From Acquisition to Retention: Avi Ben-Zvi from Winclap

Winclap is a growth marketing agency known for its innovative strategies and a keen focus on both user acquisition and retention. Avi Ben-Zvi, Winclap's GM for North America, delves into the evolving relationship between user acquisition and retention, the impact of privacy changes on marketing strategies, and the importance of understanding lifetime value (LTV) for sustainable growth. He shares practical strategies for harmonizing user acquisition and retention efforts, and recommendations for app marketers looking to enhance user engagement and retention.

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Tell us about yourself and your role at Winclap.

As GM for North America, I help lead the operation across all the various different solutions we offer within Winclap.

Winclap is a growth marketing focused company looking to scale in North America. I’ve been brought on to help usher in that new era within Winclap. I joined about a year ago and it still feels pretty fresh, pretty new as we keep learning a lot.

What’s the relationship between UA and user retention?

It's very interesting for me as someone who's come from the paid media user acquisition side. If we go back five, six, seven years ago, it was all about user acquisition. Companies were just focusing on the lowest cost efficiency rather than the best cost efficiency for actually bringing in new users. Whether it's an app or retail, direct to consumer, or whatever it is, that was always the focus.

Things really started to change with Covid and post-privacy changes. Companies started realizing that it's not just about growth at all costs and bringing in new users day over day. They need to understand if these users are valuable beyond that first interaction. What they started to find, especially within the app world, is that users were often deleting the app, snoozing push notifications, or just not engaging at all.

There's a more willingness now to bring user acquisition and retention together, finding a concert of how these two worlds can work together.

And how do you recommend marketers make UA and retention work together?

The biggest thing now is LTV. Everyone's focused on understanding LTV and the payback period. We look at retention curves, the cost of bringing users in, and the period at which companies start to see value from these users beyond acquisition.

For example, I'm bringing in these users. They have a strong cost efficiency, but what is actually the value of this user coming in and how do they measure that value? So you see a lot more focus on trying to understand LTV and the payback period. I have spent X amount to actually acquire this user. In what time period am I going to go get that money back and actually start to see profitable revenue off of those users coming in?

And in some cases, what you'll start to see is more expensive CAC: users on iOS are more expensive to acquire. But what we see is their LTV is a lot stronger. So I may need to wait a longer period of time for that buyback period. But once you hit that, you’re getting paid out two, three, four times full in terms of the value of that user coming in. I think this mentality has been very crucial for helping to bridge the gap between those two elements.

It’s something we do a lot with our quantitative growth model. We look at the retention curve: how long are we actually keeping the user in the fold? And then we'll assess what is the cost of bringing them in? And based on subscription cost, product costs, whatever it is within the app, at what period of time is the company starting to see value coming out of this user beyond acquisition?

How have your strategies for UA and retention adapted for a privacy-first world?

User acquisition historically was easy to measure because you just looked at last-touch attribution. Now, advertisers are more willing to think outside the box and consider different attribution models beyond this. Privacy controls mean that last-touch attribution doesn't provide as clear a picture as it used to. It's crucial to hit the necessary SKAN thresholds within iOS to get as much visibility as possible into what's happening. Without this visibility, it becomes difficult to truly understand how to optimize your media for iOS.

As someone who started with pure user acquisition, the increased importance of retention and engagement is clear. What are you doing not only to bring in the customer, but to keep them involved? It's not just about acquiring users; it's about keeping them involved and moving them from casual consumers to dedicated, loyal users. 

How do you prioritize LTV to develop a more holistic marketing strategy?

I think the best ones are bringing that element of retention and engagement into their attribution model. They’re saying, I'm going to bring in LTV incrementality coefficients, buyback periods, etc. There's no perfect model to mix all those things together, but you have to figure out some sort of balance that can take those different things into account. That way, you can see from an investment standpoint what is going to be really important from that first touch all the way through to somebody actually becoming a consumer and hopefully a consumer for a long time. 

Finding that right mix is really important, and then understanding how that changes certain elements within your paid media as well. It's no longer just paid media last touch informing targeting, creative, and messaging. It’s thinking about not just what are the offers, special discounts and things of that nature that are going to bring users in, but what is the unique value proposition? Because if you're bringing somebody in based on a unique value proposition versus “get 40% off on your first purchase,” that user probably has a better chance of being a retained high-LTV consumer versus the person who's coming for the discount, gets it, and then gets out the door and never returns. When you focus on that user, you get into the tricky game of acquisition costs rising, rising, rising. And you can't keep up with it.

What’s driving the interest in LTV over pure acquisition?

Advertisers realize they can only go so far with a pure acquisition play. In order for them to truly be successful, they have to think a little bit differently than they used to. I think privacy has certainly impacted the interest in LTV over acquisition. Super low CACs are also a thing of the past and it's impossible to scale your business just on the back of that now. 

In general, what you see within the market is that four or five years ago it was all about growth at all costs. Just grow, grow, grow, grow. Don't worry about the bottom line. Bring people in the door and call it a day. And I think now the trends, whether it's related to the market, related to how businesses are doing overall, etc. is more towards sustainable, profitable types of businesses. And that lends itself more to what we're talking about today, which is focusing more on that LTV and retention strategies. 

Do you have any recommendations for app marketers just getting started with user retention?

One of the most important ones is really trying to understand your existing consumers: defining those cohorts. That's what we often do– Winclap will come in, assess the situation and say, okay, here are your power users, your tried-and-true. These are your core users who are sticking with your app. Next, there’s another cohort that’s pretty involved, but sometimes they trail off a little bit. These are your casual users: they're not that loyal, but have made a couple valuable actions that are worth increasing. Finally, these are your lapsed users. You probably spent a lot of money to bring them in. They bought something or they subscribed for a free trial or whatever it is, but then they're out the door. So it's really focused on defining those cohorts, then deciding how you are going to message those cohorts differently. The power user is going to need a very different type of messaging than a casual user or a lapsed user. They're going to need a different type of cadence. Defining that and then thinking about the messaging and the cadence is a good place to start because then it feels a little bit less daunting. 

And then the second most important thing is keeping it super simple. A lot of times there's an inclination to do a lot of different strategies, especially if you're coming from the user acquisition side where things become super nuanced. But you don’t want to scare people off. You don't want people snoozing those messages and you certainly don't want people deleting the app. So keeping it simple, not going overboard with the amount of communication, I would say erring on the side of conservatism versus aggressive messaging.

How do you bring teams together toward the same goal?

We do a lot of what we call “growth panels." We bring together many different parts of an organization: of course you have retention teams, but it's also the finance side and the marketing side because the cohesion point for all these different points of contact is thinking about the business as a whole.

It's taking off the pure marketing cap and thinking: what are the strategies and what are the ways that we're going to achieve true business success and actual synergy? Our quantitative growth model tries to align more towards that by going beyond the medium metrics that you'll see. It's focusing on LTV like I mentioned, but also incrementality coefficients, buyback periods, gross margins and retention curves– anything that’s going to give you more sustainable movement towards growth and profitability. On the whole, it’s meant to give you a North Star that all teams are aligned on. That way as a marketer, whatever strategy you’re implementing or wherever you’re investing dollars, you know it's going towards this business-related North Star.

What are some of the technical challenges and solutions you encounter when running retention campaigns?

Having a really streamlined and effective set up in the CDP is critical. I think a lot of times there's a lot going on there and our focus is cleaning it up, and implementing a logical approach to the messaging strategies and the cadence and all those things. That to me is really the key. 

Do you have any examples of strategies that improve client retention or overall user engagement?

Probably one of my favorites is something we did for Shell's app, a specific app in LATAM. We started off by doing exactly what I've been preaching, which is defining those different user cohorts based on transaction frequency, value segmentation, i.e. how much money are they spending, at the gas station? Because it's not just about pumping gas, it's about the other services they could take advantage of at that particular gas station. And then doing an A/B test across all their different owned media, email marketing and push notifications, and trying to maximize both their transactional and frequency value within the app and offline. It's a two-pronged approach that we put in place and it proved very successful, especially looking at the long-tail effect: we had the most reactivated users over the last 12-month period, and the most current users over 12 months. And I think most interestingly, the least amount of churn that they had ever seen, i.e. the least amount of people not engaging or deleting the app over a five-month period.

Emerging trends or technologies that are making an impact on retention?

Well, probably the most boring answer I'm going to say is AI as everybody says AI to everything. But you know, I think that's really the thing, right? AI in terms of defining those user cohorts, AI in terms of pulling data faster and more effectively based on what's happening with user cohorts, and using AI for creative messaging based on how those consumers are actually responding.

I think we've seen it helps apps become a lot more efficient and streamlined in terms of their approach to retention strategies.