How Duolingo increased conversion and retention with a new pricing tier

Mateo Creamer, Former Product Manager, Duolingo

Breezy Beaumont, Head of Growth, Correlated

Note: this conversation was originally recorded live and transcribed into this Q&A

Tell me about Duolingo and your role

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Duolingo is a language-learning website and mobile app. The company uses a freemium model: the app and the website are accessible without charge, although Duolingo also offers a premium service for a fee.

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I’m currently working with Duolingo as part of my MBA internship at Stanford. I also previously worked for an identity management company in stealth mode as their first product manager and RapidSOS, an emergency data platform. Understanding how to build product-led companies is what sparked my interest to go to business school.

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I hear Duolingo recently launched a new pricing tier

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The Family Plan is a new Plus package that was requested from users for a long time, and for us, the result is vastly improved conversion and retention for free trials when comparing against our individual Plus plan. We’ve seen that once you add on your grandmother, your daughter, or whoever to your family plan, you're much less likely to drop that plan because you want to encourage your loved ones to learn with Duolingo. 

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The largest impact on improved retention is going from zero-members-added to getting the first member added, rather than focusing on going from four to five-members-added — essentially diminishing returns the more members are added. 

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We A/B test every single change, not just for the Family Plan, but across all elements of Plus monetization. For example, an interesting insight the monetization team discovered is the impact of horizontally displaying pricing options compared to vertically displaying the same information, resulting in a big win on Plus conversion and free trial starts. 

What tactics are you using to contact your users?

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Our user interviews heavily showed us that families are the ones subscribing to the Family Plan, not friend groups, or 20-year-olds trying to save money. So we’ve started to think a little bit more about targeting this type of user  and how we can make our strategy more parent-focused. 

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As far as other outreach goes, we’re filtering by certain conditions, like 18 to 35 year olds, and using these conditions to test the product and onboarding process with a different demographic.

Any other thoughts you want to share on the Product-Led movement? 

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EdTech is a fantastic case study of product-led growth. After COVID, even schools, which have traditionally been notoriously difficult to sell to, have become much more open to working with free software in a way they’d never really been open to before. It's not just in the B2B world. 

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Product-led companies are more likely to succeed in my opinion in the next 10 years. It's very hard for companies that are not product-led to become product-led, it's a mindset you have to have. For those that are able to make that transition sooner rather than later, great. For the ones that start off product-led from the get-go, you'll already have a leg up on legacy competitors.