they govern your CPA ceiling. Products with strong monetization can support higher cost-per-trial for user acquisition activity.

Typically we find products with 1 year LTV of over $65-$70 to be scalable, assuming you are looking for a payback period of 1 year(although this is a category of metrics where there can be a bit more variability – as there are verticals of subscription apps where lower LTVs can be scalable, because CPAs tend to be typically lower – likely because these are more mainstream products). That said, anything over $65-$70 is clearly scalable.

**

These are the 3 categories of product metrics that we find to be critical to evaluate in order to assess the scalability of any subscription app – and these are the key metrics we evaluated at the start of our engagement with the wellness app that is the subject of our case study.  

**

Today’s episode is a preview of our new case study: Growing to 4X UA budgets profitably, with 150% ROAS post-ATT. This case study is a deep dive of 11 different strategies that our team employed to grow a wellness app 4X – you can click on the link in the show notes to swipe the exact strategies we used, and unlock growth for your own apps, even in a post ATT world.

A REQUEST BEFORE YOU GO

I have a very important favor to ask, which as those of you who know me know I don’t do often. If you get any pleasure or inspiration from this episode, could you PLEASE leave a review on your favorite podcasting platform – be it iTunes, Overcast, Spotify or wherever you get your podcast fix. This podcast is very much a labor of love – and each episode takes many many hours to put together. When you write a review, it will not only be a great deal of encouragement to us, but it will also support getting the word out about the Mobile User Acquisition Show.

Constructive criticism and suggestions for improvement are welcome, whether on podcasting platforms – or by email to shamanth at rocketshiphq.com. We read all reviews & I want to make this podcast better.

Thank you – and I look forward to seeing you with the next episode!