I’m sure we all agree that Curve is trying to get new users, so there must be some sort of promo. But when the promo is too big, you are only attracting the freeloaders who will jump off the boat once they got the promo money etc.
Have a look here: https://www.mydealz.de/deals/freebie-5eur-geschenkt-als-auszahlung-auf-girokonto-auch-fur-bestandskunden-von-wavy-1275281 or here: https://www.mydealz.de/gutscheine/wavy-by-klarna-5eur-geschenkt-1284744
Written in German, but you can use google translate.
Basicially, Wavy by Klarna gave out 5€ for free for signing up, everyone signed up, withdrew the 5€ and cancelled their account afterwards again.
Users were even pi**ed cause of delay in support emails due to the high sign up numbers. So in the end Wavy lost 5€ per signup and lots of bad user reviews about the app and users who will never think about using the app ever again
Or another example where a huge promos backfire:s
200€ travel credit + 75 AmEx MR points which can be converted + cashed out to 350€ for a monthly fee of 50€ with no min. contract time.
Everyone got the promo money and cancelled right after they received their promo, HUGE outcry + internet rant because AmEx underestimated the new sign up numbers and couldnt handle all the support requests via phone, email, mail,… and didn’t follow their own t&c
This way they ‘old’ users were furios cause their support respond time also went nuts.
What I’m trying to say:
- Don’t make the signup promo too high to only attract freeloaders
- dont give new users more benefits than existing members, otherwise you’ll get lots of account closures and existing members will sign up new again --> unwanted costs for new cards etc. + upset existing members
- value existing users and encourage them to invite new friends (such as referral code) but signup bonus must meet certain criteria, such as min. spending etc. and dont allow to cash out the sign up bonus
I see this every day, especially in the start up scene, that lots of companies try to grow by giving out free stuff. In the end they burn only money without getting anything back, most of the time it even backfires cause of too many signups etc.