Dan McGaw, Director of Marketing at KISSmetrics
Build The Right Funnel and Grow
Your Business Fast
April 2014
@DanielMcGaw #KISSwebinar
Join me on Twi er
1 What is activation?
2 4 levers for industry domination
3 Common pitfalls of testing
Table of Contents
WATCH THIS WEBINAR RECORDING NOW
What is Activation?
1
Your SaaS funnel
What is Activation?
Not only do people need to create an
account, they need to start using your
product.
Are people using your product?
No value = No sale
How to define activation
Activation is the critical step people
need to take in order to get value from
your product
Facebook Activation = 10+ Friends
What is Activation?
Evernote Activation = First note wri en
What is Activation?
Instagram Activation = Filter used on an image
What is Activation?
Basecamp Activation = Project created
What is Activation?
Make sure to track activation
It’s the most important part of your
funnel and everyone forgets it.
Funnel Levers
2
What’s a lever?
A change to the funnel that helps you
maximize results.
Lever #1: Free Trials
People love free
More people will try your product
Trial Funnel
Funnel Levers
Visited Site Upgraded
Trial Sign
Up
Activated
Basecamp Free trial
Funnels Levers
On-ramp program is critical
You have a limited number of days to
make the sale. Don’t waste them.
What’s your on-ramp program?
The new user experience (NUX) should
be completely different than your
regular program.
Shopify NUX
Funnel Levers
14, 30, or 45 day trial?
You need to find out what works best for your company
Funnel Levers
Replacing the free trial
Try replacing your free trial with a 30-
day money back guarantee.
Lever #2: Freemium
Again people love free
Can be hard to convert free into paid
Looking for user growth?
Freemium is where you want to be.
What do you limit?
There’s a balance between offering enough so
people sign up but not offering too much so they
never upgra...
1 Dropbox = 2 GB of Storage
2 Evernote = 60 MB of Uploads
3 MailChimp = 2,000 Email Subscribers
Common Freemium Limits
MailChimp Freemium
Funnel Levers
Freemium users take forever to upgrade
Very difficult to track changing behavior over
time with a long-term funnel.
Cohort reports help a lot with freemium
Funnel Levers
LOG IN WITH GOOGLE
Start Your Free KISSmetrics Trial
Lever #3
Up-front Credit Cards?
Funnel Levers
When do you collect credit card info?
At account creation or at upgrade?
?
Credit cards up front
Fewer people will create an account but a LOT
more will upgrade (especially if the upgrade is
opt-ou...
Credit cards at upgrade
Much easier to get people to create an account,
much harder to get them to upgrade.
AWeber $1 Trial
Funnel Levers
Maximizing users or revenue?
• If users, try no credit card
• If revenue, try up-front credit cards.
Lever #4
Monthly or Annual Billing
Funnel Levers
Is the focus on users or revenue?
Monthly gets more users, annual gets more
revenue.
CrazyEgg used to be monthly
Funnel Levers
KISSmetrics offers both but with a discount for annual
Funnel Levers
Your funnel levers
1 Free Trials
2 Freemium
3 Credit Cards Up-front
4 Monthly or Annual Billing
Test different levers to achieve the highest growth
Funnel Levers
Common Pitfalls
3
What Should You
Focus on First?
Look for bo lenecks in your funnel
What step is a serious roadblock for people?
Very few people go from Activation to Upgrade
Common Pitfalls
Use levers to fix bo lenecks
Common Pitfalls
Are You Only
Testing the
Funnel?
Variation B performs the best in this funnel
Common Pitfalls
Variation A gives the most revenue
Common Pitfalls
Should We Test
Randomly?
Why did you get your results?
If you just start testing without first
understanding user behavior, you won’t be
learning.
Do you have qualitative data?
Once we understand our users, then we can
work the levers for the best fit.
Where do we get qualitative data?
Talk to your customers.
Questions?
We will do our best to answer
THANK YOU
Dan McGaw
@danielmcgaw
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Build The Right Funnel and Grow Your Business Fast

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Build The Right Funnel and Grow Your Business Fast
What is Activation?
Your SaaS funnel
Not only do people need to create an account, they need to start using your product. Are people using your product?
Activation is the critical step people need to take in order to get value from your product
Facebook Activation = 10+ Friends
Evernote Activation = First note written
Instagram Activation = Filter used on an image
Basecamp Activation = Project created
Make sure to track activation It’s the most important part of your funnel and everyone forgets it.
What’s a lever? A change to the funnel that helps you maximize results.
Free Trials People love free More people will try your product
Trial Funnel Funnel Levers Visited Site Upgraded Trial Sign Up Activated
Basecamp Free trial
On-ramp program is critical You have a limited number of days to make the sale. Don’t waste them.
What’s your on-ramp program? The new user experience (NUX) should be completely different than your regular program.
Shopify NUX
14, 30, or 45 day trial? You need to find out what works best for your company
Replacing the free trial Try replacing your free trial with a 30- day money back guarantee.
Freemium Again people love free Can be hard to convert free into paid
Looking for user growth? Freemium is where you want to be.
What do you limit? There’s a balance between offering enough so people sign up but not offering too much so they never upgrade.
1 Dropbox = 2 GB of Storage 2 Evernote = 60 MB of Uploads 3 MailChimp = 2,000 Email Subscribers Common Freemium Limits
MailChimp Freemium
Freemium users take forever to upgrade Very difficult to track changing behavior over time with a long-term funnel.
Cohort reports help a lot with freemium
Up-front Credit Cards?
When do you collect credit card info? At account creation or at upgrade?
Credit cards up front Fewer people will create an account but a LOT more will upgrade (especially if the upgrade is opt-out).
Credit cards at upgrade Much easier to get people to create an account, much harder to get them to upgrade.
AWeber $1 Trial
Maximizing users or revenue? • If users, try no credit card • If revenue, try up-front credit cards.
Monthly or Annual Billing
Is the focus on users or revenue? Monthly gets more users, annual gets more revenue.
CrazyEgg used to be monthly
KISSmetrics offers both but with a discount for annual
Test different levers to achieve the highest growth
Look for bottlenecks in your funnel What step is a serious roadblock for people?
Very few people go from Activation to Upgrade
Use levers to fix bottlenecks
Are You Only Testing the Funnel?
Should We Test Randomly?
Why did you get your results? If you just start testing without first understanding user behavior, you won’t be learning.
Do you have qualitative data? Once we understand our users, then we can work the levers for the best fit.
Where do we get qualitative data? Talk to your customers.

Build The Right Funnel and Grow Your Business Fast

  1. 1. Dan McGaw, Director of Marketing at KISSmetrics Build The Right Funnel and Grow Your Business Fast April 2014
  2. 2. @DanielMcGaw #KISSwebinar Join me on Twi er
  3. 3. 1 What is activation? 2 4 levers for industry domination 3 Common pitfalls of testing Table of Contents
  4. 4. WATCH THIS WEBINAR RECORDING NOW
  5. 5. What is Activation? 1
  6. 6. Your SaaS funnel What is Activation?
  7. 7. Not only do people need to create an account, they need to start using your product. Are people using your product?
  8. 8. No value = No sale
  9. 9. How to define activation Activation is the critical step people need to take in order to get value from your product
  10. 10. Facebook Activation = 10+ Friends What is Activation?
  11. 11. Evernote Activation = First note wri en What is Activation?
  12. 12. Instagram Activation = Filter used on an image What is Activation?
  13. 13. Basecamp Activation = Project created What is Activation?
  14. 14. Make sure to track activation It’s the most important part of your funnel and everyone forgets it.
  15. 15. Funnel Levers 2
  16. 16. What’s a lever? A change to the funnel that helps you maximize results.
  17. 17. Lever #1: Free Trials People love free More people will try your product
  18. 18. Trial Funnel Funnel Levers Visited Site Upgraded Trial Sign Up Activated
  19. 19. Basecamp Free trial Funnels Levers
  20. 20. On-ramp program is critical You have a limited number of days to make the sale. Don’t waste them.
  21. 21. What’s your on-ramp program? The new user experience (NUX) should be completely different than your regular program.
  22. 22. Shopify NUX Funnel Levers
  23. 23. 14, 30, or 45 day trial? You need to find out what works best for your company Funnel Levers
  24. 24. Replacing the free trial Try replacing your free trial with a 30- day money back guarantee.
  25. 25. Lever #2: Freemium Again people love free Can be hard to convert free into paid
  26. 26. Looking for user growth? Freemium is where you want to be.
  27. 27. What do you limit? There’s a balance between offering enough so people sign up but not offering too much so they never upgrade.
  28. 28. 1 Dropbox = 2 GB of Storage 2 Evernote = 60 MB of Uploads 3 MailChimp = 2,000 Email Subscribers Common Freemium Limits
  29. 29. MailChimp Freemium Funnel Levers
  30. 30. Freemium users take forever to upgrade Very difficult to track changing behavior over time with a long-term funnel.
  31. 31. Cohort reports help a lot with freemium Funnel Levers
  32. 32. LOG IN WITH GOOGLE Start Your Free KISSmetrics Trial
  33. 33. Lever #3 Up-front Credit Cards? Funnel Levers
  34. 34. When do you collect credit card info? At account creation or at upgrade? ?
  35. 35. Credit cards up front Fewer people will create an account but a LOT more will upgrade (especially if the upgrade is opt-out).
  36. 36. Credit cards at upgrade Much easier to get people to create an account, much harder to get them to upgrade.
  37. 37. AWeber $1 Trial Funnel Levers
  38. 38. Maximizing users or revenue? • If users, try no credit card • If revenue, try up-front credit cards.
  39. 39. Lever #4 Monthly or Annual Billing Funnel Levers
  40. 40. Is the focus on users or revenue? Monthly gets more users, annual gets more revenue.
  41. 41. CrazyEgg used to be monthly Funnel Levers
  42. 42. KISSmetrics offers both but with a discount for annual Funnel Levers
  43. 43. Your funnel levers 1 Free Trials 2 Freemium 3 Credit Cards Up-front 4 Monthly or Annual Billing
  44. 44. Test different levers to achieve the highest growth Funnel Levers
  45. 45. Common Pitfalls 3
  46. 46. What Should You Focus on First?
  47. 47. Look for bo lenecks in your funnel What step is a serious roadblock for people?
  48. 48. Very few people go from Activation to Upgrade Common Pitfalls
  49. 49. Use levers to fix bo lenecks Common Pitfalls
  50. 50. Are You Only Testing the Funnel?
  51. 51. Variation B performs the best in this funnel Common Pitfalls
  52. 52. Variation A gives the most revenue Common Pitfalls
  53. 53. Should We Test Randomly?
  54. 54. Why did you get your results? If you just start testing without first understanding user behavior, you won’t be learning.
  55. 55. Do you have qualitative data? Once we understand our users, then we can work the levers for the best fit.
  56. 56. Where do we get qualitative data? Talk to your customers.
  57. 57. Questions? We will do our best to answer
  58. 58. THANK YOU Dan McGaw @danielmcgaw
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