Skylight · B2C · digital family calendars and frames
Knock money off the device when people buy it with the subscription
Much higher subscription attach on the own website than on Amazon or in stores; no numbers
What they did
What happened
In their words
How Skylight Balances Growth and Profit for Sustainable Success – Michael Segal & Mark Ungerer, Skylight
Mark Ungerer… are not thinking about. But we have our own website where we sell the product and we directly control the relationship with the customer. We sell through Amazon, and we sell through retailers, and we do the same thing internationally. And so, I think the strategy to be everywhere, that has been very successful for us. But it comes with real complexities and trade-offs, and we could probably do a whole podcast just on how to be multi-channel.
Mark UngererThe point I would make here for subscription focused audiences, in our owned channel on myskylight.com, we have a much higher attach rate to the subscription because we can turn the subscription on automatically. And we actually, pro-tip here, we give a discount on the hardware if you sign up with the subscription, and that is a super successful way to get subscribers, because it seems like a great deal. Wait, I get a free month, and I pay less today, and I'm getting the full access and I can choose to opt out? Most people don't. We can't do that on Amazon. We can't do that in a retailer. And so, those channels behave differently for the subscription.
Michael SegalAnd bringing it back to the other point, as retail becomes heavier and heavier in our mix, that puts enormous pressure on us to be able to prove to our customers downstream of purchase. That there's all this, hey, you're not just here for a calendar, that part's free. You're here for the full family operating experience. The problem is when people are setting this thing up, there's laser focused on getting it up on the wall as a calendar. It's …
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More from this episode
- Raise the yearly plan from $39 to $79, not the $99 tests favoredMinimal loss of subscribers or retention; ARR curve 'transformative'; no exact numbers
- Keep old customers on the old price, and honor it for anyone who asksGave up an estimated couple million dollars for goodwill; no measured effect
- Send the device's QR code to an Apple in-app purchase instead of a web checkoutOver 100% more conversions, on a small slice of users
- Test a free trial, with and without asking for a credit cardNo extra subscribers; trial takers were people who'd have subscribed anyway
- Make every first purchase cover what you paid to get the customerEvery order in company history paid back on day zero; grew without VC money
- Borrow from risk-tolerant lenders at 15-20% to buy holiday inventory, not raise VCStayed bootstrapped and profitable; paid 15-20% a year at times
- Keep what people bought the device for free; charge for new add-ons like meal planningPhotos-on-calendar paywall 'just worked' for years; now some customers want it free
- Don't mark which features are premium once someone has subscribedRenewal rates high even for light users of paid features; no numbers
- Survey customers on whether the product is life-changing, and build to raise that shareAbout 20% say life-changing today; goal is 50%
- Push marketing spend on a new calendar product before the product was goodDidn't work; nearly killed the product; took off only after product fixes in fall 2022
- Sell the device everywhere: your own site, Amazon, Costco and Best BuyCalled very successful; retail acts as a quality stamp, but lowers subscription attach
- Change how you show what's in the subscription bundleRarely moved the share of buyers who subscribe
Tags: web, hardware-bundle, discount, opt-out, attach-rate, free-month