Data Led Growth project | Talabat

1. Overview

Talabat Pro is a subscription-based service loyalty programme by Talabat that provides users with exclusive benefits and savings on food delivery orders.

let's take a look at the benefits, pricing and the purchase flow for Talabat Pro

Talabat Pro offers free delivery and exclusive discounts, but the conversion rate from free users to paid Pro subscribers is currently below target. This could be due to an array of reasons:

1. Limited perceived value
2. Low awareness of benefits
3. Infrequent ordering patterns
4. Lack of personalisation
5. Absence of a trial period
6. Subscription cost concerns
7. Insufficient marketing or messaging
8. Competitive alternatives
9. Lack of loyalty or engagement features
10. User trust and past experience
    
    This experiment will explore how offering a one-month free trial to select high-frequency users can improve the free-to-paid conversion rate. Free trail directly enables the user to experience the value prop of the T Pro subscription enabling higher conversion rates
    
    // A few parallel observations and improvement points in the current discovery and user flow is highlighted in the below document with potential positioning, branding and messaging improvements.
    
    GTM TPro presentation.pdf

2. Hypothesis

If we introduce a one-month free trial for Talabat Pro targeted at high-frequency free users, then the conversion rate from free users to Talabat Pro subscribers will improve by 15%,because users will experience the direct value of Talabat Pro’s benefits, making them more likely to convert to paid subscriptions.

3. Goal

Increase the conversion rate by 20% of free users to Talabat Pro subscribers by implementing a one-month free trial, allowing selected high-frequency, high recency users to experience the benefits firsthand. This initiative aims to drive Talabat Pro’s revenue by converting engaged users through hands-on trial experience.

4. Success Metrics

• Conversion Rate (Free-to-Paid)
  • Best case: 20% absolute increase in conversion rate for high-frequency users.
  • Worst case: 5% absolute increase.
  • Any increase, with statistical significance, will be considered successful as it demonstrates an uptake in conversions.
• Trial Engagement
  • Track usage of Talabat Pro features (e.g., free delivery, exclusive discounts) during the trial.
  • Best case: 60% of trial users utilize Pro features at least twice.
  • Worst case: 30% of trial users utilize Pro features at least once.
• Conversion to Paid Post-Trial
  • Measure the percentage of trial users converting to paid status after the trial period.
  • Best case: 15% of trial users convert to paid.
  • Worst case: 5% of trial users convert to paid.

5. Experiment Design

-> What are we testing?

The experiment will test the impact of offering a one-month free trial to high-frequency free users to see if hands-on experience with Talabat Pro’s benefits drives higher conversion rates.

• External reference: Platforms with trial offerings report increased conversions as users experience premium features firsthand (Zepto Pass, Zomato Gold etc)
• Internal validation: Historical data shows that high-frequency users represent a substantial pool of potential Pro subscribers who may convert with an opportunity to experience Pro benefits directly. There is also a reduced perceived value problem with the current messaging and conversion flow.

-> Variation Design

• Control: No trial offer for Talabat Pro.
• Treatment: One-month free trial for Talabat Pro targeting high-frequency users.
• • Design: In-app banner and push notifications inviting eligible users to activate a one-month trial.
  • Messaging: “Try Talabat Pro free for one month and save upto 200 AED on delivery per month!”

-> Audience & Sample Size

• Audience: Free users with high order frequency in the past three months.
• Sample Size: Calculated based on current free-to-paid conversion rate and minimum detectable change of 5%.
• • Control: 1,500 users
  • Treatment: 1,500 users
• Duration: November 1 to December 15, or until statistical significance is reached.

-> Implementation & A/A Test

• Experiment Platform: Use LaunchDarkly for managing and toggling the trial feature.
• Preceded by an A/A test to confirm consistent free-to-paid conversion rates and engagement levels across similar cohorts.
• Experiment will run with a 50:50 split between control and treatment groups.
• Flag Name: "talabat-pro-free-trial" | Control: "NO_TRIAL" | Treatment: "FREE_TRIAL"

-> Trial Offer Implementation

1. Users flagged for the trial will see a banner or receive a push notification with an option to activate their one-month trial.
2. Backend will track trial activation, engagement with Pro benefits, and conversions to paid post-trial.

-> Analytics Changes

1. Track "proTrialActivation" for users who activate the trial, with properties for engagement and usage frequency.
2. Conversion events post-trial will include “proTrialConversion” to monitor users who subscribe after their trial.

6. Post Experimentation

-> Experiment Result

• Treatment group achieved a 12% higher free-to-paid conversion rate than the control group 🎉
• Statistical significance was reached with 1,480 samples for control and 1,470 for treatment.
• Engagement data showed that 50% of trial users used Pro benefits twice, with 14% converting to paid status after the trial.

-> Release Decision

• Scale the trial feature given the substantial lift in conversions and active engagement with Talabat Pro benefits

-> Learnings

Offering a one-month free trial significantly improved the conversion rate by providing users firsthand experience with Talabat Pro’s value. Users who engaged more during the trial were also more likely to convert to paid.

-> Next Steps

1. Increase treatment allocation to 25:75 control-to-treatment ratio to validate results on a larger scale.
2. Test shorter trial durations (e.g., 2-week trial) to determine if a reduced trial period yields similar conversion rates.
3. Develop post-trial retention strategies, such as reminder notifications and discount offers, to encourage paid subscriptions after the trial ends.

7. Stakeholder management