By testing different pricing options, MyBook was able to increase subscriptions to their paid monthly access to their digital library by 15% and overall cash flow by 25%!
About MyBook Digital Library
MyBook is a subscription-based digital library. Launched in 2012, the platform features over 50,000+ Russian language books and targets a Russian speaking audience. Users pay a monthly fee for unlimited access and there is also a more limited library of approximately 9,000 titles offered for free. Books can be read in iOS or Android apps and also in the browser. So far, there over 1.2 million registered users.
The Test: Increasing Monthly Subscription Signups
MyBook users pay for subscriptions for access to the digital library and enjoy the service free of advertisements. MyBook’s goal was to drive more customers to sign up for their monthly service.
There are two types of subscriptions: Standard and Business. Base price points are the following:
- Standard is priced at 169 RU (~$5) per month and allows access to a limited subset of books (40000+ titles).
- Business is 499 RU (~$14) per month and allows full access, including business books and fresh releases.
They offer several period price points via website and in the app (from 1 week to 1 year, with a varying discounts up to 10%).
The goal of their A/B test was to determine which combination of subscription periods would result in the most monthly service signups for the standard option.
When a new user tries to open a non-free book, she is presented with an offer to purchase a Standard Subscription. There are two options on the screen. Depending on the variation, these options were:
- A – Variation ‘Week’: One month (169 RU / $5) subscription or one week (66 RU / $2) subscription
- B – Variation ‘Year’: One month (169 RU / $5) subscription or one year (1690 RU / $45) subscription
MyBook was able to quickly set this up as an A/B test to verify the winning option with their user base. What were the results?
Changing the Second Subscription Option to Yearly Resulted in a 15% Increase in Monthly Signups!
By changing the second option to B – “Purchase Year,” MyBook was able to improve their conversion rate for Monthly signups by 15%
The overall improvement for the winning B-case scenario was a 25% increase in cash flow for MyBook.
What Will They Test Next?
According to MyBook:
“We have a couple more of cunning ideas about optimizing conversions for our Android app, because audience there differs a lot from our iOS audience. We also consider testing all kinds of things about readership and retaining our readers…”
This could be very interesting – A/B testing is a great tool for segmenting different types of users and measuring engagement.
This is a classic case of relative pricing and price anchoring. When presented next to a weekly price, the monthly price could seem expensive, but, next to the yearly price, it feels like a deal! It’s great to be able to verify this in practice with your users.
We recommend that MyBook also experiment with other pricing strategies such as decoy pricing. There is a great passage about this strategy in Dan Ariely’s book, “Predictably Irrational.” He offers an excerpt from the book on his website. By offering a nearly identically priced but clearly inferior product next to your higher priced product, you can drive users up from the lower priced product to the higher priced product. In the case of MyBook, they could perhaps offer a standard monthly subscription for $4.99 and two models of the business subscription at a higher price point but with one that is clearly superior. Freshplum and ConversionXL both offer excellent advice for these types of advanced pricing strategies on their blogs. Good luck with your future tests!