I'm a long time Tinybeans user (my oldest is almost 5 and we've used it since birth) and also shareholder (bought in the IPO and also later when the price was well down).
I'm also a subscriber the premium service. The main feature that makes me pay is the ability to upload multiple photos at once and longer videos. The cost isn't a lot for the convenience for me.
In saying that I agree with you about the subscription model. It was a good way early on to get some recurring revenue but now makes up a tiny proportion of revenue compared to advertising.
The best social media platforms would not have grown to be the bohemeths they are if they stuck some of their best features behind a paywall. I think it's time to let go of the subscription service, provide these features to all and focus 90% on advertising revenue and 10% on some of the niche revenue like printing.
Realtively new father and paid TinyBeans user here.
Appreciate the research shared here already and I was wondering if the guys following this business might have a perspective on an open questions I have.
Do they have a clear enough strategic direction or are they trying to be a couple of different things at once? It seems like they are spinning their wheels in the product market fit stage rather than a scaling a winning value proposition/business model.
For example, what business are they in?
If the answer is (2) the advertising platform and the app (1) is a means to an end, why not make the paid features available to all (except for the 'turn off ads' element)?
Their investment in B2B partnerships/ad sales head count makes sense here. So does the content platform acquistion (Red Tricycle). Setting up affiliate programs will also make sense.
Following a period of monetising the eyeballs they already have, Growth here will likely be incremental and scale with user acquisition. The issues is that it doesn't appear the business has a way of efficiently acquiring customers so their margins become compressed and/or growth is limited (since they need to spend to aquire at a lower rate than the advertising yield of those user's eyeballs with 3rd parties). Potentially solved if their product becomes so amazing that it goes viral through word of mouth eferrals or something but I reckon there's no reason to believe this will happen at this stage.
However, they say that they are going to do (1) with ecommerce tacked in there somehow. In their November investor deck, they say they will get the product right and consumer revenue (from app subscriptions and ecommerce ??) will drive non-linear growth from FY21. This seems easy to say but hard to execute and again we don't have many reasons to believe this likely at this stage.
Pleaes let me know what I'm missing! We like the paid product fine but we're also more sensitive than most parents around putting photos of the baby online.
Thanks Shivrak. Ridiculously insightful and a great perspective. I really appreciate it as you have given me a lot of comfort on my last lingering question on the TNY strategy.
Onwards and upwards for these guys.
I love this business and Eddie's vision but my only question is why all the sales and marketing resources appears to go into making advertising sales. My understanding is that they do no advertising to attract new app users and rely on referrals within the parenting community.
Wouldn't it be better to advertise and attract new app users and aggressively grow the user numbers. This will improve pricing and allow the user base to effectively sell itself and require much less sales campaigns. Enabling much higher pricing in the long term.
In essence - it feels they are currently so focused on generating short term cashflows which may impact long term value and user growth. However, if they do become cashflow positive I expect they can reinvest those cashflows to market and increase users.
Shivrak and anyone else following the Tinybeans story - would love to get your thoughts