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Advanced growth hacking for startups. The big unanswered questions. My slides from the DFJ CMO / growth round table
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Getting to traction
Advanced growth hacking for startups!
!
4 conundrums
@nilanp
How much should I burn ?
What are your scaling levers ?
How do I deal with competition ?
How do I build a product with acquisition built in ?
@nilanp!Introductions…
Lets start…
How much should I burn ?
The rocket internet model
Strong intent SEM!SEO
foundation!!
Display!Move to LTV
model!Broader SEM
and SEO!
TV!Offline!
Multichannel attribution!
!
Discussion points
1. Do you agree with the model ? Have you explicitly followed it ?!
2. The big downside of the model is that it doesn’t drive customer centricity - which can impact repeat rates and a path to profitability!
How much should I burn ?
3 models!
Burn transactions!
Burn Life Time Value (LTV)!
Burn equity!
Discussion point
1. Which model do you employ ?!2. How much do you burn and why ?!3. Burning LifeTime Value is much more difficult that
it sounds, modelling LTV on sparse data is hard, modelling cash-flow is hard. Do you model Life Time Revenue ? or Life Time Contribution ?!
4. What are the leading indicators of LTV that you track ?!
5. What is the right data architecture to do progressively evolve this ?
What are your scaling levers ?
What are your scaling levers ?
Improve!conversion!
rate
Improve!margin
Grow supply
Launch new
markets
Launch new
channels
Optimise channel
performance
Discussion points1. Almost always in every business I’ve been involved in the single
biggest driver of growth within a market has been supply - do you agree (Businesses normally find a couple of scaling channels - and optimise them (e.g. SEO and SEM) - then focus on acquiring supply to grow within a market)? !
2. If this is the case - how do you separate this from marketing driven growth ? How do you explicitly make this clear within the business KPIs ?!
3. How do you prioritise a dev queue over market expansion, supply growth, new channel testing and optimisation ?!
4. I used to say that a performance marketing powered business grew at the rate it grew conversion rate - but these days I see conversion rate as an optimisation and a competitive benchmark of your product - not a scaling lever of growth - do you agree ?
Dealing with competition
Cost per acquisition
Lifetime Value
CPA
LTV
CPA
competition
LTV
competition
CPA
conversion growth
repeat growth
LTV
CPArepeat growth
conversion growth
LTV
competition
competition
Discussion points1. Do you agree ? That CPA and LTV are the most
competitive metrics within the business ?!2. Do you agree that conversion rate and repeat rate
demonstrate how better your product offering is vs the competition?!
3. What other metrics do you track to understand how good your competitors product is ?!
How to build a product with acquisition built in
Some examples of products with acquisition built in
Products with acquisition built in
Channel Product
SEO LinkedIn
Virality Facebook, LinkedIn
SEM booking.com
Social AirBnB
Recently I’ve realised that your product and traffic are
linked in a more fundamental way
There is a symbiotic relationship between product
and traffic
Not only in landing pages, but also in conversion rate optimisation and product
If grow an audience from SEM, your product will iterate
towards converting high intent commoditised traffic
If grow an audience from facebook, social validation
throughout your product will be key
Traffic and product teams cannot be siloed
Discussion points1. There is a symbiotic relationship between product and
traffic!2. If you explicitly set your self the goal of increasing
conversion rate, or revenue per customer, this will be highly dependent on the traffic stream you have built the business on!
3. This stretches beyond landing page optimisation to the core product - the products that sell, and the UX you need to develop to sell them is dependent on - hence separating traffic from product is not a good idea !
Beyond the rocket internet model
The future of growth
2 steps
1. Build a great product
2. Encourage your customers to find more customers
Building a viral loop
Building a viral loop
Customers find customers
Conversion to sign up
Conversion to repeat / premium
The levers of viral driven business:!!
1. Viral mechanics!2. NPS
Discussion points
1. Is this ever really an option ? Or only a route for category leaders ?!
2. How do you layer this on post launch ? Who has done this ?!
3. What is the direction this pushes product in - does it support the same ends as performance marketing ?
Discussion points
In closing…
How much should I burn ?
What are your scaling levers ?
Dealing with competition
How to build a product with acquisition built in
Thank you !
@nilanp