By Peter Ramsey

18 Oct 24

Case study
Two practical takeaways
1. A simple idea to collect better data
2. An A/B test to reduce churn
UX Exercise

Headspace•8 min read•

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A masterclass in user activation (96% of them)

According to Headspace, 96% of their users feel less stressed after using the app.

Even if this cherry-picked study isn't scientific, it demonstrates that millions of people are actually feeling something.

Their sign-up flow is a masterclass in how to set a goal, control the narrative and create the perception of success.

They use simple and common ingredients, to make a delicious sign-up-activation-soup.

This is exactly how the magical orange-blob-face does it.

Case study

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Two practical takeaways

1. A simple idea to collect better data

During the study, I focused on the benefit to the user of setting a goal.

But there's another angle to consider: how reliable data helps Headspace understand their cohorts.

i.e., how do you collect reliable data when people skim read lists, and often just select the first option that feels appropriate?

Their technique to smooth out the data, is to randomise the order of these goals.

Simple, but effective.

Over a large dataset, they now have better data to make decisions from.

Try it.

2. An A/B test to reduce churn

Longer billing cycles typically have lower churn rates.

This is often because of a mismatch between the billing cycle, and the payback cycle.

As an example, if you watch Netflix 15 times a month, then you've been exposed to 15 "benefits", every time you pay hard-earned money.

But lots of products aren't used that often.

Instead, they're infrequent tools that have a very high impact.

Like checking your credit score, or organising your finances.

Churn increases when you're being billed multiple times between these lumpy moments of serious value.

Users won't remember how helpful the product was for them 2 months ago. They're thinking about the next 30 days (or rather: the next billing cycle).

Longer billing cycles allow users to experience those "lumpy" moments of extreme value, within a longer time frame.

e.g., the annual fee, compared to the benefits they received over the entire year.

So, how do you encourage more people to opt for the longer billing cycles (besides discounts)?

Well here's a simple idea; Headspace offer an extended trial if you take the annual plan.

It may not work for you, but I've seen it be very effective.

Worth a shot.

P.S., If you're specifically interested in reducing churn, there's a whole Cheatsheet on it (and I've got an article about how I reduced my own churn by 60% coming soon).