3 reasons why WisePass has introduced a plan costing only 8$ a month

The lifestyle Singaporean lifestyle app started a membership in 2016 with a plan costing 300$ a month, 3 years later the company introduced a plan starting from 8$ a month. What happened?

In 2016, when you heard the name of WisePass, you would hear most about this new nightlife app enabling you to get 1 bottle every day in the trendiest bars and restaurants of Ho Chi Minh City.

A year later you would see the app expanding its service offering to lunch, dinner, Starbucks and movie access for its members. In 2018 the app has expanded to other cities such as Ha Noi, Bangkok, and Manila and the introduction of a membership that would cost 700$ per month. The app really positioned itself as a premium service with access to the best places in each city.

Why the company would then start a new membership that would allow users paying only 8$ a month instead?

Reason #1: a lower price point enables WisePass to attract a larger userbase

As WisePass has grown, we realized a lot of people would seek using our service but wouldn't necessarily commit for 300$ a month upfront. What we thought instead was to give them a glimpse by providing the WisePass experience without the premium access so they could start and try using it first.

To do so, we had to redesign the value proposition and provide them different products and services from well-established brands at an unbeatable price. In Vietnam, our target market is male 25–30 living in Ha Noi and Ho Chi Minh using smartphones and looking to enjoy some casual drinks at the bar, restaurants, and clubs. According to Facebook Reach calculator, that’s 3 million people we can target and eventually acquire. Across South East Asia capitals, the target market is 44 million people matching that audience.

Even though the monetization per user drops to 8$ a month and manages to acquire only 5% of that target audience within 5 years, that’s still over 2 million subscribers generating 16 million USD monthly.

Reason #2: a higher profit margin per user and lower operations cost

When WisePass started in 2016, the model was quite simple. WisePass was generating revenue from subscribers and would allow the subscribers would get access to some products or services that WisePass would pay for.

With the 8$ membership, WisePass doesn’t pay anything back. That leads to a much higher gross margin and much fewer tasks operationally. Reducing the scope of work and automating the rest of the process has been the main focus of the company as it leads to higher scalability.

With such a model, the focus of WisePass has turned to extract data and process it for brands so it can help to support decision making on allocating their marketing budget more cost-effectively.

Reason #3: a more scalable user acquisition for South East Asia

In 2016, the way WisePass used to acquire new members was to throw some events and eventually shoots some email newsletters to convert these members.

The problem with such acquisition channels is that it’s actually really labor-intensive and not fit with expansion. It requires face to face conversation and a lot of time is required before the decision to buy is made.

With a lower price point, the time it takes to make a decision is much lower. It usually took a few days to weeks to get people to consider before making a first purchase with the 300$ membership. With 8$ only, people would usually just download and subscribe almost immediately after they understood the value proposition.

Because the value proposition is much simpler with the 8$ membership, it’s also simpler and faster to reach new users on Facebook, Instagram and Google across multiple markets instead of going out every night and meet a couple of people at a time.