The art and science of growth hacking at MassTLC Marketing Summit April 2014

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David Skok, Partner at Matrix Partners presented the Art and Science of Growth Hacking at MassTLC's annual sales and marketing summit "Building a Lean, Self-Perpetuating Marketing Machine." Follow David at www.forentrepreneurs.com

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The art and science of growth hacking at MassTLC Marketing Summit April 2014

  1. 1. THE ART & SCIENCE OF GROWTH HACKING Upsell/ Cross Sell CAC/LTV Virality Engagement Retention Freemium Conversion Rates BY DAVID SKOK Free Trials
  2. 2. GROWTH HACKING Accelerate Growth Through Work on Funnel A PERSONAL DEFINITION INCREASE FLOW & CONVERSION
  3. 3. THIS USED TO BE MARKETING’S JOB WHAT’S CHANGED?
  4. 4. TODAY’S WORLD • Freely available information • Free Trials • On-line reviews • Social Media commentary THE CUSTOMER IS DOING THEIR RESEARCH BEFORE THEY COME AND TALK TO YOU
  5. 5. YOUR ON-LINE PRESENCE IS KEY
  6. 6. THE PRODUCT IS YOUR SALESPERSON
  7. 7. THERE’S A RICH FLOOD OF NEW DATA
  8. 8. METRICS
  9. 9. REQUIRES A NEW COMBINATION OF SKILLS BOTH MARKETING AND TECHNICAL
  10. 10. Data Science THE GROWTH HACKER Creative Marketing Inbound Marketing Customer Experience & Product Design Funnel Optimization Instrumentation & Metrics
  11. 11. THE BASICSOF FUNNEL DESIGN
  12. 12. Suspects Closed Deals Loyal Customers who are Advocates
  13. 13. Suspects Closed Deals Loyal Customers who are Advocates Virality
  14. 14. IN A PERFECT WORLD… 1 Step
  15. 15. IN A PERFECT WORLD… MyProduct.com HOW IT WORKS DESCRIPTION Our product allows you … BUY NOW! Only $9,999.99
  16. 16. DESIGNING YOUR FUNNEL
  17. 17. WHAT IS A FUNNEL? ACTION MOVEMENT ACTION MOVEMENT ACTION MOVEMENT
  18. 18. HOW DO WE DESIGN THE ACTIONS?
  19. 19. BUYER THE
  20. 20. THE BUYERS JOURNEY CONSIDERATION CLOSED DEAL AWARENESS PURCHASE
  21. 21. TRIGGERS • Moving house • Movers, phones, cable TV, furniture, insurance, etc. • Starting a new software project • PaaS (Platform as a Service), Dev Tools, etc. • Need to hire a lot of new employees • Applicant Tracking System • Just lost my data in hard drive crash • Backup software/service • Read about a new scary computer virus • Anti-virus software
  22. 22. Suspects ToFU Top of the Funnel MoFU Middle of the Funnel Closed Deals SALES Bottom of the Funnel Loyal Customers who are Advocates CUSTOMER SUCCESS Retention Funnel Retain Expand Upsell / Cross sell Nurture & Qualify Inbound & Outbound Marketing Typical B2B Funnel AWARENESS CONSIDERATION PURCHASE
  23. 23. METRICS "IF YOU CAN NOT MEASURE IT, YOU CAN NOT IMPROVE IT." - LORD KELVIN
  24. 24. METRICS FLOW / QUANTITY CONVERSION RATE
  25. 25. WHAT TO MEASURE FOR EACH STEP / ACTION: NO OF ACTIONS % CONVERSION RATE TIME TIME
  26. 26. VISITORS CAMPAIGNS TO DRIVE TRAFFIC TRIALS CLOSED DEALS CONVERSION % CONVERSION % THE KEY METRICS OVERALL CONVERSION %
  27. 27. Visitors Trial 5% 10% $5,000 Customer NOT ALL LEAD SOURCES ARE EQUAL Google Ad Word Funnel FaceBook Ad Funnel Visitors Trial 2% 20% $8,000 Customer
  28. 28. ROI by LEAD SOURCE OVERALL CONVERSION % (BY LEAD SOURCE) Cost per lead Lifetime value of the Customer
  29. 29. BUT EVEN IF YOU ARE MICROSOFT, CISCO, ORACLE, OR GOOGLE YOUR FUNNEL WILL HAVE BLOCKAGE POINTS Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects
  30. 30. IN DIAGNOSING MANY FUNNEL BLOCKAGE POINTS, I HAVE FOUND THAT THERE IS A CLEAR PATTERN…
  31. 31. NOT MOTIVATED TO DO THAT THEY ARE CUSTOMERS WILL DO SOMETHING YOU ARE HOPING YOUR
  32. 32. IN OTHER WORDS… YOU DESIGNED YOUR FUNNEL THE WAY YOU HOPED IT WOULD WORK… BUT YOU MAY NOT HAVE THOUGHT ENOUGH ABOUT THE CUSTOMER’S POINT OF VIEW
  33. 33. JBOSS EXAMPLE CUT THE DOWNLOAD RATE BY MORE THAN 10X PUT A REGISTRATION FORM ON THEIR WEB SITE BEFORE A FREE DOWNLOAD IMPACT
  34. 34. FRICTION GET INSIDE YOUR CUSTOMER’S HEAD CONCERNS
  35. 35. UNDERSTAND WHAT MOTIVATES THEM MOTIVATIONS FRICTION CONCERNS
  36. 36. JBOSS EXAMPLE • Making $27,000 a month selling documentation • Solution: • Give away documentation to get their email address
  37. 37. EXAMPLE: DRIVING TRAFFIC TO YOUR WEB SITE GETTING FOUND Not going to find your site unless: - On top page of Google search results - Recommended by a trusted source - Referred to in social media or blogosphere friction & concerns
  38. 38. LESSONS FROM WEBSITE GRADER • Free tools drive viral spread • Low customer work required • High value delivered • Score leverages competitive urge, and acts as a trigger • Builds trust through clear demonstration of expertise
  39. 39. GOOD LINKAGE TO NEXT STEP
  40. 40. using engineering for marketing GROWTH HACKING
  41. 41. USING DATA TO DRIVE WEB TRAFFIC SYSOMOS: SOCIAL MEDIA MONITORING LEVERAGED THEIR DATABASE TO CREATE BLOG POSTS WITH DATA ON TOPICS OF CURRENT INTEREST: • IRAN ELECTION RIOTS • TWITTER’S GROWTH • FACEBOOK USAGE
  42. 42. LED TO: SYSOMOS ARTICLES IN ECONOMIST, NY TIMES WEB TRAFFIC TO READ THE FULL REPORT LEADS – IMPRESSED BY THE CAPABILITIES OF THE SOFTWARE
  43. 43. FREE TRIALS THE PRODUCT IS YOUR SALES PERSON
  44. 44. WHAT IS YOUR TIME TO WOW! ? Thanks to Gail Goodman of Constant Contact WOW!
  45. 45. AT CONSTANT CONTACT CREATE AND SEND YOUR FIRST EMAIL WOW!
  46. 46. TIME TO WOW! • How many steps? • How much time does it take? • How much FRICTION is involved
  47. 47. REMOVE STEPS & REMOVE FRICTION e.g. Provide Sample Data instead of requiring them to load their own
  48. 48. WOW! ANALYZE TRIAL STEPS AS THOUGH THEY WERE FUNNEL STEPS Create a full profile Import Contacts Do a search for Prospects See search results Imagine a Sales Rep signing up for the old LinkedIn
  49. 49. WOW! LOOK FOR BLOCKAGE POINTS Create a full profile Import Contacts Do custom search for Prospects See search results Imagine a Sales Rep signing up for the old LinkedIn HIGH FALL OFF RATES HERE
  50. 50. For an Outlook/Exchange User WOW!Create a full profile Import Contacts Do custom search for Prospects See search results Download an App Install the App Run the App
  51. 51. APPLY BLOCKAGE POINT THINKING WOW! FRICTION MOTIVATION CONCERNS Replace the downloaded App with request for email credentials and get contacts from Exchange. Create a full profile Import Contacts Do a search for Prospects See search results
  52. 52. • Concern: – I have tons of very private and confidential emails. I don’t want anyone to read those. You want me to give you the password to login to my email?!!!
  53. 53. APPLY BLOCKAGE POINT THINKING WOW! FRICTION MOTIVATION CONCERNS Replace the downloaded App by connecting to Contacts on iOS/Android Create a full profile Import Contacts Do a search for Prospects See search results
  54. 54. RE-THINK THE PROCESS Source: Josh Porter – Designing for Social Traction CONVENTIONAL APPROACH SIGN UP FOR TRIAL CONVERT TO CUSTOMER WOW! WOW! FIRST, REGISTER LATER WOW! SIGN UP CONVERT TO CUSTOMER
  55. 55. MAY VARY FOR DIFFERENT CUSTOMER TYPES E.g. LinkedIn • Different personae: – Recruiter – Sales person – Individual looking to find a job MAKE SURE THERE IS A CLEAR PATH FOR EACH ONE WOW!
  56. 56. BUYER THE THE KEYS TO SUCCESS GET INSIDE YOUR BUYER’S HEAD
  57. 57. WHAT WE DIDN’T COVER
  58. 58. • Buyer Persona • Top of the Funnel • Middle of the Funnel • Market Development Reps • Customer Success Management • Virality • Software Tools – The Underlying Database
  59. 59. For More information • Visit my blog at www.forEntrepreneurs.com

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