Insider Tips for Building Better, More Profitable Android Apps — Sarah Karam, Google

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 this is a very special edition of the Sub Club Podcast. I've been at Google I/O the past couple of days, and I'm sitting here on Google's campus with Sarah Karam, the managing director of app partnerships at Google Play. On the podcast, I'm going to be talking with Sarah about how to get Google's attention, highlights from Google I/O, and why hitting copy paste on your iOS strategy is probably not going to work on Google Play.

Hey, Sarah, thanks so much for joining me on the podcast today.

Sarah Karam:

Hi, David. I'm so grateful to be here. Thank you for having me.

David Barnard:

Yeah, and thanks for inviting me to Google I/O. The last couple of days have been a blast, learned so much more about Android. For years, so many of the RevenueCat customers and people I talk to are on Android. I'm not, but I'm pretty inspired. I want to build an Android app now.

Sarah Karam:

Good.

David Barnard:

So it was really fun being here and learning way more about the Android ecosystem, all that you all are doing to help developers out. So thanks for inviting me.

Sarah Karam:

Of course. I'm so happy you were able to make it to Google I/O. It's our annual event, our marquee developer event, and this one was a great one. I'm very energized, tired and energized at the same time.

David Barnard:

Same, same.

Sarah Karam:

I'm grateful you were here so you could hear all the thoughts, and yeah.

David Barnard:

I wanted to kick things off talking about your role at Google. Tell me what you do at Google and how you help Google Play developers.

Sarah Karam:

Yeah, sure. I lead our Google Apps partnerships' business development team. We work with developers all over the world, and primarily our job is to enable them to succeed, hear their feedback on what's working well, what could be better on the Play Store and on Android overall, and share that with our product engineering teams and build this beautiful flywheel of better products over time. I love my job. I get to talk to developers all day, hear what they're working on, what excites them, what's concerning them, and take that back to the team. We're a pretty small team. We are global, but we have a limited number of people in each region.

David Barnard:

Yeah, of course.

Sarah Karam:

But yeah, I've been doing this for a few years now and absolutely love what I do.

David Barnard:

Awesome. I think the first question every single person listening to this podcast is going to ask is, how do I talk to Sarah and her team? So I have to ask, elephant in the room, how do people get in touch with Google and get the attention of Google?

Sarah Karam:

Yeah, it's a question we get all the time as well. We try our best to talk to as many developers as possible. I'll say especially those that have worked really hard, their app is really, really strong, and they've scaled product market fit, we absolutely do our best to work either one-on-one or one-to-many in some form.

We do have some really good resources and we have a way to get in contact with us via support channels. We also have an incredible Play Academy, which I highly recommend to anybody, including our very mature partners. We have so much resource there on how to build an incredible app. So we do try to make it not required to talk to us to be effective on Play. As much as my team is incredible and the work they do is great, we don't want to make that a barrier to entry to be successful. But we do have ways to get in touch and we'll make sure we, as after this podcast, that people have those links. But yeah, I'd say it's really critical to invest in the platform. That's the best way to get our attention.

David Barnard:

And that makes a ton of sense. There's hundreds of thousands of developers, maybe even millions at this point, and millions of apps.

Sarah Karam:

Totally.

David Barnard:

And as big as Google is, you can't staff a developer relations team with 10,000 people. So it is hard. And I know Apple's the same way. It's hard to get in touch, but there's a reason and it makes sense. We're all humans trying to do our best to help people, and so you can't always get that one-on-one attention. But it's cool that you do that as much as you can because then that feedback is super helpful. And I think it's important for people to understand, too, that that feedback is getting to Google, that Google is out there talking to developers. And again, unfortunately you can't talk to every single developer. So if you're listening to this podcast and like, "I want to talk to Google," and you don't ever get to talk to Google, your feedback is probably getting communicated in other ways from other developers and stuff like that. And then like you said, we'll include in the show notes some links to contact support and other things, and people do read that.

Sarah Karam:

They do, absolutely.

David Barnard:

There is a big team getting that feedback. The other elephant in the room that everybody's going to ask is then, "Okay, I can't necessarily just reach out to Sarah anytime, but how do I reach out to the editorial team? How do I get my own featured?"

Sarah Karam:

No, we do get that question a lot. We have an incredible editorial team. They work tirelessly. They're also global, across every region, and they really work hard to look for the best apps for the right user at the right time, hidden gems. They really take their craft seriously. I've discovered so many apps I would've never found without that editorial team, so I'm very grateful for them. But similar to our team, they're very limited in resources. I'd say the best way to get their attention, the editorial team, is to build an incredible app, have a very high user rating, a lot of the features we announced at I/O and previously to use them all to really do everything you can to make your app meaningful, delightful, valuable to users. That is what we look for in featuring because we know that typically is what will actually work really well and users will get very excited about those apps. So that's the number one thing. That is a min bar, so just everyone should really level set on that.

And then as much as possible, we have resources that again we'll link to in the show notes where people should read the guidelines, what they can do if they want to get featured. We do have methods to make sure you're in the best possible position. It is discretion of our editorial team and we do a lot of user research on what we know users want to see. But yeah, we absolutely love featuring wonderful apps. It's mutually beneficial. We love to do it. So if you're listening out there and you want to get featured, look at the link that's in the show notes and please use it. Go through all the steps.

David Barnard:

Yeah. I was reading that last night and I found that link researching last night and put it in the show notes. And Apple has a similar page and it's a similar process. But if you're going to reach out to the editorial team, actually read those things. Don't just send a blank email.

Sarah Karam:

Yes, please.

David Barnard:

Read those things and try and tick off as many of those as you can and then reach out to the editorial team. Everybody wants to get featured, so I'm sure the editorial team is just inundated with apps that frankly haven't checked some of those features.

Sarah Karam:

Right.

David Barnard:

And so you want to make sure that you do have a good rating. It's just the reality. If you don't have a good rating, that there's signal there and you need to do some work on your product. So you probably wouldn't want to say that, but I'll say that.

Sarah Karam:

I appreciate you saying that. I also will say we've tried similar to us not being a gate to being successful on Google Play, that you don't need to work with somebody at Google to do that. We also try to make sure featuring is not a gate to be successful. It's wonderful. We definitely love to feature fantastic apps, but we often urge people who are so fixated on getting featuring from the Store that is wonderful and there's so much else you can do. We announced at I/O yesterday and we continue to put a lot of work into making the Store work effective and a wonderful channel distribution and discovery and engagement for all developers, even if you might not be ready for featuring or you might not know how to go about that. So really urge everyone to not anchor exclusively on featuring as the method for growth. There's so many things you can do.

David Barnard:

And that's something we talk about on the podcast constantly too, is there are thousands of ways to get attention from affiliate marketing, which I never thought for apps, but we've had podcasts talking about how effective that can be to influencers, to press, to paid marketing, to physical mailing. I was talking to somebody recently, that's a thing again because it's actually fairly cheap.

Sarah Karam:

Yeah, huge business.

David Barnard:

And you can be targeted, and I haven't heard of an app doing that but I've talked to people who've seen that be successful in other businesses, but maybe you should experiment if you have a broad market app or a more regionally focused app. So many ways to get attention. I do feel like primarily working on iOS myself and a lot of indies, I think get this perception of if I can just get featured, that's going to make or break my business. But to be honest, even on iOS, it's not what it used to be. Back 10 years ago, getting featured could be huge. But then problem with my business, and this is going to be the same for so many developers who are like, "Oh, I'm going to get featured." And even if they do get featured on the Google Play Store, which you then realize is like, "Oh, that's a great spike, but you still need to market." So build the foundation first.

Sarah Karam:

Exactly. You got to do the work you.

David Barnard:

Yeah, you got to-

Sarah Karam:

That's a lot of foundational work and continue to work.

David Barnard:

You can't just rely on getting featured to build your business.

Sarah Karam:

Right, 100%. It should be a yes-and, not an either-or.

David Barnard:

Exactly, exactly. So I want to move on to Google I/O. Really fun being here in person the last couple of days, and I think a lot of our audience, again, like me sitting here talking to somebody at Google, but our audience is often more iOS-focused and a lot of developers focus their efforts and attention more to iOS. But Android is such a massive opportunity. And so for those who aren't paying close enough attention, I did want to give some highlights from Google I/O-

Sarah Karam:

Wonderful.

David Barnard:

... for them to go dig in and then to also see and contrast. Google's doing some really cool stuff, but the Google Play Store has a ton of opportunity and is innovating in a lot of ways. So I wanted to talk through some of the announcements at Google I/O, do a little highlight reel so that people can then go dig in a little deeper. But the first thing I was super excited about is the Engage SDK. So tell me what that is.

Sarah Karam:

Yeah, so excited about the Engage SDK as well. It's a pretty big shift for us. And I should mention that I've been working on this team for several years and have seen Google Play go through so many stages of evolution and maturity, so I'm so blessed that I've seen that. And now more than ever, we're very focused on apps. We have an Apps GM, Mekka, who spoke in our Play keynote yesterday along with other incredible speakers. We also are really thinking about the various categories within Apps and how we develop meaningful experiences go a little deeper than maybe just generic apps as a category.

So the Engage SDK was born from this research we found where so many users have apps on their phone in the multiples of tens, typically above 50, above 80 in many markets, and they're just not using them as regularly as they should. I think we can all relate to this. You've got just a lot of icons and at some point you probably had a very relevant use case and then you forget to go back. Maybe even the same problem comes up in your life again, but you just like, "Oh, I forgot that I installed that app six months ago." And in talking to partners and developers like my team does, many developers don't have a use case that needs to be daily. Some apps are daily use and that's the intention. Some will not be daily or if they are daily, you might just miss some of that content. So we knew that was a problem we wanted to help solve, and we thought through what does that look like? What could we be doing differently?

And so the Engage SDK is a way for developers to share with us on-device in a very personalized and private way content that's relevant to the user on that device. So for you, your feed in YouTube might be one example or what you recently bought in a shopping app, that kind of thing to just provide you a little bit of contextual information and gather that up in clusters that make sense depending on the use case, if it's a social use case or shopping, whatever it might be that we know users tend to think about their apps in different groups. So that's what it was born out of. We announced at I/O that it's now in developer preview and anyone can go follow the link and start building for it, which we're very excited for. And we already have some fantastic partners that we announced on stage, Spotify, Uber Eats, McDonald's, TikTok, many others.

And so I'm super pumped of how this is going to evolve. Really our mission is to bring that content that you're all building, all the developers that are listening to this, to the forefront and show contextual personal information on a regular basis so that users don't have to go hunt in their wall of 80 icons instead of we'll just come to them in this experience. So very excited for what we're doing with Engage SDK.

David Barnard:

I got a little sneak peek. And I know it's not coming till later this year, but I'm excited.

Sarah Karam:

Awesome.

David Barnard:

Again, another thing that makes me want to build an Android app, because this looks really cool. And things like TikTok and Twitter and YouTube, they have this natural draw. You're standing in line at a grocery store and you want to kill some time and you get drawn into those things. But of course, more and more as a society, we realize that's probably not the best thing for a human to just be consuming dopamine hits constantly. And what's really cool about the way this is designed and the way it's going to be surfaced throughout the OS is that it maybe breaks that chain a little bit. There's an app Headway that has this really great ads like, "Stop doom scrolling and learn instead." They summarize books and it's an easy way to get some bite-size insights that actually benefit your life versus doom strolling TikTok or whatever.

TikTok's a great app. I don't want to totally throw them under the bus, but I think a lot of us find we engage too much with this. What excites me about this is it's going to surface apps and context and features that maybe people should be interacting with more but that don't have that natural draw that you're standing online and think to do. And so I think this is going to be a really great feature, not just for developers to get people back into their apps, but also just to help people diversify their experience and maybe get some of those more meaningful experiences on their device brought to them and having those triggers to go back to those things instead of it getting lost in the sea of apps and not even remembering.

Sarah Karam:

Absolutely. We definitely, our goal is to help users be more intentional. It's really part of Google's mission is very much about access to information, useful information at scale. And this is one way where instead of you on autopilot, like you mentioned, going to your phone and maybe just missing out on so much of the additional things you can do there and maybe just defaulting to the same behaviors, what if you see everything that might be relevant to you that maybe just wouldn't be top of mind to your point, because of just the nature of that app not being as frequent potentially. And you are in control. You can see what you want to access, what's relevant to you, and then go a level deeper.

And again, back to my team and what we care about, making sure developers are getting that benefit and seeing that traffic back into their apps. Also having full access and control over what is shown to the user. It's very personal on device. Yeah, I do think there's some strong element of intentionality here to help users really use their phone as a supercomputer and take advantage of the full corpus of insight and data and services on it.

David Barnard:

Yeah. Switching gears a little, there was a lot about the Google Play Commerce capabilities, and I wanted to kick that section off talking about the continued expansion of payment options. I think this is something that's lost on a lot of folks, especially people who are like web, web, web. We need to pay on the web. Google has 190 markets supported, 165 carrier billing options, 300 different local payment options. The ease of payment on Google Play is something the teams have been putting a ton of effort into to make it so much easier for people to pay, which is what you want as a...

Sarah Karam:

Totally.

David Barnard:

You want to make it as easy as possible end users to purchase. And Google Play has been doing a ton of work on that front.

Sarah Karam:

We have. I've been here to appreciate you saying that. I'm so excited about what we announced, and I mentioned this to you. I think Harisha leads that team. We work very closely on developer feedback, constantly are listening to the ecosystem, what's working, what could be better, what forms of payment they want, what features in the flow and the buy flow would be useful to them. So everything we announced, I just as a giddy kid, I was listening like, "Yeah, that's what this developer wanted or that developer wanted," or, "Oh, for the last year we've been talking about this." So I've never been prouder than yesterday.

Every single feature that we announced was very much based on feedback from the ecosystem. And yeah, we announced new payment forms in Brazil Pix, which is a huge payment form there, super popular that it's now available on Google Play billing. And in India, we've expanded UPI options also, similarly the incredibly popular form payment in India. And we also added new ways to pay installment payments, which is popular not just in Brazil but also in several European markets. We've made that available.

We're really working on not just access, so anyone can pay more effectively using the form of payment they want and better ways to make sure the buy flow is relevant. If you're a student, you can now pay, or as a developer, you can set student plans, senior plans. So many things we announced have just been in the works for a while. They're not easy. It takes us a lot of time, a lot of resource. This is somewhere we definitely invest across Google as well. But yeah, we're very proud of the payments platform. We also announced over 200 million subscribers across all of our corpus of apps in the ecosystem. So really proud of the work the team is doing there.

David Barnard:

Yeah. So you mentioned installment payments. When that was announced, I think in the developer keynote, I thought, and then I saw tweets and other things, it's like, "Wait a minute, that's just a subscription." But it's not.

Sarah Karam:

It's not, yeah.

David Barnard:

And it took me a minute to realize how cool that actually was, is that one, there's countries like India where there are heavy regulations against recurring subscriptions because it can be problematic and people are taking advantage of it. And personally, I think there should be more and more regulation about making it easy to unsubscribe and giving users more control because when you have the capability to automatically take money from somebody's account, that's a weighty responsibility.

Sarah Karam:

100%.

David Barnard:

And so I believe in it as a software developer, as an effective monetization tool that benefits both users and developers by incentivizing that continued investment. But it doesn't work for everyone. It doesn't work in every country. It can be problematic. And so installments are a way to have a non-recurring subscription, but that isn't such a big... For a lot of people up front, paying 60 bucks can be a huge hit to their budget.

Sarah Karam:

Absolutely.

David Barnard:

So yeah, tell me more. I'm journeying on because I-

Sarah Karam:

I love this space. So yeah, I feel like we could talk all day about subscription. So you're totally right, that it's both about being creative and making sure we're being thoughtful. And not everyone in the world subscribes the same way and not everyone in the world wants to subscribe at all. Installment payments, like you mentioned, is not just popular in Brazil for users who might feel the sticker shock of a large amount. It's actually just the way to pay. Even if you can afford it or you're not thinking too much about the actual price, it's just the methodology that people tend to prefer. It's something we've been investing in for many, many years. We launched our subscription center. I think we were one of the first platforms to have a subscription center, and we were very bullish on easy ways to cancel.

And I do remember, I have to share this because it's accurate when we had that easy cancel button where you didn't have to call a human. There was this time where you had to call constantly. And unfortunately it still happens in many situations, and we were very strict that like, "Nope, there's going to be a button," and we're not going to allow if developers say, "Hey, I don't like this button." And we got a lot of feedback from our partners saying, "I want you to remove that button. It's increasing my churn. And on other platforms my churn is better, and I think it's because of that button." And we were very firm on it that like, "Nope." We hear from users. And to your point, unfortunately there are some bad actors out there who really try to dupe users into recurring payments on things they didn't even know they were paying for.

So we've always been really passionate about not just like we love subscriptions, we think that's such a fast-growing space. There's so much innovation happening, and we announced some of that too and how to think about different price points, different plans, all of that. But also to be really careful that you got to build that trust first. If users don't feel like you're going to give them an easy way to cancel or they think you're going to renew in the background without telling them, it can just do a world of harm. We take that really seriously.

David Barnard:

A couple of other cool things in the payment space that I thought were really interesting was ask someone else to pay.

Sarah Karam:

That's so cool.

David Barnard:

And I know it came out of the family purchase, which I actually use with my kids. They have to ask to buy. They actually even have to ask to download, which I love that as a parent, but ask someone else to buy, you can ask anybody to buy an app for you, which is again, a diversification of payments. So you might ask a friend if you are using the app together and they were like, "Hey, you really need to get this happen." You're like, "Okay, you pay for it." And now on Android it can be like you send them the link and they pay for it.

Sarah Karam:

Yeah. I think, again, we really try to listen to what our users are telling us, what our developers are telling us. And because we're such a global platform, we announced we have over 2.5 billion active users across the world, we find these interesting patterns where people don't behave the way somebody in the Bay Area might behave with how they pay. So yeah, that came out of our feedback on this is something we've been looking for same with of the various plans we announced yesterday on student plans and senior plans. So I'm really excited about it. I think whenever we announce these features, I think of it as growing the pie of options, and that is only good for different types of developers, different regions and use cases.

David Barnard:

And you dropped it in there, but I wanted to go deeper on the student plan thing because that was another thing that I think is super cool. There is talk about how tough it is to monetize some of these younger users, high schoolers, college students. They don't have the kind of disposable income that career professionals have. And so being able to have a flow inside Android that verifies you're a student and then when you're no longer a student, you no longer get to... That's really cool.

Sarah Karam:

It is very cool. And I love that we're allowing a flow for when you're no longer a student that you can quickly move to the next non-student plan in a seamless way as well, so you don't churn out that user. Yeah, it's such a critical area for us. You saw a lot of what we announced at Google I/O, not just on Play in Android but more broadly centers around learning, and students are a huge part of that. So we're absolutely a company of learners. I feel like we're a little bit like university, so it's a lot we do for students because we know it's such a critical space. And we were all students one day in some form, and we know that, like you said, it's not always easy to pay for really meaningful apps. Especially now with gen AI apps, there's so many useful apps that we know students should be using. So we're hopeful that a lot of developers take advantage of student plans.

David Barnard:

Yeah, that's super cool. And then similarly, having students have to verify that they're a student and then that student status expiring, you'll also introduce some tools to help developers prevent price arbitrage. So not only can you not pretend to be a student, but if you're in the US, you can't pretend you're in India and get a discounted price. I never even thought about that. But again, it's like Google operates at such a large scale around the world that you probably see in the data-

Sarah Karam:

We do.

David Barnard:

... this price arbitrage of people using VPNs and stuff. So now Google Play has tools to help prevent this kind of price arbitrage.

Sarah Karam:

Yeah, definitely. And that's something we have seen on our end quite a bit. Like you mentioned, we're a very global business. We operate across so many billions of users and so many markets. So one thing we've done is when we're noticing a higher propensity of arbitrage, if a currency is fluctuating, we know developers will have, especially those that maybe offer at scale lots of IP, will have to scramble to figure out, "Oh, how do I handle this?" And that's not the kind of thing we want our developers spending a lot of time on. It's not ideal.

David Barnard:

And it's really complex to solve this kind of things.

Sarah Karam:

Very complex and difficult. So we know that's something we think is a platform. We can really help developers to address that and just take that stress out of their days and handle it as much as we can on the platform level. So I think that's a mindset we generally take. We don't want developers to have to worry about things that we can help solve and make better on a platform level.

David Barnard:

Yeah. Another thing that is so much harder for developers to do but it's something that platform can do a better job at is a new feature device recall, is that people will wipe their device and get free trial every seven days, figure out way, another kind of arbitrage of redo the free trial over and over again. And so now there's ways in a privacy-focused way to prevent those kinds of things as well.

Sarah Karam:

Yeah, absolutely. Again, we know some people will factor your reset. We can address that and that not be an issue for developers. And again, we're just trying to make sure as a developer, when you're getting subscribers, when you're getting people buying your products and using your products, we want them to be well-intentioned the users that you're trying to target and that you have the right safeguards in place to make sure you're not having to do a ton of extra work to ensure you have the right users coming for the right reasons.

David Barnard:

And the last thing from Google Play that I wanted to highlight, again another thing that's really cool is that you can now create custom Play Store listings targeted on keyword. So in the past there's been deep links to the custom, there's been a lot of options for these custom Play Store pages, and now you can target based on keywords.

Sarah Karam:

So excited about this. We've been investing a lot in our custom Store listings, adding more features so that you as a developer can experiment, can customize the actual Store listing based on the audience. And this is another way that I think we hope will help developers to maximize the value of the organic traffic they're getting. Search is such an important part of the Play Store or search company. We have decades of experience in search and we know how important it is to make sure if I find your app based on a certain keyword search, that you might want to show me a very different custom Store listing experiment to maximize my conversions, so, so excited. We're also suggesting the keywords that are important ones for you to customize based on. I'm really excited and I hope more developers will take advantage of this so that they can really boost their conversion rate.

David Barnard:

And the Google keynote was many jokes made about it. AI, AI, AI, Gemini, Gemini, Gemini. So there's been a lot of talk about AI this week and broadly this year. What are some of the ways you think Google Play developers can leverage AI in the most impactful ways? I do feel like it can be a distraction. It can lead you down paths that maybe aren't optimal for your business. So I know you and your team talked to a ton of developers and this has been a hot topic for over a year now. So what are some of the top ways you think that AI can help developers and actually increase business instead of leading them down rabbit holes that aren't going to actually benefit them?

Sarah Karam:

I think that's a really good point that AI is a tool and it's a super powerful, very exciting tool. And now with the power of the models, especially the custom models, the multimodal models, there's so much more you can do as a developer to either decrease your time spent on something that maybe you could be a lot more efficient with or maximize the value, the experience for the user. So I'm really excited about it. I do think you're spot on that where you use AI in your business, whether it's user-facing or internal, needs to start with what problem you're solving. And if there isn't a real problem that you're solving either for the user or your business, probably not the place to use AI or probably anything really. You shouldn't be in the business of building demos for users.

But I think for what we've heard from many of our partners and developers at large developer ecosystem on where they're finding success with AI, a lot on content creation. I think back to custom Store listings, a few years ago, if you were to have to customize based on so many variables, keywords, regions, AdWords campaign, everything in that nature, you're going to have a team who's doing a ton of custom creation of assets and testing those out, it is important work. What if that team could be using tools and therefore they can spend their time on the more complex work of understanding what's working and use those tools to create those assets in a faster way? And often those assets can be created even better with more rifts with tools.

So I think a lot of it on content creation in all ways and forms, we're seeing feedback that it's been very successful. Still requires a lot of human verification and hopefully that goes back into your model, whatever model you're using so that you can get better over time. I think another space we're seeing a lot of success is in helping the customer experience, both the customer feedback and any support systems that you might have as a developer, but also just making sure you're asking in a contextual way for feedback, getting feedback from the customer.

There are some areas I think we're seeing slower adoption. Whenever it's user-facing, I think there's some concerns of is this going to be good? We don't want to denigrate trust. But that's that. I think it's just the beginning. I think there's so many exciting things that we're seeing many of our partners adopt and also seeing as a system, we're seeing usage in really interesting areas. So yeah, whether it's on-device models that we announced in the keynote, the content creation multimodal models, especially if you're a video creator, back to making sure you're engaging your users across the whole funnel, there's so many ways you can use AI. But it needs to start with the problem that you're solving.

David Barnard:

Don't just throw AI in the app and so you can put AI in the keywords.

Sarah Karam:

Yeah, not a good idea or not sustainable.

David Barnard:

I want to switch gears and talk more specifically about how developers can succeed on the Play Store. I know that's what you and your team focus so much on. And the first thing I wanted to talk through is what you've been seeing. And so something you were telling me about is that on a global scale, this is something I've been saying on the podcast for a while, but then hearing it from you, you actually have the global data and the user level data to be able to actually see how this is playing out. But I've been saying for a long time, anecdotally people talk about subscription fatigue and things like that, and then I'm looking at the RevenueCat data saying we see so many apps growing and the pie is growing. And so I've anecdotally saying it seems like more and more people are willing to pay for digital goods and services and more and more people are willing to pay via subscriptions, but it all kind of felt anecdotal. But you see the data.

Sarah Karam:

We see the data, absolutely. And you're spot on. We're seeing subscriptions growth, both in net overall but also in buyer numbers. People are subscribing at scale to lots of different apps and use cases. I do think there's something to be said about making sure you're matching the value to the subscription you're offering. So I think often when we hear subscription fatigue, that could be maybe an incorrect way to say maybe the value is off or people don't feel like that's worth paying for.

And we are really investing and encouraging developers to think beyond subscriptions because many, especially US developers tend to offer only subscriptions. And we think that especially on Android where we've got such a broad range of users in different markets, different device types, it doesn't work for everybody. Back to what we were talking about with installment payments and other forms of payments, so we definitely don't think it's a yes-and. Subscriptions are growing, what a wonderful way to grow your business. There's so many benefits to that and there are other ways you can reach users, maybe even diverse users that you would not have reached otherwise if you can think beyond the monthly or the annual subscription.

David Barnard:

In that Whitepaper that we're going to link to in the show notes, one of the things that really stood out to me to the point you just made is that in the Whitepaper, it showed that US-based developers are more likely to lean on subscriptions, but the developers in Asia, in other parts of the world who actually understand their markets better, you see in the data and those pie charts and things in this Whitepaper showing that developers outside the US are actually leading the way in diversifying the way to pay. In the US, consumers are more willing to pay via subscription. It is one of the biggest markets. But it's interesting to see that developers in other countries actually know that's not always going to work.

Sarah Karam:

Yeah, totally. That's what I love about Play and Android and my job, that you learn from others. There's so much that we think we know about how users want to pay or how apps should be built, and then it gets turned on our head sometimes, which is a really wonderful thing. So yes, you're spot on. I think in what we found in Asia Pacific, more users are interested in a diverse way to pay, usually IAP, often a blend of subscriptions and IAP. Whereas in the US, it typically has been the case that people launch with subscription businesses and scale those, maybe offer more plans, but rarely will branch out into IAP in addition.

And the interesting thing is that the developers who are based out of Asia Pacific and who have been more willing to experiment with subscriptions and IAP actually tend to find really good success in the US. So it's a really little known fact that the US is one of the largest mid to entry-level device markets for Android. There's this mindset that the US is everyone's on a premium device, but that's just not true. So we do find that developers who are willing to experiment with either a hybrid of IAP and subscriptions or more IAP will tend to actually do very well in the US. There are more people with different devices, different preferences who might not be willing to pay for an annual subscription but they might do a seven-day pass or a standalone consumable for a specific product.

So yeah, we do see this big regional difference. And I'm glad you mentioned the white paper, very proud of the team, our consulting team that worked on that. We have really wonderful researchers and consultants who go deeper into these topics.

David Barnard:

I want to dive deeper into diversifying revenue streams and hybrid monetization. But before we get there, I did want to take a step back and talk about how different the Play Store is than iOS. And I think too many people, it's like they know it's different but there's still a tendency to copy and paste their iOS strategy and think it's going to work on Android. And this is part of it is a diversification of payments. But the Play Store works differently. The people are different, the devices are different, the willingness to pay is different. There's some pretty big differences between the iOS market and the Android market. And when you're on both platforms, a lot of developers who say they can't find success on Android, some of that is maybe that they aren't spending enough time to really understand those differences. Any key things that you think developers should be thinking about?

Sarah Karam:

Yeah, absolutely. This is a really big topic and something that we talk a lot about on the team of how can we reduce those barriers to understanding and entry and help developers to build for Play in a different way. And I think one thing we've noticed in our data is there's so many devices on Android. There's a huge spectrum of you've got the $2,000 device, they made the latest S device from Samsung, or the $200 device that somebody got and it works very well but it doesn't have the same spec as a very high end device. And the users who are on the more premium devices actually behave quite similarly to those on iOS or other premium SKU heavy platforms.

So if you're only targeting those users, then potentially the same behaviors will work with some swaps to the features. But if you're really targeting a premium user, there might be one SKU that you build for that or you just generally keep your aperture a little more narrow, but that will not get you the full benefit. And the beauty of Play and Android where you've got 2.5 billion people around the world. And many for whom this is their first computing device, their only computing device and their preferences are going to look different. And so we absolutely do encourage anyone building for Play and Android to think bigger and to think about the bigger diversity of users that you can reach.

So whether it's I think really it comes down to the full funnel, thinking through how am I going to target my message? How am I going to offer different features and services and value that can really appeal more broadly? It doesn't mean that you have to offer too many bells and whistles like every single thing in the app, but tailor that depending on device type, on region, and especially price points and different SKUs, whether it's subscriptions or IP, even just different plans depending on the user and what your signals are telling yourself that they might want.

I think that's really critical. We've seen that in our work that the developers who take that time and do that little bit of extra legroom to understand, "Oh, this is a different platform. It's more diverse, there's more to do," they reap a lot more rewards than those that don't.

David Barnard:

I want to dive deeper into a lot of things you mentioned, and you mentioned specifically that, and we've been talking about this, diversification of revenue streams. And there's a lot of different ways that can happen. And so one of the top things, and not only are there a lot of ways that that can happen, there's stages to it as well. And so for a small team thinking about all the different SKU, and we will get to that and talk more deeply about how to package all the different SKUs and stuff, but even for the early developers, the lowest-hanging fruit is to experiment with pricing and packaging and maybe even layering in some consumables. How do you think about how developers should start the baby steps to expanding into the diversification of revenue?

Sarah Karam:

It's a great point because yeah, if you're a subscription developer who has maybe one tier, potentially two, you've got one plan, a premium plan, and that's what you're working with, jumping straight from that to let me build a virtual currency ecosystem might be quite a bit to take on. It's possible but not going to be easy. You're spot on that we definitely recommend the low-hanging fruit of testing, pricing and tiers is a good place to start. And that's something that we often see, for example, especially in content-heavy spaces, so media, entertainment, books, music, that there is some anxiety to go outside of the boundaries of this premium plan. A lot to do with the unit economics of the content that you might be providing as a developer, a lot to do with just norms of competitors.

But what we find is that if you can just think about what works for you, it's not what your competitor is doing or what another industry is doing might not be the right fit to start to test, to pick apart what might be a better fit for a seven-day pack, like a starter pack for your app. If you're a music app or an audio app, maybe offering a few podcasts as a consumable. And if that works and people want more, then maybe thinking through, "Okay, how might this fit into my broader premium plan?"

So absolutely agree that if you're early to this experimentation phase, to first start with pricing and plans and see what works. And to be as open as you can to weekly subscriptions is something we see a lot of success with in some regions, but not too many developers using it, especially out of the US in addition to prepaid plans. So it's not really a subscription but another way to market a subscription to a user so that they don't feel that burden of, "I got to commit for a whole year to this product."

David Barnard:

Hey, we were talking about this earlier and it's the kind of thing that might actually work really well for AI apps because they do have such a high cost of goods is that instead of offering a seven-day free trial, maybe you offer a seven-day pass that's two bucks. And if there's a really low barrier to entry and the user sees a lot of value, then you get them in at this cheaper price. And then if they do see a ton of value, that's the on-ramp to the subscription rather than just offering a free trial which may end up being very expensive to deliver, especially when your cost is high. And so yeah, thinking through some of these. And that's a fairly low-hanging fruit. It's not that hard to create a seven-day pass and offer that instead of a seven-day free trial. There's a lot of this kind of experimenting and pricing and packaging.

I did experiment my weather app just showing the monthly price as a default. So in my app, you just see one price and then there's a button to see all the plans. I did an experiment seeing the $4 a month plan, does that increase conversion compared to seeing the $40 a year plan? Turns out 20% increase in paid subscribers by them just seeing forward through anchoring, right? They see $4 like, "Oh, that's cheap." Funny enough, I ran the experiment through RevenueCat and I've been tracking the data.

Sarah Karam:

Nice.

David Barnard:

And I'm going to actually lose money. So even though I got a 20% increase in-

Sarah Karam:

Interesting.

David Barnard:

... conversion, those monthly subscribers are churning. So I switched it back to the $40 plan because that is going to maximize revenue, but it was just super low-hanging fruit experiment. And to see that lower price point was really attractive and did lead to more paying users even though it didn't maximize LTV for me. And those are the things that people should be experimenting with.

Sarah Karam:

Totally. I love that, and I love that you took the time to look at the full analysis of the data, how it impacted your LTV, and were open to just trying out new things. I think that's exactly what we're encouraging the ecosystem to do. It's not so much to absolutely have as many tiers as possible and consumables and a virtual coin currency of your own. It's really getting into that habit, that muscle of continuously experimenting, tracking what's working and what's not based on your goals. Again, and if you are global, which I hope many of you are listening are because that's the beauty of mobile development, being very aware that what works in one market or works for one set of users, especially on Android, is very likely to not work as well outside that group. So just to be much more nimble and test as much as you can.

David Barnard:

And your team has been thinking a lot about and sharing about, and we talked about, a kind of framework to think about these experiments through is maximizing the points along the demand curve. Some people are willing to play a small amount, but there's a lot of people willing to pay a small amount and there's a small number of people who are willing to pay a lot, and finding ways. So as you're experimenting with this hybrid monetization and different pricing and maybe a paid trial instead of a free trial, it's looking for ways to maximize all the points on that demand curve. Meet people where they are for their willingness to pay. And a lot of it has probably are leaving money on the table, not experimenting on the high end of things. It's like offering a super premium tier, offering additional ways to pay.

Sarah Karam:

Yeah, we've seen a lot in our data. For example, the majority of users who will purchase in an app, including subscriptions and beyond, tend to wait over a year before they make their purchase. That is a very common flow, which was very surprising to us.

David Barnard:

Surprising to me too.

Sarah Karam:

I think we had assumed like, oh, everyone's just going to wake up, install their app, and then immediately get convinced by the value proposition and purchase. And I think what that insight told us, and it does differ a little bit by vertical and type of app use case, but it's generally there's a big audience out there that won't be convinced in the first few days of your app that they're willing to pay, but they will be one day and that data is exactly what we see. So yeah, exactly to your point, picking up as many signals as you can through your own understanding of what your app offers, your own audience analytics, and then thinking through what might be the right offer for this user based on their patterns.

Are they a Mary coming in every now and then, somebody who might be shopping around for different apps in this use case that you might have a different approach for that kind of user versus like you said, somebody might be a power user really engaged. And you might be leaving value on the table with them because you're not offering them enough. Maybe they're a monthly subscriber, but there's more that they're very willing to pay for. So absolutely, I think there's this mindset that I either have to get someone to pay or they're free. And if I don't do that in the first couple of weeks, then I'm missing out. I've got a low conversion rate. And I think we're seeing that's maybe the old mobile world, and I think the more sophisticated developers that we're seeing greater success are thinking much longer term and bigger picture in terms of the segments of their audience.

David Barnard:

And probably again, stage. An early stage app maybe does need to push really hard on that early monetization and maybe they can't play that long game. But then to see that that is an opportunity. I was shocked when I saw those numbers that so many people do subscribe after a year. So freemium can be and is a very powerful strategy. Get the habituation, show them some value, and eventually bring them into the paying fold.

Sarah Karam:

Exactly. Exactly.

David Barnard:

One of the things we've been talking about but haven't really gone super deep in is consumables. In some ways it's the ultimate way to meet people along the demand curve, and I feel like Tinder, I've talked about this a lot as a great example of that, is that those consumables really give the people who want to pay more, who are super engaged, who can pay more, the ability to pay more, but that's probably not the best fit for every app. So how has your team seen consumables be used most effectively to meet people at different points in that demand curve?

Sarah Karam:

Yeah, and you're spot on that Tinder, a lot of dating apps have seen great success with both IAP and the hybrid model where if you're a subscriber, you might even get unique access to certain consumables that are a good fit for you. We are seeing more. It's funny that you say that maybe some people would think that's not a fit for their business. And I'm going to say something radical right now, so bear with me. I think it could be a fit for anyone's business. And I think there's something out there that is a good fit for consumable. It's just about thinking through what's the right way for you to do it and when. To your point on maturity, that's not something we'd recommend to if you're very early stage and you're a subscription model year or two, that might not be the right time to think about adding a whole bunch of IAP.

And I'll give an example. I think what we've seen out of a lot of developers in Korea and Japan that are in the web novel, webtoon, or comic space, huge industry, and actually it's really growing in the US. We see a lot of young Americans loving that kind of content and using a lot of those apps on their phone. And that industry used to be a little bit more subscription heavy and similar to many other content industries, this model where you're subscribing and getting whatever it is, your access for a monthly period or an annual period. And what we've found is that many webtoons and web novel developers are experimenting with their own virtual currencies with a hybrid of IAP and subscriptions and seeing really good success, especially when thinking through, like you said earlier, the high value users who might have a higher appetite for certain IAP. There's more they can offer there. And they have that content and they can even be creative with what they source from their own creators, the artists.

So I think there's so many ways any business could approach IAP. It is something to think about when you're in a more mature stage if you're a subscriptions business because it is complicated. We're very bullish on learning from other industries. Obviously gaming is by far the most IAP-centric industry. And I think there's a lot apps can learn from both obviously from gaming, but also from dating, from comics and web novels. And social apps also have been experimenting a lot more with IAP because it can be a really good way to engage your valuable users and to offer them more chances to build that trust and that buy-in with your app. Like you said earlier, people want to pay. We're seeing that propensity increase over time. So giving them the options to do that in a way that works for them is a smart thing to do.

David Barnard:

So speaking of gaming, a lot of people talk about gamification of apps and we have seen huge example. Duolingo is a great example of bringing a level of gamification into the app, but you also mentioned tipping and coins and collectibles and stuff like that. I actually met yesterday, might end up having him on the podcast. He was a hoot to talk to, the founder of RunPee, the app where tells you when in a movie you can go pee where you're not going to miss a big plot twist or something. And he actually said they moved to fully tipping and he's making more money than ever, and that people just love the app so much. And he presented in a very help us create this content. And he was saying they get surprisingly large tips even. And so point being with this whole conversation has been about diversifying monetization and gamification, tipping coins, collectible. There's so many ways to do that. So any low-hanging fruit there that you think people should be exploring?

Sarah Karam:

Yeah, we are seeing huge growth in tipping, whether that's through a coin economy or just some IAP that you can offer at various price points. And we're seeing it mostly in livestreaming and social. And to your point though, we're seeing that expand. We've noticed this trend where creator economy apps really started. The most fast-growing ones tended to be in video creation, so YouTube and Discord, TikTok, that kind of app. And we're now seeing that model expand more and more into different areas and industries. For example, there's this trend that we're seeing coming out of a lot of greater China-based apps called Drama Shorts, which is these short form videos. They're definitely worth checking out some of these apps. They're very fun to watch, very engaging, almost like the Days of our Lives style, dramatic. And a lot of their content and their monetization models are akin to games, a lot of IAP, a lot of time-based things.

And on tipping, you're absolutely right that we're seeing more developers experiment with tipping outside of the traditional social livestreaming. It definitely is something to I think, continue experimenting with. It depends on the problem you're trying to solve for the user back to the problem and the value that they're going to get. But absolutely, that's something that we think has got a huge bright future. We're seeing growth in these types of business models at a faster rate. And that's part of the reason we announced also yesterday that we're increasing our price limits, I think to 999.99 because we know that there's demand and some users are absolutely very into these creators and have a lot of love for them and the content they're making and want to tip.

So it is a really important space. It's fast-growing. And I think creator economies have this beautiful symbiosis where often it's creating a space for these smaller creators. We call them professional user-generated content where your goal is not even necessarily to become the next whatever it might be, major studio, major artists, major et cetera. Sometimes it is, but sometimes it's not. Sometimes you do want to remain a kind of a professional state, but in a smaller scale, and this allows you to have a business and run that business, not just for video creators, but for all types of creators out there.

David Barnard:

The last topic I wanted to bring up from the Whitepaper, it is really cool again that you all shared a White paper and shared a bunch of data, and I know the team's looking to share more and more data over time. But you mentioned secondary product market fit and the fact that apps that find solid secondary product market fit have almost tripled the minutes with their daily active users and almost doubled the daily active user to monthly active user ratio.

And we saw this with Calm, a great example again, pioneer big app in the space, is that when they expanded from meditation into sleep stories, it wasn't this dramatic bolt on a whole another feature set but it was a very natural extension of the product. But it was a very strong secondary product market fit that unlocked new growth for them. I haven't talked to Calm and gotten any data on this or anything, but from what we see broadly, it seems like that created a new inflection point in their growth. And I would imagine similarly, they probably saw increased engagement, more daily active users.

There's a trigger, right? We were talking about earlier, it's like a trigger. "I need to go to sleep. Oh, now I'm going to use Calm to sleep." Whereas maybe meditation it's like, "Oh, I know I should meditate, but I don't have time today." And so that was a way to not only create secondary product market fit, but create this secondary trigger to bring people back in the app. So what are you seeing be successful in this secondary product market fit?

Sarah Karam:

Yeah, I think absolutely I love that this is data that we saw corroborated by what our instincts were really telling us, that I think what Calm did really well, and John Tan, their CPO, I think speaks about this really thoughtfully, they're out to solve a set of user problems that actually have some common symptoms potentially where I'm not sleeping well. Maybe I have some anxiety. I'm a new parent. I'm not sleeping well because I have young kids. They've continued to think very holistically about that instead of thinking, another way to think about your product is I'm a livestreaming app or I'm a meditation app. And that can be a lot more restrictive and isn't actually what your users are coming to you for. They're coming because they have a problem. There's a great quote that Andy Dunn often uses. I think it's attributed to Peter Drucker originally that the consumer rarely buys what you think you sell.

I think it's a very accurate trend that we see in the apps in the store that often the reason that somebody is coming to your app has a multitude of ways you can solve for that problem and to not feel restricted to I'm only going to offer streaming video or I'm only going to offer a social text-based interaction. From a design perspective, we're very supportive of clarity and a clear user proposition and clear onboarding all of the above, and I think Calm does that very well. But yeah, absolutely. We do see that if you can solve that problem in multiple ways and offer more diversity of content on how to do that, because not everyone's the same and some people might want to listen to something without video, some people might want only video, some people might want a transcript. If you can be more, again, back to diversity of different users and different ways of interacting, you can be big picture thinking about the problem you're solving, we see a lot more success.

So yeah, we see that across the board of every type of user behavior that if you offer more than one way to solve that problem, you'll see better success.

David Barnard:

Yeah. Very cool. Well, as we wrap up, anything else you wanted to share with the Sub Club listeners?

Sarah Karam:

I'm so grateful that you had me on. I'll just plug for a second that a lot of us on the team are huge fans of your podcast and we love listening to it, and you often have, a lot of the guests you have are people we work with and really love the insights that you share. So thank you for the work you do. I think it's rising the tide of the entire ecosystem, and so happy about that.

I'll share that we publish content as much as we can. We're trying to get more insights out there into the ecosystem. So if you want to learn more about what we're up to, especially a lot of the I/O announcements, check out our blog, check out our X feed, YouTube channel, all of the above to find out the latest. And yeah, very excited for everyone to give feedback on the features we announced at I/O the past couple of days and to test them out.

David Barnard:

Thanks so much for doing this. This is so much fun.

Sarah Karam:

Thank you so much for having me, David.

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.