HealthifyMe's Revenue Growth Challenge
HealthifyMe revenue needs to grow from Rs. 185 crores to Rs. 450 crores in 12 months.
TL;DR:
I participated in GrowthX's Product and Growth Leadership program. I was part of the 3 week capstone project focusing on revenue challenge for HealthifyMe, a health and fitness app
Problem statement was to increase revenue from Rs. 185 crores to Rs. 450 crores in 12 months.
Key steps:
We conducted market research and user interviews
We identified four customer personas, prioritising 'Get Fit' and 'Recover from Medical Condition'
We built growth model focusing on acquisition, monetisation, and engagement/retention
Engagement and retention strategy:
We recommended milestone-based gamification for health goals. This would help in building habits around health and fitness through micro-goals and feedback loops.
We further recommended building ICP-specific freemium features (e.g., glucose tracker, menstrual cycle tracker). This would help in acquisition of the potential users who are facing similar problems.
We created communication strategy for user retention. The communication strategy would help us activate dormant or at risk users therefore reducing churn.
Outcome: We were selected as one of the top 5 capstone teams in batch GX12. The assignment was also shared with the HealthifyMe's growth teams and they referred this while crafting the growth strategy of 23-24.
Capstone Experience at GrowthX
In November 2022, I participated in GrowthX's Product and Growth Leadership program. This intensive 8-week course culminated in an optional 3-week capstone project, offering participants the opportunity to tackle real-world business challenges. Our team was one of nine, each assigned to work on either a B2B or B2C product case study. Our focus was on HealthifyMe, a health and fitness app.
Our approach to addressing HealthifyMe's revenue challenges was methodical and comprehensive. This article will provide an overview of our strategy, with a particular emphasis on the engagement and retention aspects - areas that I personally spearheaded and executed.
About HealthifyMe:
HealthifyMe was founded in 2012, and in 2021 was sitting at an overall user Base of 30Mn+ along with revenue of INR 185 Cr.
HealthifyMe's core value proposition is to help its customers achieve their health transformation and fitness goals through:
Calorie counting: Tracking the daily calorie intake and generate actionable insights and recommendations.
1-1 Expert guidance: Personalised 1-1 guidance from fitness coaches, nutrition consultants that are just one click away.
Wearables: Ability to pair wearables to track real time physical activity and generate insights.
Content: This helps in building the knowhow on various health, fitness and wellness topics.
We also learned that HealthifyMe has more than 90% users in India, while the remaining are spread across SEA, Dubai and USA with SEA having the maximum contribution. The revenue contribution from the international market is 25% of the total revenue of HealthifyMe.
Problem Statement:
The problem statement given to us was "In 12 months, go from Rs. 185 crores to Rs. 450 crores while controlling losses and focus on sustainable growth."
Our approach began with a comprehensive research phase, designed to gain a thorough understanding of India's health and fitness market. This involved several key steps:
Analyzing HealthifyMe's business models
Engaging with both potential and current users to identify pain points and generate user insights
Establishing critical metrics to formulate a growth equation and model
This research aimed to pinpoint the top three levers we could adjust over the next 12 months to achieve our assigned revenue goal.
In the following sections, we'll delve deeper into each of these steps, providing a detailed look at our research process and findings.
Research phase:
Secondary research to understand the Indian health and fitness market dynamics, company's market share, revenue breakups and so on.
Primary research where our target was to speak to at least 100 users of HealthifyMe or competitor apps like Cult.Fit to generate actionable insights. The research was focused on demographics, lifestyle, current health and fitness habits, target health and fitness goals, pain points and others. We also covered questions around different aspects like acquisition, engagement & retention, onboarding experience and willingness to pay.
The research questionnaire was prepared in advanced and the next step was to reach out to potential users.
We used channels like Linkedin, Whatsapp, GrowthX's internal slack and other social networks to get leads.
Week 1, all of us focused on gathering the responses from the user calls and document them on Notion and Google Sheets.
The next step was to derive insights from the user calls. We gathered some great insights from the user calls:
Health and fitness industry trends:
Peak customer acquisition: New Year (January)
Major retention challenges: April-May
Secondary spikes: June-July and December-January
Cyclical pattern: High engagement followed by significant dropouts
HealthifyMe is a premium product therefore a maximum number of free users use it only for calorie tracking.
Non residential Indians use HealthifyMe outside India for tracking calories since HealthifyMe has a huge database of Indian food.
HealthifyMe has a strong brand recognition and major acquisition channels were paid ads, word of mouth.
Loss of motivation to follow-up on health and fitness goals and lack of direction were the top reasons for drop-offs.
The next step was to identify Ideal Customer Persona and their jobs to be done. We identified four customer personas:
Define Ideal Customer Profile:
Ideal Customer Profile-1: Riya (Category: Get Fit):
Meet Riya, she is 31 years old, currently works at Adobe as a Technical Lead. Riya has been blessed with a baby girl recently. She currently stays in Bangalore with her husband and baby girl. She likes to read about the latest trends in the tech industry.
Jobs to be done: [When (Context/Situation)]: I don’t fit in my current/pre-pregnancy clothes and I am feeling conscious about my physical self [I want to (Motivation)]: lose weight in order to go back to my previous shape [So I can (outcome)]: fit in my current/pre-pregnancy clothes and feel more confident.
Ideal Customer Profile-2 (Category: Stay Fit):
Meet Rahul, he is 31 years old hails from Gurgaon, NCR. He works as a Business Development Executive at OYO Rooms. He is an extrovert, regularly travels for meetings. He likes to party and has a very active social life at work and outside work.
Jobs to be Done: [When (Context/Situation)]: I am about to hit 35 years and I am developing a slight belly despite maintaining the same level of physical activity [I want to (Motivation)]: level up my physical activity and diet to maintain my shape and may be build muscle mass [So I can (outcome)]: look younger and fitter for my age
Ideal Customer Profile-3 (Category: Non-residential Indians):
Meet Arjun, a pakka desi who absolutely craves for Indian food. He has recently moved from Mumbai to Canada. He misses ghar ka khana. He works as a Senior Product Manager with the Home Depot and usually works from home.
Jobs to be done: [When (Context/Situation)]: I have relocated to Canada and regularly consume Indian food. Recently, I have gained weight due to lack of physical activities due to unfavorable weather conditions and inability to track calorie deficit [I want to (Motivation)]: look for a reasonable pricing and flexibility in order to stay fit as the trainers and gym subscriptions are expensive and scarce/ far from my place[So I can (outcome)]: maintain a healthy and active life.
Ideal Customer Profile-4 (Category: Recover from a Medical Condition like Diabetes or PCOS):
Meet Priya, she is 30 years and she got married 3 years back. She is currently a homemaker. Priya and her husband Jatin were planning a family and on consulting a Gynaecologist they realised that Priya is suffering from Polycystic ovary syndrome (PCOS). Priya was experiencing some fat around lower tummy and unwanted facial hair growth due to PCOS but realized this when she got herself tested for fertility. She wants to experience the joy of becoming a mother and need to start focusing on her health.
Job to be done: When (Context/Situation)]: I consulted a gynaecologist for infertility and she has confirmed PCOS as the core reason for my infertility . I have been recommended to engage in physical activities and control diet [I want to (Motivation)]: reduce the symptoms of PCOS [So I can (outcome)]: conceive and experience the joy of motherhood.
Identifying the Growth Levers:
After identifying the four key user personas, we looked at prioritising the ideal customer persona based on the below mentioned factors:
Market size- we used top-down approach to derive TAM, SAM, SOM.
Willingness to pay- we extrapolated this from user research.
frequency of usage- we extrapolated this from user research.
Stickiness to paid features in the app- we extrapolated this from user research.
Using these insights, we had to prioritise from the four ICPs: 'Get Fit', 'Stay Fit', 'Non-Residential Indians' and 'Recover from a Medical Condition'. Further we dropped Stay Fit and Non-Residential Indians as a category based on insights around:
1) Market was saturated
2) Higher cost of acquisition
3)Willingness to pay was lower.
Therefore we were left with two core ICPs where we would focus all our efforts: 'Get Fit' and 'Recover from a Medical Condition'.
After we identified the core ICPs to focus on, the next step was to come up with a growth model. The stages of drafting a growth model were as mentioned below:
Formulate the growth equation= f(paying users*average monthly subscription cost*transaction per year)
Prepare the growth model for last 12 months: we made a few assumptions, referred to Data.AI for keys stats around app installs, traffics. We also validated these assumptions with employees of the firm who denied sharing exact numbers but confirmed if we were far off or closer to the actual numbers.
Nuke scenario: with zero spends on acquisitions where would you reach in coming 12 months. Calculating the deficit from the goal.
Iteration over the numbers to identify key levers from Acquisition, Engagement & Retention, Onboarding and Monetisation.
For HealthifyMe, we had to consider both free to paid conversions and retention on paid subscriptions. We were finally able to conclude our top 3 levers as:
Acquisition
Monetisation
Engagement and Retention.
The below mentioned section focuses on my contribution to the capstone for Engagement and Retention.
Engagement and Retention Deep Dive:
Now we were slowly coming back on the track after a small derailment, the next thing was to work on each of the core levers and detail them out with solutions and numbers so that they can contribute to the growth model and bring us closer to the final revenue goal.
Due to paucity of time and competitive pressure, we decided to do a time-boxed free flowing brainstorming activity for capturing ideas for all 3 levers. We identified key people in the team to drive each of the levers. I was chosen for driving the engagement and retention section. In 2 hours, we were able to list a plethora of ideas against each lever.
I took lead on completing the engagement and retention section since it was one of the most important sections. The first task was to establish an appropriate engagement framework. The outcome of the customers using engagement framework is to either get fit by losing weight or recover from a medical condition like diabetes. The engagement framework needs to be selected in a way that will help them achieve their fitness goals. Therefore we went ahead with:
Depth will help in micro habit formation for the end user and increase the core activities performed on the app. This in turn will help in building stickiness towards the app. Depth= f{(Number of activities done on the app) and/or (Number of different types of activities done on the app) and/or (Number of days the activity was done on the app )}.
Breadth will help the user in experiencing the actual core value proposition on the app with the help of sub-features that will help in achieving the desired outcomes for their fitness related end goals.
This engagement framework will be applicable for free and paid users both.
We didn't have access to the actual data or metrics therefore we had to make assumptions and extrapolate user segmentation data based on the depth and breadth of engagement from user research.
The pain points gathered from user research about HealthifyMe were also analysed to come up with product hooks. As HealthifyMe is a freemium product, except for trackers all other features are behind a paywall, we need to develop more product hooks so that the free users will realise the core value proposition.
Prioritisation of product hooks using RICE Framework:
Idea 1- Milestone based gamification for Health Goals:
Insights: Based on insights from primary and secondary research, around 64% Indians don’t exercise. The prime reason for the same is lack of motivation. Also as confirmed with industry experts, the internet tech companies in the health and fitness industry are struggling with the problem of intrinsic motivation that becomes a biggest hindrance in the engagement and retention of the users. Further the seasonality aspect in the motivations of the users further impacts the industry. For example: there is a significant motivation for the users to signup for new paid plans right at the beginning of the year and the motivation reduces from Q1 to Q4 (Source: Growth Model). This makes it challenging to keep the existing users retained or engaged throughout the year and thus impacts renewals and conversions.
Problem Summary:
Health and fitness is a challenging space. From what we learned from the industry experts, there is a serious level of seasonality involved when it comes to the customers in this space. For example: The customers tend to make new year's resolution to focus on their health and fitness goals at the beginning of the year. However the enthusiasm fizzles out as they progress. The users actions on the app starts reducing to a greater extent.
Therefore the health and fitness goals especially in ICP-1 who want to lose weight and get fit are highly driven by intrinsic motivation which makes it difficult for the companies like HealthifyMe to engage with the customers.
Problems specific to HealthifyMe:
Goals are static: Once input by the user, the goals are static for the time period selected (e.g. lose 10 kgs in 20 weeks).
The goals are broken into daily goals (considering linear approach), which becomes repetitive and boring
There is no external motivation fuel to achieve a specific goal
Trackers are not interlinked (How Exercise tracking changes with deviation in food tracking)
With 3-4 trackers, and multiple loggings in a day (5 meal plans, etc) - it becomes overwhelming for the user to be active, and come and track so many times on the app.
Solution Summary:
The main problem here is that users have clarity on their end goal which can be to lose weight or getting rid of a medical condition. However there is a lot of ambiguity for them to visualise the journey that will help them reach their end goal. Therefore the first step is to build a journey that helps them assess the steps required to reach their end goal.
The second part of the problem is developing micro habits. The end goal needs to be broken down into micro goals that are easier to achieve, provide instant gratification to the end user and are dynamic in nature so that users are not easily bored with static micro goals.
The answer to this is milestone based gamification that helps the user to visualise the daily dynamically generated milestones that they need to achieve in order to reach their end goal. The experience that we are trying to create here is similar to a game where there are levels that the main character of the game needs to cross in order to reach their final goals.
The real time feedback provided by the milestone based gamification around how far or near are they from their goal which further motivates them to continue on their fitness journey.
Activation Metrics:
An activated customer is the one who has completed at least 30% of the milestones. This is because if the user (exp. free users) completes 30% of the milestone based journey they would have experienced all the key paid features that will help in drive the conversion.
Success Metric:
Increase in adoption of core to power user by 10%
Increase in adoption of casual to core users by 5%
Increase the conversion from free to paid user by 5%
Increase the reinstalls by 5%
We looked at resources like Atomic Habits for building micro habits and how it can be applied to the health space:
Cue:
Cue is a trigger that initiates specific behaviour or action. From the context of HealthifyMe, we are looking at a cue which will nudge users to start tracking food/step/water/stress to achieve their milestones.
One such cue will be the Health Score: It is a single unified score which will indicate the individual’s activity towards achieving their milestones. User will have to move the score upwards to achieve the milestone.
Every single activity towards the milestone will have a positive or negative impact on the score. Health Score is obvious, attractive, timely and actionable and hence a perfect cue to build good habit.
Craving:
A craving is a desire or wanting for a specific outcome or reward. In case of HealthifyMe, the milestones or the goals set by the user will act as the craving which will drive the habits of the users or motivate them to reduce the calorie intake or to burn more calories.
For e.g., If a user wants to reduce weight by 10Kgs, HealthifyMe shall display the target Health Score to achieve that milestone. If a user deviates from the good habits, the negative impact on the score will act as a nudge to take corrective action.
On the other hand, a continuous good behaviour will nudge the score in the positive direction, thereby being much more attractive for the user to continue the good habits.
Response:
Response is a specific behaviour or action that the user takes in response to a cue and a craving.
In the context of HealthifyMe, in order to maintain a good Health Score, and to achieve the milestone, user will be required to track their foods, water, steps, sleep and stress levels.
These can be done once a day easily and can form as micro habits for the user. These actions initially can be reinforced with rewards on each activity basis.
Reward:
Reward is a positive outcome or benefit that is received as a result of engaging in a particular behaviour or action. In the context of HealthifyMe, achieving milestones will generate rewards like HealthifyMe Boost, Scratch cards etc., which can be redeemed against particular products/plans of HealthifyMe.
At the end of successful milestone, user can be satisfied with double edged rewards: Free HealthifyMe products/services and better body/health.
We also looked the well known Octalysis framework for gamification:
The idea for the gamification evolved as mentioned below:
Define Goals:
This is the starting point for the user. The user defines the primary goal based on the ICP the goals can be different. Example: for ICP-1 user it can be lose weight, for ICP-4 it can be get rid of PCOS.
The second step is to quantify the goal, for example: lose 10 KG weight. This will be an input to the system to calculate the number and intensity of the dynamic goals required for the user to achieve the end goal.
Dynamic Micro Goals:
The app will then showcase a journey to the customer with end goal clearly defined on the screen.
The app will then show day wise micro goals or milestones. The user can only view today’s goal and all the other goals are locked. The idea behind the progressive disclosure is to create intrigue around what the next goal would.
The activities that are clubbed in the milestone is based on the ICPs dynamic goal. For ICP-1 the goals will have a mix of tracking, workout, diet, coaches and social challenge.
For ICP-4 it will be specific to the generic trackers, ICP specific trackers like Menstrual or Blood sugar level trackers. This ICP will have more goals where there are interactions with experts to get real time feedback on their progress.
Gamification:
To cater to the problem of monotony, we will add an element of gamification. Everyday’s milestone will have a difficulty level just like the games. The difficulty level will be determined by the type of activity that is part of the daily goal.
The goal engine will further adapt the difficulty level of the milestones based on the inputs from users activity data and overall performance as compared to the other users. The data will be used to create benchmarks which will determine the difficulty level for each day.
Users who are acing the daily goals will have an increased level of difficulty while users who are not able to cross the benchmark will be given more achievable goals. This will help in reducing drop offs due to the difficulty level of the goal.
Feedback Loops:
Track Overall Progress: This will provide the user with the real time feedback on how far or near they are from achieving their overall end goal.
Track milestone level progress: This feedback loop will help the user to understand the progress on daily milestones. Daily nudges will be around completion of the milestones rather than tracking your meals or water. This will help in making the nudges more meaningful.
Leaderboard: The leaderboard will tell the user how they are performing in comparison to the others. This will further help in increasing the motivation to perform better on future milestones or keep them motivated to maintain the current streak.
Reports: Health reports tell the users about the benefits they achieved by completing the daily milestones. This will another validation that the user is on the right track and is able to achieve the outcomes.
Rewards:
Rewards for positive actions will ensure that the user keeps on taking actions, slowly making progress towards the final goal with the help of small wins.
The rewards are ICP specific and that will help in ensuring that the rewards are valuable to the end user and there is always an intrinsic motivation to earn them.
Brag Worthiness:
Daily achievements: The users get to share the daily achievement progress on social networks.
Achievements against celebs: The users gets to know the relative position as to how they are doing a particular celeb as part of the ‘fitness with celeb’ challenge.
Achievements in social challenges: The achievements made as part of the social challenge that supports a social cause will also provide brag worthy moments to the customer to share them on the social network.
Overall goal achievement: The scores against the overall goals are also shareable which further adds as an additional opportunity to create the brag worthy moments for the end user.
Adoption:
The milestone based gamification will also include exposing the users to paid features so that they experience the core value proposition completely.
At the end of every experience a feedback can be collected from the feedback on paid features to identify the satisfaction level. The next set of campaigns will be around building confidence and trust on the paid features for users who have highly rated the previous interactions.
Similarly we also recommended product hooks like:
Body glucose tracker (Diabetes) that targets ICP who wants to focus on health to get rid of diabetes. HealthifyMe already has CGM (glucose monitoring) related plans and coaches. The Body Glucose Tracker which will be a free feature can be a way to generate potential leads for the premium plans related to diabetes control.
Menstrual cycle tracker (PCOS): This idea would again target the ICP who wants to focus on health to get rid of PCOS. The Menstrual Tracker which will be a free feature can be a way to generate potential leads for the premium plans related to PCOS control.
Social Rewards: The idea was how users can challenge each other on social media to complete daily fitness goals. Maintaining a leaderboard to track the progress. Certain challenges were also associated with social causes like 'Walk 10 KM to raise fund for a charity'.
Rewards Store: We established platform currency as 'Boosts'. Each boost was given a value of 0.25 paise (to start with). The users can redeem boosts on the in-house store to avail healthy meals, gym equipments, athleisure clothing and so on.
Retention:
We analysed the top reasons for churn based on the user reviews and social listening.
Plotted the retention curve based on data from Data.AI.
We analysed the existing cancellation flows.
We also analysed and identified actions that could potentially indicate at-risk (of churn) users.
Based on these analysis, we formulated certain hygiene campaigns as part of our communication strategy.
We also evaluated certain resurrection campaigns that can help in activating the dormant users.
Communication Strategy:
We identified ICP wise hygiene campaigns that helps in nudging the core, casual and power (free and paid) users to ensure the engine keeps on running and we are able to offer a wholesome experience to the users at all times.
This has been done keeping in mind the ICP agnostic features and hooks as well as ICP specific features and hooks as well as our moonshot idea of competing with the Celebs in their transformation journeys to create an element of virality that would help in organic acquisition through content.
Achievements:
This capstone project, while physically demanding, proved to be an incredibly rewarding experience. It provided us with the unique opportunity to delve deep into a real-world problem statement, engaging with industry experts and conducting over 100 user interviews to gain invaluable insights into the health and fitness space. Throughout this journey, I was continually grateful for my team's unwavering support, which was instrumental in our success.
Our collective efforts and dedication were recognized when we were selected as one of the top 5 capstone teams - an achievement that fills me with immense pride. Reflecting on the challenging yet fulfilling path we traversed to reach this milestone, I'm struck by how this experience reinforced the value of hands-on learning and collaborative problem-solving in addressing complex business challenges.
