Send the device's QR code to an Apple in-app purchase instead of a web checkout

David BarnardAnd that was something I was going to ask about too is that I know a lot of hardware enabled subscriptions don't charge via in-app purchase because there aren't required to. So, I have an Oura Ring and some of these others I've talked about are apps. The Fi Collar is an app that you can't subscribe within the app. Was that a conscious choice? Did Apple ask you to do that or why do you have it in-app purchase?

Mark UngererI believe, Michael, you can correct me if I'm wrong because this predates me, but I believe Apple asked us to do that even though we had the hardware. And obviously, things have changed with what Apple's requires now, so we could move outside of Apple. But in the tests that we've run and we've only done really one good one, it pays for itself. So, I've been a little bit dragging my feet, if I'm honest, over that being this big juicy pot of... Because it's like a fraction of our customers are subscribing on Apple, because we have the direct channel, and then of that it's 30%, and in year two it's 15% and some percent will not subscribe. And so, it seems like this juicy pot of money that for me at least in the test we've done, has paid itself off in an increased conversion through reduced friction.

Michael SegalYeah. I think that's the money quote. It's reduced friction. In a world where they were equally easy, then, of course, there's no incentive. But I don't think they're yet equally easy. There's still some extra clicks and some extra UI weirdness if you're going to take them to your website. So, it's the same reason we're in retail. It would be much easier to just be direct to consumer. Retailers are hard, demanding, but if you want to be... And by …

Michael SegalIt has to be the plus subscription, going from 39 to 79, with minimal loss of retention or attach. I mean the ARR curve, you can see it. It just was transformative to the business. Mark led the entirety of that start to finish. To me, I mean there's many, many wins, but even it's coincidental that we're on a subscription podcast. I would've said it even if we weren't on a subscription podcast, that was huge, huge win.

Mark UngererI'll throw in dollars much less, but in percents a big win, was changing our checkout flow back to the Apple thing. We used to have on our device, if somebody was not subscribing and they scanned a QR code, it would lead to a web-based checkout. We flipped that to Apple and we saw over 100% increase in conversion. Now, the number of people that were doing that was smaller. So, again, it wasn't like the two X factor of the price that affected everybody. But just reducing that friction of Mom pulls out her phone, scans a QR code, bang, she's subscribed, over 100% lift from a change in a QR code.

David BarnardWow. Yeah. That's great. So, what was the biggest fail of the year? The experiment that went off the rails, the product change that pissed a lot of people off. What was the biggest fail of the last year and what'd you learn from it?