It takes a lot of experimentation, money, and mistakes to shift your model to subscriptions, and we’ve seen that without buy-in from the top down, it’s hard to succeed. What was your experience?
John Capodilupo: When we decided to make the transition, we discussed it with the whole company—management, investors, staff—and got buy-in from everyone. It’s a tremendously huge undertaking; we had to bring in departments and teams we didn’t have before: finance, specialized teams for software, the subscription management tools, business analytics teams. It was a lot and having full buy-in was key. You call your subscribers “members.”
What’s your take on the importance of building a loyal “tribe”?
Ben Foster: We use membership to drive people to achieve their goals. We don’t just get revenue because we have a subscription model, we’re “allowed” to get subscription revenue because we deliver ongoing value. That changes the entire orientation for us. We invest in the product experience, and we invest in the services we’re providing to our members to ensure that they’re deriving improved value over time for the product they’ve bought. So to us, the Whoop product is the membership, not the device.
Subscription pricing is notoriously difficult. How did you decide how to set up your pricing when you launched into the consumer space?
Ben Foster: I don’t know that we’re ever really done with figuring out the optimal price points that make sense both for our customers and for our company. But we actually haven’t changed our pricing since we launched the subscription: it’s $30 a month with a six-month commitment for new members. If they’re willing to pay upfront for a year or more, they’ll get a discount. But we continue to experiment with different pricing strategies. And we’re probably like a lot of other companies; we have to feel around for the appropriate pricing.
How important has customer data and customer feedback been in the evolution of Whoop since you went to a subscription model?
Ben Foster: Securing the privacy of our members’ data is our first and foremost concern. That said, the data is critical for helping inform our product development strategy and find ways to enhance the value of membership.
John Capodilupo: One of the things we’re really excited to be investing in is the ability to proactively coach our members based on the data our coaches are seeing. For example, a coach might analyze a member’s sleep data and recommend melatonin. This kind of thing gets to the heart of what’s special about our subscription model. We really care about the long-term engagement with our customers and the results they get from our product. And we’re willing to make those investments to ensure our customers get the best possible experience, even if it costs us more. We know it’s beneficial to our customers, and so we both win.