Does Premium Version Adoption in mHealth Improve User Engagement and Health-Related Outcomes?

Abstract

This study examines the impact of premium adoption on user engagement and health outcomes in an mHealth setting. Using a staggered Difference-in-Differences (DiD) framework, we estimate the effects of premium adoption on food and exercise tracking, adherence to caloric budgets, and weight loss. While premium users exhibit an initial engagement spike, these effects dissipate within weeks, consistent with hedonic decline. Despite increased tracking, premium adoption does not lead to sustained improvements in weight loss. We demonstrate that failure to account for endogeneity and selection in premium adoption will lead to an overstatement of these effects on user engagement and weight loss outcomes. Taken together, our findings underscore the transient nature of premium-induced behavior change and motivate reinforcement mechanisms to sustain long-term engagement.

Keywords: Behavioral Analytics, Freemium, Mobile Health, Subscriptions, Sunk Cost

JEL Classification: I12, C21, M31, I10