How’s Your App Really Doing? The State of Subscription Apps 2023

On the podcast we talk about RevenueCat’s State of Subscription Apps report, all the nuance that didn’t make it into the report, and why your app landing in the bottom quartile of some metrics might not be as bad as it seems.

Top Takeaways
🤔 Understand your own business model and unique leverage
📈 Consider the stage of your app when looking at benchmarks
🖐️ 5 key insights: conversions, renewals, retention and more

Links & Resources
‣ The report: State of Subscription Apps 2023
‣ Give us your feedback
‣ One year retention rate insights
‣ Join the RevenueCat team
‣ Follow RevenueCat on Linkedin
‣ Follow RevenueCat on Twitter

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‣ David Barnard
‣ Jacob Eiting
‣ RevenueCat
‣ Sub Club

Episode Highlights

[2:33] The why: RevenueCat is uniquely positioned to measure the data set released in the State of Subscription Apps 2023 report. (By the way, if you don’t want your data set featured in the report, just let us know.)
[7:18] The how: Anonymized data from $4 billion in tracked revenue across 22,000 apps is a lot to dig into. But it’s important to take it all in context for your own app’s situation.
[13:15] The what: Be sure to understand your own business model and the unique leverage you have. Price is a factor in retention.
[18:50] The flipside: Big acquisition costs and ad spend means you need to ideally be in the top quartile to get the right returns.
[23:12] Drawn and quartered: Why the report uses the upper, middle, median, and lower quartiles is important.
[32:43] Key results: David and Jacob go deep on each of the report’s top 5 takeaways.
[40:22] Calculating value: Understanding lifetime value (LTV) isn’t easy. You have to be careful not to fall into the naive developer trap. The good news is that predictive LTV is on RevenueCat’s roadmap.
[44:53] Retention: Weekly subscriptions have a 73% retention rate by week two, which drops to 3% by the end of the first year. But while monthly subscription starts lower at 64%, it comparatively only drops to 11%. Survival analysis: The longer you stay subscribed, the more likely you are to continue subscribing.
[49:16] Annual vs. monthly: Why is annual better than monthly? The answer might not be so obvious. (Hint: product quality.)
[55:14] The magic of subscriptions: If users are more likely to stick around the longer they stick around, minimal churn on annual subscriptions means more money (for free!) next year.
[1:00:21] Trials and tribulations: What percentage of apps have a trial strategy? Perhaps surprisingly, a lot don’t have one at all
[01:08:03] Trial duration: David dives into the trial-to-paid conversion rate. The results were counterintuitive.