Tinder · B2C · dating app
Price the 7-day feature pass the same as a 7-day subscription, shown side by side
Less cannibalization and more revenue, but still not good enough
What they did
What happened
In their words
Dynamic Paywalls That Drove Millions in New Revenue – Shawn Gong, Tinder
Shawn Gong… we price too low, it's too affordable and then so it's like no-brainer, so user use it. The second thing we do is like, oh, we should increase the price for a la carte and to see how that will change the conversion and then subscription cannibalization. So we definitely noticed that the subscription cannibalization reduced as we expected, and then the conversion reduced a little bit, but total revenue actually went up. So that was very positive.
Shawn GongAnd then we continue to test because we wanted to minimize the subscription cannibalizations. And then we increase the price again and then also have upsell on the paywall. Basically we show, hey, David, you can buy Passport, standalone a la carte, but also you can buy Plus subscription. And then we use a very interesting kind of psychology thing. Basically for our seven-day Passport feature a la carte, the price is the same as seven day Plus subscription.
Shawn GongSo that case, David, you think like, oh, duh, then the seven-day plus subscription is a better deal. I can get it more than this feature. So that also helped. Of course, it means reduce the cannibalization, also increase the conversion revenue, but it's still not good enough. So we decide, hey, let's use our perfect ML model again, so we will show users subscription first. If you don't want to buy subscription, we show you a la carte, so we'll give you a second chance.
David BarnardI love hearing these kind of stories because I just think Tinder's been around so long and so many of us in the industry look up to it as a pioneer in monetization in apps, and I just think so many apps are leaving money on the table by not experimenting with these kind of things and not trying all the different... Three tiers. And like we said, it can lead to confusion. It's not the right thing for every app, but there's just so much opportunity …
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More from this episode
- Use a prediction model to show each user just the one plan they'll likely buyEstimated multimillion-dollar yearly revenue gain in an A/B test
- Sell the travel feature on its own for 1 day, 3 days or a weekConversion jumped, but it pulled buyers away from the cheapest subscription
- Raise the price of the standalone feature so it stops stealing subscriptionsFewer lost subscriptions, slightly lower conversion, higher total revenue
- Offer the subscription first; show the one-off purchase only to people who say no
- Add an even pricier top tier for the biggest spendersDidn't fit a mass-market brand; being scaled down
Tags: a-la-carte, price-anchoring, decoy-pricing, cannibalization