User acquisition for subscription apps is a crucial factor in driving long-term growth and profitability. Unlike one-time purchase apps, subscription-based models rely on a steady influx of paying users to sustain revenue. Effective acquisition strategies go beyond increasing downloads, they focus on attracting high-value users, encouraging conversions, and maximizing retention.
In this article we will explore the key aspects of user acquisition for subscription apps, including their benefits, challenges, the most common subscription models and user acquisition strategies. Moreover, you will discover how Mapendo can help refine your user acquisition strategy to attract the right audience and retain high-LTV users for your subscription app.
- What are Subscription Apps
- What is User Acquisition for Subscription Apps
- Benefits and Challenges
- User Acquisition Strategies for Subscription Apps
- User Acquisition for Subscription Apps: a Mapendo Success Story
- Conclusion
Many apps adopt a subscription-based model, allowing users to access premium features and exclusive content through recurring payments. Subscription plans vary, with monthly, annually, or even weekly and quarterly charges.
For example, streaming and entertainment apps, dating apps, and photo-editing apps rely on subscriptions, giving users access to exclusive content and premium features that are not available in free versions.
Users can manage their subscriptions, choosing to modify, renew, or cancel at the end of the subscribed period. In some cases, subscriptions renew automatically, ensuring uninterrupted access unless the user unsubscribes.
The most common subscription models are:
- Flat-rate subscription: this model charges a fixed price for full access to all features and services provided by the app. Users pay the same amount on a recurring basis, making billing simple and predictable.
- Tiered subscription: the app offers different plans with different prices and features, allowing users to choose the option that best suits their needs. This model is a great option for apps with many features and a diverse user base, where higher tiers provide extra benefits.
- Usage-based subscription: the price depends on how much the app is actually used. Users pay according to the number of resources or services they consume, making this model flexible and cost-effective for those with different usage habits.
- Per-added subscription: the app provides a basic package, and users can purchase extra modules and features. In this way, users can personalize their experience and pay only for what they actually need.
- Per-user subscription: the cost is determined by the number of users accessing the app and it is particularly effective for collaboration apps or platforms that facilitate teamwork. As more people use the app, the price increases accordingly, ensuring a fair pricing system.
Effective user acquisition for subscription apps goes beyond simply increasing downloads, it focuses on reaching the right audience, encouraging meaningful interactions, and ultimately converting users into paying subscribers.
Since subscription apps generate revenue through recurring payments, their financial success depends on a steady influx of premium users. Bringing in new users not only increases revenue but also strengthens the app’s reputation since engaged users contribute to a thriving community, enhancing credibility and attracting even more subscribers.
User acquisition for subscription apps helps optimize engagement and increases retention rates, ensuring sustainable revenue growth. By targeting specific audiences, apps can maximize their chances of acquiring high-value subscribers. Additionally, tracking user acquisition campaigns provides valuable insights into user preferences and helps refine strategies to improve conversion rates.
User acquisition for subscription apps offer a number of benefits and challenges that must be carefully considered.
Benefits:
- Recurring revenue: with recurring payments, subscription apps can more accurately predict monthly and annual revenues, facilitating financial planning and sustainable growth.
- Higher user retention: the subscription model helps build long-term relationships with users. By consistently providing value, loyalty is strengthened, and the risk of churn is reduced.
- Lifetime value: instead of a single payment, revenue accumulates over time, increasing the total value of each user and improving growth potential.
- Upselling opportunities: offering plans with advanced features encourages users to upgrade to higher tiers, leading to higher revenue.
- Combination of subscriptions and ads: subscription apps can mix subscriptions and ads, offering a cheaper option for users willing to watch ads.
Challenges:
- Over-saturation: with so many subscription apps available, users are becoming more selective and often cancel subscriptions they do not find essential, leading to higher churn rates.
- Constant updating of content: users expect regular updates and new content. If the app does not evolve, they may lose interest and unsubscribe.
- Management of trial periods and onboarding: convincing users to subscribe is not easy. It is important to showcase the app’s value during the trial period and provide an effective onboarding experience.
- The first 30 days matter: many users cancel their subscription within the first month if they do not see enough value. Making a strong impression from the beginning is crucial for long-term retention.
Effective user acquisition for subscription apps is essential for their success. Here are five key strategies to attract and retain subscribers:
- Create flexible pricing plans: offering multiple subscription tiers allows users to choose the option that best fits their needs and budgets. Moreover, providing discounts for long-term commitments not only increases revenue but it also encourages users’ loyalty by making the subscription more appealing.
- Leverage free trials to showcase value: a well-structured free trial gives potential subscriber firsthand experience with premium content and features. Allowing users to explore the full potential of the app before committing can increase the chances of conversion, thereby enhancing user acquisition for subscription apps.
- Keep users engaged to minimize churn: consistently updating your app with new content and new features keeps users interested and reduces cancellations. Personalized recommendations and notifications tailored to individual preferences can further enhance user engagement. By improving user acquisition for subscription apps, it is possible to foster long-term relationships and reduce churn rates.
- Optimize the onboarding experience: the way users are introduced to your app plays a crucial role in user acquisition for subscription apps. If your app requires upfront payment, be sure to prove its value before encouraging users to subscribe. On the other hand, if you offer a free version with paid upgrades, guide users through the core features, ensuring that the switching to a paid plan feels natural.
- Track Free Trial: subscription apps usually offer a free trial of 3 to 7 days. Monitoring the free trial and install-to-free trial rate can provide valuable insights into user quality. Moreover, unlike subscriptions, which often have delays of 3-7 days after installation, free trials are faster to optimize in real-time.
- Track performance: regularly analyzing key metrics like conversion rates and acquisition costs helps refine user acquisition for subscription apps. This analysis can provide deeper insights into user behavior, allowing you to adjust your free trial duration or pricing strategies based on how quickly users convert.
User acquisition for subscription apps is a challenge since growth depends not only on installs but on converting users into paying subscribers. Sociaaal, a tech company developing non-gaming GenAI mobile apps for Gen Z, partnered with Mapendo to refine its user acquisition strategy and acquire high-LTV users for its subscription app, Litstick.
With monetization based on in-app purchases and subscriptions, unlocked after a free trial, Sociaaal needed a partner in order to optimize campaigns toward post-install engagement and maximize ROAS. By running CPI campaigns through Mapendo’s ML-powered platform and leveraging Adjust integration, Sociaaal was able to track and optimize key in-app events like free trials and subscriptions.
Thanks to granular optimization and contextual targeting, install-to-trial and trial-to-subscription rates saw immediate improvements in acquiring high-LTV users. Moreover, the introduction of CTV performance-based campaigns further accelerated growth, leading to a spike in new users while maintaining a stable and profitable subscription rate and ROAS.
Litstick has achieved significant results as it reached a steady trial-to-subscription rate of more than 20% and CTV campaigns exceeded expectations driving a 3X increase in new users in just one month.
- Subscription apps provide access to premium content and features through recurring payments, offering a sustainable monetization model over time.
- User acquisition for subscription apps is the process of attracting and converting users into paying subscribers, ensuring a steady flow of revenue and app growth.
- User acquisition for subscription apps presents both benefits and challenges, such as predictable revenue and higher retention, but also higher churn rates and the need for constant content updates.
- Key user acquisition strategies for subscription apps include offering flexible pricing plans, leveraging free trials, engaging users to minimize churn, and optimizing the onboarding process to improve conversion rates.
- By leveraging Mapendo’s user acquisition strategies, Sociaaal achieved significant results for its subscription app Litstick.
