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. Although premium users exhibit an initial spike in engagement, these effects dissipate within weeks, consistent with hedonic decline. Despite increased tracking activity, premium adoption does not translate into sustained improvements in weight loss. We further demonstrate that failing to account for endogeneity and selection in premium adoption leads to an overstatement of its effects on both engagement and health outcomes. Taken together, these findings underscore the transient nature of premium-induced behavior change and highlight the importance of reinforcement mechanisms to sustain long-term engagement.

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

JEL Classification: I12, C21, M31, I10