Product Manager - Growth: A New Role with a Sole Focus on Growth

PRODUCT MANAGER - GROWTH: A NEW ROLE WITH A SOLE FOCUS ON GROWTH

VP PRODUCT AND COFOUNDER GROWTHHACKERS.COM

JASON MERESMAN

PRODUCTCAMP LA JULY 16, 2016

HULU HEADQUARTERS, SANTA MONICA, CA

MY BACKGROUND

• 15+ years product management experience in both B2C and B2B

• Cofounded GrowthHackers with Sean Ellis in 2014

• Prior to GrowthHackers:

• Cofounded and sold Qualaroo

• Index Ventures portfolio, Ask.com, SGI

GROWTH HIGHLIGHT: JAXTR (2007-8) GREW USER BASE FROM 500K TO 5M

IN UNDER SIX MONTHS

REGARDLESS OF WHAT THE ROLE IS CALLED, TO BUILD A SUCCESSFUL BUSINESS GROWTH IS WHAT YOU’RE AFTER.

WHAT YOU’RE ABOUT TO SEE IS MY OPINION

WHAT WE WILL COVER IN TODAY'S SESSION

• Why the PM of Growth role has emerged

• A framework for identifying growth opportunities

• A process for evaluating and prioritizing growth initiatives

• Advice for overcoming the challenges growth teams face

TIME AT THE END FOR Q&A

WHAT WE WILL NOT COVER IN TODAY'S SESSION

• Specific "growth hacks" and tactics

• User acquisition channels like SEM, SEO and content marketing

• The basics of AB testing (we'll assume you know them)

WHY A PM OF GROWTH ROLE

— Andy Johns, VP Growth at Wealthfront (formerly growth at Quora, Twitter and Facebook)

IF FINANCE OWNS THE FLOW OF CASH IN AND OUT OF A COMPANY.

GROWTH OWNS THE FLOW OF CUSTOMERS IN AND

OUT OF A PRODUCT.

GROWTH NEEDS TO BE MANAGED

• Internet growth has emerged as its own discipline, which requires specific skills and experience

• Like core product management, growth requires constant focus and attention

THERE MUST BE LEADERSHIP, VISION AND ACCOUNTABILITY AROUND DESIGNING

TESTS TO DRIVE GROWTH

EXAMPLE OF PM GROWTH ROLE

AND THE TREND IS GROWING

PM OF GROWTH VS. CLASSIC PM

Classic PM role PM Growth role

Identifies opportunities to deliver and expand the product’s value proposition

through features

Identifies opportunities to convert, activate and acquire users through

product touchpoints

Ships features Ships experiments

Generally measured by ability to ship product that satisfies the needs of the

users and market

Generally measured by achieving lift (or reduction), in a conversion rate for a

desired goal

IN COMMON: BOTH USE DATA TO INFORM DECISIONS AND ROADMAP

HOW WELL DOES THE CLASSICAL PM SKILL SET TRANSLATE TO THE PM OF GROWTH?

• PM of Growth must be very comfortable with analytics

• Have a good understanding of the psychology of influence (i.e. - what motivates people to behave the way they do)

• Broad skill set and experience that spans across marketing, product and operations

• Familiar with several tools that allow rapid execution and testing such as email, landing page creation and surveys

• Be comfortable with taking risks and imperfection

SHORT ANSWER - IT DEPENDS

A FRAMEWORK FOR IDENTIFYING GROWTH OPPORTUNITIES

— Sean Ellis, CEO at GrowthHackers (formerly growth at Dropbox, Eventbrite and LogMeIn)

AT LEAST 40% OF YOUR USERS SHOULD SAY THEY

WOULD BE VERY DISAPPOINTED IF YOUR SERVICE OR PRODUCT

WENT AWAY OVERNIGHT

FIRST: KNOW WHEN IT'S TIME TO GROW

• Must have product-market fit - don’t pour fuel on a fire that hasn't started

• Strong retention cohorts - no sense in filling a leaky bucket

PROBLEM/SOLUTION FIT (CUSTOMER DEVELOPMENT)

PROBLEM/MARKET FIT (CUSTOMER VALIDATION)

SCALE (CUSTOMER CREATION)

STAGES OF A STARTUP OR NEW PRODUCT

WORK BACKWARDS FROM THE ONE METRIC THAT MATTERS• With your growth model in place, develop a single metric to measure

performance (aka OMTM; One Metric That Matters); a metric that everyone in the business can understand

• OMTM may change depending on the stage of your business

• Different OMTMs for different businesses

• OMTMs should be aligned with where the product delivers value

• Some examples of OMTMs

• MRR for SaaS, DAUs for apps/communities, LTV for ecommerce, etc.

• Nights booked for Airbnb, Rides taken for Uber, etc.

DEVELOP A GROWTH MODEL

• A growth model captures the elements and levers that influence your OMTM (i.e. - how your product or business grows)

Three elements Five levers

• Top of funnel

• A-ha moment

• Must-have experience

• Acquisition

• Activation

• Retention

• Referral

• Revenue

‘Must Have Experience’ coined by Sean Ellis Levers courtesy of Dave McClure’s ‘Startup Metrics for Pirates’ http://www.slideshare.net/dmc500hats/startup-metrics-for-pirates-long-version

GROWTH MODEL: THREE ELEMENTS

• Top of funnel

• Ability to capture traffic and convert it to taking an action

• A-ha moment

• A simple action tied to an emotional reward

• Must-have experience

• When the continuous value the product or service delivers, transcends from being a nice-to-have to a must-have

‘Must Have Experience’ coined by Sean Ellis

GROWTH MODEL: FIVE LEVERS

• Acquisition: users come to the site or app from various channels

• Activation: users enjoy experience and have an a-ha moment

• Retention: users come back repeatedly; it's a must-have experience

• Referral: users like the product enough to refer others

• Revenue: users conduct some monetization behavior

Courtesy of Dave McClure’s ‘Startup Metrics for Pirates’ with some changes http://www.slideshare.net/dmc500hats/startup-metrics-for-pirates-long-version

HOW IT ALL COMES TOGETHER

Model courtesy of Sean Ellis

ACQUISITION

ACTIVATION (A -HA MOMENT)

RETENTION (MUST HAVE EXPERIENCE)

REFERRAL

REVENUE

A PROCESS FOR EVALUATING AND PRIORITIZING GROWTH INITIATIVES

— Brian Rothenberg, VP Growth at Eventbrite

THE ESSENCE OF STRATEGY IS DECIDING WHAT TO SAY ‘NO’ TO, AND WHOEVER IS

MANAGING THE TEAM SHOULD HELP TO IDENTIFY

THOSE THINGS

DEVELOP A GROWTH ROADMAP

ANALYZE & LEARN

EXPERIMENT

PRIORITIZE

FORM IDEAS

ANALYZE, LEARN AND SET OBJECTIVES

• Use quantitative and qualitative methods to analyze your users and to learn their behavior (data!)

• Quantitative sources

• Google Analytics, MixPanel, Amplitude, many more

• Qualitative sources

• Qualaroo, UserTesting, SurveyMonkey, many more

• Set Objectives and expected results

OBJECTIVES SHOULD BE AMBITIOUS, VISIBLE, AND PAIRED WITH KEY RESULTS WHICH ARE

MEASURABLE AND TIME BOUND.

FORM IDEAS (I.E. - A BACKLOG)

• Leverage your data to come up with ideas that will drive growth

• Each idea should be backed up with a hypothesis

• A good hypothesis has three parts

• A variable that can be modified

• A quantifiable result that can be measured

• A rationale that connects the outcome to the theory

Source: ‘Design a hypothesis that drives your business goals’ by Optimizely

IF [VARIABLE], THEN [RESULT] BECAUSE [RATIONALE].

EXAMPLE OF A STRONG HYPOTHESIS

• Strong

• If we personalize the Call to Action to users who clicked on our poker ad campaign, then we will see a 20% lift in click goals, because our heatmap data shows that users who focus on poker-related copy on the page click through our links 20% of the time.

• Weak

• If we personalize the Call to Action to users who clicked on our poker ad and remove distracting images around the page, we’ll see an increase in revenue on our site.

Source: ‘Design a hypothesis that drives your business goals’ by Optimizely

PRIORITIZE

• Assign an ICE score to each idea (Impact, Confidence, Ease)

• Impact: The impact the idea could have on the business if the experiment results in a win.

• Confidence: How confident the team is about the outcome.

• Ease: How easy is it to develop the experiment. Does it need developers?

AVERAGE THE SCORE: HIGHER IS BETTER

EXAMPLE OF PRIORITIZED LIST OF IDEAS

EXPERIMENT

• Two types of experiments

• Experiments to learn: Understand user intent and behavior

• Google AdWords to test copy/positioning/value proposition

• 404 tests to test appeal of new product features

• Experiments to optimize: Boost funnel performance

• Testing changes to steps in the funnel

• Testing steps in a viral loop (email, CTAs to invite a friend, etc.)

EXAMPLES OF TOOLS FOR EXPERIMENTATION

• Optimizely

• AB testing page elements and user journeys (web and mobile)

• Unbounce

• AB testing landing pages

• MailChimp/ESPs

• AB test email subject lines, messages, delivery day/time/etc.

• Homegrown tools

• Ideal for complex testing deep in the application

REMEMBER TO TRACK YOUR EXPERIMENTS

RECORD YOUR RESULTS

• What was the bottom line?

• Include both quantitative results and lessons learned

• In general, there are three conclusions:

• It worked

• It didn’t work

• It was inconclusive

• Build a knowledge base of results (“artifacts”)

• Enshrine your winners and learn from the losers

EXAMPLE OF EXPERIMENT RESULTS

EXAMPLE OF KNOWLEDGE BASE

STAY ORGANIZED AND FOCUSED

• Use "Growth Sprints" to keep a cadence and commit to it

• Always be testing; no testing = no learning or optimizing

• Have a weekly growth meeting led by PM of Growth

• Use an experiment document or system of record to memorialize your experiments and their results

EXAMPLE OF WEEKLY GROWTH MEETING AGENDA

Growth Meeting Agenda courtesy of Sean Ellis

EXAMPLE OF EXPERIMENT DOCUMENT

ADVICE FOR OVERCOMING THE CHALLENGES GROWTH TEAMS FACE

— Harvard Business Review

BEFORE YOU CAN GET BUY-IN, PEOPLE NEED TO FEEL

THE PROBLEM.

GET EXECS AND STAKEHOLDERS ALIGNED

• Get executive buy-in before you try to assemble a growth team

• Executive department heads across product, marketing, engineering

• Ideally CEO (it really makes a difference)

• Make sure you have the team and resources needed

• Ideal: Cross-functional "growth team”

• PM of Growth aka “GrowthMaster” (roadmap, decisions, leadership)

• Growth Engineer (full-stack engineer; from database to CSS)

• Designer (agile; embraces the idea of results trumping great design)

• Access to copywriter and analyst as needed

MAKE THE CASE FOR A DEDICATED GROWTH ENGINEER

• Dedicated growth engineer = self-sufficiency

• Benefit: Experiments still run even when core development is delayed

• If growth initiatives are competing against core product initiatives, shipping product will almost always win

• Examples of where a core growth engineer is crucial

• Instrumenting an AB tests for measurement

• Building light-weight features or tweaks to elements that are being tested

• Running data queries from the database if unavailable through your analytics tool

FIND A GREAT PM OF GROWTH

• Look internally or externally

• PM Growth skill set is the intersection of imagination, math and technology

Required (Very) Nice-to-Have

• Natural leader

• Highly analytical

• Curious and creative; a fast learner

• Technical

• Detail oriented

• Coding experience

• SQL

• Marketing experience

• Copywriting skills

ANTICIPATE TENSION BETWEEN THE CORE PRODUCT TEAM AND THE GROWTH TEAM

• Why tension?

• Traditionally product management is the gate keeper for any changes to a product that impact the user experience

• Having an autonomous growth team reduces core product’s control

• How to overcome it?

INVOLVE PRODUCT LEADS IN THE WEEKLY GROWTH MEETING

MAKE SURE YOUR ANALYTICS ARE IN ORDER

• Without having your analytics in order, you can’t measure the impact of your experiments, positive or negative

• Before beginning any growth initiatives, it is imperative that foundational work is complete - every step of your funnel should be instrumented

“You might as well not change it at all if you're not going to measure the impact of that change.”

— Bing Gordon, Kleiner Perkins Caufield & Byers

SHARE THE WINS AND INSIGHTS

• Growth efforts should be transparent and visible across the organization

• Send an email or Slack message company-wide when an experiment is a success and delivers material gains on a key metric

• When an experiment fails, present the results and lessons learned

• Know when it's time to grow

• Designate a PM of Growth along with the necessary supporting resources

• Develop a growth model and roadmap

• Test, learn, apply

• Make sure you have executive buy-in and organization-wide visibility

GROWTH IS A PROCESS & CULTURE THAT IS MANAGED

HELPFUL RESOURCES

• Online:

• GrowthHackers.com

• Dave McClure's Startup Metrics Presentation http://www.slideshare.net/dmc500hats/startup-metrics-for-pirates-long-version

• Books

• Predictably Irrational - Dan Ariely

• The Four Steps to the Epiphany - Steve Blank

• Hooked: How to Build Habit-Forming Products – Nir Eyal

• Lean Analytics - Alistair Croll

• Sprint: How to Solve Big Problems and Test New Ideas in Just Five Days - Jake Knapp

QUESTIONS AND ANSWERS

THE END

Product Manager - Growth: A New Role with a Sole Focus on Growth

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