How to Build a Funnel that Will Grow YourSubscription Business the Fastest Lars Lofgren Marketing Analyst - June 2012   in...
@larslofgren #KISSwebinar
We’ll cover...1   What is activation?2   4 levers for industry domination3   Common pitfalls of testing
WHAT ISActivation?
Your SaaS funnel
Are people using your product?  Not only do people need to create an  account, they need to start using your              ...
No value = no sale
How to define activation   Activation = the critical step people    need to take in order to get value             from yo...
Facebook Activation
Evernote Activation
Instagram Activation
Basecamp Activation
Make sure to track activation   It’s the most important part of your      funnel and everyone forgets it.
FUNNELLevers
What’s a lever?  A change to the funnel that helps you        maximize users or revenue.
Lever #1     Free Trials
Trial Funnel     Visited Site   Trial Sign Up   Activated   Upgraded
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 ...
Shopify NUX
14, 30, or 45 day trial?
Replacing the free trial  Try replacing your free trial with a 30-        day money back guarantee.
Lever #2      Freemium
Freemium Funnel    Visited Site   Free Sign Up   Activated   Upgraded
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 ...
Common Freemium Limits1   Dropbox = 2 GB of Storage2   Evernote = 60 MB of Uploads3   MailChimp = 2,000 Email Subscribers
MailChimp Freemium
Freemium users take forever to upgrade      Very difficult to track changing   behavior over time with a long-term        ...
Cohort reports help a lot with freemium
Lever #3           UP-FRONTCredit 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...
Credit cards at upgrade   Much easier to get people to create  an account, much harder to get them                 to upgr...
AWeber $1 Trial
Maximizing users or revenue?  If users, try no credit card. If revenue,         try up-front credit cards.
Lever #4     MONTHLY OR ANNUAL           Billing
Users or revenue?  Monthly gets more users, annual gets               more revenue.
CrazyEgg used to be monthly
Your Funnel Levers 1   Free Trials 2   Freemium 3   Credit Cards Up Front 4   Monthly or Annual Billing
Test different levers for most growth
COMMONPitfalls
WHAT TO FOCUS ON   First?
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?
Variation B performs the best in this funnel
Variation A gives the most revenue
SHOULD WE TESTRandomly?
Why did you get your results?   If you just start testing without first    understanding user behavior, you             wo...
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.
Other options?
Q&A Time!    Lars Lofgren llofgren@kissmetrics.com        @larslofgren
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How to Build a Funnel that Will Grow Your Subscription Business the Fastest

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• 3. We’ll cover...1 What is activation?2 4 levers for industry domination3 Common pitfalls of testing
• 4. WHAT ISActivation?
• 5. Your SaaS funnel
• 6. Are people using your product? Not only do people need to create an account, they need to start using your product.
• 7. No value = no sale
• 8. How to define activation Activation = the critical step people need to take in order to get value from your product
• 9. Facebook Activation
• 10. Evernote Activation
• 11. Instagram Activation
• 12. Basecamp Activation
• 13. Make sure to track activation It’s the most important part of your funnel and everyone forgets it.
• 14. FUNNELLevers
• 15. What’s a lever? A change to the funnel that helps you maximize users or revenue.
• 16. Lever #1 Free Trials
• 17. Trial Funnel Visited Site Trial Sign Up Activated Upgraded
• 18. Basecamp Free trial
• 19. On-ramp program is critical You have a limited number of days to make the sale. Don’t waste them.
• 20. What’s your on-ramp program? The new user experience (NUX) should be completely different than your regular program.
• 21. Shopify NUX
• 22. 14, 30, or 45 day trial?
• 23. Replacing the free trial Try replacing your free trial with a 30- day money back guarantee.
• 24. Lever #2 Freemium
• 25. Freemium Funnel Visited Site Free Sign Up Activated Upgraded
• 26. Looking for user growth? Freemium is where you want to be.
• 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. Common Freemium Limits1 Dropbox = 2 GB of Storage2 Evernote = 60 MB of Uploads3 MailChimp = 2,000 Email Subscribers
• 29. MailChimp Freemium
• 30. Freemium users take forever to upgrade Very difficult to track changing behavior over time with a long-term funnel.
• 31. Cohort reports help a lot with freemium
• 32. Lever #3 UP-FRONTCredit Cards?
• 33. When do you collect credit card info? At account creation or at upgrade?
• 34. Credit cards up front Fewer people will create an account but a LOT more will upgrade (especially if the upgrade is opt-out).
• 35. Credit cards at upgrade Much easier to get people to create an account, much harder to get them to upgrade.
• 36. AWeber $1 Trial
• 37. Maximizing users or revenue?
• 38. Lever #4 MONTHLY OR ANNUAL Billing
• 39. Users or revenue?
• 40. CrazyEgg used to be monthly
• 41. Your Funnel Levers
• 42. Test different levers for most growth
• 43. COMMONPitfalls
• 44. WHAT TO FOCUS ON First?
• 45. Look for bottlenecks in your funnel
• 46. Very few people go from Activation to Upgrade
• 47. Use levers to fix bottlenecks
• 48. ARE YOU ONLY TESTING THE Funnel?
• 49. Variation B performs the best in this funnel
• 50. Variation A gives the most revenue
• 51. SHOULD WE TESTRandomly?
• 52. Why did you get your results?
• 53. Do you have qualitative data?
• 54. Where do we get qualitative data? Talk to your customers.

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  • Let’s take an Apple product for example.\nIt’s obvious to use Apple as a case study for user experience. Their whole business model is built on UX and delighting their customers.\n
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  • How to Build a Funnel that Will Grow Your Subscription Business the Fastest

    1. 1. How to Build a Funnel that Will Grow YourSubscription Business the Fastest Lars Lofgren Marketing Analyst - June 2012 info@kissmetrics.com - Confidential - Do not distribute
    2. 2. @larslofgren #KISSwebinar
    3. 3. We’ll cover...1 What is activation?2 4 levers for industry domination3 Common pitfalls of testing
    4. 4. WHAT ISActivation?
    5. 5. Your SaaS funnel
    6. 6. Are people using your product? Not only do people need to create an account, they need to start using your product.
    7. 7. No value = no sale
    8. 8. How to define activation Activation = the critical step people need to take in order to get value from your product
    9. 9. Facebook Activation
    10. 10. Evernote Activation
    11. 11. Instagram Activation
    12. 12. Basecamp Activation
    13. 13. Make sure to track activation It’s the most important part of your funnel and everyone forgets it.
    14. 14. FUNNELLevers
    15. 15. What’s a lever? A change to the funnel that helps you maximize users or revenue.
    16. 16. Lever #1 Free Trials
    17. 17. Trial Funnel Visited Site Trial Sign Up Activated Upgraded
    18. 18. Basecamp Free trial
    19. 19. On-ramp program is critical You have a limited number of days to make the sale. Don’t waste them.
    20. 20. What’s your on-ramp program? The new user experience (NUX) should be completely different than your regular program.
    21. 21. Shopify NUX
    22. 22. 14, 30, or 45 day trial?
    23. 23. Replacing the free trial Try replacing your free trial with a 30- day money back guarantee.
    24. 24. Lever #2 Freemium
    25. 25. Freemium Funnel Visited Site Free Sign Up Activated Upgraded
    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. Common Freemium Limits1 Dropbox = 2 GB of Storage2 Evernote = 60 MB of Uploads3 MailChimp = 2,000 Email Subscribers
    29. 29. MailChimp Freemium
    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
    32. 32. Lever #3 UP-FRONTCredit Cards?
    33. 33. When do you collect credit card info? At account creation or at upgrade?
    34. 34. Credit cards up front Fewer people will create an account but a LOT more will upgrade (especially if the upgrade is opt-out).
    35. 35. Credit cards at upgrade Much easier to get people to create an account, much harder to get them to upgrade.
    36. 36. AWeber $1 Trial
    37. 37. Maximizing users or revenue? If users, try no credit card. If revenue, try up-front credit cards.
    38. 38. Lever #4 MONTHLY OR ANNUAL Billing
    39. 39. Users or revenue? Monthly gets more users, annual gets more revenue.
    40. 40. CrazyEgg used to be monthly
    41. 41. Your Funnel Levers 1 Free Trials 2 Freemium 3 Credit Cards Up Front 4 Monthly or Annual Billing
    42. 42. Test different levers for most growth
    43. 43. COMMONPitfalls
    44. 44. WHAT TO FOCUS ON First?
    45. 45. Look for bottlenecks in your funnel What step is a serious roadblock for people?
    46. 46. Very few people go from Activation to Upgrade
    47. 47. Use levers to fix bottlenecks
    48. 48. ARE YOU ONLY TESTING THE Funnel?
    49. 49. Variation B performs the best in this funnel
    50. 50. Variation A gives the most revenue
    51. 51. SHOULD WE TESTRandomly?
    52. 52. Why did you get your results? If you just start testing without first understanding user behavior, you won’t be learning.
    53. 53. Do you have qualitative data? Once we understand our users, then we can work the levers for the best fit.
    54. 54. Where do we get qualitative data? Talk to your customers.
    55. 55. Other options?
    56. 56. Q&A Time! Lars Lofgren llofgren@kissmetrics.com @larslofgren
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