What should be the focus when using a value-based bidding strategy in a subscription-based business?

The focus when using a value-based bidding strategy in a subscription-based business should center on assigning values to conversions based on user subscriptions. This approach allows businesses to optimize their ad spend by calculating the actual value each subscription brings, rather than just aiming for a high number of conversions without understanding their individual worth.

By assigning monetary values to different levels of subscriptions—such as trial users versus full subscribers—businesses can prioritize their advertising efforts toward acquiring customers who are likely to generate higher revenue over time. This strategic alignment enhances the effectiveness of marketing campaigns, enabling businesses to make informed decisions that directly contribute to their long-term profitability.

Other options do not align with the principles of value-based strategies. For instance, merely creating the lowest subscription price does not guarantee profitability and may devalue the service. Targeting as many leads as possible can dilute focus, leading to less qualified leads that might not convert into valuable subscriptions. Reducing the number of conversions tracked would impair the ability to measure the true effectiveness and return on investment of the advertising campaigns, ultimately hindering growth. Thus, the correct approach is to focus on assigning values to conversions, as it establishes a more effective framework for maximizing revenue in subscription-based models.