The Moment of Truth: Pricing
Extract from Digital Brand Romance: How to create lasting relationships in a digital world. Available on Amazon.
In Part I (of Digital Brand Romance), we distilled why anyone buys any product or service, experience, or offering down to one single principle—we buy because it makes our life better. The previous milestones in the ADORE Process™ have laid out the conditions that you need to create to get your site visitor to commit to your brand. We now need to add the elements to make them stay and pay.
My parents are both mathematicians, highly practical, and very much old school when it comes to the subtle art of self-promotion. Their view is that great work speaks for itself, and therefore, there is no need for self-promotion. Q.E.D.
The problem with this approach is that it does not work. It does not work in the workplace, it does not work in a romantic relationship, and it does not work on Internet Street (John 2021; de Botton 2017; Taniguchi 2021). The fact is that if you don’t tell, and then remind, the people who matter about how it is that you make their life better, they might just forget. Not because they don’t value the relationship, but simply because they are thinking about 35,000 other things.
It is not enough to deliver a quality offering and to get someone through all the ADORE Milestones™ to the point of sign-up and engagement. To get them to buy, and rebuy, from you, you need to create an authentic yet systematic way to remind your customers exactly how you make their life better. To be authentic, your reminder system should be decoupled from your billing cycles.
Case Study: How Grammarly Uses a Weekly Newsletter as a Clever Reminder of Their Value to Maintain Engagement
The Challenge
In this case study, we depart from analyzing growing brands and look at a household name that has created a unique system for converting their digital relationships from Sign-up to Upgrade and rebuy. The Grammarly business story is quite interesting, as they started as a paid enterprise offer- ing, and over a decade, grew into a freemium consumer product (“How Grammarly Quietly Grew Its Way to 6.9 Million Daily Users in 9 Years” 2017). Although Grammarly is now a household name, they continue to put tremendous effort into ensuring that they remind their users of their value. Their consistent, personalized, and evolving system for doing this is a pivotal component of their incredibly high retention rates.
The Approach
Grammarly’s headline in Google is “Grammarly: Free Online Writing Assistant.” They draw you into using their tool through a zero risk, simple installation process of the free version of their product as a browser add-on. Grammarly activates a weekly summary of Grammarly Insights sent to you by e-mail as soon as you sign up. The weekly update provides you with basic stats about how many words you checked, how many mistakes Grammarly corrected for you, and how you compared to other people using Grammarly—they have turned e-mail writing into a competitive sport. Each e-mail is also a subtle reminder of the value you are leaving on the table by not upgrading, in the form of “mistakes that we found, that you can unlock by upgrading.” Their system creates the ultimate FOMO (fear of missing out) and makes it effortless to upgrade to get the big reveal.
As you use Grammarly, you are introduced to extended useful features in-situ and through their weekly e-mail updates. The feature revelations are relevant to the way you use Grammarly and so are extremely useful. Grammarly has successfully turned their e-mail marketing campaigns into a trusted relationship.
Why It Worked
Grammarly’s strategy to convert users into paying customers is one of the best in market. It has helped them double their revenue and active users each year since the business started in 2008. Their approach is worth deconstructing, understanding, and applying in your business.
The approach taken by Grammarly works because:
The resistance to getting started is almost zero. The browser exten- sion is free and easy to install, and you get immediate utility.
The points you are invited to upgrade are connected to the moments you have the highest perceived value from the app. If you use the free version and load in a new 4,000-word document, you’re actively and heavily invested in getting that document checked. That’s the perfect moment to ask the user to upgrade: you have used your free quota, upgrade, and never miss another mistake.
The weekly e-mails from Grammarly reinforce the value that the app is delivering to you each week—the newsletters are personal- ized with your actual statistic and only contain offers to upgrade at points where you will receive value from the upgrade. In addi- tion, the newsletters are fun! You receive reports that are lightly competitive and encouraging: “You were more accurate than 96 percent of Grammarly users this week” (I am awesome!); “You were more productive than 71 percent of Grammarly users this week” (I am winning!); “Grammarly Premium found three addi- tional mistakes that you could have corrected—Upgrade now” (instant FOMO).
Apply It in Your Business
Grammarly has evolved a perfect balance between utility in their offering and a reminder of their utility—or how they make your life better— through their personalized weekly newsletter delivery. While they set
Map out your end-to-end product usage journey, and mark:
(a) Rates of engagement at key points
(b) Perceived value at key points
Map out your value matrix by aligning your value points with your target audience’s willingness to pay. Overlay your rates of engagement over the matrix.
Note whether the points of engagement, points of value, and payment points align, and if they do not, adjust your process.
Use The ADORE Process™ to optimize the journey on your website and ensure that your value is supported through regular communications via e-mail, socials, or whatever channel your target audience uses to engage with you.