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KEY HIGHLIGHTS

😛 How the privacy landscape changed for kids’ apps

⚖️ Why did the team start to look at web-based flows

👨‍👩‍👦The user journey involves both parents & kids

🍭MMPs didn’t have SDKs that were compliant with kids’ apps

🤿 With SKAN are kids’ apps on par with other apps?

 🖥 What the web-based flow looks like for users

📱 Other acquisition channels that opened up

📡 Facebook or Google UAC – what works better

🚰 Other channels on mobile that work well

🩺 Tests that helped them improve and optimize the funnel

💲 How hard was the internal buy-in?

⚙️ How M&As impacted planning around growth and marketing

KEY QUOTES

Threefold approach to web-based marketing

The web-based marketing efforts were threefold. 

One was the ability to improve our margins or net CLTV, since we’re no longer paying that 30% Apple tax while acquisition happens on the web. 

Two, from the data points that we had in general, the kind of cohorts of customers on the web were at a much healthier CLTV for us, against iOS and Android users. So a really healthy market there. 

Third was our ability to move past just selling an individual, singular, monthly, six-month, or 12-month subscription, but the opportunity to really drive more ARPU or revenue per user at the time of purchase, through cross-selling and bundling was good.

How the user journey involves parents and kids

 We really have two users that are equally important from a user journey perspective. Advertising to the parent who was going through the onboarding, funnel, and quiz either in-app or on the web, and signing up for a trial, but then leads to a subscription 30 days later. After that experience, the customer downloads the app and signs in or continues their journey on the app to start their free trial experience. 

That is really where the customer becomes dual, where it’s the child who is the end user for this product and uses the product every single day, but the parents are the one whose credit card is being charged.

Components of a web-based flow for users

Our architecture and strategy in terms of our web-based flow is a true end-to-end onboarding experience and purchase cycle that happens within our web ecosystem. 

So a customer comes to our landing page because we’re in the kids’ education space and the ability to really provide that insight and details to the parent, in a more long-form way allows better education to the parent of what the problem is that we’re trying to solve. 

The parent goes into an onboarding funnel, which is a combination of some first-party data that we collect, such as email and SMS, and then goes through a quiz, which creates personalization for the child, what they’re going to be experiencing and using inside the app through a series of questions that connects back to that kind of onboarding experience of the child, the parent then submits their credit card. 

Surprising wins and failures

The more zero-party data, or first-party data as they call it these days, we can kind of gather the better. Intuitively collecting email and SMS we felt would probably be important but we certainly believed that collecting in the first step would really hurt the attrition of consumers going through the funnel. 

We found out very surprisingly that that actually was helpful, not hurtful in terms of collecting that data. That was a big unlock for us that there’s a level of trust within our consumers who are really willing to give up their email and SMS and not for any real incentive, besides just wanting to learn more about our business and dig into a little bit more.

Other channels on mobile that work well

the number one concern that was company-wide about focusing on the web was that all these customers will come across our website, go through the funnel and decide not to purchase but just go directly to the app and purchase from there. I think that was really dissolved on day one, as we found that there is a whole different customer subset that lives out there outside of the mobile app world, at least for our product and category that’s super excited about what we have to offer, super willing to not only go through a web-based funnel and download an app but with us really create some better opportunities and how we can serve them in a larger way.

FULL TRANSCRIPT

Shamanth 

I’m excited to welcome Todd Kane to the Mobile User Acquisition Show. Todd, welcome to the show.

Todd 

Thank you so much, really honored to be here.

Shamanth 

We’re thrilled to have you because a lot of the iOS changes have been far-reaching for a lot of marketers. But you guys have been very much ahead of the curve in many ways. You guys have adopted many strategies, especially the web-based flows, which I’m excited to dive into. All of these things could potentially help a lot of folks deal with some of the mess that we are all in with iOS changes. 

To set the stage, you and your team work with kids’ apps. Can you give us a background of how the privacy landscape is different for kids’ apps as compared to other apps?

Todd 

The kids category overall is ruled by an additional body under the regulations of COPPA, which basically is there to increase the protection of  children from any sort of advertising. The impact of that for us happened well in advance of iOS 14.5 and the impact of ATT, where they required in late 2020 that all apps who are focused on kids products have to remove all IDFA completely from the app itself, regardless of if you’re collecting information or not. 

The requirement from Apple was that basically the next big update or any update you did, if you collected any IDFA inside the app it would be pushed back and not allowed. This included all the MMPs and our ability to track marketing performance and scale day-to-day business. So for us, the challenge ahead of us was really how do we react and adapt to a world which was at that point being relatively unknown. 

With the modifications for being kids-friendly, an IDFA free SDKs wouldn’t be available for industries and categories such as ourselves, which really led to the strategy that we’re going to talk about today, which was developing and focusing more on the web. So tons of regulations,  nuances in our product, and the consumer is twofold. The buying consumer is the parent, and the user is the child inside the app, which kind of causes that complexity.

Shamanth 

Sure, these are complexities that most other apps don’t have to deal with at all. I know you said because of a lot of the regulatory and privacy-related stuff, you guys started looking at web-based flows. What was the genesis of the idea to look at web-based flows? What were some of the assumptions that were inherent in this planning?

Todd 

So some of it, or a lot of it really came out of need. We knew that the future of a company that was 90-95% mobile app focused and 95% of that being on iOS in terms of UA was undefined, moving forward. We still need to really help grow our business and be thoughtful of continuing to serve our customers at the time. We had a very small amount of spend and unlike most mobile app businesses had, but the belief in the data points that we saw was the proof that made us super excited around just the opportunity and ambition to really supersize. 

The web-based marketing efforts were threefold. 

One was the ability to improve our margins or net CLTV, since we’re no longer paying that 30% Apple tax while acquisition happens on the web. 

Two, from the data points that we had in general, the kind of cohorts of customers on the web were at a much healthier CLTV for us, against iOS and Android users. So a really healthy market there. 

Third was our ability to move past just selling an individual, singular, monthly, six months or 12-month subscription, but the opportunity to really drive more ARPU or revenue per user at the time of purchase, through cross-selling and bundling was good. 

I guess there is a fourth one, which is pretty exciting, that really unlocks certain marketing channels outside a traditional mobile app space. So the ability for us to really grow and scale those channels that we had belief in, was like the genesis of excitement. 

We didn’t have a website. We started this project mentality. There was some work in terms of a very baseline experience and funnel and quiz that will allow us to at least have a starting point. And that was beyond just the starting line in terms of that journey. Naturally, lots of changes to really help supersize and focus on that as a strategy, which is very different in terms of just the visibility and accountability around driving a mobile app business.

Shamanth 

Right. And as you pointed out there were very different reasons and opportunities right there that were inherent. You guys were also not starting completely from scratch. So I think that definitely would have helped. I know you briefly talked about how parents are involved in kids’ apps as well. Can you help us understand how the user journey involves parents and kids, and how does that impact marketing-related decisions?

Todd 

Our world is uniquely complex. We really have two users that are equally important from a user journey perspective. Advertising to the parent who was going through the onboarding, funnel, and quiz either in-app or on the web, and signing up for a trial, but then leads to a subscription 30 days later. After that experience, the customer downloads the app and signs in or continues their journey on the app to start their free trial experience. 

That is really where the customer becomes dual, where it’s the child who is the end user for this product and uses the product every single day, but the parents are the one whose credit card is being charged.

So our jobs are, how do we on one side create the best kind of content in education to really supersede that value for the child, but also, how do we create that right connection to the parent at the same time either through SMS or email to show the outcomes and value that the child is having within the app. Because of the limitations of IDFA, and COPPA, we can’t send things like push notifications inside the app, because the child at that point is using the app. 

Shamanth 

Sure. So in many ways, the parent is the decision maker and the child is the user. That introduces quite a bit of complexity in how you want to think about this. Because ultimately, the initial marketing has to be parent-focused, and the product itself and ongoing marketing have to be kid-focused. I think that’s where the complexity comes in. 

I know you briefly also said that early on the MMPs didn’t have SDKs that were kids apps compliant. What does that mean? 

Todd

The app players of the world hadn’t had the time to make sure that all their SDKs were there, that there was a version of that that was kid-friendly, and not collecting any IDFA, which was challenge number one. Just having something to track inside of our system to go back. 

The second, which is a larger challenge is how the SKAD network has adopted or has not adopted the inability of the usage of IDFA, which is a pretty important data point within that to allow our ability to mature in terms of channel spending and most importantly, visibility and performance of that: because again, we’re not an install-based business, we’re really a post-click business in terms of focusing on the most efficient cost per trial. 

So acquisition for us is beyond important. Again, that kind of ambiguity for us was an important reason where, on the web we can track everything. So how do we just really double down on what we have in front of our eyes versus waiting for the category to mature, which in some cases is still very ambiguous of where it’s at and how it’s growing within our category. 

Shamanth 

With SKAN, would you say the playing field is leveled between kids’ apps and other apps? Or is that not quite the case?

Todd

Not quite the case, it may have gotten 30% back to its original level in terms of some of the channels that we can spend in but the importance and value of IDFA within the apps for it to click back to SKAN still supersedes the kind of current state, which is completely IDFA free. 

So I think there’s still a ton of maturity within the category and then the technology to catch up to the kind of development and mature past this kind of current stage.

Shamanth 

Post SKAN, a lot of other apps have 30/40/50% IDFAs and you guys have zero. That’s the fundamental difference. Can you also help explain what you mean by a web-based flow? 

Can you describe what that looks like for a user, what are the components? 

I also ask this because I think different people mean different things. So I think it’d be good to help understand how you guys have architected.

Todd 

Our architecture and strategy in terms of our web-based flow is a true end-to-end onboarding experience and purchase cycle that happens within our web ecosystem. 

So a customer comes to our landing page because we’re in the kids education space and the ability to really provide that insight and details to the parent, in a more long-form way allows better education to the parent of what the problem is that we’re trying to solve. 

The parent goes into an onboarding funnel, which is a combination of some first-party data that we collect, such as email and SMS, and then goes through a quiz, which creates personalization for the child, what they’re going to be experiencing and using inside the app through a series of questions that connects back to that kind of onboarding experience of the child, the parent then submits their credit card. 

In the end, it puts down their information for that first 30-day free trial, which they only get charged after that trial was done for that first month. Then they are greeted with a series of different prompts that allows them to quickly and nimbly download the app, with a QR code, links, as well as a subsequent series of emails and text messages back to the parent to get them to download at that point. 

They sign into the app, and then the app lines up personalization based on what they filled out in that quiz. 

Shamanth 

That certainly feels very well thought out. Just to go back to something you said earlier, there are other acquisition channels that get opened up. Can you speak to what those are?

Todd 

Some of them are reformatted of current channels that were in. So in the mobile app world, we were heavily using Google UAC. But traditional non-brand and brand search through text ads were not at all a strategy for us. That unlocked in terms of the web-based strategy, a huge opportunity for consumers that we were super excited to bring into our experience – affiliates. 

Commission based affiliates was not a priority for us in the traditional mobile app world. It opened up to become a very large business for us in the web world through that web-based flow and final experience. Other channels include building a true influencer network that supports us. This was a little bit different than the mobile app space for our ability to really supersede that and drive them to our web-based funnel has proven incredibly fruitful, and especially in terms of that client telling that they really need to help better understand the education product, because it is so specialized, and it is so innately personal to them in terms of their child’s education. 

It’s not as easy sometimes as a quick download of a mobile app to start your journey. It’s part of that understanding and personalization. That’s super crucial for that as well.

Shamanth 

Of course, the added advantage also is you have complete tracking, as you expressed because users are completing both the setup and registration and also the purchase during the web flow. So you are able to see what sites they’re coming from, and you’re able to optimize in a way that you just can’t on mobile now. In addition to these channels, are you also running SKAN on mobile? 

Todd 

Yes. Mobile has not gone off our plate by any means. But it’s changed in terms of its size and complexity for us. Like I mentioned 90-95% of the mobile app is really split down the middle now 50/50 web vs. a mobile app, iOS, Android, and the bulk of that still being predominantly iOS. So it really allowed us to diversify as there are unique challenges happening in both spaces. 

With mobile app tracking and iOS 14 in the traditional world, what’s coming down the lane in terms of the cookieless world in 2024? There are challenges on both sides, but it allows us to tread a little bit easier. 

Shamanth 

Definitely helps spread out the risk and diversify it quite a bit. I would imagine your running SKAN on mobile, with Facebook be harder because you don’t have IDFA. Does Google UAC not work on mobile? Or is that sort of a way to make that work?

Todd 

It depends on the platform. So on Android, it’s working completely fine. On iOS, it’s nonexistent. Similarly on Facebook, which depends on IDFA, and SKAN to be somewhat useful. The kids’ category has been pretty hampered, at least for our mobile app, but again on the web, Facebook is still a nice channel for us to drive and see that performance. 

So it’s a balancing act between the two.

Shamanth 

So from what you’re saying, on Facebook with SKAN, it’s possible to run but not quite very well, or did I miss what you just said?

Todd 

I would say in the kids’ space, with no IDFA, it’s pretty much useless. Unless you’re trying to run a very costly cost-per-install campaign, which again, is not our business. But outside of that, it’s kind of downstream. Signals are basically non-existent, no matter how much you tried to prime the pump.

Shamanth

Are there other channels on mobile that tend to work well, other than Facebook and Google? I’m just curious because you said 50%, mobile 50%. web. iOS is a big chunk of the challenges with Facebook and Google. What other channels work and how well?

Todd

Apple Search Ads has been consistently phenomenal for us on iOS and a channel that we continue to focus on and optimize. It’s naturally not just us as you’re reading the percent of Apple search ad marketing and media adoption over the last year and a half since iOS 14 came out. It’s superseding all the other subsequent channels. 

We’ve also seen some success in terms of some DSPs that we’ve been able to really focus on, and double down on for iOS outside that’s kind of the core effect. On Android again, a much smaller part of the whole, but UAC is the large and singular channel that drives our volume.

Shamanth 

I think that’s in line with what we see on iOS generally across other apps we work with. 

I wonder if you also share some of the concerns we have, which is on Apple Search, it works well but it’s just hard to scale. With the DSPs, we just worry that the problem is they could get shut down any day  now. 

I wonder if those are concerns you guys have or how you think, how do you think about that?

Todd

Yeah, of course. Every marketer’s job is diversifying the channel mix, and if there’s no chance to diversify that, it obviously becomes a little bit cumbersome. So if iOS has to become smaller, because of any reason you’ve kind of inserted, we have the ability to scale up there, which is super important. 

The other is, depending on our business we can own and operate a few different mobile apps within the kids’ space. It is an international opportunity, especially for those that aren’t language based. The ability to focus in on key markets that we now have a really great consumer base, really good LTV, really good maps in terms of our consumer and the data that we want to go after and spending some capital there to help diversify outside of the US. 

Shamanth 

Sure. I know you described how your web funnel was architected and the different steps and components of that. I know you mentioned when we last spoke that there were a number of tests that you guys ran, can you speak to some of the tests that you guys ran to improve and optimize the funnel? 

Also please share if there were any surprising wins or surprising failures that came up during this testing process.

Todd 

Our CRO function is really a staple within our organization where we believe in the conviction of relentless testing, learning, and optimization through those tests and experiments, almost weekly in terms of learning, so the learning curve just keeps moving in terms of hypothesis and things that we really want to improve and really challenge. 

A few things that we were super surprised about were,

the more zero-party data, or first-party data as they call it these days, we can kind of gather the better. Intuitively collecting email and SMS we felt would probably be important but we certainly believed that collecting in the first step would really hurt the attrition of consumers going through the funnel. 

We found out very surprisingly that that actually was helpful, not hurtful in terms of collecting that data. That was a big unlock for us that there’s a level of trust within our consumers who are really willing to give up their email and SMS and not for any real incentive, besides just wanting to learn more about our business and dig into a little bit more.

So we were super excited that we could collect that first-party data or zero-party data early on and go through it.

It’s probably the most surprising that we had that permission with the customer, which is different businesses, that usually might not be introduced into the last step because that’s the least in terms of customer experience. 

The other one that has been a really exciting challenge and opportunity for us is how we continue to drive customers to longer-term plans, and move them away from monthly into 12-month commitments. That was a really large hypothesis that we had no idea where it would land in terms of us moving that needle and found that especially in the web flows, our abilities to really create best in breed CRO, in terms of highlighting and really promoting that monthly plan, how we set that up, how that looks and feels, those dynamics and buttons and all the other things that go along with it has been huge unlock for web as well. Being able to create more revenue and better LTV for those customers who are joining from our web experience.

Shamanth 

It’s definitely something that mirrors what I’ve seen for other subscription apps and other spaces we’ve done some work with like health and fitness apps, learning and education apps. People are willing to commit to longer-term price plans, people are willing to commit to higher price points. I think that also speaks to just the fact that the subscription space is just becoming more mature, people are more comfortable with that. I think that definitely lines up with what you just spoke about. 

Just to turn the clock back a little bit, when you and your team were thinking about going down this path of doubling down on the web-based flows, considering this as a company and I know, 90% of marketing was app based. So given that this was a completely new direction, how hard was it to get internal buy-in?

Todd 

To be honest, I understand that this kind of even supersedes a little bit of what I even started at the organization that there really wasn’t much of a challenge to it, because it had to be done right, the opportunity cost of leading vs. not moving is pretty strong in that environment. So the decision had made a ton of sense. 

The kind of KPIs that we were pulling out from just what we saw with a much lower level of spend were super enticing. I think the organization has been phenomenal in understanding what that looks like in terms of covering the 101s, web-based performance, marketing, fast page load time, and other factors. 

We got through things like, how do we really develop the baseline playbook from soup to nuts in architecture and SEO, down to page load time, to developing and building teams exclusively focused on engineering and product features for the web is a whole different language. 

That’s always evolving over the last couple of years of us trying to understand those unique kinds of capabilities. How do we resource support? I think that’s part of the fun of just this. This process is really bootstrapped in some cases, but focusing in and having so much conviction on the opportunity and really driving made a difference.

Shamanth 

Something you guys have done is grown via M&As quite a bit. How has that informed the broader strategy and planning around growth and marketing?

Todd 

Last year, we acquired three companies within a six-month period, as well as launched a partnership with a very, very well-known iconic children’s company called Sesame Street. So the opportunity now is serving kids. From 6 to 9 we went to 0-12. So we kind of have that full consumer journey of a child in terms of their formal growth process and being able to really supersede their needs based on what they’re looking for. 

The larger opportunity, which kind of goes back to a part of the opportunity that really excited us about web is, how do we really use these different properties together, how do we bundle these products together to increase the outcome that we’re providing parents during this education? 

We can provide them with a single app as an example. Or we can provide them an app for tutoring because they know that their child needs help on this specific topic. We can serve that across any of the properties. So we’ve learned things that we’ve kind of been obsessed with over the last 24 months and our execution and growth in terms of web-based marketing, as well as how we really supersize the category, the ARPU and the LTV of these customers by really superseding their needs.

Shamanth 

Yeah, I would imagine that also opens up the opportunity to cross-promote between these properties. Obviously, a lot of these audiences could be mutually exclusive but when they’re aging out of one app, I imagine that presents an opportunity to cross-promote, somewhat seamlessly,

Todd 

Cross-sells upsells, bundles, packages, all of those just add a new language for us. It’s the reason why we’re all super excited about the next 12 to 24 months with kind of the larger opportunity at hand.

Shamanth

Absolutely. And that obviously takes you guys out of just a very siloed mobile marketing world. The one thing that I am taking away from this conversation is really that, I think there’s so much value in not looking at mobile marketing as just a single silo in which we’re looking at the tech stack that is very mobile-specific. There’s huge, huge value in breaking out of that silo to really see where the users are, what’s the best way to reach them, even if that way to reach them is not device-specific.

Todd 

Literally, the number one concern that was company-wide about focusing on the web was that all these customers will come across our website, go through the funnel and decide not to purchase but just go directly to the app and purchase from there. I think that was really dissolved on day one, as we found that there is a whole different customer subset that lives out there outside of the mobile app world, at least for our product and category that’s super excited about what we have to offer, super willing to not only go through a web-based funnel and download an app but with us really create some better opportunities and how we can serve them in a larger way.

Shamanth

Yeah, and do you think that in part could be because some of the channels you guys use now are web-specific? Like you said affiliates are working, and a lot of these folks are more comfortable with it. 

I would imagine they’re more in like a research mode, rather than experimental. So you know, if you’re like, looking at a rewarded video ad for a hypercasual game, you’re in the mood to download something in the next minute and churn in the next two days. Whereas I would imagine somebody that’s coming into an affiliate site or search, it’s more than, like an information research phase. I wonder if that’s something you see, or is there something else to this? 

Todd

It depends on where they are in the funnel, I think there’s always gonna be a subset of the top-of-funnel learning and discovering research phase vs. interested in kind of looking around vs. deciding to buy. But minimally, there’s a huge group and audience of customers that we just weren’t connecting with and talking about through the channels that we currently were within the mobile app world. They’re just not connecting to them. 

We’ve found other ways to really find other customers out there and be able to bring them into our story and into our product through this. So I think it really unlocked just the eyeballs that we weren’t getting before. 

Shamanth 

Yeah, definitely. Then that also lines up with our experience with folks who have done a lot more on native ads, like Taboola & Outbrain. That definitely lines up with folks we know that have done that. It may not be right for all products. As I said, if you have a hypercasual game, it’s just not right for you. You probably shouldn’t do it like a web flow. But I think for the right kinds of products, it can be a huge, huge opportunity, as you just described and pointed out about how you guys executed.

Todd

Yeah, really great.

Shamanth 

Todd, this has been incredibly instructive, just because I think all of us are in this bit of a mess around how to figure out all things iOS just now.  I’ve certainly taken notes just because I do think this is just a huge opportunity and direction for the right kinds of products. 

This perhaps is a good place for us to wrap toward. But before we do that, can you tell us how people can find out more about you and everything you do?

Todd

The easiest way is to find me on LinkedIn, Todd Kane and you can happily see all the products that the company represents. On Twitter it’s @ToddKane

Shamanth 

Wonderful. We will link to all of that in the show notes. Now, thank you so much for being on the Mobile User Acquisition Show.

Todd

Real honor and privilege. Thank you again.

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.

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