Sub Club Podcast: Optimizing Trial-to-Paid Conversions — Rachel Chukura, The Weather Company

0:00hello I'm your host David Bernard today's conversation is shorter than usual and will be featured in Revenue cat state of subscription apps report each episode in this series will explore one crucial metric and share actionable insights from Top subscription app operators with me today Rachel chakura head of consumer product at the weather company on the podcast I talk with Rachel about how to optimize paid conversion the impact of external factors on AB testing and why increasing sub subscribers probably shouldn't be your top priority hey Rachel thanks so much for joining me on the podcast today thank you so much for having me I'm excited to have the conversation so

0:39we're talking state of subscription apps and one of the key metrics a lot of people look at in the report to kind of determine how their business is is shaping up compared to others is the trial conversion races like converting from a free trial converting from App open to paid and then ultimately that's also converting from free premium to pay and so that's what I wanted to kind of focus on today was optimizing and like strategy for how to think about those things and the weather channel app is interesting because you have both a very generous pre tier which does kind of make it more challenging to push that

1:15subscription as opposed to kind of hard pay walls or kind of apps that are more aggressive or have fewer features but they also have a free trial for the premium features so it's kind of an interesting model so let's just start with that aspect of like balancing free and having a free trial even for a Premium app yeah absolutely so as you pointed out our app is very generous from an ad supported free experience and that's because we've always seen ourselves really as a utility whether is in some ways a commodity that exists throughout the ecosystem and so as we look at the landscape we know that

1:52there's a level of importance of having a certain amount of information that is just readily available for those core user needs but what we have identified is that there are users and specific cohorts within our business that are willing to pay and so we have over the past four or five years established a really strong premium experience in which we're able to really play into the user need of specific cohorts and in our case it really is that weather Enthusiast that is a power user wants access to more data more sophisticated radar experience and that has allowed us to at least Drive the initial growth of

2:32the business there's still a lot of value that core users are getting from us and so as we look to unlock the next phase of growth we are looking at what is available overall and how do we better balance the gate that exists within the product to get users into that funnel I think that's a really great frame of reference to start thinking about subscriber conversion in that so many apps are so focused on getting that subscriber that they're not seeing the forest for the trees of there being so many cohorts that would be casual users that they could still monetize via ads and maybe nurture over

3:09time to become a subscriber and so it's interesting on the fact that as a business the weather channel has chosen to give away more value for free and then understanding who very specifically is the cohort that is willing to pay more and then monetizing those better like what's the process for a better understanding who those people are are and then better targeting them so you can keep those free users but then still have this like extra value you layer on we do a lot of research we know a lot about our users and about our business and the industry so everything that we do and construct in a subscription

3:47product and a core product is centered around those core jobs to be done of our users and that comes through research it also comes through analytics we take all the data that we know about a user and create cohort and segmentation that allows us to better super serve those users with the data and the information and the features that they care most about and are willing to pay for so in this model it's been really wonderful to be able to look at what our power users care about because a lot of those weather enthusiasts are power users for us and so they spend almost every day

4:25multiple times a day in the product they've been with us through the legacy of our brand and so there's a lot that we can lean into there but what's going to be really important for the next phase of growth because the subscription industry at at large is going through an evolution right now as are we is to find that next segment that we can lean into build features for and move past just core weather data as a value behind the pay wall into the what's next that's additive to that user experience in finding those new segments and unlocking those new opportunities what are the tools or what's the process

5:01you're using to discover those things we do interviews with our users we do broad surveys to understand user need and behaviors we look at product analytics we look at subscription analytics through things like Revenue cat that enable us to identify those new opportunities so what it allows us to do is look at the behaviors themselves look at what users are saying are the behaviors or the needs that they have and really matching that up to what they're doing when they are in the product to make sure that those things align because not always do user need that is verbally communicated actually match the behavior that you see in the

5:42product and then looking at really where those drop off points are all the way from acquisition throughout the experience throughout the subscription life cycle that we can better serve them and lean into those moments that matter so are you starting to segment and build up kind of an understanding of an individual user and then hitting them with a a more specific and targeted pay wall or pointing them to specific areas of the product that you know is then going to help nudge them towards conversion absolutely on both fronts so we have historically been a very Anonymous based site we get a lot of traffic through the Google searches and

6:20going back to kind of how we perceived ourselves as a utility brand really didn't require our user to have a significant value exchange with us for a long time such as providing an email address so that we know who you are and what you care about as that begins to evolve then we're able to lean into improved targeting and understanding how best to package the subscription product how best to actually Elevate features within the experience itself that is most relevant and attractive to you to encourage that buying Behavior we do use AI propensity models and things like our weather targeting that really enable us to be more sophisticated in our

7:04marketing without even having to consider as much the user side of things but we can take the context because weather is such a contextual signal that adds value to the acquisition and the conversion of that user into being a subscriber what do you mean by propensity models I don't know that our audience will all be familiar with that we use data science to actually determine who is most likely to subscribe or take an action within our product so it takes a lot of the data signals based on what you're doing in the product what we know about you and it merges those things together to give

7:40us a signal as to whether or not you are likely or unlikely to subscribe so many apps are getting better and more sophisticated at this as kind of the tooling the industry and other things have progressed and then as you know Ai and machine learning and these models have gotten better they can be such a powerful tool when used well to drive those outcomes for the audience it is really important to continue to evaluate and improve and refine those models because I have also seen the other end of the Spectrum in which we have created a model and we believe it works very well but if not tuned and properly

8:18managed things change right economics change competition changes and so you really need to look at the effectiveness of your models if that is something that you are deploying in building those propensity models and thinking about converting folks from the premium experience to the paid experience so many big consumer apps pushing to convert more of those free users to paid there's maybe a bit of over monetization that we've maybe gotten a little too aggressive at times about hard pay walls and and using every nudge tactic in the Playbook how do you think about balancing the subscriber conversion and monetization against kind of the customer experience of it all so the way

8:57we look at it is that it is all centered around the customer we don't lead with the monetization to us that is an outcome or an output of us really doing a good job with creating a performant and useful experience for our users we lean heavily into research to understand our users and their needs so that when we think about how best to grow our subscription product we do so within the context of what a user really is looking to achieve when they visit the weather app or weather.com and how do we lean into that behavior and that need in order to have a very clear value

9:38exchange and to surface the subscription at a moment that really matters and so thinking about that customer journey is essential I'll give you an example one of the things that works really well for us is our radar experience so leaning into that Persona that we are hypers serving they like to look at data and make their own conclusions about the data and so that is why we've leaned heavily into things like access to more data like the hourly details or even more radar information and so what we have found is that by really giving context and creating these moments of delight and access points that really

10:24start to drive demand are just hard to refute because they're core to the experience they the user themselves they are finding value and finding a need that it allows us to better balance user experience and monetization we do know that if we tip that pendulum too far in One Direction it doesn't work well for us and it doesn't work well for a lot of Brands and they you know it really is about finding that right balance in the tearing strategy yeah and you know for for some apps they're going to choose it and this is what's interesting about having this conversation in the context of the state of subscription apps report

11:01is that when you look at the benchmarks it's going across the entire industry and so some apps do choose to monetize more heavily and but then you just you understand the trade-offs and I I think it's really interesting how you're framing these trade-offs because you do value those freemium users more than a lot of apps do and then as a company your roots are in monetizing those free users as well so like The Weather Channel been ad supported for decades and the app itself I believe it just introduced subscriptions in the last like two years so I think it's interesting to hear you kind of talk

11:38through these things in that broader context is that so many apps make so many different kinds of choices but this is like a great way to build a really big business is that you really take care of your customers and you deliver a lot of value to those free users and then you build on top of that value to then charge and you find great ways to monetize those for users so that there is like you keep saying a value exchange so as you're thinking through all of these things do you have any kind of specific advice for folks to take away of like in your day-to-day what are you

12:11doing how are you thinking you know what are the Tactical things you're doing to help make these decisions and to guide the business so our big Focus right now is data and experimentation so really creating a lot more rigor in how do we test and learn whether it's the change in a color of a button or a the length of our trial for example those are things that are really essential in kind of growth hacking the conversion rate and acquisition of new subscribers and so we've been able to improve our data position we've put a lot of work into that to unlock our ability to be a little bit more Nimble

12:57and more data driven in the execution of our acquisition strategy so that's where we're focused right now and so we are constantly re-evaluating full endtoend experience and how do we just continue to elevate that make it more performant make it really a positive experience for our users so that they continue to pay use and see value in the exchange that we have with them you mentioned testing there what are your thoughts on like how to best execute testing so that you come to the right conclusions from the test you run cuz I mean running something you mentioned you know even testing button colors which at the scale of the weather

13:41channel is where you can actually start to see some wins but you can also easily fool yourself if you don't have it set up so how do you think about kind of being rigorous in your testing yeah I think having a clear hypothesis to start is really important as well as welldefined key results so what are you trying to achieve what kpi are you looking to move the needle on and I think one of the things that we have found as a business because as you mentioned we do have the ability to scale experiments pretty quickly and so while we can reach stat Sig on an

14:17experiment within 24 hours in some cases we do recognize that buying behavior is often influenced by many other variables out outside of very specific colors and text right purchase Behavior could be everything from what is the weather outside what is my need right in that moment that's going to drive the purchase behavior and so we recognize that and we know that we have to run experiments for long enough to be able to because it impacts our business see what happens in certain weather conditions to see what happens with all these variables in mind to really make sure that what we are seeing out of that experiment is true and something that we

15:04can believe and move forward yeah that's a great way to think about it and I I had even thought about how much not even just with the weather app but but even for straa or other apps you know if a straa runs a test on a Wednesday that's probably going to get way different results than they did it on a Saturday because more people are out biking and hiking and doing the things it that yeah it's something that we live and breathe because in the weather business we often use that as one of our privacy forward signals because weather is actually a really strong predictor in a user action

15:43it's funny we just recently went through a lot of marketing research and one of the things that came up is that weather is an original influencer because it is an influencer of users behavior and so we know that very well and one thing that we con L remind ourselves is we have to do what we know works and what we understand about user Behavior user psychology and things like weather's influence on that and so we really do try to take that into account as we make these decisions run the tests and put new products in Market awesome well Rachel it has been so much fun chatting

16:19through all of this with you so many great insights for folks to take away as we wrap up is there anything you wanted to share we're going to share some links in the show notes but anything you wanted to say as we wrap up I just will say the subscription business the subscription industry at large is undergoing yet another change and I think it's really important for all of us as peers anybody who is in that part of the business to lean on each other because we are all going through very similar things and while our industry is may be different the experiences that we're having with driving growth in a

16:53subscription business is the same and we should be able to create moments to lean on each other and share notes because it'll make us all more effective as well in the end awesome well thanks for doing exactly that today by sharing what you're learning at The Weather Channel yeah thank you for having me thanks so much for listening if you have a minute please leave a review in your favorite podcast player you can also stop by chat. sub club.com to join our private community