Victor Chapela (CEO) hosted a webinar a few weeks ago titled “Why do most nutrition apps suck?”.
I took notes and will publish these in two parts starting with this one, covering beginner steps, explaining the best ways to launch a nutrition app, how to move on to monetizing in, and the best and worst business models for a nutrition app company.
The second part will encompass user engagement patterns, explore the differences between food logging and behavior tracking, how the user’s individual psychology affects how they use the app, and more.
My notes are below.
Launching a nutrition app
At Suggestic, we have the advantage of having the experience of releasing our own direct-to-consumer app as well as numerous white label nutrition apps. It turns out that the best approach for releasing all kinds of nutrition apps is a strategized combination of a waitlist and a sequence drip campaign.
Let’s start by looking at why the waitlist approach is the best first step in creating and releasing your nutrition app.
A landing page prompting the user to sign up for a waitlist is a great way to test the overall viability of your idea. The best thing about it is you can create one before you have even fully developed the idea of your app. Just offer people to join the waiting list saying that the app is in closed beta for now. The people who sign up will be your testing audience who will help you build the app that users want to use.
A waitlist allows you to start gauging interest and seeing who would be interested to download the app, while also letting you test and adapt your marketing strategy. Through a thought-out landing page, you can gauge what people want and need. It also allows you to create surveys and very specific types of engagement.
Example: For Dr. Kara Fitzgerald’s biological age reversal program Younger You, which Suggestic curated, we put a landing page together in a day – it involves a simple form to collect email addresses, links to the study supporting the program and links to social media profiles.
We also added a list of actions (pre-order the book, refer to friends, read the study, visit us on social media) that earn customers points to move up the waiting list. This creates a sense of scarcity, making the customer that puts in their email address more likely to purchase the final product.
What a waitlist does is generates a group of people who are interested in participating and who will tell you why they’re interested in participating. This is how you can test your messaging and value proposition. It allows you to define what is best for your particular app in terms of messaging and product-market fit. You can learn how much you will charge for your app and how to integrate it in your full experience.
In addition to a waitlist, we have found the use of a sequence drip campaign highly beneficial.
In our direct-to-consumer Suggestic app, we launched many programs over time. What resulted in the highest conversion rates was a sequence of drip marketing emails. A sequence of 3 emails worked the best.
- First email should contain pure information. (Example: teach the customer about epigenetics, send them an article about aging clocks, share a study)
- Second email should hint at your product. (Example: hint at the potential of age reversal with food and supplements)
- Third email should entirely focus on your product and include a clear call-to-action. (Example: here is the waitlist for our Younger You program – it is restricted to a cohort of a hundred, but you can complete actions to move up the list)
The two most important elements in the release of a nutrition app are a very clear call-to-action and the sense of scarcity.
Scarcity is created either by a time restriction or a small cohort. It is the most important element to drive fast conversion. Scarcity needs to be hinted at in the drip campaign, and in the case of a time-based restriction needs one to two further emails (one when the offer is due and one when it stops being available).
Like any other product, an app needs to be launched. The biggest app developer misconception is that by simply adding an app to the app store, people will eventually find it and be fascinated by it.
Your nutrition app should be a part of a larger outcome-based program or service. While people do value the app, they value the outcome above everything else.
Monetizing a nutrition app
Suggestic has utilized the waitlist for a biological age program (Dr. Kara Fitzgerald’s Younger You program which is a one-of-a-kind age reversal program) to survey its potential customers, giving us a very insightful look into the expectations and needs of the market. Out of 1500 who signed up for the waitlist, 450 answered the questions.
The survey first told us what the customers wanted to get from the program. It was to reverse biological age, live healthier, live longer, and so on.
The second thing the survey taught us is what exactly it is that users are willing to pay for. In our specific case, people responded that they were most likely to pay for lab testing, for integration of devices, for a visual dashboard of their biological age, and for nutrients and supplements. A smaller percentage of people were also willing to pay for one-on-one nutrition coaching.
The interesting outcome was that people were not willing to pay for what they responded was the most useful for them – for meal planning and recipes. Those things are assumed free.
The survey found that there was room for a $50-75 subscription in a digital form, and a $250-400 space for those people who wanted something that included products such as tests, supplements, and services of coaching.
The pure gold of the survey was asking the customers how they would describe this program to someone else. This gave us the exact words and the language that our customers use. We realized why exactly this program is interesting for them and what they value. We could use what we were given to reflect it back to our users through marketing speech.
People value physical things and the things that they already know cost a lot (in our case, lab tests were valued the highest, just before devices and wearables). When the perception of price is already set high (in the understanding of customers in our survey, lab tests sometimes cost in the thousands), it is easier for the entire nutrition program to have a higher price point.
Once you have these different perceptions in the customers’ heads, a program that includes a combination of some type of personalization (a lab test, a device or even just a personalized test), some coaching (one-on-one or group) and some supplementation, the value perception will directly represent the value that people give these specific elements – and, as we found out in our survey, they value all three above groups highly.
One thing to avoid is to be compared to a weight loss diet. Those are either free online or cost $15-20 in book format. Apps like Noom are not selling the weight loss – they are selling the coaching and lifestyle guidance (in the specific case of Noom, the coaching is entirely what drives the price point).
What you tell users they are getting reflects on how much they are willing to pay.
One-time fee vs subscription
The way that people feel about their weight loss or lifestyle change will be the defining factor in whether they are prepared to pay a one-time fee or a recurring subscription for your nutrition app.
For that reason, it is important to understand two different psychologies of nutrition app users.
- Ashamed people
These are people who have been pushed to a drastic lifestyle change by an impactful event in their life (such as diagnosis of diabetes, for example) or the decision to lose weight. They want to have a success story as fast as possible and prefer to do this in secret. These users pay for the success they expect to have in the near future, so they prefer a one-time fee.
- Proud people
These are people who are not paying for a quick fix, a quick success story, but are rather buying a better version of themselves. Examples include meditation apps or gym subscriptions. These are tools that proud people have on hand to use at any time to upgrade their life, but they don’t feel the urgency to use them. These users pay for an ever evolving levelled-up version of themselves, and therefore prefer a subscription.
The pricing model must reflect both of these opposite types of psychology.
Freemium, paywalls, subscriptions, in-app purchases, bundles
Once you’ve learned how to set the price for your nutrition app based on customers’ value perception, and have created both one-time fee and subscription options, the next step is to decide if your app’s pricing strategy.
Even though freemium seems a great option at first glance, this only works well if you have virality. It is very hard to monetize. An example of a successful freemium app is MyFitnessPal.
Freemium works extremely well with video games. When a user feels successful and comes back very frequently, they get the dopamine rush. Eventually, however, the game stops progressing as fast as it did in the beginning, so the user has to start putting money in (incrementally more to continue being competitive). This works well because the video game itself is the ultimate goal of the video game.
Within a nutrition app, the goal is not to keep coming back to the app forever and using it every day. The value of a nutritional app may be very transitional. Therefore in-app purchases work the best. The customer pays for a cohesive user experience. The app is like an orchestrator that sits on top from the moment they learn about you to the moment they refer you to a friend or refill their supplement order.
For this reason, bundles are, in our experience, the best way of valuing a nutrition app.
People pay for outcomes. They don’t want to just pay for a keto bar, they want to pay for the benefit of being keto for a long time. Your product is giving people the outcome. Your product is not the app itself, it’s not the supplements or meal delivery or grocery lists.
“Sell people what they want but give them what they need.” – Joe Polish
The second aspect of the price itself as well as the revenue model behind what you’re selling is influenced by the channel you’re using to get to your customer. People want to pay for your business model AND the channel through which the people are learning about your model.
There is a finite number of channels that work – paid marketing, content marketing, bundling with other products. Whatever you are choosing as a channel will define what business models are available to you.
At Suggestic, we tried freemium for a long time, and it was not nearly as successful as paid app. Since the customer acquisition cost for a freemium is normally the same as for a paid app, even with a very good conversion, you will not be getting more than $6-10 lifetime value out of a customer, and each download will cost you $2. Your competition (a free trial app like Noom, for example), however, is making 100$ per month per customer and their average retention rate is 3 months, clocking up at $300 for the same user.
The main differentiators are products and services outside your nutrition app. The app is a way to link together the user experience. The apps are commodities. They are the minimum requirement. Customers are expected to be met where they are and be presented with a cohesive user experience. The app itself will most likely not be your main competitive advantage – that will be the full unique experience you can provide for your customer.