How to Scale Globally as a Niche Startup
DNA of Wachanga’s Success
When you think about profitable business opportunities, mobile apps for parenting are probably not the first thing that comes to mind. But the Wachanga team manages to prosper, attract investments, and keep global leaders on their toes. How?
Between January 2017 and April 2020, Wachanga increased its size 185 times over — from 7500 to 1.4 million active users per month! Wachanga has long worked with localization studio Alconost, and together we decided to analyze the building blocks from which Wachanga’s success was formed.
A product ecosystem
In 2013 Wachanga released its first app, “Early Childhood Development.” 3 years later a satellite app was created to generate leads to the first app. This satellite was Babycare, a newborn care app. Interestingly, the satellite ended up taking off and becoming a key product in Wachanga’s lineup.
The Wachanga team decided to recreate their success, and made a “satellite of a satellite,” releasing a pregnancy app. This was a logical step, as audience size, traffic, and attention are all greater at the early stages of parenthood.
The company then proceeded to expand the product line to 8 apps and began positioning itself as a “family development assistant.” The other apps are the period calendar Clover, Water Tracker, Baby Names (helps choose a name), and Breath of Siberia: Sleep and Meditation.
The result was an ecosystem of products designed for long-term use. After all, each app logically leads to the next:
For a narrow niche it makes perfect sense to expand the audience through linked themes, and Wachanga does exactly this. For example, the pregnancy app was augmented with a contraction timer, meaning that the primary keyword “pregnancy calendar” was augmented with the powerful keyword “contraction timer.” This keyword attracts new users who only need a contraction timer for one or two days. Afterward, however, they may move on to the newborn care app.
Focusing on actual needs, not invented ones
One particularity of the company is that the folks there create products that are not hypothetical, but spring from actual user needs. First these needs are studied, and then a product or specific feature is created.
Wachanga CEO Maxim Kolpakov was given considerable insight by his own wife. Why have a breastfeeding app, one might wonder? All you need to feed a baby is a breast or a bottle, right? But with his own wife Maxim saw that there are real challenges: a baby must be fed many times a day, and it’s easy to lose track of which breast was offered last and when exactly (breastfeeding mothers will understand why this matters).
Nearly all the team members have children, so the real needs of parents were easy to discover in their own families. These needs were then verified via customer development, by polling the target audience, which we will describe below.
“We don’t use marketing tricks like inventing consumer needs. We work from the actual needs of our users, so we can say with certainty that all our apps are successful.”
Sergey Dergachev, Wachanga product manager
The Wachanga app already has over 4,000 tasks designed to facilitate a child’s well-rounded development up to age 8. Interestingly, in addition to tasks related to various holidays, the app provides responses to urgent needs. For example, during the coronavirus pandemic Wachanga created a series of tasks that teach adults how to get along with their children while sharing a space 24/7, keeping their sanity while organizing interesting activities. A separate series of pictures helps explain to the child why the coronavirus has caused so many changes and limitations in our daily lives.
Growth model: covering as many markets as possible
We’ve already said that to succeed in a narrow niche it is critical to expand your audience. Aside from including related themes and creating product lines, breaking into foreign markets is a major means of increasing audience size. There are many markets around the world with a serious lack of good products: you just have to watch your chance and fill the need.
The pregnancy app is in the top 100 in 84 countries (App Store, Medicine category). Often it is in the top 10 in countries such as Portugal, Belgium, Ireland, Israel, and Austria. The ratings change daily, and in this category Wachanga has to compete against pharmaceutical services with deep pockets. On Google Play the app is in the top 10 for 19 countries, including Sweden, Brazil, and Portugal (for the Parenting category), and it is frequently in the top 5 for France, Italy, Turkey, and Hungary.
Babycare was one of the top grossing apps in its category in 2019. Today the app is in the top 10 for countries such as Finland, Switzerland, and Denmark.
In many ways, it was translation of their products into other languages that boosted Wachanga’s growth so dramatically. When their apps were seeing a mere 110 installs per day, Maxim decided to localize the apps into a dozen languages, and this step led to growth of 20 times over in just 8–9 months. Maxim described the secrets of effective localization in detail in this article.
This initial success inspired the Wachanga team, and localization became an obligatory stage in their growth:
“Our team has its own code, its own DNA, which I have codified, and which we now employ for each new product. One of the first stages of this code is ‘scaling up.’ Today we only produce products that can easily be scaled up to a global scale.”
Maxim Kolpakov, Wachanga CEO
For fast translation of interfaces and new features into 50+ languages, Wachanga uses the online service Nitro, where all translations are handled by native speakers, and translations of small texts are ready within 24 hours.
To some, translating an app into 50 languages might seem a needless extravagance. But this decision has proven economically sound: all Wachanga’s localizations have paid for themselves. Would you bother localizing an app into Indonesian? And yet, thanks to its population of 260 million, this developing country produced enough paying users for the localization to pay for itself.
In Switzerland and the countries of Scandinavia the inhabitants speak English quite well, but even they find it easier to process important information in their native languages. Countries where English is spoken poorly, but which are sorely lacking apps in their native languages, are the more appreciative when apps are translated into their own languages. Breaking into numerous low-competition markets is one way of becoming a leader in these markets and getting the biggest piece of the pie.
In Wachanga’s case, not only translation but complete adaptation is required, depending on the recommendations for pregnant women and for newborn care in the given country. For this reason the Wachanga team selects OB-GYNs and pediatricians to write their content. These professionals then adapt the material to the situation in their own countries.
We also must not forget that developing the app itself is far more expensive than localization. This means that localization is a relatively inexpensive means of distributing a quality product to the whole world and obtaining far more paying customers than with no localization at all, or with localization into just 5 or so languages.
Feedback and user retention
In December 2018, Wachanga’s apps had around 5,000 installs per day and 280 thousand monthly active users (MAU). In April 2020 it had over 20 thousand installs per day and 1.4 million MAUs. In other words, Wachanga can boast not only of a steady stream of new customers, but also of the fact that those customers stay and use the apps in the long term. Incidentally, all this is organic traffic, which we will touch on separately.
In many ways, user retention remains high because the team constantly has its finger on the pulse of its users and receives feedback from them. Here, customer development (custdev for short) is helpful.
Custdev is communicating with the target audience in order to determine their actual needs. Maxim “custdeved” himself, and taught the team to do the same. He would put on a “#Wachanga” T-shirt, approach mothers at playgrounds, and engage in heart-to-heart conversations.
“In our Babycare app on Android we wrestled with retention for nearly a year. We custdeved, released dozens of updates, did everything to keep the app in constant use. Today our apps are opened an average (!) of 30 times per day per user, with a 4-month retention of over 20%. This has become one of the most important factors in reaching the top.”
Maxim on custdev feedback and retention, May 2018
After reaching the top, the Wachanga team did not stop custdeving. On the contrary, it became a routine practice. For example, Maxim may walk down the hall in an office building, see a pregnant woman, and strike up a conversation. On business trips Maxim and technical director Ilya find opportunities to interview expectant mothers. Custdev interviews have already been conducted in the USA, Japan, France, Cyprus, and Thailand.
The company makes it a rule to always answer reviews, and sometimes an email correspondence turns into a simplified custdev. The team tries to engage in conversation with users who show an interest in the product: they try to learn about their problems, about why this or that app feature matters to them, and so on. This provides the company with valuable insight and replenishes the list of hypotheses.
Each important metric of a product must be constantly tracked and improved. At Wachanga, a series of hypotheses are selected for each metric, an experiment is performed, results and insight are obtained, conclusions are drawn, and they move on to the next hypothesis. Usually the team checks 2–3 hypotheses per week, with periodic breaks so as not to burn out.
It may seem that checking a large quantity of hypotheses would require a large team and an equally large budget, but this is not entirely the case. According to Maxim, half of their hypotheses, which have resulted in growth by dozens of percentage points both for traffic and for profits, were simply cobbled together without any particular labor costs.
Wachanga life hack: use the filter question “Watfer?” Example:
“Let’s add the ability to like posts!”
This actually occurred; the “like” idea was scrapped.
A field for constant experimentation is icons and their style, headings and subheadings, which can differ widely for different localities.
It was interesting to note the change in user opinion on one icon within the breastfeeding app. At first reviews were as follows: the breastfeeding app icon featuring two breasts was deemed “in poor taste,” an icon showing a baby was “hard to understand,” while a stylized B-cup breast was “aesthetically pleasing and easy to understand.” The bottle, however, was “not suitable.”
Today, however, that icon depicts a baby bottle, because at some point user opinion changed.
The habit of checking numerous hypotheses over a short time led to Wachanga creating new apps with remarkable speed.
For example, Clover (a period app) was created in just 3 weeks, from initial concept to release. This was the first minimal version for Google Play and the App Store, and this required analyzing the market and competitors, conducting numerous custdev interviews, modeling the planned functionality, testing various icon versions, preparing the content in 2 languages, and commencing translation into the next 10 languages.
Wachanga’s experiments include working with influencers and brands. They receive offers from manufacturers of children’s yogurts, infant formula, etc. The company has already worked with such well-known brands as Pampers and Splat. The Wachanga: Child Development app includes a course called “Brushing Teeth is Fun,” which teaches a child proper tooth brushing in 21 days — a joint project with Russian toothpaste company Splat.
This year Wachanga wants to expand its partnerships with brands and medical companies throughout the world, in order both to build on its medical expertise and to share its own experience with pediatricians.
Organic traffic vs. paid traffic
This is not the first year that people have been saying that organic traffic is not reliable, and that it is a “poor channel for expansion.” A couple of years ago Wachanga attempted to attract users via paid channels, and although the unit economics worked out, it turned out that paid traffic also does not easily lend itself to scaling up. To see significant growth Wachanga would have had to invest tens of thousands of dollars in paid traffic. And so Maxim decided to do away with paid channels altogether.
As you could see in the chart above, Wachanga managed to achieve impressive growth with organic traffic as well. Naturally, this was facilitated by quality products and an expanded audience due to localization.
After securing investments from venture capital firm Embria, the people at Wachanga decided to resume paid traffic. Here is what you get when you advertise a fine-tuned product that has been tested by millions of users:
This first experiment confirms that the target audience is far from exhausted, and that apparently Wachanga’s success story is just beginning.