← Sub Club by RevenueCat
Sub Club by RevenueCat
Building Trust with Users to Drive Revenue and Retention – Ryan Beck, Pray.com
00:53:52
Loading summary
Transcript141 lines
- [00:01]
A
Welcome to the Sub Club podcast, a show dedicated to the best practices for building and growing app businesses. We sit down with the entrepreneurs, investors and builders behind the most successful apps in the world to learn from their successes and failures. Sub Club is brought to you by RevenueCat. Thousands of the world's best apps trust RevenueCat to power in app purchases, manage customers and grow revenue across iOS and Android and the web. You can learn more@revenuecat.com let's get into the show. Hello, I'm your host, David Barnard, and with me today, revenuecat CEO Jacob Heiding. Our guest today is Ryan Beck, co founder and CTO@payy.com, an app with the mission to grow faith, cultivate community and leave a legacy of helping others. On the podcast, we talk with Ryan about the risk of ad creative concentration, how to reach older high value demographics, and why the ultimate KPI is still just revenue. Hey Ryan, thanks so much for joining us on the podcast today.
- [01:14]
B
Yeah, well, thank you very much, David, Jacob, for having me. I look forward to the conversation.
- [01:18]
A
And Jacob, always nice to chat with you this nice Monday morning.
- [01:22]
C
It's a beautiful day for podcasting. David, let's go. So.
- [01:26]
A
So, Ryan, I wanted to dig in first to the story of prairie.com, we don't always go into the story, but I think you've got some, like, interesting twists and turns along the way that I think the audience would be interested in hearing. So tell us about the founding of prairie.com and kind of those early years.
- [01:38]
B
The original thesis was we saw a need in the faith space for digitization. Traditionally, faith space has been laggards in technology adoption, so they've been hesitant to go on social and things like this. And we saw that coming to kind of an end where reality was going to meet dogma and reality was going to win out. What I mean by that is churches have been operating, faith organizations have been operating a certain way for millennia, quite literally. And so coming in and doing a Netflix to their blockbuster was something they resisted. And that was not something we wanted to do. We wanted to help them transition. And so that was the whole thing. So we started off with a private social network for faith organizations. And so we had some of the largest faith organizations across the country on the platform. And that went really well. We had great retention, you know, Facebook level retention. The social network was going great. In order to onboard these faith organizations, you had to go to them and you generally had to go them more than once to get to 80% penetration rate of onboarding their Organization and the problem is faith organizations, they're open generally one day a week where everyone's there and it's usually the same day. And so the salesforce needed for that.
- [02:54]
C
And I also imagine the folks you could recruit to sell this product probably are busy on that day.
- [02:59]
B
I would guess that is true. Yeah. You need a sales professional that has the faith background.
- [03:04]
C
Just an army of atheists selling your product. Probably not going to connect.
- [03:09]
B
No, they, they probably would not. They would not. And so, yeah, that was how we started.
- [03:14]
A
And then one of the things you told me while we were kind of prepping for this is that you also were worked multi den or not even multi denominational, but across all faiths. Right. So it was like Buddhists and Muslims and Christians and kind of like worked across all faiths. I imagine that was a challenge as well.
- [03:30]
B
In those early days it was interesting to work with some of the largest mosques, synagogues, temples, parishes and churches because we saw ourselves as this rather basic platform in which faith organizations could build upon. And so we didn't want, and really any nonprofit, we didn't want to be pigeonholed into one. We wanted to build a platform that was rather to use a term, agnostic to a religion coming on because we saw this space was underserved and so we actually didn't have a lot of resistance. Now all the founders were all Christian founders and so we had to come at it with a little bit of humility and as we approach some of these religions that were not ours and explain to them the heart and the thesis around it. Because they all have the same problem, no matter the religion, and they all have the same goal. Just they look at it from a different, different lens. Right. They're just trying to help their community, generally speaking, and they're trying to promote virtues and values in that community with their people.
- [04:31]
A
You launched a product, you had it like amazing retention. The main problem you talked about was kind of needing the salesforce. But what else wasn't working if you had such amazing retention and then, you know, where did you go from there?
- [04:43]
B
These organizations, they tend to be a little bit older on the demographic scale. And so virality isn't, isn't something that you're going to get with with that type of demographic like you would with maybe the high school demographic or college demographic where they're sharing their digital natives. When we're going to these organizations, we have a booth in which they're coming to us to ask us how do you download an app? Right.
- [05:06]
C
And you all were Mobile first.
- [05:08]
B
We were mobile first. We were mobile first because we thought that and rightfully so. That's just where even they were even at that time. And you can fast forward now, post pandemic. Our parents are probably texting us where they used to just call us, right? And now they're texting us. You're like, thank God they're they're actually texting us now and not just calling us all the time, you know.
- [05:28]
C
But yeah, I can imagine even, even in the past five years or so there's still trans happening, especially in those like older cohorts in terms of like behaviors. And then there's probably some cohorts that just will never make the mobile transition even for like a given computer savviness. I feel like mobile is still easier because of what you described there. At least they can bring you their computer to the booth, meeting their phone, you know what I mean? Like you can't help somebody who's like at a Dell at home. Then you're trying to figure out how to log in. But still it's gotta have a lot.
- [05:59]
A
Of challenges, you know, before we move on to kind of what you did next. I do think it's interesting because this older demographic, while, I mean especially since 2020 has kind of adopted technology a little more than they did in the past, especially on mobile, but it is still like a high paying demographic. I mean, you know, I've talked to a lot of apps where younger cohorts don't perform well. Even my own like weather app, like I look at stats and like the payers are like men over 45. And I think there's probably going to be a lot of apps where the boomer generation with trillions of wealth spend it on something.
- [06:34]
C
It might as well be apps, you know what I mean? How about that?
- [06:38]
A
Any lessons from that time period about like kind of working with those demographics and those cohorts, we may get into.
- [06:44]
B
It a little bit more. And this ties into, you know, when we started doing performance marketing and focus more on consumer subscription, we went. TV worked really well for us pre pandemic and during the pandemic because that older cohort was there and that was the medium in which they trusted for advertisement. Digital was not something they necessarily trusted as widely. Now Facebook was and still is to some extent in Facebook proper. Right. Is still king of that demographic and it does a very good job of that. But the TV platform worked really well when that audience was there. And so we were able to kind of meet that demographic where they Were at, on their technology journey. A lot of them were still on TV and radio at that time. And now they're starting to get more and more digital native and in generally it's mobile. And so yes, that demographic, it pays higher. The higher LTVs. There's a little more difficulty in getting them to conversion though. And so, you know, it can balance out for us. It worked out better. That demographic generally is, I hire ltv. They align more. And just if you think about our own life journeys, we, we start thinking about faith and religion generally later on in life when families come into play and you're thinking about how do I raise my kid, where do I settle down? You're starting to think about those things that religion generally talks about, those value based kind of foundations that you want maybe to instill your kids. They may not be religion, but for.
- [08:10]
C
A lot of people it is jumping ahead. Right. Because at some point y' all decided to not focus on like a social network aspect anymore. Right. Like what led up into that decision? Like what were the inputs that, that made y' all decide? Like, okay, we need a different, a.
- [08:25]
B
Different tack is really the growth. So retention was great, but you know, when we modeled out the growth, it wasn't fast enough. And we're a venture capital backed company and so, you know, speed is, velocity is very important to us. And so we, we were always looking for ways in which we can speed up our growth rate. And so we started doing the. From our social network. We found these daily prayers were very helpful. These pastors would send out messages to their audience, text messages to, to their audience, and people would resonate with them.
- [08:56]
C
Was this an emergent behavior that that was happening on your network or was this something you all built into like a feature like daily notifications or.
- [09:04]
B
It was both. So it was emergent in that we, these were just normal social posts that you would see on a Facebook group.
- [09:11]
C
So it wasn't like a daily prayer feature, but it was something that people were, were doing.
- [09:15]
B
Yeah, but we tied in text messages. That was kind of the thing because people really wanted to gravitate towards these. And so we, we found that they were operating a little bit different than social posts and that people really engaged with these. What we found was there's an analog into this in the physical world in which they're kind of these little quote cards, but they're faith quotes. And that's basically what these masters were giving. And what we added on the capability, they could record an audio or a video clip. And so what you are finding is they would do these social posts with a little bit of a devotional behind the quote. And so that's what's led to our daily, our morning, noon and nightly prayers, which is kind of a main feature of our app. If you go and you see it, you'll see and that's what transitioned us into this content where we're like, well, we can make these devotionals. And we created those devotionals in 2019. They worked really well, had great engagement. And then that's what led us into our entry into subscriptions because we started doing more long form.
- [10:14]
C
Are you still maintaining the social product? Is it still part of it?
- [10:18]
B
Yes, and it's tucked away because there are some people that still use it and it's going to be revitalized here in some fashion, but it will not look the same as like a Facebook group, most likely. But it's tucked away. It's hard to get to.
- [10:31]
C
Yeah, it's tough when you, when you have, you have products that are like used but maybe don't fit your business need and like how to responsibly like pivot away and like, you know, take care of all stakeholders and everything, especially when they're stakeholders, you know, care about in the sense of like their perception of your brand and whatnot. Right. There's still potential future customers. So it's really interesting that I thought you were going to say a digital analog of prayer chains. Is this a thing? This is a thing. I'm in rural Ohio. We used to have like a phone chain that you know, you sometimes they used to have this for school before, like one to many communication. Right. The school was. Something was going on. You'd have a, you call this person, then you call the next person. But that was like all the parishes around here would have like prayer chains. Like we needed to hit the phones if there's something going on. I thought that's what it was gonna be about, but I imagine people probably use it for that, that kind of thing too.
- [11:17]
B
Yeah, we built a feature that you were able to build these chains. It was kind of like we, we took from Twitter and our ex. Now that kind of. You can add these, these threads onto your posts that had context and you could say oh yes, it was answered or hey, we're still need, you know, here's an update so people can update it, they can answer it. So yeah, there's a lot of analog in the physical world that we're able to just pretty seamlessly transition to the digital world. That's why we started with like, hey, there's a lot of practices that we do physically that can go into the digital world very seamlessly. You just got to get people over to that digital world.
- [11:52]
A
Let's keep talking through this pivot of the app, but through the lens of monetization. So were you monetizing the app before this transition to subscriptions? Like, did you have ads in the app or was it zero monetization? And you're like, okay, we have something here and we're going to transition to subscriptions to actually monetize it. Or we already monetizing.
- [12:10]
B
We were monetizing through donations. We weren't monetizing. The organizations on our platform were monetizing. And we had.
- [12:16]
A
You were facilitating donations, right?
- [12:19]
B
Yeah, we were facilitating them. And so there were some transaction volume and it was significant. It was in the millions. So it was. It was good. And it was in 2019, when we added the revenue, the monetization on our side, where we started collecting a subscription fee.
- [12:34]
A
So how did you determine in those early days? I mean, it sounds like this key feature, these like daily prayer things were the kind of main monetizable feature. What was that, like, process of deciding what to monetize? What did you monetize and how did things go?
- [12:47]
B
You know, for us, there's clear paths. Some of the giant CSS companies of the pre pandemic era of like the comms and headspace, they had gone down that path. It was more secular, right? So they had calm, had figured out sleep content. And so for us, there was a lot of similarities that we could do, but more on the faith perspective rather than the secular perspective. And so we just tested out, you know, we saw what was working for other people. I'm a big fan of imitate, iterate and innovate. And I would rather imitate to start because innovation is hard, right? You don't know how it's going to perform until it goes live. But imitation, you can set benchmarks. And so we were able to roll out bedtime Bible stories, sleep psalms, and some of these contents that were. People were finding traction to already. And then meditative prayers and things like that that had analogs to what people were already consuming in the secular space. So that that made it easy. And we just iterated. I mean, it was constant tests. We redid our whole product platform to allow for testing of onboarding flows, paywalls, and having that from the server side so that we didn't have to deploy new apps every time we wanted to test something. And so we were able to run rapid iterations on our tests. And that's really what helped us figure out that what could monetize and what couldn't monetize and then how far we could take that monetization.
- [14:08]
A
I think a lot of apps, especially apps that are free, are very nervous to monetize and then those that are already monetizing are nervous to mess with the monetization of like putting different features behind paywalls, adding new features that are paid versus free. Don't want to kill the golden goose. That was like driving the retention you were talking about like Facebook, like retention. Any kind of lessons from some of those early iterations on like how the, the community responded to monetization, you know, how you introduced it and how you iterated on that to get to where you are today.
- [14:43]
B
It was, you know, being very data driven. So, you know, there's data informed and that seems to be the pinnacle. I'm, I'm very much a student of data driven product development. So looking at the data, seeing how people are responding and that data is sometimes quantitative and sometimes qualitative. So customer feedback, you're looking at how many reports you're getting on certain things and you're listening to your customers and you're listening to the data. You're listening to the customers through the data, their interactions. And so we let that be the guide and we set up KPIs, right? So you have average revenue per user, their retention and these are things that are trade offs, right? You can model these out. You can figure out if I have my retention is accident goes down by 10%, what does that do to my long tail revenue? Right? You can model these things out. And so you just have to have a robust understanding of the data and how the KPIs you want to look at in a consumer impact, that revenue and ultimately you want to be do what's best for the customer because that's how you're going to monetize. But then you have to make sure that you can sustain a business or a for profit business. Right?
- [15:50]
C
Yeah. I was going to say I think taking on venture capital is a good way to not worry about charging for things. You know what I mean, David? I think this is usually the indie developers who feel like there's no need for a return and all of this is, you know, free. That's like, oh, I can't charge. But you know, when you got a.
- [16:05]
A
But did you see any specific or do you have any specific examples that come to mind of qualitative pushback of like, oh, they shouldn't. Because I think I forget if it was pray.com or some other religious based app I had talked to or looked at at some point that got pushback that like this is faith, it's church, it should be free. Like it's, you know, greed is, is bad and like monetization is evil. Like was there qualitative feedback on that kind of stuff as you did start to push toward monetization?
- [16:35]
B
There's some you can, you know, that's probably all of our negative reviews is.
- [16:40]
C
You get big enough there, you can find a hater for every topic.
- [16:42]
B
Yeah. And it's not for everybody and we respect that. That's why we have a free version that people can enjoy and they don't have to pay. And so it's a balance when you're running a business between making sure that the customers, because the customer is who you're building for the value you're trying to deliver, you want to listen to them. And there is going to be a segment of those especially probably more so in the faith space that expect things to be free because that's kind of how the model has worked previously. And so it's a balance. And yes, we do get it. And we, you know, we try to, we respond to every customer feedback. Anytime someone writes in, we respond. We'll get feedback that says doubt anybody's going to respond to this and just charge and trying to make money. And we'll respond and hawk it on a call. My, my business partner Steve, who's the CEO, he'll get on a call and then we have a great customer support person who runs that, Earl who there is not one report that comes in positive or negative, that is not getting a person responding. And so that's how we've handled it. And it's labor intensive but that was something we decided from the very beginning and that's how we've handled the objections to make sure that we hear them and we respect them because they do come in and more so in the faith space.
- [17:56]
C
I mean it's a lot of these things are a fine line even outside of the face space. Like you just gotta use your judgment. I think people, and just in general people over rotate on negative comments more than they they do on positive. And I think that's what throws a lot of developers for a loop. There was a crazy Reddit thread I got find it this weekend about developer who got one his first negative review for charging money and was like ready to like Take down the paywall and everything. I just think. No, no, no, it's fine. This is. It's working as expected. It's working as expected.
- [18:24]
A
If nobody complains about your price, you're not charging enough. So if people are complaining about having to pay, you're doing the right thing because it's a signal that they want it. So, like you're building something valuable. It's like a positive signal of value creation.
- [18:37]
C
Yeah. Nobody complains about products they don't care about. Right. That's also a truth.
- [18:41]
A
And nobody complains about a price of something that they don't want. Like, if trash is sitting on the ground, you're not complaining. It costs something. It's like they actually want it, which is a good signal.
- [18:52]
C
But that's what I mean. You go back to data driven, right? That's what indicators, like retention indicators, like conversion rate indicators, like ltv, arpu, you can just like turn the dials and if you can see what the alchemy does, right. Like what the other numbers go up and down and you can kind of understand. I think it's just really hard to. Not really hard, but I do think it takes some wisdom and sort of like a steady hand to be able to also integrate that qualitative feedback. You know what I mean? Those like individuals, right. It's easy to look at a conversion rate and say like, oh, well, you know, 80% of the people didn't buy. It's harder to like talk to one of those 80% of people who thinks you're like a ripping them off. You know what I mean? So being able to handle both of those is tricky, but it's important, especially in consumer where you have to really synthesize, like qualitative and quantitative.
- [19:37]
B
Yeah, there's lots of data, lots of input.
- [19:39]
A
And speaking of that, having to synthesize. But I'll ask a question. Any top lessons from that time of a win or a fail? So like one kind of like test you did on the monetization that was just like doubled revenue or something crazy like that. And then on the contrary, any, like, change you tried to make, like, massively impacted retention in a way you're like, revert, revert, revert. Any, any of those kind of wins or fails that you can think of that you want to share?
- [20:05]
B
I mean, there's a few and there's some that early on in the social network, it was phone, email, name. Right. You're going into these communities, we want to make sure you're a real person. And we had the phone in there and consumer subscription, we do now, we found ways to work with it, but that phone number was not working with consumer subscription and it was tough to get it back in there.
- [20:29]
A
You mean requesting the phone number would cause such high drop off in it caused such high churn that you couldn't then monetize. So by removing the requirement of a phone, you would then monetize better.
- [20:41]
B
Correct, Correct. So you know that onboarding experience, just like when you're onboarding new employees to your company or into your product, that customer onboarding is the most important part of the customer journey. And so really, really honing in that placement of the paywall, making sure that it, you know, you could put it up front, you can put it as the first thing and you may get some, that initial conversion may go up, but then that long tail, that ltv. And so you just have to understand those further down those long tail metrics. And so I think another thing, when we were running lots and lots of paid advertisements, some of the failings on paid advertisement is not having a diversity of creative. So we had Meta going. It was tens of thousands of dollars a day and most of it was behind one creative. It was performing really great and it had five stars in the description and Meta approved it. They said, looks good. But then Meta decided, you know what, not good. And they took it down on a dime and it totally went upside down. Our cacs went upside. Our customer acquisition costs were untenable. And so we had to bring down those campaigns, retool it, figure it out and then bring them back up. And this was part of that Q5, you know, post Christmas to end of January when everything is really great for CSS companies.
- [22:10]
C
Yes. Consumer subscription holidays, you know, like. Yeah. So you mean like diversity, just like having more creative content on advertising than you need, Right?
- [22:19]
B
Yeah. So just like if you're an investor and you have an investment portfolio, you don't want 80% of your investments tied up in one creative. You want it to be. Maybe if it's an Nvidia, you got 30% max. Right. But if you do anything more than that, you, you run a little bit of a risk. And so you want to. Your creative diversification is very important. And so that's something that was a, that was a hard lesson learned because it costs lots of money.
- [22:44]
C
How do you do creative? Do you have that all in house or do you work with agencies or what's your process?
- [22:49]
B
We've done both. Now we work with a great agency, they run it and we've developed kind of a playbook prior to working with them that we, we like to run. And so we are probably one of their most aggressive clients when it comes to creative testing. And they work with some really big names. Some of the names that are part of the that GP bullhound chart. Right. So we just run a very aggressive creative testing. There's really nothing that within limits, obviously there's constraints, but there's. We'll try pretty much anything. We look across industries. We aren't looking at oh, how does media companies. We're looking at gaming, we're looking at dating all these different apps. How what are they running to find that inspiration because of going back to the kind of the triple I framework that imitate, iterate, innovate. And so we're running our. We're doing diversification across that that generally leads us to a well diversified creative mix that's helping us scale our campaigns.
- [23:44]
C
I'm sure there's interesting inside the Facebook's black box of optimization. I'm sure there's really interesting emergent phenomenon when you're trying to traverse like a demographic that's usually unstated or like Facebook doesn't have a necessarily. No, but they probably kind of do know, you know what I mean? Because they should probably target based on. But they also need to, you know, known Christians or known people who would resonate with your content but then they also to grow the tam they probably should be. It might be the case that the Facebook algorithm is the greatest evangelist in the world in terms of like net net evangelism. You know what I mean? Do you think about that? Do you consider yourself to selling to folks who are already within the faith and like strengthening their faith or do you think about like expanding beyond, you know, maybe folks who aren't like actively involved in the faith.
- [24:31]
B
I wouldn't speak for meta to, you know, determine if they're the greatest evangelist, but their algorithm is very good. It's still the best in the market for applications, mobile applications. And the way we approach that is that we kind of let meta do its thing and they're pretty good. And we find a breadth, right from people who are curious to people who are strong and you know, going to their faith organization on a weekly basis. So it's the whole gamut and Facebook figures it out.
- [25:03]
C
Yeah, I'm sure. How do you think about those different customer profiles on the like content side and like product side? Do you think about like folks who are maybe. I mean there's probably many dimensions that you can cut up that content on. Right. Depending on denominations or not and things like this. I imagine it's kind of an interesting puzzle as well.
- [25:21]
B
I think that pre IDFA there's a little more controls that were helpful. I personally haven't seen post IDFA where those controls have been a net benefit over time. Maybe. And to make sure I understood your question, how I'm interpreting this, sometimes you can get fine grained with your audience matching and I find that pre ID fate there, it was a little bit better.
- [25:44]
C
I'm wondering just like from, you know, you get somebody in net from wherever, right. Like how do you think about what kind of content is within the app? You know, depending on those different profiles of like, you know, the curious all the way to the like super strong in their faith and then, and then across also like the different denominations and styles of things. It's got to be an interesting problem to determine like where you focus your investment, right?
- [26:08]
A
Yeah. Like I mean on onboarding are you asking people like you know, do you attend regularly and then do you show different content and different experiences based on some of that kind of data? The questions that you ask.
- [26:19]
B
One of the strategies that has worked well is some sort of light or heavy kind of quiz funnel in your onboarding to help understand what's that weight loss app that really put you? No. And that puts you through the ringer. You know, it's like a multi day onboarding event.
- [26:35]
C
You know, gotta book it, you've gotta get it on your calendar, take some pto.
- [26:40]
B
Yeah. They really, you know, showcased how you can, you can utilize these quizzes to optimize the user experience post onboarding to make it feel more for them. And I would say we're light in our journey there but there's things that we do to make sure that we're, we're helping guide them in their, in their faith journey. Because all these things, all these indicators, right. They could be used for kind of nefarious or malicious purposes, but you can also use these things to help people in their healthy habits. And that's where we focus on is helping people with healthy habits. Just like noom, right. They want to take in that information so that they can help you in your weight loss journey and help you become healthier.
- [27:18]
C
People won't pay you for reinforcing bad habits. I mean they will but like not forever, right? And you want those long term customers, that's where the money is.
- [27:26]
B
So we really focus on developing those, getting those questions answered in onboarding to help us facilitate that mental and spiritual health track that they want to go on.
- [27:35]
A
We've been talking about meta. Are you experimenting with TikTok and Snap and all sorts of other, even Taboola. Those kind of ads seem to maybe perform well for your demographic. Yeah. Any other kind of channels that you're experimenting with or seeing success with?
- [27:50]
B
We experiment with most of the channels, but we always come back to kind of meta. I think post IDFA for mobile applications. They're the ones that seem to be ahead of the curve as, as far as figuring it out and how to handle this app tracking and deliver the right ads to the right people so that the people on their platform can resonate with it and find value in that product. And so they, they seem to be ahead of the curve. And we're on alpha, you know, Google platforms and, and TikTok and things like that. But we find that the consistency is with the meta platform. That's the. Just where they have a wide array of products that you can market on and advertise on and reach a wide demographic to help them in their faith journey better than some of the other platforms.
- [28:36]
C
Do you find within Meta, do you focus on like more Instagram? Because I like Facebook itself has reels within it as well and I don't know if they like actually separate the two anymore. Do you have a sense of like which specific apps in their platform are resonating the best or is it kind of all over the place?
- [28:53]
B
Yeah, I would say that early on it used to be mostly Facebook. We would talk to the meta rep and early on pre IDFA, like call it 2020, 2019, that we would run a lot of images and it would be on Facebook. They would resonate really well, like in feed ads basically. Yeah. And they were like, now everyone's moving to video and these videos there are a lot more to.
- [29:16]
C
To make but a hundred times the cost of production, right?
- [29:19]
B
Yeah, but they weren't really resonating and maybe it was on us in its transition. Now video is kind of more the dominant form.
- [29:26]
C
Yeah. They've also raised the prevalence of video and short re. Short form video in every app. I complain about this. Every app has reels now. Like every app like Gmail is going to have reels soon. Like, but I guess it's also helpful because you probably have one, you know, focus on short form video, creative and then you can deploy that across a bunch of different platforms.
- [29:44]
B
Yeah. And when, when TikTok kind of became a mainstay application. I'm a big fan of Meta's Quarterly earnings. So we'll, we're listening to those and.
- [29:52]
C
Probably providing a lot of them.
- [29:55]
B
And so I was just like, hey, we need to. We started investing in the reels early on and, and now that's where it predominantly is. And it's spread across the, the application verse for meta. And I wouldn't say Facebook is, you know, by far the, the leader anymore. And I think that it's been five years. Ish, you know, four or five years. And you're getting new people. And we had a kind of an accelerated tech adoption cycle with the pandemic that moved people across platforms and made people more comfortable. Our parents are now scanning QR codes. They weren't doing that. And so, you know, they became mobile capable now. And so you're seeing different demographics shift across these applications.
- [30:36]
A
Earlier you mentioned TV and radio. I wanted to dig in that a little bit. And one of the things you said, and maybe we can talk about these things in parallel, but I'd never thought about trust before in ads. And the way you said it was that, you know, that older generation trusts TV ads. Like if it's on tv, it's true kind of mentality, which is unfortunately led many astray. I think how does trust play into that and like creating ads on platforms that people trust and in ways that people trust. But then what does the TV strategy look like now when maybe that's not as big of a deal for folks?
- [31:12]
B
As seen on TV is a real thing, right? As seen on Instagram is not a real thing. And so that trust element is there with TV. You may have an influence on Instagram and YouTube that you're like, oh, Mr. Beast promotes this or so. And so I have no idea what Mr. Beast promotes, but he is the first influencer that came to mind. And so I think what you find is the influencer has the weight of the medium before it. So TV was the medium and that had a lot of weight. So if people saw it, they thought this is legit. Why? Because the barrier to entry was higher. Five bucks gets me on Instagram, my advertisement. Right. Five bucks does not get me on tv. And so, you know, that's one of the things that you, you find your, your strategy is a lot different. It's more akin to betting rather than investments. Where I feel like digital performance marketing on digital is more to investment strategy.
- [32:05]
C
It's like betting, but you also don't know if you won until your tax season next year.
- [32:08]
B
Right.
- [32:09]
C
Because like, like, how do you find out? Like, you bet on a big Ad on CNN or something like this. Do you even try to like do some attribution there? Do you find it useful or do you just go like we know this kind of has to kind of work.
- [32:19]
B
Oh no, we, we are in the data, data driven to the core. I mean we are looking at by minute, we're looking at real time feeds when we run it. We have a great brand with pre.com that resonates very well.
- [32:32]
C
This is technical question but like who you work with like a platform for TV ad buys and they actually give you by the minute when ads are running.
- [32:40]
B
Yes, and they would help us with that media mix modeling but it would just be for broadcast and then we'd have our performance marketing so you have to blend it. So from the very beginning we've been doing media mix modeling and so we've been comfortable kind of flying with statistical models rather than you know, very deterministic models of performance marketing which is I.
- [33:00]
C
Think is the evolution of versus maybe five or six years ago I think with the ATT made this more important. It's just like there always was uncertainty. I just think people didn't want to admit there was. Now we just accept that there's uncertainty. Right. And you just roll with it. It's really interesting. I see anecdotally like when I'm sitting at my parents house and they've got Fox News on or something like this or whatever. I see so many consumer subscribers, subscription ads for apps I've never like even heard of. It's crazy actually I wonder in some cases it might erode that perceived trust, you know and over time like it's no longer like breaking between Walter Conkite, you know to sell you Colgate like feels like it's a little bit more accessible. So I wonder if that that's going to change. The same is for terrestrial radio too. I hear so often I hear Babel and Noom and like so many like terrestrial radio buys and I mean you probably know this but like I've heard it's depending on how you target can be cheaper than you think. Especially probably at your scale. You know you're spending five figures on Facebook a day. It's like probably not that crazy.
- [33:56]
B
Yeah, I think that TV radio are different today than they were. Not to make this a political thing but during the Trump Trump administration TV was, was at its height, you know, it was, it was doing really well.
- [34:09]
A
Yeah. Whether Fox News or CNN or msnbc, everybody's just glued to the.
- [34:14]
C
You mean for effectiveness even I guess cost probably Went up along with that too. Right.
- [34:18]
B
I think it was. The ratios were good if you had a good brand, which we do. So it worked. It resonated well. We worked with some of the biggest TV buying agencies and they were blown away by the effectiveness of, of our advertisements that we can actually get what's unique.
- [34:33]
C
It's like you don't see an app. It's like the juxtaposition of two things like technology and faith, which I mean exists, but it's like somewhat novel. Right. The combination of those things. So it doesn't surprise me. At least be intriguing compared to your 20th fitness app or like whatever. Right. It's like something somewhat new. So it's pretty interesting.
- [34:50]
B
Yeah. And the creatives were a little bit different, but they weren't too much. I mean, we had James Earl Jones reads the Bible and so that helps with creatives. But we ran other ones that didn't, didn't have James Earl Jones that our content team put together some bangers and so they were able to perform really well and set us up for understanding the media mix models. But TV buying, radio buying, totally different animal. You're making big bets on prime times and, and these kind of earlier shows. And then you have to have a 50% strategy covering 50% of your spend that's very well spread out across many channels, time slots so that you can have some consistencies because a Tuesday prime time one week may just be the best thing you've ever seen and maybe the worst thing you've ever seen the next week. So it's, it's very volatile and you just have to understand that volatility and bring some, some calmness to that. That turbulence.
- [35:43]
C
Yeah. I was, I was gonna ask, like, how does your team divide your focus between like customer engagement, product development. Right. Like actually on what you build versus like, you know, your internal optimization around paywalls and stuff like that versus, like feels like this whole performance marketing and advertising and acquisition, that's probably like a whole technology stack. Right. Like, how do you like as leadership team or whatever, however you think about, you know, your. What your pie of corporate focus, like how do you break it down? Like how much resourcing and thought goes into the different sort of categories of work.
- [36:15]
B
The tech product is the most central and we know that it's extremely important for the, you know, I oversee the technology and the product now and then. I work very closely on the day to day for performance marketing. And we've hired a VP of marketing. He ran all of our lifecycle and Retention marketing. And then now he's taking over that performance marketing. So I'm handing him over the reins and he's been doing a great job.
- [36:39]
C
So that was like kind of the performance marketing was closely related to the technical side of the business.
- [36:43]
B
Yeah. So it was just all under one roof when we started. And so that made it easy because I had a lot of empathy with the marketers because I was the marketer. And so I was like, hey tech team. And I'm running the TikTok. I'm like, hey guys, I'm. I get it, I get it. It's, you know, we're getting another request and it's coming at you, you know, and you got to get it done yesterday. So it created a lot of empathy where I was able to have a different perspective than probably most engineers that I got to feel the pain of needs from the marketing team where a lot of times when it's divided and so really it was one cohesive whole and then we still operate, even though I'm more of a, of a partner transitioning it over, but it's still built into our DNA so we're closely aligned on that. And so really it's, we don't really divide it up, but we know that there's a priority. Hey, if the tech product is not working correctly, if not sending the right signals, if it doesn't have the right flows, if something, you know, we're watching each step of the flow. If something's broken there, the whole thing collapses. Vice versa, if something on the, on the marketing side, if a creative goes sideways or gets dropped out of the list or something happens over there, if a change happens in Facebook platform and, or YouTube or whatever and one of the signals goes down, they have to adjust and then we, you know, we have to work in tandem. So it's a very unified front and we don't really divide it up like a normal organization.
- [38:06]
A
I feel like that's one of the biggest things we've seen talking to larger customers who are considering migrating to revenue cat like existing apps that are large and want to use Revenue cat is there's often a dysfunction between marketing and engineering where the marketing team is like fighting for resources. They're not tightly integrated.
- [38:28]
C
And similarly, like often a very successful apps performance rolled up to like a CTO or like a very technical or they built it into as part of the machine. This was a realization sort of mid cycle or mid into this journey for me. I talked to, I think it was somebody from Blinkist actually and like how they did, you know, because they were very successful early on on this. And you know, it all ran up to their cto, right? And he was, you know, he integrated like all this stuff and made sure it all ran. And then you were saying, Ryan, just like elevating the urgency of those requests to engineers because like they don't always understand. And also I find too on marketing, sometimes marketers will totally hamstrung by something which to an engineer is trivial, right? It's like, and you just like, if you can connect that and like clear that barrier, like suddenly you can unlock a lot. But I think businesses like yours, it's not app and then layer marketing on it, right? Like the whole machine is like one big product, right? It's one big business. Which I don't know if everybody's figured that out yet.
- [39:26]
A
And we talked to Jason van der Merva on the podcast two years ago now and he was head of growth engineering and it sounds like that's what you've built. And maybe that's like a big takeaway for a lot of organizations who have dysfunction between marketing and engineering is like, you need to like rethink how these teams work together. Because when you can pair growth and engineering together to be more effective, it's going to be way more effective.
- [39:53]
C
Do you have the engineers like dedicated to growth and performance marketing stuff?
- [39:57]
B
We actually don't, we don't have engineers dedicated towards it.
- [40:01]
A
It's more of everybody's a growth engineer, right?
- [40:04]
C
I mean, at a venture backed startup. But yes, David, that's kind of true.
- [40:09]
B
It's one roadmap. So we don't have different roadmaps. I think that's one of the key, key things that I learned is don't have different roadmaps. Make sure that your product roadmap is taking into account the whole organization and making sure that everyone's getting visibility into that and understanding the priority and priority shifts and then modeling out the ramifications of if we delay this, this is what we can expect. And so giving people more that I'm not the, you know, I wouldn't say I'm perfect on this, but that's the ideal state of we do have one roadmap. It's a living roadmap. It's constantly changing and it's based on different stakeholders so that everyone's aware of what's coming. And so that, you know, I think that's how we've solved it. Rather than saying, okay, there's going to be a team dedicated to this because when you're small and scrappy, and I still consider us small and scrappy, we run a lean team is when there's some engineers over there that seem like they have a little bit of downtime and you, you have a, hey, come over here.
- [41:07]
C
You end up in this like interlocking resource strains constraints where like one team will have a little bit extra resources and then. But there's team with a need. We're at this stage now where we have like multiple engineering teams and growing. And I think one of the things that's made it somewhat more successful is basically us having to go and do this. Being my CTO and I like reprioritizations, like, and just moving people around constantly to like. Cause yeah, you lack that visibility and stuff. But you know, I don't think anybody's got it figured out. I love the one roadmap thing. I don't know, I'm trying to get to zero roadmaps. I don't want any roadmaps. Just ask me what's our roadmap. It's whatever we're working on right now. Everything else is just ideas.
- [41:46]
B
Hot take. All right, no roadmaps.
- [41:50]
C
There's just today. We have to live in the moment.
- [41:52]
A
Ryan, you know, one tiny little example from what you were just talking about that I just experienced like last week in my little indie app, my little weather app. I've known for like 18 months that our onboarding sucks, but I wanted to focus on the product and so I kind of ignored the onboarding and I like just put together like what I thought was like the most simple onboarding that my cousin who's doing development could possibly do. And so for like 18 months it's been like eating away at me, like, we gotta fix the onboarding, we gotta fix. But I never talked to him about it. And so just last week I finally like had the conversation like, and like laid out the whole thing of like, okay, we have a hard paywall. Onboarding is everything. And like, we need to start running some cycles on onboarding. Here's like the expectations I see. Like, if we improve onboarding, I think we can improve conversion by X ray. And I had this whole like 40 minute conversation and lots of back and forth and just having that conversation on that level to like get on the same team that, hey, we actually need to spend some cycles on. This was a huge unlock for us as like a little two person team. I can't imagine like as a bigger organization that is facing a lot of this dysfunction. Even if you can't necessarily combine all the teams and create a growth engineer or whatever. It's just like break down those communication barriers between growth and engineering so that you're all on that same team and understand where those roadblocks are.
- [43:14]
C
I try to break down the barriers, David, just nobody wants to hear it when they actually know what I think. That's the problem. They don't want to know. You don't want to know what the roadmap looks like. It's crazy in there.
- [43:25]
B
Yeah. One question would be how do you think about the product roadmap? And so we have a SaaS portion and a consumer portion you can kind of look at as a two sided marketplace like an Etsy or something where we connect people and pastors. And I find that in consumer subscription world, in a direct to consumer application, the roadmap can be a little more fuzzy than a SaaS. And so in the SaaS world there's a lot more modeling, there's a lot more math towards features because you understand like, hey, if we roll out this product we can have a net revenue retention increase because we can now upsell for this and we think there's going to be a 3% adoption rate. You can do that a little bit in consumer, but when I've Talked to other D2C companies, I find that that's less prevalent than the SaaS world. So how do you, I guess a question for you. How do you think about it at revenue cat about your roadmap and modeling?
- [44:17]
C
Yeah, I mean I think that really depends on how you're pricing. Which is the reason it doesn't work in consumer as well is because like some SaaS can do really nice a la carte pricing where you're like, okay, you want feature X is our core feature and then you want feature Y. Okay, we'll just add on, you know, another charge per seat or whatever to your contract. And so you can very easily go, okay, we think 20% of our customers will use this. It's $10,000 a year. Bang. Like that's our value. And there is pretty nice. And also usually that's coupled with a like pretty understood B2B Salesforce where you're like I know how to get these folks to convert to this. And you can incentivize people to do that too. It's like, hey, sell this new $10,000 widget add on. And I think you'd be surprised. Like I would love to know at like a sales. Salesforce maybe is like the extreme example. But like I say Mid to late stage, mid cap SaaS companies, I would bet the majority of their Salesforce is not like selling Salesforce, it's selling cross whatever, right? It's all about just expanding. It's has nothing to do now revenue Cat we actually our specific case is different because, because the way we price is like mostly based on volume. So it's like a little bit harder because it's like well we, we price on volume for everything else. So it's like you add in a new thing and it just for us it ends up getting kind of baked out in like how much pressure we get. We can, you know, in like a contract negotiation or whatever if we're adding in features and things like that. But it's a little bit less a la carte. I need a mixed media modeling model for it, right. I just know if I build a more useful product like people will pay for it more, pay more for it. And then I just figure that like a little bit of horse trading will find the right price. So I don't benefit from that modeling. So I don't have a roadmap. Why I'm just like well just build whatever. But to that point too like sometimes you'll have like key customers that will be like we need X. We will literally sign a contract for Y if you guys build X today. And like okay, now we have a roadmap like this, this is getting built right now because it's going to like it's a burden of hand. But yeah, I just feel like generally and I think, I don't know if this is true out if this is like a B2B thing. I think it's kind of true for all businesses. It's kind of. Actually I think the philosophical underpinnings of media mix modeling is just that there's so much, so many inputs to these systems and like so many uncertainties that I think if you try to overly simplify and be like oh this leverage moves this number and if you like over focus on that stuff, I think you can end up driving to like really odd conclusions. There's probably some relationship right between lever A and output B. But if you're not considering everything else, I find this too with like, I think you see this a lot in like funnel funnel optimization, right? It's like okay, you move your paywall from the beginning to the end. Like you were saying, yeah, you'll change or from the end to the beginning you'll change your conversion rate. But you're going to, it's going to have other effects. Right. And which may or may not be localized to that change, which then makes it hard to manage and measure. So you have to make sure you're meas multiple data points. And then I still think there's like, I don't know, this might be just personal. I feel like there's still room for craft. Right. There's still room for like gut feel and being like meh, I think this feels better and like we should do this. But as much as I'm, I look at dashboards all day, I'm very data driven. But you know, I don't know. If we don't have, if we don't have some human magic going into product creation, the AIs are just going to replace us. And wouldn't that be terrible?
- [47:22]
B
Well, yeah, depends what magic is. You know, we might find out that our magic wasn't as magical as we thought.
- [47:30]
C
Isn't that magic after all? Nope. Nope. As soon as you have a roadmap, you're replaceable. So like no roadmap can be replaced by AI.
- [47:37]
A
How do you manage the B2C roadmap, Ryan? I think a lot of people would be curious about that at your stage and given all that we've discussed.
- [47:44]
C
You mean like feature specifically David, or like just B2?
- [47:47]
A
Cuz we kind of like did this chase a Rabbit on the B2B side. But most of our listeners are B2 so I wanted to kind of bring it back to like what do you do on the B2C side that maybe folks listening can learn from?
- [47:59]
B
When it comes to the B2C side, I really think of subscription is is kind of your core for your, your monetization. But my general thoughts are post IDFA subscription is not enough. I think Duolingo is a perfect case study of subscription plus ads. They also have some other monetization. It's less so but they do have some other monetization paths and they have one time. So they have ads subs and then one time upsell.
- [48:26]
C
So there's multi time upsells. Right. Like it's consumable. Like they can, you can buy like yeah non recurring but like you can consume many like gem refills or whatever.
- [48:36]
B
Yeah. And so you can start looking at them with some of the, the lens that's been applied to consumer subscriptions lately which Is with some SaaS metrics. And so I think that I look at across those three lenses. One subscription is going to be my core. Ads is my secondary and then one time purchases or upsells is Another avenue in which I have to figure out how can I monetize across my user base. So then I generally start with revenue as my North Star, since I think that's the best metric for a company. Just revenue same.
- [49:06]
C
We agree on that, Ryan.
- [49:07]
B
Yeah, it's in the name. It's in the name. And so I think that we start there and we figure out how can we add value since we have both sides of the marketplace along those lines for our consumer. So they're going to give us money, what value do they get in exchange? And then how can we make sure that that money coming to us is shared with that money in the form of value shared with our pastors and our leaders? And so that's how we look at our B2C application is across those three revenue lines, revenue being the North Star. And then what features can we add that increase? Each one of those subscriptions is kind of tried and true. And there's a lot of tactics around that. Ads. That's tried and true. A lot of tactics. One time is where you have to get a little bit creative for your space. For us, it's a lot different than maybe a duolingo or something like that.
- [50:00]
C
My church used to have the little candles they charge you a quarter to light. So maybe that could work.
- [50:04]
B
Yeah, yeah. Books, right. So all these things.
- [50:08]
C
Yeah, yeah. One time. Content. Right, right. Sorry. I've had to hold back. I had a lot of zingers in this one, but I just tried to try to. I don't know where the line is.
- [50:15]
B
You know what? I'm flexible. I'm flexible. I did train to become a pastor, so there's going to be a lot of judgment if you.
- [50:21]
C
Okay. I imagine David had a question on here. Just like culture. I do imagine you kind of have to be. Take it pretty lightly to like run a tech company in this space. And everybody's got to be very like open minded and very chill about this.
- [50:33]
B
I like to say that we took a, for the, the people, people that come from a religious background. We took a Solomon approach to things. Solomon in the Old Testament built a temple, a temple to God. Right. But he got the best, got the best artisans from around the area. And it didn't matter which religion they came from, it was just the best and they had to be able to apply their best. And so that's how we, we do think about it. We are very much missional. And so even if you don't come from a Christian background, which is the content that's on our Platform, you have to be empathetic towards that space and you have to be aligned with wanting to create value. So there's very much a missional component, but we don't have like this strict restriction. Sales is a little bit different because you're interfacing with these religious organizations. So you have to have this trust in there. And generally people are going to trust when it comes to religion, people of their same kind. But we don't have any strict things. It's more strict religious. We're not a religious organization. We don't have like a doctrine of faith. And so we just look for people that just want to do good in the world, want to see kind of values communities created. And so that's how we. We filter.
- [51:42]
C
At some point in time, I think maybe it became a misunderstood that, that you should join a company when you don't believe in the mission because it's a good check or whatever. Right. That's actually a benefit to you because, like, I think that mission is so specific and charged in some way. Right. Or just like very clear. And I think asking that very directly is probably somewhat easy. Right? In your. Not easy, but nobody's getting into day one on prey.com being like, you do what? You know what I mean? Like, everybody kind of understands what they're getting into and why, which is nice. It's nice to have those selectors, those filters that happen naturally, right?
- [52:16]
B
Yep. Yep. That is true. No one's surprised.
- [52:21]
A
Should that be a screening question? Do you believe in consumer subscription apps? Do you pray to the God of David?
- [52:27]
C
What do you think my founder interview is for? We probably should put it earlier in the process. Right? I was like, do you believe we're in the techno, the techno capital singularity and you want to accelerate what? No. Okay. No, it doesn't get that weird.
- [52:39]
B
I do have Ray Kurzweil's book up here, his latest one. So, you know, I'm all in.
- [52:43]
C
You wouldn't look at me funny. I actually literally don't ask that, but, like, maybe I should.
- [52:47]
A
Well, Ryan, this has been a ton of fun. We do need to wrap up. But as we do wrap up, was there anything you want to share? We're going to share links to, of course, pray.com, it's in the name. Pray.com. you can go check out the app, see what they're working on.
- [52:58]
C
Such a good brand. That's a. I don't want to ask how much that.com cost you, but it was probably worth it.
- [53:02]
B
Expensive and fair.
- [53:04]
A
And we'll link to your personal LinkedIn, which I think is really cool too. The Name of your LinkedIn is purpose, so you must have been like really early on LinkedIn to be able to get the title instead of like your your name. So your like handle on LinkedIn is purpose. We'll share that and a link to the app as well. But anything else you wanted to share as we're wrapping up?
- [53:20]
B
No, just thank you for having me. This has been a great conversation, longtime listener and Jacob's blushing and but this is one of the most valuable podcasts in the consumer, probably the most in the CSS space. So I really appreciate it. Thanks for having me.
- [53:35]
A
Thanks so much for listening. If you have a minute, please leave a review and your favorite podcast player. You can also stop by chat.subclub.com to join our private community.