Talking with Tinder’s Renate Nyborg
As subscription organizations scale, one of the trickiest challenges they face is entering international markets. While they often focus first on things like managing local currency, translating copy into local languages and ensuring compliance with regulations around privacy, security and recurring billing. These tactical steps are only table stakes. We’re going to talk about what it takes to grow your subscription rapidly outside of your home country. My guest, Renate Nyborg, is an expert on going global with subscription and membership models. Prior to her role as General Manager of the EMEA region for Tinder, she was at Headspace, where she built and led its first international product and marketing team.
She previously spent over four years at Apple, where she led the app store subscription business in Europe, helping both the world’s biggest subscription companies. The many small and fast-moving European subscription startups learn to compete on a global stage. Renate and I discuss how to staff your first international program, the biggest mistakes American subscription businesses make when scaling into Europe, and the most powerful secret to increasing lifetime customer value, not just in Europe but everywhere.
The following interview is adapted from my podcast, Subscription Stories: True Tales from the Trenches.
Robbie Baxter: You started as a GM for EMEA, for Tinder after working with a broad range of subscription and membership organizations. When it comes to people, especially in Europe, who have deep expertise on the subscription model, particularly with mobile apps and at the intersection of the United States and in Europe, I don’t think there’s anybody more knowledgeable than you on subscriptions in Europe. You’ve always worked at that intersection between Europe and the United States and for subscription businesses. How did you end up there? What drew you there?
Renate Nyborg: For me, I always say that I don’t really work in technology. I like to work with people. I think that the first career choice I had when I was still a teenager was to become a psychologist. Then I got fascinated by technology because it’s a way for people to bring these things into life. To work with subscriptions, to work with member-based models, which go far beyond technology, you need to understand people. You need to commit to what they need. You need to commit to serving those needs and being incredibly honest with yourself. You can’t sell something to someone once and walk away. I’ve always been attracted to the hard honesty that brings to the relationship you have with your products and with your customers.
Robbie Baxter: When you are dealing in subscription model products, as opposed to more transactional or episodic ones, you have an obligation both to get to know your customer because you have to have a relationship for a long time, and to serve them in a way that is trustworthy. Otherwise, they’re going to leave, and you might be left in a position where you’ve spent more to acquire them than they’ve spent with you. It’s interesting that you came at this with an interest in the human side, as opposed to particularly the technology side or the financial side, although I know you have competence in those areas as well. In your time at Apple, you worked in both directions. You were helping mostly American subscription businesses adjust and localize for other markets. You were also helping European subscription startups figure out how to quickly go beyond their own borders across Europe and then into other regions. What were some of the biggest challenges you saw in each direction?
Renate Nyborg: In terms of American companies coming this way, which I’m based in Switzerland, it’s easy to be overwhelmed by the incredible complexity of operating in Europe. One of those angles is the need to localize, the need to translate, the fact that often there are local competitors. Europe has done well over the years at coming up with local equivalents to American services before the American services localized themselves. In addition to that, if you commit to the markets in Europe, you’ll need to put boots on the ground. I’ve worked with some companies through the challenges of understanding local HR, local recruitment, the differences that there are on a by monthly basis on how you can hire, how you can fire, which is a reality of things as well.
Even before that, I would say there is not the right perspective of how big the opportunity in EMEA is. The small kids, they look at a company like Netflix. We think of it as one of the great American subscription company. Even for Netflix, international, especially Europe, has been the majority of the growth for the last years. This is not a recent thing. I think for years on end, I would amuse myself because they kept missing their American full cost slightly and they kept massively overachieving on their forecast for international growth. If you get it right and Netflix invested after a period of time, this should be your biggest growth opportunity once you’ve hit a certain level of maturity in the US.
If you want your subscription business to succeed, you need to understand what people need and commit to serving those needs.
Going the other way, there’s a small fireside chat with Daniel Ek, founder of Spotify, who popularized and taught Europeans about subscriptions for us all to benefit from. He said this thing where it’s crazy that with all the money that we spend on digital products and services, with all the talent that we have, especially in the more technical side of things, that we don’t have a single $100 billion-plus company founded in Europe apart from SAP, let alone trillion-dollar companies like we have in the US and China. I’m excited about the work that I do and will continue to do with European companies. Hopefully, we’ll be providing some equivalents to the great American subs companies soon.
Robbie Baxter: Spotify is the most well-known globally of subscription businesses that were started in Europe. What do you notice, if anything, is distinctly Nordic or European about the way Spotify has launched, expanded, and thrived versus an American counterpart like Netflix for example?
Renate Nyborg: I can make all kinds of jokes about it being dark all the time in the Nordics, and so people have nothing to do but sit inside and subscribe to things, which is true. Sweden is tiny, nine million people. Spotify had to be built for the world from day one. American companies can build for the US and have a healthy business there for ten to fifteen years before they reach a level of scale where they need to start to look elsewhere. I used to manage the Nordics at Apple. I’d often tell developers from bigger markets, “There’s something you can learn from these small countries by building for the wealth from day one.” If you’re half ambitious, you know that you will need to go there after ten or fifteen years. You will always have to go there whether you’re coming from the US, China or Japan. You can avoid many of the pain points that you’ll have to solve if you have to adapt to local audiences, localization and so on. These things are maybe not the sexiest things but having the right approach to your CRM, to your CMS, all these types of things from day one, will definitely help you scale and grab global momentum much quicker than people who don’t.
Robbie Baxter: If you were starting out, let’s say that you’re in the United States or you’re in China, in India or one of these larger markets, and you’re getting started, you were an organization that was lucky enough to have you as an advisor, when you say build for the world from day one, which is an awesome phrase. What would you have them do differently from day one? What would be maybe two or three examples of what you would say that they might think that they should do and you direct them differently?
Renate Nyborg: The first thing I would do is to look at tooling carefully, to work with tools. For example, when you get accelerated as a subscription company, you can hit the ground running by working with different tools to help you manage your subscription more easily.
Robbie Baxter: You’re talking about software tools?
Renate Nyborg: Software tools, that’s right. You will be looking at tools to localize strings or to put strings of content into the app. You would be amazed how many times dozens of companies, no matter what size, that end up hitting this block in the road where they’re like, “We’d love to go to Germany but we have to replace our entire infrastructure in order to do that.” It doesn’t take a huge amount of work upfront to make sure that you’re working with companies that have the right plugins, have the right tools and features to work with, or to talk to other international platforms. As an example, pricing and being able to offer to take payments based on local bottles will be incredibly important at the time, even for the app store. The Netherlands, which is a highly-advanced European market, people didn’t have credit cards. The growth of the app store was restricted for a long period of time and for the subscriptions that wanted to sell there because people couldn’t pay for things like Netflix and other things of their recurring basis.
That’s the first thing. Look at tools and services and make sure that whatever service providers you go with have an international outlook, have a track record of updating. If there is a huge new payment method in Asia and Europe, check that they have regularly created software updates to be compliant and to be compatible. The second thing is start with doing competitive landscape mapping, looking at pricing, looking at marketing methods. Even if you want to start by focusing on one market, having a clear sense of where you can foresee friction years down the road, that is going to put you in a great place from the beginning. It will inspire you to get things right from the beginning. If you start with a price point from day one that isn’t going to work anywhere except your core or your initial market, maybe you want to rethink that before you even launch. Maybe you want to think about the subscription plans that you offer. Those would be my two points of advice, tools and get to understand the global landscape before you start to build.
Robbie Baxter: On the tools, when you’re talking to your potential partners, your software providers, your solution providers, it’s important to ask them about their clients that have grown globally. Ask about how they handled the most recent update and payments in this market or that market. All of those things are good to ask from an early stage. Your other point about having a clear vision of where you’re trying to go, even as you’re taking your first baby steps is important. That North Star helps you think critically about every little step you take at the beginning and can set you up to go much faster. Not just in going global but in everything you do, attracting new markets, expanding into different services, having that vision is important. You told me the last time we talked that you thought that most American organizations over-index on the UK when they are expanding into Europe. I’m curious about that. What evidence do you have and why do you think that is?
Renate Nyborg: It’s easy. You don’t need to do anything, which by the way I think is also an urban legend. The majority of companies that I would see launching subscriptions the last few years would initially have more than fifty percent of their revenues coming from the UK. That is because the product is already localized. The UK is used to content, culture, even news coming from the US. If you’re a company that has managed to reach the point of mainstream awareness, you’re probably going to be on the news and in newspapers in the UK too. However, by numbers, the UK has 67 million people. It’s the exact same population size as France. The UK has a smaller economy than Germany. People spend more per average subscriber in the UK, but Germany is 88 million people by comparison.
Depending on the kind of service you run, the Nordics is just as mature, if not more so than the UK in terms of mobile adoption, in terms of bandwidth and fantastic fiber everywhere throughout the Nordics and a high propensity to pay. You don’t need to localize depending on the business or service you have at least not for a long period of time. For me, one of the biggest things I always talk to people and companies about is how much incredible value there is to unlock quite easily in Europe, either based on market size, bigger market sizes that are the same to the UK and markets where you don’t need to translate but you need to invest a little bit, understanding and adapting to the local market.
Robbie Baxter: I want to pick up on this thread about translation versus localization. For a lot of people, those are the same thing, but translating your content is not the same as localization. I’d love for you to talk about what it looks like when you’re thoughtfully localizing for new markets.
Renate Nyborg: This is one of my favorite topics. This is why to be a subscription person, you need to be part psychologist and part anthropologist. For me, translation is I’m going to translate my websites. Instead of it being $9.99, I’m going to make it £9.99 or €9.99. I’m going to translate or put some subtitles in my app and off we go. It’s a dumb state version of your product. Localization, which is where you see success, is if you take the time to understand the local market, cultural nuances, these are so incredibly important the way that people relate to products and services.
You hear about this a lot. There are many companies that will launch a product or a service thinking they’re just tools or software. We can put it out life. One example is Pinterest. Pinterest doesn’t produce its own content, it’s not Netflix. You don’t have to necessarily dub it or add subtitles. When it first launched across a variety of European markets, France was one of the markets where it wasn’t working. Also doing focus groups, they realized that the word ‘pinning’ didn’t make any sense to French people. All they did was add a little tutorial at the beginning where the first time someone used the app or the product, it said, “Here’s a picture. Would you like to pin it?” It’s showing them how to do it. Instantly, France was their fastest growing market.
Robbie Baxter: The word ‘pin’ didn’t translate, is that why they were having trouble with it?
Renate Nyborg: Yes. The whole concept, to pin something, to have a pin board, it wasn’t a concept. The French didn’t use pins. Those are often a-ha moments. I tell people, honestly, ninety percent of the work in getting a subscription business to succeed in a European market isn’t necessarily about all kinds of complex things. It’s not about producing tons of new content. It’s getting that first ten minutes right. What is that thing about the first ten minutes that will make it relate to someone that will help someone understand? For me, localization is to reinvest and understanding what the problem that you’re solving is. Ultimately, that’s what subscription products do.
I’ll give you another example from Headspace. When I joined Headspace, they had already invested in translating the content in the app into four new languages. Headspace, which is a meditation and mindfulness app, has been available as an English language product only for ten years. They translated the work. When I joined, I’m lucky I speak a few European languages when I was listening to the recordings. I’ve been a Headspace subscriber for years, I just don’t have the same relation to the concept that I’m hearing. We hadn’t done the work at the time to understand what is mental health in a country. Attitudes to mental health, as you probably know, is a completely different on a market by market, has a completely different meaning. In France, mindfulness is not a word you can translate. We had to go back and do that work from the ground up to say, “What is the conversation around mental health and around mindfulness that we want to support?” We started to invest in tweaking some of the scripts and also co-creating content with local artists, local mindfulness and meditation teachers.
Robbie Baxter: People are often overwhelmed when they say, “We’re going to go international. We’re going to go to Europe. We’re going to expand to this new market.” One of the points that you made that I think is so critical is that if you have limited resources, focus on those first moments that a prospect or a brand-new subscriber has with you. That onboarding, helping them understand and make the connection to why they’re there, and helping them find a way to make it a habit, is critical. I know you have said before that you think that the most overlooked and important place for an organization to invest, if they want to maximize lifetime customer value, is in that place. Can you talk a little bit more about the sales page and the onboarding process for a subscription business and how to think about that, particularly if you’re localizing?
Renate Nyborg: I love sales pages. I occasionally will email people, “I need to tell you about your sales page. I think we can improve it.” Your sales page is your first date to use it. It’s the difference between love at first sight and the second day or married someday and nothing else at all. This is the page that if you change nothing else about your product for a year, let’s say you don’t have the revenues, but you want to be live in Europe or EMEA, spend your time there. Understanding how people react and engage with your sales page, which is where you lay out the benefits of subscribing, which is where you lay out the different options of plans and the pricing, that is where you’re going to understand A) Whether you need to change anything about your product, and B) How to make them feel comfortable.
In all of the roles that I’ve had, we’d spend a huge amount of time testing even things like the terms and conditions. You’d find remarkable things which always tie back to cultural nuances by increasing the terms and conditions and saying, “Please know that after seven days you will be charged,” and all these types of things. You think that it would scare people off. I’ve seen a few examples where in Germany, people would be more likely to sign up to a free trial or be more likely to subscribe. They felt reassured that from the beginning, this app wasn’t trying to cheat them or trick them in any way. They were upfront with what you would do and when they would be charging you. Similarly, you’ve got to think about the socio-economic circumstances of a country that you’re marketing in, as well as the type of audience that you’re marketing to.
If you’re in the Nordics, people have more money to spend. People are used to subscribing. People have a ton of subscriptions that are all ten dollars a month. You could go straight in with that offer, or even try and drive people to an annual plan, which is what you want to do eventually. If your brand is still super new, people haven’t heard of you and your service is new, or if you’re in a market or marketing to an audience such as Gen Z, which doesn’t have quite as much to spend, you probably want to focus on slightly cheaper subscription packages, a lower time to commit, weekly plans or bi-weekly plans, make it easy for someone to say yes. Like that first day, we’re appealing and not scary. Think about how you’re going to make someone feel comfortable going out and maybe holding hands with you.
Robbie Baxter: You are a true Tinder person, using metaphors of dating and romance in your subscription model. I don’t know if you know this but in my book, The Forever Transaction, my dedication is to my husband, who I call my own forever transaction. I love that metaphor. You talked about the sales page, which I think is important, the headline benefits being clear, and also letting people know how they can leave if they need to leave, so the opposite of hiding the cancel button. Once somebody clicks to subscribe or clicks for the trial, how do you onboard them so that they decide to stay? For many organizations, they find this failure to launch, failure to fly. They signed up but then they never used the product, or they signed up and they binged on the product and then they left. How do you onboard them in such a way that you can make it their habit? Does that differ by region, by culture? Is language part of it? How do you think about that onboarding phase of making your subscription into a habit?
Renate Nyborg: The first thing is you can and should design for engagement. This especially is true for any apps with a motivation-driven attend like education, weight loss, health and fitness. As human beings, we’re incredibly motivated for short periods of time to improve our life. It’s hard, especially when these are things that take a long time to show improvement. I think the first thing I’d say is where I’ve seen apps truly have success is to focus on one thing that has the lowest level of friction as possible. For example, there’s a great app from the Nordics called Sleep Cycle, which analyzes your sleep quality. It does fun things like record you when you snore, so your husband or wife can prove it to you. The beauty of it is that what we need to do is set your alarm every evening and it will automatically go on and track. The barrier to entry while still getting strong value is low.
Similarly, I’ve seen a number of language learning apps, healthcare apps, often many years of trying other things focusing on one action, one tracking thing or learning one word a day, in order to build that habit. There’s a lot that’s been written about habit creation but getting it down to one thing. For other apps, it’s hard to generalize, but finding lean back moments to regularly provide value to someone. This goes whether you’re a subscription service that provides access to financial analysis or whether you’re a music streaming service, finding little moments to delight someone. Ideally based on stuff they’re already doing, if you’re using that software to listen to music, let people know what other music they should be listening to.
At the end of the day, even though all of these apps and all of these products say, “It’s only ten minutes a day. You could become fluent in French in ten minutes a day.” Sure, but if I want to become fluent in French, I want to learn to how to run 10K, and I want to learn to play chess, which are all things that I have on my phone that I would like to do, that adds up to a lot of ten minutes a day. Try to make it as lean back as possible using stuff that people already are doing on their phone with different apps to provide some value, number one, if you can do that. If not, if it’s a more intensive, higher commitment type thing, find that one moment, recommend them a piece of content, a simple habit tracking thing to keep them coming back before they can get hooked on your product.
Robbie Baxter: This idea of establishing habits with small bites, BJ Fogg, Nir Eyal, both have written extensively on this. If this is an area that you’re dealing with, people who are reading, I encourage you to check out both of those people. I wanted to talk to you about structuring your team, particularly if you are going into a new market. How do you think about the connection between that team, the kind of people you need on that team? How do you track their success? How many constraints do you put on them? I’m based in Sweden and I’m coming to United States. I’m based in the States and I’m going to the Nordics. I’m going to Europe. How do you think about that? How do you staff for that and manage for that?
Renate Nyborg: I’ve operated and managed almost every form of setup. We also need to think about this differently in a post-COVID world. I have on my desk the Work-From-Anywhere Future.
Robbie Baxter: That’s the Harvard Business Review Work-From-Anywhere issue.
Renate Nyborg: I’ve worked a little bit all over the place. I’ve been based in the UK, managing a combination of contractors all over the world. I’ve been in teams where my colleagues were all in different markets where we’ve traveled together and Headspace, the majority of my team was based in Los Angeles. We started to build a team in Europe. Unfortunately, there’s not a one-size-fits-all approach but I think here are some of the principles that I’ve learned. First of all, your structure is the most important thing to get right in terms of driving your culture and your business strategy. This is why the way I’m thinking about structuring my team at Tinder is distinctly different to what I did at Headspace or the way I worked with people at Apple. I think especially when it comes to Europe where we have many different choices, it’s an hour by train to travel between most countries. It’s an even shorter flight to travel between those markets. We do have a huge amount of flexibility. A lot of people live in one country and work in another. Instead of worrying about the complexities that brings, embrace that, use that. I do think that there is a lot to be said for talent density, especially when you’re first entering a market for having people together, that feel like a team, that feel ready to conquer the world. Especially in a post-COVID world, if that ever happens, I would like Europe to set an example, whereby we allow people to split their life perhaps between cities and between nature, where we go back to a place where economically we can reinvigorate parts of Europe. We’re losing people to the biggest cities because that’s where companies are based. When we start looking at things like, “Maybe you can live wherever you want, as long as you can take a train there,” our environmental impact is limited. Especially when you’re first getting started, talent density or at least the opportunity to meet regularly is important. Outside of that, I think allowing people to find talent where talent is, hopefully another good thing about working in a knowledge job and working in a post-COVID world.
Robbie Baxter: How long do you give a team that’s getting started to hit metrics or to even define what the metrics should be, what kind of engagement should we expect in Denmark? How long should we need to mark it before we build traction in Germany? How do you think about what metrics should be used to evaluate whether or not that team on the ground, that small team that can conquer the world is on a path to conquer the world or if they’re failing, struggling or not on the right path?
Renate Nyborg: I think you should be knowledgeable about it from day one, from day zero, from day minus one hundred. I advise a couple of startups that are in the process of launching subscription businesses. By the way, I have a fantastic book instead of me speaking to all my friends who want to launch subscription businesses. I must admit that I text them the couple of pages you have on subscription metrics you should have, and then they buy the book afterwards, which I think you’ve discovered for yourself.
Robbie Baxter: Thank you for that. I’ve had some calls from your friends.
Renate Nyborg: Thank you for putting it all on the page instead of me getting on Zoom every time. I’m a big believer that you shouldn’t allow yourself to be ruled by metrics because no matter what the business is, if you only do things that can be measured, you’ll miss out on chasing the big moments that don’t have analytics yet, that are too new to know what they’re going to do. It’s important that you become an expert on metrics, on benchmarks, that you speak to many people in the industry, especially close to your sphere, but also in different categories. You’ll quickly build up an understanding that what’s good in your category or in this country may not be good in this other country. Part of my role at Apple was to look at benchmarks by category, by market. You’ll find that there is a notion of what good looks that’s completely different.
The only way to get comfortable with that is to look at it constantly. In order to get so comfortable with it, that you can almost forget about it, that’s how you’ll then be able to release yourself and sometimes say, “I’m happy to take a bit of a nose dive on my engagement metrics for the first six months because I’m chasing this thing. I’m happy to sacrifice my retention metrics for the first twelve months that I have find my imaginary team in Denmark because I’m focusing on this thing.” Start with the metrics. Get super familiar, so that you can forget about the metrics. I’ve seen way too many companies think that metrics are what leadership is. It’s not.
Robbie Baxter: For subscription entrepreneurs in Europe, what’s the most important thing that they should do as they grow?
Design for engagement. Focus on one thing that has the lowest level of friction as possible.
Renate Nyborg: The real answer is download and go through the onboarding for ten different apps every single day.
Robbie Baxter: For fast growing American companies, as they look to go global, what would be your advice?
Renate Nyborg: Speak to people on the ground and look at companies that have initially failed and eventually succeeded. There’s a playbook when you look at Netflix, YouTube, some of these companies, especially as they’re still figuring it out. I’d also say don’t be guilty. I’ve had so much mea culpa from some of the biggest subscription companies in the world, or being embarrassed that they’re starting to look at certain elements of Europe or localization. It’s never too late to start. There’s a way you can start learning the piano when you’re in your fifties. Most companies are just getting to this. There’s no such thing as a stupid question. If you call people in Europe, we’re friendly. I think you’ll find a lot of people happy to give you advice.
Robbie Baxter: What’s the first subscription you ever had?
Renate Nyborg: Donald Duck Magazine.
Robbie Baxter: What’s your favorite subscription outside of your current employer?
Renate Nyborg: Sweat With Kayla. Having been stuck inside for almost a year, I use it almost every single day. I never thought I’d like it. It’s an important part of my routine. I pay happily.
Robbie Baxter: What’s a time that you remember feeling as a member that you belonged?
Renate Nyborg: I have to say Spotify. I’ve been a Spotify subscriber since it launched. It’s the fact that you can see how far back your history goes. They have these fantastic time capsule things, which served me up my 12th year history with the company. I love that.
Robbie Baxter: What’s your favorite way to reward or recognize a customer’s loyalty?
Renate Nyborg: Showing them what they got out of it. It’s funny. It’s the impacts, which I’ve seen in lots of different ways, but bringing it to life somehow. If it is a language learning app, giving them a certificate from an ideal language learning school, giving them a chance to attend an event with your favorite meditation teacher, all these types of things, especially when it’s a surprise, are a wonderful way. I’m still a big believer in the power of offline and the power of physical things. I think if you can match that with the investment someone makes with your digital product, that’s a wonderful thing.
Robbie Baxter: Renate, thank you so much for talking with me. This was fantastic.
Renate Nyborg: It’s been a pleasure reading you over the years and getting to know you. I have to thank you. This is an area of life that has been a passion of mine for years. No one else in the world has done the work to lower the barrier of entry to put all of these lessons into a single place. I hope that your book and various other things are going to help us find some more one hundred billion dollar companies in Europe with the subscription business model.