Episode 792: 156% More App Subscribers in Six Months! Here’s How We Did It

Download your free Tier 11’s nCAC calculator at: https://www.tiereleven.com/ncac

How do you acquire new customers without frustrating the ones you already have? It’s a delicate balance that’s harder than it seems, especially when you think you’ve reached your market saturation.

In this episode, we revisit a case study of a business that thought it had tapped out its market but was still able to scale quickly and profitably. We offered data-driven customer segmentation, personalized ads, and targeted creative hooks. 

Our results within about six months included a 52.7% year-over-year increase in total subscribers, nearly 20% growth in web subscribers despite a price increase, and 156% growth in app subscribers. 

In this episode you’ll learn:

  • How to target new customers without alienating existing ones
  • Why most businesses wrongly think they’ve saturated their market
  • The importance of granular customer segmentation in targeting
  • How understanding geographic and seasonal differences improves targeting
  • How accurate data and testing can help identify winning creatives 
  • Real examples of businesses turning flat growth into rapid expansion
  • How to leverage software tools to track and optimize your customer acquisition costs
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READ THE TRANSCRIPT:

156% More App Subscribers in Six Months! Here’s How We Did It

00:00:00:00 – 00:00:04:14
Lauren
how might we acquire new customers without pissing our existing ones off?

00:00:04:14 – 00:00:12:14
Ralph
unless you actually have this thing that we call Cappy imports or you have tier 11 data suite, you really don’t know who your new customers are, who your returning customers are.

00:00:12:16 – 00:00:13:06
Ralph
So

00:00:13:13 – 00:00:17:19
Ralph
going to show you some graphs inside their membership platform.

00:00:17:19 – 00:00:19:01
Ralph
So the first thing that we did is

00:00:20:14 – 00:00:42:23
Ralph
if you have a great product or something in the space like these guys do, where there is a starving crowd, as her mosey says, you should create some kind of community and monetize it in one way, shape or form into a continuity program. So the problem with these folks were that they had a high market saturation penetration, or so they thought.

00:00:43:01 – 00:00:58:21
Ralph
Okay, they were nation wide. They sell these products, they sell this membership site in this recreation niche. Okay. Rabid. You know, fans of this particular recreational activity and.

00:00:58:21 – 00:00:59:11
Lauren
You’re a fan.

00:00:59:11 – 00:01:01:01
Ralph
You’re on specific you’re a fan.

00:01:01:01 – 00:01:10:02
Lauren
Out fan. I’m like this. Like, we’re just going to pretend it’s dragon boating, right? Like they targeted the dragon. You’re going community. You’re like, you know this space.

00:01:10:04 – 00:01:10:23
Ralph
Yeah.

00:01:11:01 – 00:01:19:14
Lauren
If you’re not in the dragon boating community, you have no idea that there’s 20 people competing plus a drummer, unless you watch that or a farming like, ten year old. Right.

00:01:19:14 – 00:01:22:16
Ralph
So Dragon ball, dragon boating, you see. There you go.

00:01:22:22 – 00:01:43:12
Lauren
There are. There are memberships to dragon boating continuity plans. There totally are. It’s a huge fringe. Like there’s more people that watch the Dragon Festival than people that watch the Super Bowl. And so they’re isolated to the United States in our, modicum of space. It’s like how no one thinks about Singles Day being like the biggest sales day of the year, while the US, we just think about Black Friday.

00:01:43:14 – 00:01:44:13
Ralph
And.

00:01:44:15 – 00:02:02:17
Lauren
Anyways, it’s okay. We live in our world. A bubble of this alleged dragon boating recreational membership community. Again, what you’re saying though, is that, this is set up for when you’re in the space, you have a place to geek out with other rabid fans because not everyone gets dragon boating.

00:02:02:17 – 00:02:07:12
Ralph
Not everyone does. But yeah, maybe this could be in the dragon boating space.

00:02:07:12 – 00:02:19:19
Ralph
So problem that they have here is, like I said, high market saturation penetration. So they felt when they came to us like we think we’ve got everybody we’ve targeted everybody in the US who could buy our stuff.

00:02:19:19 – 00:02:22:07
Lauren
We’re like so they’ve they’ve conquered Tim.

00:02:22:07 – 00:02:44:06
Ralph
They’re, they thought that they had they’re like we’ve sort of reached we got to this great level. It’s great business. But we just got stuck and we can’t find new customers. So that is the that was the real problem. So not being able to acquire new customers at a cost that made sense. As soon as they scaled, all of a sudden their Ncac or their we actually had to figure out their own kayak.

00:02:44:06 – 00:03:03:03
Ralph
They didn’t really know their own kayak to start off, which is fine. Cost to acquire a customer. So we determined that we went through sort of a very deep level, analysis for that, figured out what that number would be. And with a membership site, you know, you’re selling digital products, so your gross profit is pretty high.

00:03:03:05 – 00:03:21:02
Lauren
Yeah. Your labor is not as intense. So you’re able to scale faster and you do increase your staff when you’re managing, you know, every 50 or 5000 members, you need to bring on an additional customer service. Yeah, individual. But yeah, your cogs are pretty healthy at scale.

00:03:21:04 – 00:03:33:09
Ralph
Yeah. The basis of this is there’s actually I forgot to mention, there’s a software in this to help these users, you know, in their pursuit of that recreational activity, which is a tremendous software which.

00:03:33:13 – 00:03:34:18
Lauren
Well, I can out.

00:03:34:20 – 00:03:40:13
Ralph
Yep. We’re using their ads to sort of attract people into the community. But they get the community.

00:03:40:15 – 00:03:48:13
Lauren
Yeah. And also dragon boating paddle app. Like you can see how many strokes you get in a minute and you can track how often you do it. I got it, the Strava, paddleboarding.

00:03:48:15 – 00:03:59:03
Ralph
Yeah. So and then you got in the back end, you’ve got e-commerce like whether we’re selling them more paddles, I don’t know, different paddles. Just a paddle.

00:03:59:04 – 00:04:08:03
Lauren
Board. You need a knee pads for those I don’t know. There’s a difference between rowing and paddling.

00:04:08:05 – 00:04:08:11
Ralph
Is.

00:04:08:11 – 00:04:16:23
Lauren
There. Row. You go backwards. When you paddle, you face a direction that you’re entering your device into the water.

00:04:17:05 – 00:04:23:03
Ralph
Yeah. Just watch out. Don’t like, you know, destroy your mic. Clang! Anyway.

00:04:23:05 – 00:04:28:22
Lauren
You’re actually so, So cute. Figures of usb-C, that’s, you know, the work,

00:04:29:00 – 00:04:31:17
Ralph
For skates. Obvious.

00:04:31:19 – 00:04:36:19
Lauren
I’ll be as I imagine, that word to hide all this information. So let’s keep going.

00:04:37:00 – 00:04:48:05
Ralph
All right? We’re doing it. We’re doing it. So, anyway, inability to segment new users or customers and targeting. So big problem in especially in meta right now is

00:04:48:05 – 00:04:56:05
Ralph
unless you actually have this thing that we call Cappy imports or you have tier 11 data suite, you really don’t know who your new customers are, who your returning customers are.

00:04:56:07 – 00:05:16:20
Ralph
So the point is, is that if you were already a customer, meta in most cases is going to target those people. Even if you put them in as exclusions, they’re having a very hard time segmenting out new potential prospects in their targeting. And they were just serving their ads at a very, very high frequency to people who have already bought.

00:05:16:20 – 00:05:20:04
Ralph
So they’re super frustrated. And their members were getting super frustrated.

00:05:20:04 – 00:05:37:02
Ralph
Yeah, it was that they had good creatives, but I think they needed some help from a strategy standpoint for, identifying winning creatives based upon the point before that, which is, all right, which creatives are attracting new customers. So we had to figure that sort of stuff out.

00:05:37:04 – 00:05:58:08
Ralph
At the heart of all of this is really is data and reporting. So we needed to figure out what their Ncac is. So in our first three weeks or so, their growth strategist, we went through the whole spreadsheet, you know, sharing the PNL, you know obviously this confidential information. So I mean, we typically will get sort of a summarized PNL, but anyway, we’ll figure out exactly what your gross profitability is, what you want from your net.

00:05:58:10 – 00:06:21:00
Ralph
All of that. We use the N calculator, which you can get over at your 11.com/ncac, of course. So we figured that out with the advice of our growth strategist. And we really focused on new customer acquisition. And the big thing was new customer signups for the membership site. And on the back end, obviously, as the e-commerce side sort of pulled them in with the app as well.

00:06:21:00 – 00:06:26:18
Ralph
So it was just a whole strategy component that just really wasn’t in place. And they had a great business.

00:06:26:23 – 00:06:32:20
Lauren
Leveraging all the money models, throwing back to Alex that they had in systems. So essentially you’re saying

00:06:32:20 – 00:06:37:10
Lauren
how might we acquire new customers without pissing our existing ones off?

00:06:37:10 – 00:06:45:03
Lauren
And introducing them to the suite of offers and products available to them, whether they join the membership or just tap into these resources.

00:06:45:03 – 00:06:55:18
Ralph
So this is a very common problem. Like on every caller I’m ever on, like I’m sure for you to. Yeah, like this is the big problem. Like I can’t acquire new customers or I don’t know.

00:06:55:20 – 00:07:10:17
Lauren
Like us effectively. They’re like, how do I penetrate a new market where it doesn’t blow out my budget? Because there’s two ways of bank of a business, right? You’re bankrupt. By overspending on staff or overspending on marketing. And that’s a fear where people will mess it up. So it’s like, yeah, I want to acquire new customers at a reasonable cost.

00:07:10:19 – 00:07:31:02
Lauren
I don’t often get the without pissing off my existing customers, because you were saying that that frequency, it’s like the importance of where with Andromeda and all this type of stuff, like everything and matter we’ve talked about many times is essentially a massive retargeting ecosystem of ads. And it’s you want to have some control because matter should not be shoveling down a product you already bought down my throat.

00:07:31:02 – 00:07:39:05
Lauren
I’m like, I already bought it. Back off. That’s how I feel about Live Fresh right now. I’m like, stop advertising to me. I have four months worth of toothpaste.

00:07:39:06 – 00:07:40:09
Ralph
I know. Yeah.

00:07:40:14 – 00:07:43:05
Lauren
So I feel for these and butters and time.

00:07:43:07 – 00:07:46:21
Ralph
He’s dragging about exactly the fictitious dragging bearing space.

00:07:46:21 – 00:07:50:09
Ralph
Yeah. So those were the issues that we found very, very common.

00:07:50:09 – 00:07:51:15
Ralph
So the first thing that we did is

00:07:51:15 – 00:07:54:16
Ralph
we did our end tracking set up,

00:07:54:16 – 00:08:12:22
Ralph
and we categorized it. This is very important with not a lot of people do this. So in this case these enthusiasts are in specific geographies that are relating to certain bodies of water.

00:08:13:03 – 00:08:13:12
Lauren
Okay.

00:08:13:13 – 00:08:22:22
Ralph
So the point is, is that not every state is a target. So if you live in a state where you don’t have this specific type of body of water, so you’re talking.

00:08:22:22 – 00:08:27:15
Lauren
About like a puddle versus a lake, or is it like salt water versus fresh water versus.

00:08:27:19 – 00:08:29:09
Ralph
Any of those things, like how to give it.

00:08:29:09 – 00:08:32:06
Lauren
Away and maybe water water falls.

00:08:32:08 – 00:08:55:20
Ralph
Right. Somebody in Florida is a very good target, whereas somebody in Nebraska not a good target. Okay. You get my drift. Great. So they were targeting everyone. They weren’t going by state. So the one of the first things that we did is we’re like, all right, well let’s think about the business. People in Nebraska are not your customer unless they’re traveling to Florida and or or Massachusetts or wherever it happens to be.

00:08:55:20 – 00:09:11:10
Ralph
So and there was also a seasonal component to this as well. So there’s a lot of different factors. And they never really thought about that. So then we looked at by state what is their Ncac by state new customer cost to acquire a customer okay.

00:09:11:13 – 00:09:39:12
Lauren
So you’re taking it down. You’re dialing back from the federal level to the state level instead of focusing on the national coverage. You’re dialing down into the hyper specificity at the state level because the water recreation areas that they’re participating on, they are very well known to that hyper localized community. But I can’t tell you about anything in Nebraska versus I can tell you all about what Kiva.

00:09:39:14 – 00:09:42:12
Ralph
And I think have that right. Yeah.

00:09:42:14 – 00:09:46:00
Lauren
Because you’re not in Florida. You’re not I’m not sorry.

00:09:46:03 – 00:10:03:11
Ralph
Sorry. I’m Massachusetts, but, you know, we are both surrounded by water. Saltwater, that is. Anyway, the point is, is that they had never really broken this down, and they also had never really broken down. Like, which state is the most profitable or which state has the largest potential.

00:10:03:11 – 00:10:07:13
Lauren
Oh, they didn’t know the importance of their priority markets. Oh that’s hard.

00:10:07:15 – 00:10:34:08
Ralph
Oh that’s hard. So yeah. But the data was so cloudy. We installed tier 11 data. So we did you know this one of the processes of this is Capi imports. So we can basically figure out who’s a new customer who is not a new customer. So in most cases like you know, they were they were on track because most of the folks that they’re targeting are potential new customers, but they didn’t have a level of granularity.

00:10:34:10 – 00:10:57:18
Ralph
So like I said before, current customers are also being targeted by ads, which wasn’t as big of an issue. The point is like they didn’t really know geographically where the real sweet spots were, where where are the most lucrative enthusiasts? And so we broke this down literally state by state by state, and then created Ncac almost specifically for each state didn’t fluctuate all that much.

00:10:57:23 – 00:10:58:21
Lauren
Okay.

00:10:58:23 – 00:10:59:08
Ralph
Okay.

00:10:59:08 – 00:11:21:23
Lauren
So that was they might want to do like, like additional marketing. Right. Are they president specific trade shows that these tracking voters could be attending? Are they going to festivals or dragging voters are competing, like where do you invest deeper into markets that you can acquire new customers faster and cheaper. So like this type of stuff while you’re doing it from the digital side, it’s like mission critical to know your numbers.

00:11:21:23 – 00:11:39:04
Lauren
If you don’t know your numbers, you have no numbers to know. Like it doesn’t make you don’t have a business. You don’t know your own numbers because that way it allows you to. I mean, I say this with sensitivity to Black Friday, Cyber Monday, everyone defaults to the big three Google, meta and TikTok for their advertising when there’s still a lot of local opportunities or stuff.

00:11:39:04 – 00:11:51:08
Lauren
Like we said this, what you do with your first $10,000, knowing which states to penetrate to, and knowing the trends of that state, can open up diverse advertising channels that, may make sense for you.

00:11:51:10 – 00:12:18:23
Ralph
Yeah, yeah. And even going down to, like, the regional level and you’ll see and I’ll, we’ll share some of the ads here. I’m not sure how much I can really show you, but I’ll show you sort of an example of a couple of the ads. We even went down from like state and then to the local geography of that, and then in that local geography, I actually shot footage of bodies of water specifically that are unique to that local amazing.

00:12:18:23 – 00:12:47:19
Lauren
You added relevant creative hooks through landmark visual cues. Yeah. That and I mean we do that a lot. And we’ll even have like the copy language because if you think of someone in NorCal, if you hear someone say like hella, you know, they’re from NorCal, right? And if you hear someone say, like a boot or there’s different like vocal cues, language cues, landmarks that act as really good creative hooks to have you stand out above the competition so you leverage those gained on the regionalized level.

00:12:47:19 – 00:12:54:01
Lauren
Again, you had with Kiva Island, I would recognize it. You have no idea. But I hear you on this.

00:12:54:02 – 00:13:08:11
Ralph
Yeah, totally. And, you know, even in the ad copy and we’ll show some of the ads here, like we’re even using some of the local lingo like this is this is next level targeting for the ideal customer profile. So we I would.

00:13:08:11 – 00:13:27:07
Lauren
Argue it’s past level because I’d say this is madmen era. This is how you did marketing before. Digital marketing, like Facebook and Clickfunnels made it so easy to just like spray and pray massively what you like. People just took their digital billboards and made it so they were talking to everyone and it was easy to make money for a while.

00:13:27:08 – 00:13:30:15
Lauren
But now you’re going back to like foundational marketing. Yeah.

00:13:30:15 – 00:13:42:10
Ralph
I mean, if you really think about it, okay. Like the enthusiast in Southern California is extremely different than the enthusiasts for this in Alabama, for sure.

00:13:42:10 – 00:14:14:15
Lauren
And they have different things that they’re thinking about, different like ways that they’re competing where their dollar spent. And so if you talk to everyone, no one is listening. And here you’re saying, I’m being intentional. I’m personalizing my campaign and making it relevant for the end user. And that’s where, like you and I have said a lot, you will win with advertising, especially in the world of AI, when you’re as personalized and as relevant as you can to who they are in relationship to your brand and who they are in relationship to your CRM, which is where again, going back to what you said, the people who are existing customers, the relationship with the CRM

00:14:14:15 – 00:14:20:01
Lauren
is they were already bought, so that relationship wasn’t personalized or relevant to them. It was annoying.

00:14:20:03 – 00:14:38:07
Ralph
As annoying as well. That wasn’t the biggest issue, but that was like the real issue is like they just didn’t know what they didn’t know. And the question that they had, I think it was our first call because this is obviously this. A friend of mine that is not a customer of ours. But the point was, is he was like, am I tapped out in my market?

00:14:38:08 – 00:14:57:16
Ralph
And I gave him the example of my buddy on Cape Cod, my fishing guide, my my buddy Ryan Collins, which, you know, we were talking about this yesterday. I think that reporter is that he has a membership site for Cape Cod and this particular niche, and he has 2000 members, which bloats up to like 4000 members.

00:14:57:18 – 00:15:04:16
Lauren
So if he doesn’t, this individual, this dragon boat company, if he didn’t have at least 4000, then no way did he conquer his town.

00:15:04:18 – 00:15:08:14
Ralph
Exactly, exactly. But if you think about like Cape Cod is tiny.

00:15:08:19 – 00:15:09:08
Lauren
Exactly.

00:15:09:10 – 00:15:21:00
Ralph
Tiny, tiny, tiny little area. And it’s literally it’s Cape Cod Bay. That’s what he actually markets to. He doesn’t even market outside. So it’s a market inside a market inside a market. And he’s got 4000 of these enthusiasts.

00:15:21:04 – 00:15:22:08
Lauren
Somewhere in the niches.

00:15:22:12 – 00:15:43:07
Ralph
Absolutely. And you got and I was like, you guys are nowhere close to tapping out your market. So subject matter expertise certainly does help here. But also we were looking at some of the audiences inside meta are like, oh my god. Like they’ve barely scratched the surface. You just need to have good data to be able to target the right people with the right message to the locale that makes the most sense for them, speaks their language.

00:15:43:11 – 00:15:59:14
Lauren
So the creative helps curate the audience 100%. That helps allow them to penetrate new markets. And especially with Andromeda, like that’s what Zuckerberg wants. He wants again, that’s personalization and the relevancy. I want to know that you’re talking to me, Lauren. Elizabeth a true love.

00:15:59:16 – 00:16:01:00
Ralph
Yep. And no one else.

00:16:01:02 – 00:16:03:15
Lauren
Yeah, yeah. Make it all about me. My favorite subject.

00:16:03:17 – 00:16:18:19
Ralph
Okay, so speaking of making it about you, what we did notice is that we went back. We did an analysis of all their ads that have worked well. They didn’t have this regional targeting or any of that sort of stuff, which is fine. So that’s one of the things that we obviously did. But we also looked at what was the hook that was bringing in.

00:16:19:00 – 00:16:41:21
Ralph
What we felt like, according to in platform metrics were the strongest hooks, and it was clear there was 1 or 2. And we’ll show them here in just a second. I don’t know how much we can show them, but it was really problem based. It was like, this enthusiast has this specific problem because they see it inside their membership site, and they know that that’s the big problem.

00:16:41:21 – 00:17:06:17
Ralph
So that that hook like where to find X was the big problem. We identified that hook as the ad type or the hook with regional copywriting, regional lingo, regional dialect that then targets these people that all had the same problem, but spoke to them in a slightly different way. If they’re from Southern California or they’re from Alabama.

00:17:06:18 – 00:17:24:13
Lauren
Makes sense. Yeah. Because if they’re in LA for 405, you know that it’s going to take you two hours just to be able to participate in this recreational activity. Right. And so you’re concerned about like I need to be on the road by X time. Whereas in Alabama you might be walking or biking or like just be have this as your backyard.

00:17:24:13 – 00:17:50:23
Lauren
So again, you’re getting into that personalization and what that allows you to do. What I’m looking at here for those that don’t see online is we have a 52.7% increase of total subscribers year over year. Yeah, almost 20% increase of web subscribers year over year with a price increase. So they’ve made more money and acquired more customers and had a 156% increase in app subscribers.

00:17:50:23 – 00:18:07:08
Lauren
So that was leveraging one of the money models, one of the resources that was probably heavily invested in that was just sitting on the side, like I built this really beautiful thing and it’s so helpful, but no one’s using it. And you’re like, hold on, let me use it. Let me get it in front of the right people because they would love to have this app or software.

00:18:07:10 – 00:18:14:13
Ralph
Yeah. So the app, the subs, the subscribers, all of this incredible growth within six months.

00:18:14:15 – 00:18:15:12
Lauren
Come on.

00:18:15:14 – 00:18:35:13
Ralph
Just just these changes alone, like most of these changes are not even really media buying related. They’re just like, let’s think about the business critically and let’s try and figure out how to solve X problem, which is we’ve had flat growth the last three years. We feel like we’ve tapped out our market. They didn’t know any of these numbers.

00:18:35:13 – 00:18:51:12
Ralph
They didn’t know what was the cost to acquire a new customer. Like, let’s get that up as high as we possibly can. That and it still makes sense for you. And you guys are profitable, you know, including our fees and like great. So we figured out that we hinted at the results obviously great results here. We’re

00:18:51:12 – 00:18:55:18
Ralph
going to show you some graphs inside their membership platform.

00:18:55:18 – 00:19:14:12
Ralph
So here are the results. And once again if you’re not watching this over on professional traffic.com/youtube, I highly recommend that you do so. But actually this is you see active subscribers going from about 3000 to nearing 10,000