How Bounce improved authentication rates for Lingopie and lifted their entire business KPIs
How Bounce improved authentication rates for Lingopie and lifted their entire business KPIs
Lingopie is the world's only language-learning application that uses real TV shows and movies to help its users learn a new language. They make language learning fun and as simple as watching your favorite TV show.
One of Lingopie’s amazing achievements is their long-lasting relationship with their users.
While joining their subscription service, Lingopie users go through an authentication process before starting their free trial. The purpose of the authentication process is to prevent fraud and attain a valid form of payment from the user.
Having a reliable, smart and efficient authentication process that validates the users is key to achieving long lasting relationships.
Before Lingopie started working with us many of their potential users did not comply with the authentication process.
We got to partner with Samuel Medalie, CFO of Lingopie and found that many users were failing the authentication stage due to faulty declines. These users could have been approved but were not making it past the initial authentication.
We integrated with Lingopie’s current authentication process, keeping the existing user journey. Putting our solution to work, our ML algorithm identifies good users who were about to be blocked by card declines. These good users were able to smoothly pass the authentication process and move on to the free trial phase, ensuring a positive experience.
After joining Bounce the number of new users completing the authentication process increased, allowing more users to initiate their journey with Lingopie and transition into paying customers.
"Bounce increased our authentication rates by 8%. Customers are automatically approved, so the user experience is seamless."
This has a huge impact on Lingopie’s subscribers, which increased by 5% as well as other KPIs such as top line, LTV, conversion rates and retention.
"Bounce helped us provide our new users with a smooth authentication experience. More users start their journey with us and stay for a longer time”
While improving Lingopie’s authentication process, we were also happy to advise them with other payment-related decisions they faced, such as optimizing their subscription process. We simply see our customers as partners and their success is also our success.
Improved KPIs
lift of
authentication rates
rise in total deals
LTV &
repeat customer’s purchase
conversion
& retention rates
How Bounce improved authentication rates for Lingopie and lifted their entire business KPIs
Lingopie is the world's only language-learning application that uses real TV shows and movies to help its users learn a new language. They make language learning fun and as simple as watching your favorite TV show.
One of Lingopie’s amazing achievements is their long-lasting relationship with their users.
While joining their subscription service, Lingopie users go through an authentication process before starting their free trial. The purpose of the authentication process is to prevent fraud and attain a valid form of payment from the user.
Having a reliable, smart and efficient authentication process that validates the users is key to achieving long lasting relationships.
Before Lingopie started working with us many of their potential users did not comply with the authentication process.
We got to partner with Samuel Medalie, CFO of Lingopie and found that many users were failing the authentication stage due to faulty declines. These users could have been approved but were not making it past the initial authentication.
We integrated with Lingopie’s current authentication process, keeping the existing user journey. Putting our solution to work, our ML algorithm identifies good users who were about to be blocked by card declines. These good users were able to smoothly pass the authentication process and move on to the free trial phase, ensuring a positive experience.
After joining Bounce the number of new users completing the authentication process increased, allowing more users to initiate their journey with Lingopie and transition into paying customers.
"Bounce increased our authentication rates by 8%. Customers are automatically approved, so the user experience is seamless."
This has a huge impact on Lingopie’s subscribers, which increased by 5% as well as other KPIs such as top line, LTV, conversion rates and retention.
"Bounce helped us provide our new users with a smooth authentication experience. More users start their journey with us and stay for a longer time”
While improving Lingopie’s authentication process, we were also happy to advise them with other payment-related decisions they faced, such as optimizing their subscription process. We simply see our customers as partners and their success is also our success.
Improved KPIs
lift of
authentication rates
rise in total deals
LTV &
repeat customer’s purchase
conversion
& retention rates
Further reading
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Scale is a California based, tech-driven company. They build next-generation health, wellness education, and products that address some of the world's most common health issues. They sell their products online as a subscription base or as a one off purchase and have a checkout process in place.
They knew they had challenges around checkout and subscription conversion and were hoping to find a solution to mitigate that.
We partnered with Hannah Blum, Head of Marketing Strategy, and Chris (Christapor) Arzoumanian, Senior growth product marketing manager, two industry experts.
Diving into Scale’s processes
Scale offers various types of supplements, in 5 different brands, both one-time checkouts and subscription refills. When reviewing Scale’s system, we ran a comprehensive analysis of their payments, to see which failed payments could be saved. Through our ML system, we found that 20%-30% of their customers were being wrongly rejected at the time of subscription refill/ renewal (and could be saved), due to a variety of reasons totally out of Scale’s control. We got to work and implemented our solution.
Shortly after, by cutting out a portion of those card declines, we saw a stream of steady and increased revenue, overall raising their KPIs.
As more deals were seamlessly approved in real-time, a number of things took place. Customer satisfaction levels grew, retention rate improved, and even the ticket size per transaction increased, thanks to frictionless payment experiences.
“We grew our subscription retention rate by 2.4%.”
Bouncing up lost checkout deals
Renewals were just the beginning - while analyzing Scale Media’s checkout transactions, they realized how many of their customers were actually unable to complete their purchase - 10% (!) of their customers were being rejected at checkout, due to different reasons.
We applied our proprietary machine-learning algorithms on Scale’s data, using millions of data points, and identifying which declined checkout transactions should be recovered. With our real-time ML model and zero-risk policy, we were able to recover a full 30% of Scale’s declined checkout transactions. Bounce’s auto-recovered checkout deals lift Scale’s top line by almost 3%.
As Scale’s checkout experience improved, the average user purchase size and total number of purchases increased. Instead of losing potential users to failed checkout processes, Scale was now retaining its leads and customers at much higher rates.
“We work closely with bounce and see bounce’s team as partners. We constantly consult the team with any payment related decision”.
What it’s like to partner with Bounce
Every decision related to payments is a multifaceted process for any company. At Bounce, we thrive on collaboration to enhance your company's payment experiences. Our approach is to seamlessly integrate with your processes, providing valuable insights and guidance.
The successful collaboration with Scale's talented team has driven the desired results – improved metrics and happy customers. Together, we were able to showcase the power of a collaborative approach in transforming payment experiences.
"As for the decision to work with Bounce, it was a pretty straightforward one. We took zero-risk and saw an uplift of 3-5% on our checkout generated revenue"
The authentication process and its effect on your KPIs
Card authentication declines happen more often than you think.
At Bounce, we wanted to get to the bottom of it.
While mapping hidden and obscure spots of the payments industry, we uncovered something quite incredible -
up to 30% of online credit card authentication processes are denied.
This scenario frequently occurs when you allow your customer to try the product or service before paying for it. Within the context of free trial subscriptions and sign-ups, failed card authentication is a common occurrence.
During a trial sign-up, a merchant authenticates the user's card while allowing them to try out the product or service before payment.
Sadly, due to false payment declines, the merchant can inadvertently block the customer during the authentication step. This occurs after the customer has made the crucial decision about your product, provided the payment details, and all that remains is for them to complete the authentication process.
But it's precisely at this critical moment that you are losing them, and possibly for good.
The authentication process is both an opportunity and a challenge.
If the customer fails the authentication for no good reason, it will tarnish the customer's experience.
On the other hand, when done right, authentication gives the seller an opportunity to bypass certain customers who are less likely to become paying customers, thereby increasing conversion and top line.
Essentially, this process increases the percentage of users that ultimately become paying customers.
Over the years we learned that many companies are not even aware of how many good deals they’re losing due un-authentication rates.
Many don’t see how common the problem is and how it affects a business’s performance and the marketing team’s KPIs:
- Top-line - False authentication declines lead to lost customers, deals, and loss in revenue.
- Cost of Acquisition (CAC) - Getting a successful user registration is a massive step, especially after all the marketing resources you spent on getting them there. An unauthenticated credit card deal puts you in a position to retarget and repeat the process, causing your CAC to spike.
- LTV, retention and repeat customers - The negative effect of declined authorization process has a clear impact on LTV. The customer’s bad experience will result in them not coming back. In the case of free trial, they will clearly not turn into recurring revenue, as they are not even starting their journey with you.
- Conversion rates - Losing customers during the authorization process not only affects the specific authentication conversion rates but hinders the whole conversion - Leads/ Visitors > Free trial > customers.
How Bounce improves authentication rates
Here at Bounce, we've learned to identify false authentication authorization declines,
enabling us to save an average of 20% of deals that were wrongly rejected.
This results in a 7% increase in the total number of users progressing to the next stage of your funnel.
Our ML algorithm quickly identifies and approves good deals in real-time, saving the transaction and ensuring users can smoothly transition to become paying customers after authentication, without any roadblocks.
By perfecting the authentication process, you can filter out unwanted leads and ensure you only allow leads with conversion potential to move forward.
It’s about balance - you need to make sure these good users are moving forward, while identifying those that are not going to become paying ones.
Unlike other marketing, growth or optimization tools, Bounce doesn’t require any additional budget or extra work after implementation.
There is no customization, monitoring, or any additional set up needed - All you have to do is relax and enjoy the absolute wins.
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A good B2C marketer tries to win over customers. But a great one wins over customers while hitting company goals, aka marketing KPIs (key performance indicators).
Setting targets and strategies that support a company’s long and short-term objectives is the most important part of a B2C marketer's job. In this blog, we'll cover the key KPIs every B2C marketer should know to boost their business.
Understanding the marketing funnel
Marketing KPIs exist within the marketing funnel. To understand any KPI, one needs to be familiar with the marketing funnel as a whole. This is essentially a model that visualizes the path customers take from brand awareness to conversion (purchase).
While there is no single marketing funnel that everyone agrees on, there are some basic stages that remain the same.
- Awareness: Introducing consumers to your brand and keeping it top of mind.
- Consideration: Educating consumers about your brand and its unique value proposition.
- Conversion: Convincing consumers to make a purchase decision.
- Loyalty: Building long-term relationships and turning customers into advocates.
Within the B2C sphere, the marketing funnel can also be referred to as the Purchase Funnel. Essentially this outlines the buyer's journey within a website, from the product page to adding items to the cart, and ultimately checkout.
Conversion rate
This is probably the most important metric or marketing KPI for measuring performance. Conversion rate records the percentage of users who have completed a desired action.
It helps assess if a certain action or campaign was successful or not and indicates what actions need to be taken accordingly.
Marketers or growth specialists can define their own different conversion rates; For example - one could measure the traffic to cart conversion rate (customers that arrived at a site and placed a product in the cart), or the level of traffic to a newsletter signup (the amount of visitors that ended up subscribing to a newsletter).
Traffic to Cart Conversion Rate: This measures the percentage of website visitors who add items to their shopping cart. It helps assess the effectiveness of product visibility, website design, and the ease of adding items to the cart.
Cart to Purchase Conversion Rate: This metric indicates the percentage of visitors who complete a purchase after adding items to their cart. It reflects the persuasiveness of product descriptions, pricing, checkout process, and overall user experience.
Traffic to Newsletter Signup Conversion Rate: This measures the percentage of website visitors who subscribe to the company's newsletter. It gauges the appeal of the content, incentives offered for signing up, and the placement and visibility of newsletter signup prompts.
Conversion rates are calculated by taking the total number of users who 'convert' (for example, by clicking on an advertisement), dividing it by the overall size of the audience and converting that figure into a percentage.
For example, to calculate conversion rate of visitors > free trial, you need to divide the number of free trial signups by the total number of visitors. So , if you have 500 visitors to a free trial campaign landing page, and 45 of those visitors subscribe to a free trial, you have a conversion rate of 45/500, or 9%.
Checkout conversion rate
A subsection of conversion rate, and a major component in e-commerce businesses, this B2C KPI marketing metric refers to how many leads ‘convert’ into actual paying customers. This can also be referred to as macro-conversion, whereas a micro-conversion can refer to general engagement with the business (as mentioned above.)
Return on Investment (ROI)
While there are creative ways to cut costs and stay resourceful, marketing campaigns cost money, especially large ones aimed at attracting a lot of eyeballs. This is why ROI (return on investment) is crucial to your overall marketing costs and budget. ROI is the biggest determinant of cost allocation, with the goal being to get the most revenue possible with the least amount of investment.
Calculate ROI: Divide Net Profit by Cost of Investment, then multiply by 100%.
For example, if you invest $10,000 and generate $15,000 in revenue, with a net profit of $5,000, you would need to divide 5,000 by 10,000 and turn it into percentage - 50%.
Customer Acquisition Cost (CAC)
Customer Acquisition Cost (CAC) is the total expense of marketing to get a single customer. It covers the costs of marketing campaigns and other related expenses necessary to attract new customers, needless to say, it's important.
The CAC formula is calculated by dividing the total marketing costs by the number of customers acquired during the period.
For instance, if your monthly marketing expenditure amounts to $5000 and you acquire 1000 new customers, your CAC would be $5.
AOV (Average Order Value)
A crucial metric within the e-commerce industry, the average order value (AOV) measures the average total of every order placed with a merchant over a defined period of time and is a key factor in business decisions for online stores. It is calculated by dividing the total revenue by the total number of orders.
To find the Average Order Value (AOV), you divide the total revenue by the number of orders placed. For example, if you made $4000 from 160 orders this month, your AOV is $25.
Calculation:
$4000 / 160 = $25
Lifetime Value (CLV or LTV)
Customer Lifetime Value (CLV or LTV) is a metric that represents the total revenue a business can expect from a single customer over the entire duration of their relationship. It's a crucial measure for understanding the long-term value that each customer brings to a business. CLV takes into account not only the initial purchase but also the potential for repeat purchases and the overall loyalty of the customer. The customer lifetime value formula is:
Customer Lifetime Value = Customer Value x Average Customer Lifespan.
This gives you the revenue expected from an average customer over their time spent with your business.
Churn Rate and Retention Rate:
This time a pair of crucial B2C marketing KPIS: Churn Rate and Retention Rate are two key performance indicators (KPIs) used to measure customer loyalty and engagement.
Churn Rate:
This metric represents the percentage of customers who discontinue using a product or service within a specific period of time. It reflects the rate at which customers "churn out" from a business.
The formula to calculate churn rate is as follows: Lost Customers ÷ Total Customers at the Start of Time Period x 100.
For instance, if your business had 250 customers at the beginning of the month and lost 10 customers by the end, you would divide 10 by 250. The result is 0.04. Then, multiply 0.04 by 100, which equals a 4% monthly churn rate.
Retention Rate:
This metric indicates the percentage of customers who continue to use a product or service over a certain period of time. It measures the ability of a business to retain its existing customers and prevent them from churning.
The formula for calculating retention rate is: ((Number of Customers at the End of a Period - Number of New Customers Acquired During that Period) ÷ Number of Customers at the Start of the Period)) x 100.
For example, if your business started with 500 customers, acquired 100 new customers, and ended after a certain period of time with 550 customers, the retention rate would be: (550 - 100) ÷ 500) x 100 = (450 ÷ 500) x 100 = 90%.
Tracking traffic source and volume
Web traffic sources are the various ways people arrive at a website.They give us clues about where our visitors come from, the volume of traffic, and how they discovered the content. Monitoring these sources and assessing the amount of traffic helps manage your online presence and decide where to invest resources wisely.
Typically, these sources include:
- Direct Traffic: Folks who type our website URL directly into their browser or use a bookmark.
- Organic Search: Those who stumble upon our site through search engine results after typing in relevant keywords.
- Referral Traffic: Visitors who click on links from other websites, blogs, or social media platforms.
- Social Media Traffic: People who find our site via links shared on social media platforms like Facebook, Twitter, and Instagram.
- Paid Search: Visitors who click on ads displayed in search engine results.
- Paid social: Users who click on ads or promoted content on social media platforms.
- Email Marketing: People who click on links in emails or newsletters sent by us or our affiliates.
- Display Advertising: Visitors who click on banner ads or display ads placed on other websites.
An example taken from hubspot traffic sources report
Click-through Rate (CTR)
Click-through rate refers to the marketing metric that measures how often people click on a link, ad, email, or any piece of content in general. This tells us how successful the piece of content was in capturing a person's attention. The higher the click-through rate, the more successful the ad has been in generating interest.
It's important to keep in mind that these numbers are typically low when referring to ads, as many internet users today have developed ad fatigue (the average American sees somewhere in the region of 4,000 to 10,000 ads every day.) A typical click-through rate may be only about two users per 1,000 views (or impressions), or 0.2%.
Email Open Rate
If your strategy involves email marketing, understanding your Email Open Rate KPI is crucial. This tells you how well your email marketing is working as it indicates the percentage of people who open the emails you send. Many digital marketers love to focus on the size of their email list, but what use is a huge list if no one's clicking? A higher open rate means your subject lines are grabbing attention, while a lower one might mean they need some tweaking.
Which KPIs do I establish?
When establishing which marketing KPIs for you are most important to your ecommerce store or B2C company, it's essential to look at the bigger picture and consider how different KPIs interact with each other. For example, while a high conversion rate may seem great, if the customer acquisition cost is too high, it could significantly impact your overall ROI. In this instance, you would ask yourself why the CAC is higher than usual or why your top line is low while conversion rates seem to remain stable.
By analyzing multiple KPIs together, you can gain a more comprehensive understanding of the performance of your marketing efforts and make better decisions.
The KPIs measured can be adjusted periodically based on your marketing priorities and the current challenges in your sales funnel. For instance, after launching a service or product, you may prioritize driving traffic to it. Once you achieve this, you can then shift your focus to converting the generated traffic. After successfully converting leads, you can redirect your focus to metrics like Lifetime Value (LTV) or the percentage of repeat customers, and so forth.
In conclusion, investing time and resources into understanding and leveraging B2C KPIs is essential for staying ahead in the dynamic realm of marketing and achieving sustainable success in today's B2C landscape.