Building Trust with Users to Drive Revenue and Retention – Ryan Beck, Pray.com

David Barnard:

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, Android, and the web. You can learn more at revenuecat.com. Let's get into the show.

Hello, I'm your host, David Barnard, and with me today RevenueCat CEO, Jacob Eiting. Our guest today is Ryan Beck, co-founder and CTO at Pray.com, an app with the mission to grow faith, cultivate community, and leave a legacy of helping others. On the podcast we talked 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.

Ryan Beck:

Yeah, well, thank you very much, David, Jacob for having me. I look forward to the conversation.

David Barnard:

And Jacob, always nice to chat with you this nice Monday morning.

Jacob Eiting:

It's a beautiful day for podcasting, David. Let's go.

David Barnard:

Ryan, I wanted to dig in first to the story of Pray.com. We don't always go into the story, but I think you've got some interesting twists and turns along the way that I think the audience would be interested in hearing. Tell us about the founding of Pray.com and those early years.

Ryan Beck:

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 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. 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, 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 to them more than once to get to 80% penetration rate of onboarding their organization. And the problem is, faith organization, they're open generally one day a week where everyone's there, and it's usually the same day, and so the sales force needed for that.

Jacob Eiting:

And I also imagine the folks you could recruit to sell this product probably are busy on that day, I would guess.

Ryan Beck:

That is true. Yeah, you need a sales professional that has the faith background.

Jacob Eiting:

Just an army of atheists selling your product probably not going to connect.

Ryan Beck:

No, they probably would not, they would not. And so yeah, that was how we started.

David Barnard:

And then one of the things you told me while we were prepping for this is that you also worked multi-denominational, or not even multi-denominational but across all faiths, right? So, it was like Buddhists and Muslims and Christians and worked across all faiths. I imagine that was a challenge as well in those early days.

Ryan Beck:

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 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 their religion, and they all have the same goal, just they look at it from a different lens. 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.

David Barnard:

You launched a product, you had amazing retention. The main problem you talked about was kind of needing the sales force, but what else wasn't working if you had such amazing retention, and then, where did you go from there?

Ryan Beck:

These organizations, they tend to be a little bit older on the demographic scale, and so virality 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?"

Jacob Eiting:

And you all are mobile first?

Ryan Beck:

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 and now they're texting us, you're like, "Thank God, they're actually texting us now and not just calling us all the time."

Jacob Eiting:

But yeah, I can imagine even in the past five years or so, there's still transition happening, especially in those older cohorts in terms of behaviors. And then there's probably some cohorts that just will never make the mobile transition. Even for 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? You can't help somebody who's got a Dell at home, then you're trying to figure how to log in, but still it's got to have a lot of challenges.

David Barnard:

Before we move on to kind what you did next, I do think it's interesting, because this older demographic, well, I mean, especially since 2020 has adopted technology a little more than they did in the past, especially on mobile, but it is still a high paying demographic. I mean, I've talked to a lot of apps where younger cohorts don't perform well. Even my own weather app, I look at stats and the payers are men over 45, and I think there's probably going to be a lot of apps where the boomer generation with trillions of wealth.

Jacob Eiting:

I spent it on something, it might as well be apps. You know what I mean? How about that?

David Barnard:

Any lessons from that time period about working with those demographics and those cohorts?

Ryan Beck:

We may get into it a little bit more and this ties into when we started doing performance marketing and focused more consumer subscription, 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, and 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 generally it's mobile. And so yes, that demographic pays higher, the higher LTVs, there's a little more difficulty in getting them to conversion though, and so it can balance out. For us, it worked out better. That demographic generally is a higher LTV, they align more. And just if you think about our own life journeys, we start thinking about faith and religion generally later on in life when families come into play and they'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 in your kids. They may not be religion, but for a lot of people it is.

Jacob Eiting:

Jumping ahead, because at some point y'all decided to not focus on a social network aspect anymore. What led up into that decision? What were the inputs that made y'all decide, "Okay, we need a different tack."

Ryan Beck:

Is really the growth. Retention was great, but when we modeled out the growth, it wasn't fast enough. And we're a venture capital backed company, and so velocity is very important to us. And so we're always looking for ways in which we can speed up our growth rate. And so, we started doing, from our social network we found these daily prayers were very helpful. These pastors would send out messages to their audience, text messages to their audience, and people would resonate with them.

Jacob Eiting:

Was this an emergent behavior that was happening on your network, or was this something you all built into a feature, like daily notifications, or ...

Ryan Beck:

It was both, so it was emergent in that these were just normal social posts that you would see on a Facebook group.

Jacob Eiting:

So, it wasn't like a daily prayer feature, but it was something that people were doing?

Ryan Beck:

But we tied in text messages. That was kind of the thing, because people really wanted to gravitate towards these, and so 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 to 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 pastors 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 led to our daily, our morning noon and nightly prayers, which is 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 subscription, because we started doing more long form.

Jacob Eiting:

Are you still maintaining the social product? Is it still part of it?

Ryan Beck:

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 a Facebook group most likely, but it's tucked away. It's hard to get to.

Jacob Eiting:

Yeah, it's tough when you have products that are used but maybe don't fit your business need and how to responsibly pivot away and take care of all stakeholders and everything, especially when they're stakeholders you care about in the sense of their perception of your brand and whatnot. There's still potential future customers, so it's really interesting. I thought you were going to say a digital analog of prayer chains. Is this a thing? This is a thing, I mean, in rural Ohio we used to have a phone chain that sometimes they used to have this for school before one to many communication. The school is something was going on, you call this person, then you call the next person, but that was all the parishes around here would have prayer chains. We needed to hit the phones if there's something going on. I thought that's what it was going to be about, but I imagine people probably use it for that kind of thing too.

Ryan Beck:

Yeah, we built a feature that you were able to build these chains. It was kind of like we took from Twitter, or X now, that kind of you can add these threads onto your posts that had context and you could say, "Oh yes, it was answered. Or hey, we're still, 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, and you just got to get people over to that digital world."

David Barnard:

Let's keep talking through this pivot of the app, but through the lens of monetization. Were you monetizing the app before this transition to subscriptions? 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 were we already monetizing?

Ryan Beck:

We were monetizing through donations. We weren't monetizing. The organizations on our platform were monetizing, and we had-

David Barnard:

You were facilitating donations, right?

Ryan Beck:

Yeah, we were facilitating them. And so there was some transaction volume and it was significant. It was in the million, so 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.

David Barnard:

How did you determine in those early days ... I mean, it sounds like this key feature, these daily prayer things were the kind of main monetizable feature. What was that process of deciding what to monetize? What did you monetize and how did things go?

Ryan Beck:

For us, there's clear paths. Some of the giant CSS companies of the pre-pandemic era of the Comms and Headspace, they had gone down that path. It was more secular, so they had, Comms 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, 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. 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 stores, sleep songs, and some of these contents that 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.

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.

David Barnard:

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 putting different features behind paywalls, adding new features that are paid versus free, don't want to kill the golden goose that was driving the retention. You were talking about Facebook like retention. Any lessons from some of those early iterations on how the community responded to monetization, how you introduced it and how you iterated on that to get to where you are today?

Ryan Beck:

It was being very data-driven, so there's data informed and that seems to be the pinnacle. 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, so you have average revenue per user, their retention.

And these are things that are trade-offs. You can model these out. You can figure out if I have ... My retention is X and it goes down by 10%, what does that do to my long-tail revenue? 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 and a consumer [inaudible 00:15:38] impact that revenue. And ultimately, you want to 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.

Jacob Eiting:

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 free. That's like I can't charge. But when you got to ...

David Barnard:

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, 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 this is faith, this church, it should be free, greed is bad and monetization is evil. Was there qualitative feedback on that kind of stuff as you did start to push toward monetization?

Ryan Beck:

There's some, that's probably all of our negative reviews is-

Jacob Eiting:

You get big enough, you can find a hater for every topic.

Ryan Beck:

Right? 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 how the model has worked previously. And so, it's a balance, and yes, we do get it and 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 in trying to make money," and we'll respond and I'll get on a call.

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.

Jacob Eiting:

I mean, it's a lot of these things are a fine line even outside of the faith space. You just got to use your judgment. I think people, and just in general, people over rotate on negative comments more than 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 to find it, this weekend about developer who got one, his first negative review for charging money and was ready to take down the paywall and everything. I just think, no, no, no, it's fine. It's working as expected. It's working as expected.

David Barnard:

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 you're building something valuable. It's like a positive signal of value creation.

Jacob Eiting:

Nobody complains about products they don't care about. That's also a truth.

David Barnard:

And nobody complains about a price of something that they don't want. If trash is sitting on the ground, you're not complaining that it costs something. It's like they actually want it, which is a good signal.

Jacob Eiting:

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 turn the dials, and if you can see what the alchemy does, what the other numbers go up and down and you can understand. I think it's just really hard to, not really hard, but I do think it takes some wisdom and a steady hand to be able to ... Also integrate that qualitative feedback. You know what I mean? There's individuals, right? It's easy to look at a conversion rate and say like, "Oh, well 80% of the people didn't buy." It's harder to talk to one of those 80% of the people who thinks you rip 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 qualitative and quantitative.

Ryan Beck:

There's lots of data, lots of input.

David Barnard:

And speaking of that, having to synthesize, but I'll ask the question, any top lessons from that time of a win or a fail? One test you did on the monetization that was just doubled revenue or something crazy like that. Then on the contrary, any change you tried to make massively impacted retention in a way you're like revert, revert, revert. Any of those kind of wins or fails that you can think of that you want to share?

Ryan Beck:

I mean there's a few and there's some that early on in the social network it was phone, email, name, you're going into these communities, we want to make sure you're 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.

David Barnard:

You mean requesting the phone number would such high drop off ... It caught such high churn that you couldn't then monetize, so by removing the requirement of a phone, you would then monetize better?

Ryan Beck:

Correct, correct. 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 ... You could put it up front, you can put it as the first thing, and you may get that initial conversion may go up, but then that long tail, that LTV, so you just have to understand 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 of post-Christmas to end of January when everything is really great for CSS companies.

Jacob Eiting:

Yes, consumer subscription holidays. So, you mean diversity, just like having more creative content on advertising than you need, right?

Ryan Beck:

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, but if you do anything more than that, 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 hard lesson learned because it costs lots of money.

Jacob Eiting:

How do you do creative? Do you have that all in-house or do you work with agencies or what's your process?

Ryan Beck:

We've done both now. We work with a great agency. They run it and we've developed a playbook prior to working with them that 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 that GP Bullhound chart, so we just run a very aggressive creative testing. There's really nothing that ... Within limits, obviously, there's concerns, but 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, what are they running to find that inspiration because of going back to the triple I framework that imitate, iterate, innovate, and so we're doing diversification across that. That generally leads us to a well-diversified creative mix that's helping us scale our campaigns.

Jacob Eiting:

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 a demographic that's usually unstated. Or Facebook doesn't have necessarily know, but they probably kind of do know. You know what I mean? They should probably target based on, but they also need to, 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 net evangelism. You know what I mean? Do you think about that? Do you consider yourself selling to folks who are already within the faith and strengthening their faith, or do you think about expanding beyond maybe folks who aren't actively involved in the faith?

Ryan Beck:

I wouldn't speak for Meta to determine if they're their 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 breath right from people who are curious to people who are strong in going to their faith organization on a weekly basis. So, it's the whole gamut and Facebook figures it out.

Jacob Eiting:

Yeah, I'm sure. How do you think about those different customer profiles on the content side and product side? Do you think about folks who are maybe ... I mean there's probably many dimensions that you can cut up that content on, depending on denominations or not and things like this, I imagine it's an interesting puzzle as well.

Ryan Beck:

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 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-IDFA there it was a little bit better.

Jacob Eiting:

I'm wondering just from a, you get somebody in there from wherever, how do you think about what kind of content, is it within the app, depending on those different profiles of the curious all the way to the super strong in their faith. And then across also the different denominations and styles of things. It's got to be an interesting problem to determine where you focus your investment, right?

David Barnard:

Yeah. I mean onboarding, are you asking people, 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?

Ryan Beck:

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 at that really put you? No, that puts through the ringer. It's like a multi-day onboarding event, got to book it.

David Barnard:

You've got to get it on your calendar, take some PCO.

Ryan Beck:

They really showcase how 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 helping guide them in their faith journey. Because all these things, all these indicators, they could be used for 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.

Jacob Eiting:

People won't pay you for reinforcing bad habits. I mean they will, but not forever. And you want those long-term customers, that's where the money is.

Ryan Beck:

We really focus on getting those questions answered in onboarding to help us facilitate that mental and spiritual health track that they want to go on.

David Barnard:

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. Any other channels that you're experimenting with or seeing success with?

Ryan Beck:

We experiment with most of the channels, but we always come back to Meta. I think post-IDFA for mobile applications they're the ones that seem to be ahead of the curve 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 seem to be ahead of the curve and we're on Google platforms and TikTok and things like that, but we find that the consistency is with the Meta platform. That's just, 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.

Jacob Eiting:

Do you find within Meta, do you focus on more Instagram, because Facebook itself has Reels within it as well, and I don't know if they actually separate the two anymore. Do you have a sense of which specific apps in their platform are resonating the best, or is it all over the place?

Ryan Beck:

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, call it 2020, 2019, that we would run a lot of images, and it would be on Facebook. They would resonate really well.

Jacob Eiting:

In-feed ads basically?

Ryan Beck:

And they were like, "Now everyone's moving to video." And man, these videos, they're a lot more to make, but-

Jacob Eiting:

They say 100 times the cost of production, right?

Ryan Beck:

But they weren't really resonating, and maybe it was on us, in its transition now video is kind of more the dominant form.

Jacob Eiting:

Yeah, they've also raised the prevalence of a video, short-form video in every app. I complain about this, every app has Reels now, every app. Gmail is going to have reels soon, but I guess it's also helpful, because you probably have one focus on short-form video creative and then you can deploy that across a bunch of different platforms.

Ryan Beck:

And when TikToK became a made-stay application, I'm a big fan of Meta's quarterly earnings, so we were listening to those-

Jacob Eiting:

Probably providing a lot of them.

Ryan Beck:

And so, I was just like, "Hey, we need to" ... We started investing in the Reels early on, and now that's where it predominantly is, and it's spread across the application verse for Meta. And I wouldn't say Facebook is by far the leader anymore, and I think that it's been five years ish, four or five years and you're getting new people and we had 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 they became mobile capable now. And so you're seeing different demographics shift across these applications.

David Barnard:

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 older generation trusts TV ads, 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 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

Ryan Beck:

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 influencer 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's 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, five bucks does not get me on TV. And so, that's one of the things that you find 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.

Jacob Eiting:

It's like betting, but you also don't know if you won until your tax season next year. How do you find out, you bet on a big ad on CNN or something like this, do you even try to do some attribution there? Do you find it useful or do you just go, "We know this kind of has to work?"

Ryan Beck:

Oh no. 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 Pray.com that resonates very well.

Jacob Eiting:

This is a technical question, but who you work with a platform for TV ad buys and they actually give you by the minute when ads are running?

Ryan Beck:

Yes. And they would help us with that media mix modeling, but it would just be for broadcasts. Then we'd have our performance marketing, so you have to blend it. From the very beginning we've been doing media mix modeling, and so we've been comfortable flying with statistical models, rather than very deterministic models of performance marketing.

Jacob Eiting:

Which I think is the evolution of versus maybe five or six years ago, I think 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 and you just roll with it. That's really interesting. I see anecdotally 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 subscription ads for apps I've never even heard of, it's crazy. Actually, I wonder, in some cases it might erode that perceived trust over time. It's no longer breaking between Walter Cronkite to sell you Colgate, feels like it's a little bit more accessible, so I wonder if that's going to change. The same is for terrestrial radio too. I hear so often I hear Babel and Noom and so many terrestrial radio buys, and I mean you probably know this, but I've heard it's depending on how you target can be cheaper than you think. Especially probably at your scale you're spending five figures on Facebook a day, it's probably not that crazy.

Ryan Beck:

Yeah, I think that TV radio are different today than they were. Not to make this a political thing, but during the Trump administration TV was at its height, it was doing really well.

David Barnard:

Whether Fox News or CNN or MSNBC, everybody's just glued to the-

Jacob Eiting:

You mean for effectiveness even. I guess cost probably went up along with that too, right?

Ryan Beck:

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 our advertisements that we can actually get.

Jacob Eiting:

Well, it's unique. 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 somewhat novel, the combination of those things. So, it doesn't surprise me to at least be intriguing compared to your 20th fitness app or whatever. It's like something somewhat new, so it's pretty interesting.

Ryan Beck:

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 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 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 may be the worst thing you've ever seen the next week. So, it's very volatile, and you just have to understand that volatility and bring some calmness to that turbulence.

Jacob Eiting:

Yeah, I was going to ask, how does your team divide your focus between customer engagement, product development, actually on what you build versus your internal optimization around paywalls and stuff like that versus it feels like this whole performance marketing and advertising and acquisition, that's probably a whole technology stack. How do you as leadership team or whatever, however you think about your pie of corporate focus, how do you break it down, how much resourcing and thought goes into the different categories of work?

Ryan Beck:

The tech product is the most central, and we know that it's extremely important for the ... 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 life cycle 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.

Jacob Eiting:

So that was, the performance marketing was closely related to the technical side of the business?

Ryan Beck:

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 tech team." I'm like, "Hey guys, I get it, I get it. We're getting another request and it's coming at you 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 the 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 hole and then we still operate, even though I'm more of a partner transitioning it over, but it's still built into our DNA, so we're closely aligned on that.

And so, really 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, we're watching each step of the flow. If something's broken there, the whole thing collapses." Vice versa, if something 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 or YouTube or whatever and one of the signals goes down, they have to adjust and then 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.

David Barnard:

I feel like that's one of the biggest things we've seen talking to larger customers who are considering migrating to RevenueCat, like existing apps that are large and want to use RevenueCat is, there's often a dysfunction between marketing and engineering, where the marketing team is fighting for resources. They're not tightly integrated.

Jacob Eiting:

Similarly, often a very successful app's performance rolled up to like a CTO or a very technical or 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 how they did, because they were very successful early on this and it all ran up to their CTO, right? And he integrated all this stuff and made sure it all ran. And then you were saying, Ryan, just elevating the urgency of those requests to engineers, because 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? And he's just like, "If you can connect that and clear that barrier, suddenly you can unlock a lot of value." But I think businesses like yours, it's not app and then layer marketing on it. The whole machine is one big product, so is one big business, which I don't know if everybody's figured that out yet.

David Barnard:

And we talked to Jason Van de Merwe 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 a big takeaway for a lot of organizations who have dysfunction between marketing and engineering is you need to rethink how these teams work together, because when you pair growth and engineering together to be more effective, it's going to be way more effective.

Jacob Eiting:

Do you have the engineers dedicated to growth and performance marketing stuff?

Ryan Beck:

We actually don't. We don't have engineers dedicated towards it. It's more of-

Jacob Eiting:

Everybody's a growth engineer. I mean, on a venture-backed startup, but yes, David, that's kind of true.

David Barnard:

Yeah.

Ryan Beck:

It's one roadmap. So, we don't have different roadmaps. I think that's one of the 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, 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 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 have a, "Hey, come over here."

Jacob Eiting:

You end up in this interlocking resource constraints where one team will have a little bit of extra resources, but there's team with a need. We're at this stage now where we have 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, being my CTO and I, reprioritization and just moving people around constantly to ... Because yeah, you lack that visibility and stuff, but 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.

Ryan Beck:

Hot take. All right, no roadmaps.

Jacob Eiting:

There's just today, we have to live in the moment, Ryan, you know?

David Barnard:

One tiny little example from what you were just talking about that I just experienced last week. In my little indie app, my little weather app, I've known for 18 months that our onboarding sucks, but I wanted to focus on the product and so I ignored the onboarding and I just put together what I thought was the most simple onboarding that my cousin who's doing development could possibly do. And so, for 18 months it's been eating away at me like, "We got to fix the onboarding, we got to fix." But I never talked to him about it. And so just last week I finally had the conversation and laid out the whole thing of like, "Okay, we have a hard paywall. Onboarding is everything and we need to start running some cycles on onboarding. Here's the expectations I see if we improve onboarding, I think we can improve conversion by X-rate."

And I had this whole 40-minute conversation and lots of back and forth, and just having that conversation on that level to get on the same team that, "Hey, we actually need to spend some cycles on this," was a huge unlock for us as a little two-person team. I can't imagine 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.

Jacob Eiting:

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.

Ryan Beck:

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 it 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 A, "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. I guess a question for you, how do you think about it at RevenueCat, about your roadmap and modeling?

Jacob Eiting:

Yeah, I mean, I think that really depends on how your pricing, which is the reason it doesn't work in consumer as well is because some SaaSes 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 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. That's our value." And it is pretty nice. And also, usually that's coupled with a pretty understood B2B sales force 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." And I think you'd be surprised. I would love to know, Salesforce maybe is the extreme example, but like I say, mid to late stage, mid-cap SaaS companies, I would bet the majority of their sales force is not like selling Salesforce, it's selling cross, whatever. It's all about just expanding, it has nothing to do.

Now, RevenueCat, actually our specific case is different because the way we price, it's mostly based on volume, so it's a little bit harder, because it's like, "Well, we price on volume for everything else." So, it's like you add in a new thing. And just for us it ends up getting baked out and how much pressure we can in 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. I just know if I build a more useful product, people will pay more for it, and then I just figure that a little bit of horse trading we'll find the right price. I don't benefit from that modeling, so I don't have a roadmap.

I'm just like, "Well, we'll just build whatever." But to that point too, sometimes you'll have key customers that will be like, "We need X. We will literally sign a contract for Y if you guys build X today. And okay, now we have a roadmap." This is getting built right now because it's going to ... it's a burden of hand. But I just feel like generally, and I think, I don't know if this is true, if this is a B2B thing, I think it's 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 so many uncertainties that I think if you try to overly simplify and be like, "Oh, this lever moves this number." And if you try over-focus on that stuff, I think you can end up driving to really odd conclusions.

There's probably some relationship between lever A and output B, but if you're not considering everything else, I find this too with, I think you see this a lot in funnel optimization. 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 it's going to have other effects, 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 measuring multiple data points. And then I still think there's, I don't know, this might be just personal. I feel like there's still room for craft, right? There's still room for gut feel and being like, "Nah, I think this feels better and we should do this." But as much as I look at dashboards all day, I'm very data driven, but I don't know, if we don't have some human magic going into product creation, then AI is are just going to replace us. And wouldn't that be terrible?

Ryan Beck:

Well, yeah, it depends what magic is. We might find out that our magic wasn't as magical as we thought.

Jacob Eiting:

Isn't that magic after? Nope. Nope. As soon as you have a roadmap, you're replaceable. So, no roadmap, can't be replaced by AI.

David Barnard:

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-

Ryan Beck:

You mean feature specifically, David, or-

David Barnard:

Just B2C, like, because we kind of did this chase a rabbit on the B2B side, but most of our listeners are B2C. So, I wanted to bring it back to, what do you do on the B2C side that maybe folks listening can learn from?

Ryan Beck:

When it comes to the B2C side, I really think of subscription is kind of your core for 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 upsells.

Jacob Eiting:

They're actually multi-time upsells, right? It's consumable. You can buy non-recurring, but you can consume many gem refills or whatever.

Ryan Beck:

And so, you can start looking at them with some of 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. Then I generally start with revenue as my north star, since I think that's the best metric for a company is revenue.

David Barnard:

Same. We agree on that, Ryan.

Ryan Beck:

Yep. 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.

Jacob Eiting:

My church used to have the little candles they'd charge you a quarter to light, so maybe that could work for you.

Ryan Beck:

Yeah, yeah. Books, right? So all these things.

Jacob Eiting:

Yeah. Yeah. One-time content, right? Sorry, I've had to hold back. I had a lot of zingers in this one, but I was like, try to, I don't know where the line is.

Ryan Beck:

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 watch it, man.

Jacob Eiting:

I imagine David had a question on here, just like culture, I do imagine have to take it pretty lightly to run a tech company in this space, and everybody's got to be very open-minded and very chill about this.

Ryan Beck:

I like to say that we took a, for the people that come from a religious background. We took a Solomon approach to things. Solomon in the Old Testament built a temple, the temple to God, but he got the best. He 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 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 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 people of the 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 a doctrine of faith. And so, we just look for people that just want to do good in the world, want to see values communities created, and so that's how we filter.

Jacob Eiting:

At some point in time, I think maybe it became a misunderstood that you should join a company when you don't believe in the mission, because it's a good mission or whatever. That's actually a benefit to you, because I think that mission is so specific and charged in some way, or just very clear. And I think asking that very directly is probably somewhat easy in your, not easy, but nobody's getting into day one on Pray.com and being like, "You do what?' You know what I mean? Everybody understands what they're getting into and why, which is nice. It's nice to have those selectors, those filters that have it naturally, right?

Ryan Beck:

Yep, yep. That is true. No one's surprised.

David Barnard:

Should that be a screening question? Do you believe in consumer subscription apps? Do you pray to the God of-

Jacob Eiting:

David, 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 capital singularity and you want to accelerate?" "What? No? Okay." No, it doesn't get that weird.

Ryan Beck:

I do have Ray Kurzweil's book up here, his latest one, so you know I'm all in.

Jacob Eiting:

You wouldn't look at me funny. I actually literally don't ask that, but maybe I should.

David Barnard:

Well, Ryan, this has been a ton of fun. We do need to wrap up, but as we do wrap up, is 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.

Jacob Eiting:

It's such a good brand. I don't want to ask how much that .com costs you, but it was probably worth it.

Ryan Beck:

Expensive and fair.

David Barnard:

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 really early on LinkedIn to be able to get the title instead of your name. So, your 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?

Ryan Beck:

No, just thank you for having me. This has been a great conversation, long time listener, and Jacob's blushing, 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.

David Barnard:

Thanks so much for listening. If you have a minute, please leave a review in your favorite podcast player. You can also stop by chat.subclub.com to join our private community.