Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
Lean Analytics
Growth Tribe startup event
April, 2015
@acroll
Today’s agenda
18:45-19:15
19:15-20:00
20:00-20:30
Lean Analytics
Exploits and growth hacks
How not to fail
Part one:

Introduction to Lean Analytics
Don’t sell what you can make. Make what you can sell.
Kevin Costner is a lousy entrepreneur.
The core of Lean
is iteration.
Unfortunately,
we’re all liars.
Everyone’s idea is
the best right?
People love
this part!
(but that’s not always
a good thing)
This is where
things fall a...
Most startups don’t know what they’ll
be when they grow up.
Hotmail

was a
database
company
Flickr

was going to
be an MMO...
Analytics can help.
Analytics is the measurement of
movement towards your business
goals.
In a startup, the purpose of analytics is
to iterate to product/market fit
before the money runs out.
A good metric is:
Understandable
If you’re busy
explaining the
data, you won’t
be busy acting
on it.
Comparative
Compariso...
The
simplest
rule
bad

metric.
If a metric won’t change how
you behave, it’s a
h"p://www.flickr.com/photos/circasassy/78581...
Metrics help you know yourself.
Acquisition
Hybrid
Loyalty
70%

of retailers
20%

of retailers
10%

of retailers
You are
j...
Qualitative
Unstructured, anecdotal,
revealing, hard to
aggregate, often too
positive & reassuring.
Warm and fuzzy.
Quanti...
Exploratory
Speculative. Tries to find
unexpected or
interesting insights.
Source of unfair
advantages.
Cool.
Reporting
Pre...
MayAprMarFeb
Slicing and dicing data
Jan
0
5,000
Activeusers
Cohort:
Comparison of
similar groups
along a timeline.
(this ...
Which of these two companies
is doing better?
  January February March April May
Rev/customer $5.00 $4.50 $4.33 $4.25 $4.50
Is this company
growing or stagnating?
Cohor...
Cohort 1 2 3 4 5
January $5 $3 $2 $1 $0.5
February $6 $4 $2 $1  
March $7 $6 $5    
April $8 $7      
May $9        
Avera...
The Lean Analytics framework.
Eric’s three engines of growth
Virality
Make people
invite friends.
How many they
tell, how fast they
tell them.
Price
Spe...
Dave’s Pirate Metrics
AARRR
Acquisition
How do your users become aware of you?
SEO, SEM, widgets, email, PR, campaigns, bl...
Stage
EMPATHY
I’ve found a real, poorly-met need that a
reachable market faces.
STICKINESS
I’ve figured out how to solve th...
Six business model archetypes.
E-commerce SaaS Media
Mobile

app
User-gen

content
2-sided

market
The business you’re in
(Which means eye
charts like these.)
Customer Acquisition Cost
paid direct search wom
inherent
virality
VISITOR
Freemium/t...
Model + Stage = One Metric That Matters.
One Metric

That Matters.
The business you’re in
E-Com SaaS Mobile 2-Sided Media ...
Really? Just one?
Yes, one.
In a startup, focus is hard to achieve.
Having only one metric
addresses this problem.
www.theeastsiderla.com
Metrics are like squeeze toys.
http://www.flickr.com/photos/connortarter/4791605202/
Empathy
Stickiness
Virality
Revenue
Scale
E-
commerce
SaaS Media
Mobile

app
User-gen

content
2-sided

market
Interviews;...
Better: bit.ly/BigLeanTable
Drawing some lines in the sand.
A company loses a quarter of its
customers every year.
Is this good or bad?
Not knowing what normal is
makes you do stupid things.
Baseline:
5-7% growth a week
“A good growth rate during YC
is 5-7% a week,” he says. “If
you can hit 10% a week you're
doi...
Baseline:
10% visitor engagement/day
Fred Wilson’s social ratios
30% of users/month use web or mobile app
10% of users/day...
Baseline:
2-5% monthly churn
• The best SaaS get 1.5% - 3% a month. They have multiple Ph.D’s
on the job.
• Get below a 5%...
Baseline:
Calculating customer lifetime
25%

monthly churn
100/25=4

The average
customer lasts
4 months
5%

monthly churn...
Baseline:
CAC under 1/3 of CLV
• CLV is wrong. CAC Is probably wrong, too.
• Time kills all plans: It’ll take a long time ...
The Lean Analytics cycle
Draw a new line
Pivot or

give up
Try again
Success!
Did we move the
needle?
Measure
the results
Make changes
in productio...
Do AirBnB hosts
get more business
if their property is
professionally
photographed?
Gut instinct (hypothesis)
Professional photography helps AirBnB’s business
Candidate solution (MVP)
20 field photographers ...
5,000 shoots per month
by February 2012
Hang on a second.
Gut instinct (hypothesis)
Professional photography helps AirBnB’s business
SRSLY?
Draw a new line
Pivot or

give up
Try again
Success!
Did we move the
needle?
Measure
the results
Make changes
in productio...
“Gee, those
houses that do
well look really
nice.”
Maybe it’s the
camera.
“Computer: What
do all the
highly rented
houses ...
Circle of Moms: Not enough engagement
• Too few people were
actually using the
product
• Less than 20% of any
circles had ...
Landing page design A/B testing
Cohort analysis General analytics
URL shortening
Funnel analytics
Influencer Marketing
Publ...
Part two:
Growth hacking
(is a word you should hate but will hear a lot about.)
The Attention Economy
“What information consumes
is rather obvious: it consumes
the attention of its recipients.
Hence a w...
Lit motors tests the risky part
Once, it was
cool to be a DJ.
Supply and demand
is a harsh mistress.
Why pop music sucks,
in under a minute.
92.76%
0.93%
1.39%
1.86%
1.39%
1.67%
Writing camp
Songwriter
Producer
Vocal producer
Mix/Master:

$78,000
Song roll-out:

...
10:1 ROI on song

2:1 ROI on marketing
2:1 ROI on song

10:1 ROI on marketing
$100K on song

$1M on marketing
Your budget:...
10:1 ROI on song

2:1 ROI on marketing
2:1 ROI on song

10:1 ROI on marketing
$1M song ROI

$2M marketing ROI
$3M ROI tota...
Attention
training.
If it gets attention,
does it need to be real?
$10K on song

$10K on marketing
1,000h on interesting
Better:
{
Artist C:
Figures out how
to be interesting.
Now: cars, insurance, furniture
Lagging
Historical. Shows you
how you’re doing;
reports the news.
Example: sales.
Explaining the
past.
Leading
Forward-loo...
Fundamental:

Correlation
1
10
100
1000
10000
Ice cream consumption Drownings
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
Correlated
Two variables that are
related (but may be
dependent on
something else.)
Ice cream &
drowning.
Causal
An indepe...
• Growth hacking is simply what marketing should have been
doing, but it fell in love with Don Draper and opinions along t...
Guerrilla

marketing
Data-
driven

learning
Subversiveness
GROWTH

HACKING
A Facebook user reaching 7 friends within 10 days of signing up
(Chamath Palihapitiya)
If someone comes back to Zynga a da...
Why is Nigerian spam so badly
written?
Aunshul Rege of Rutgers University, USA in 2009
Experienced scammers expect a “strike rate” of 1 or 2 replies per 1,000 me...
Turns out the word “Nigeria” is the best
way to identify promising prospects.
Nigerian spammers
really understand their target market.
They see past vanity metrics.
Growth hacking, demystified.
Find
correlation
Test
causality
Optimize the
causal factor
Pick a metric
to change
A leading, causal metric
is a superpower.
h"p://www.flickr.com/photos/bloke_with_camera/401812833/sizes/o/in/photostream/
Is social action a leading
indicator of donation?
http://blog.justgiving.com/nine-reasons-why-social-and-mobile-are-the-fu...
Is mobile use?
http://blog.justgiving.com/nine-reasons-why-social-and-mobile-are-the-future-of-fundraising/
AirBnB and Craigslist
http://www.flickr.com/photos/bootbearwdc/1243690099/
Think subversively.
Find other ways
to collect data;
everything is an
experiment.
http://solveforinteresting.com/what-makes-a-great-startup/
Baby steps to get thereObvious in hindsight
Take baby steps.
Netflix
Tesla
http://www.hdwallpapersinn.com/wp-content/uploads/2012/12/600-tesla.jpg
Twitter’s 140-character
limit isn’t arbitrary. It’s
constrained by the size
of SMS (160
characters) and
username (20
chara...
Black car Uberpool
Part three:
How not to fail
I can’t tell you how to succeed
(If I could, I’d be starting your company instead of standing here.)
I can tell you how to avoid failure
(At least, some forms of it.)
Percent of businesses that fail
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
71%69%66%63%60%55%5...
Still operating after 4 years
Finance Insurance and Real Estate
Education and Health
Agriculture
Services
Wholesale
Mining...
Why they die
http://www.statisticbrain.com/startup-failure-by-industry/
Neglect, fraud, disaster
1%
Lack of industry exper...
1. An
entrepreneur
is (maybe) not
a founder The goal is to discover a new
business model in an uncertain
environment
Learn...
“A startup is an organization
designed to search for a sustainable,
repeatable business model.”
Entrepreneur
Known business model
Out-execute the
competition
Less risk, less reward
Steal and improve
Startup founder
New...
Is your idea a roofrack or a steering wheel?
http://www.datacenterknowledge.com/archives/2010/03/02/cloud-computing-the-ro...
Degrees of uncertainty
Market with
unmet need
Job to be
done
Business
diagram
Business
model
Business plan
Really uncertai...
2. Growth Sustainable growth comes from
user actions
It better be over 5% a week
Early on, growth is everything.
It’s oxygen
You need customers to keep learning
It’s a substitute for solvency
PhotobyPaulMilleronFlickr.https://www.flickr...
What are you
growing,
anyway? Reputation, Attention, and
Money
But really it’s all P&L
$
@
!
http://human20.com/free-reputation-
for-everyone-the-three-non-traditional-
economies/
Startup success is often about your
exchange rate between the three.
3. Building
your business
model Start with a systems diagram
What’s the core job to be done?
http://www.flickr.com/photos/tinfoilraccoon/197640807/
A lemonade stand’s business model is simple.
Yours should be too.
How to build a business model:
Start with the customer journey.
Consider the morning routine.
Wake up What happens here?
Start the
workday
Personal
dimension
Social
dimension
Functional
aspects
Emotional
aspects
Related jobs
to be done
Functional
aspects
Emotio...
Changes create new JTBD answers
Photo by Andrew Dyer on Flickr - https://www.flickr.com/photos/andrewdyer/350938953
+ = ?
Know what they call a product or
service without a business model?
A hobby.
PhotobyRakkaonFlickr.https://www.flickr.com/photos/rakka/6889638004
Business plan Financials
Projections
SWOT analysis
Competitive landscape
Go-to-market plan
Product description and roadmap...
Asking for a business plan before
you know your product and market is
like asking Columbus for a world
map before he leave...
4. Staffing Hacker, hustler, designer, analyst
Product, sales, finance CEOs
TY and YT rule the valley
Hiring and firing
http://solveforinteresting.com/hacker-hustler-designer-analyst/
Hacker
Makes it real,
finds the lazy
angle.
Hustler
Builds ...
http://solveforinteresting.com/the-three-kinds-of-ceo/
Product CEO
“If the product is
awesome,
everything will
work out.”
...
TY and YT
http://solveforinteresting.com/yt-and-ty-four-letters-that-run-the-valley/
http://solveforinteresting.com/yt-and-ty-four-letters-that-run-the-valley/
The 5-minute favor
AKA why game theory, braggin...
YT is how every
important hire starts
6. On advisors
and boards Why do you have advisors?
Why are investors sociopaths?
Why do you have advisors?
They need to earn their keep
Make expectations explicit
Give them options, and make sure you can...
Why investors are sociopaths
https://www.flickr.com/photos/peptravassos/10658028023
https://www.flickr.com/photos/46124960@N...
7. Marketing
is not a bad
word Sergio Zyman’s five mores
The attention economy
Risk is out of your control
Building message...
Sergio
Zyman’s
five
mores
More things
To more people
For more money
More often
More efficiently
Supply chain optimization
Pe...
Your growth problem is probably
a marketing problem.
(Things out of your control are riskier.)
How to build a message map.
http://solveforinteresting.com/building-a-message-map/
I need a carA.
I should buy

a car
B.
It should be

a hybridC.
I should buy

a Honda CivicD.
Everyone in the world
People who want to drive
Prospective car buyers
People looking for a hybrid
Honda Civic Hybrid owners
I need a carA.
I sho...
“Isn’t it time you got out of the
city?” campaign showing how cars
make nature accessible & ridiculing
urban hipsters.
Ads...
People who want to drive
“I need a vehicle to get
around, be productive, and
enjoy my life.”
Prospective car buyers
“I wan...
People who want to drive
“I need a vehicle to get
around, be productive, and
enjoy my life.”
Prospective car buyers
“I wan...
“Isn’t it time you got out of the
city?” campaign showing how cars
make nature accessible & ridiculing
urban hipsters.
Ads...
How to build a marketing campaign
http://www.yearonelabs.com/three-questions-all-marketers-must-answer/
When will you deci...
“The most important figures that one
needs for management are unknown
or unknowable, but successful
management must neverth...
Pic by Twodolla on Flickr. http://www.flickr.com/photos/twodolla/3168857844
ARCHIMEDES
HAD TAKEN
BATHS BEFORE.
Once, a leader convinced others
in the absence of data.
Now, a leader knows
what questions to ask.
Alistair Croll
acroll@gmail.com
@acroll
Ben Yoskovitz
byosko@gmail.com
@byosko
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking
You’ve finished this document.
Upcoming SlideShare
Technical Marketing and Growth Hacking Low Hanging Fruit
Next
Upcoming SlideShare
Technical Marketing and Growth Hacking Low Hanging Fruit
Next

83

Share

Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking

Growth Tribe invited Alistair Croll, author of the Lean Analytics to come to Amsterdam to give a workshop about Lean Analytics & Growth Hacking.

Livestream video part 1: https://www.youtube.com/watch?v=0cEfe9mSatM
Livestream video part 2: https://www.youtube.com/watch?v=muu0GENRkoI
Growth Tribe: http://www.growthtribe.nl/

Related Books

Free with a 30 day trial from Scribd

See all

Growth Tribe: Alistair Croll startup workshop Lean Analytics & Growth Hacking

  1. 1. Lean Analytics Growth Tribe startup event April, 2015 @acroll
  2. 2. Today’s agenda 18:45-19:15 19:15-20:00 20:00-20:30 Lean Analytics Exploits and growth hacks How not to fail
  3. 3. Part one:
 Introduction to Lean Analytics
  4. 4. Don’t sell what you can make. Make what you can sell. Kevin Costner is a lousy entrepreneur.
  5. 5. The core of Lean is iteration.
  6. 6. Unfortunately, we’re all liars.
  7. 7. Everyone’s idea is the best right? People love this part! (but that’s not always a good thing) This is where things fall apart. No data, no learning.
  8. 8. Most startups don’t know what they’ll be when they grow up. Hotmail
 was a database company Flickr
 was going to be an MMO Twitter
 was a podcasting company Autodesk
 made desktop automation Paypal
 first built for Palmpilots Freshbooks
 was invoicing for a web design firm Wikipedia
 was to be written by experts only Mitel
 was a lawnmower company
  9. 9. Analytics can help.
  10. 10. Analytics is the measurement of movement towards your business goals.
  11. 11. In a startup, the purpose of analytics is to iterate to product/market fit before the money runs out.
  12. 12. A good metric is: Understandable If you’re busy explaining the data, you won’t be busy acting on it. Comparative Comparison is context. A ratio or rate The only way to measure change and roll up the tension between two metrics (MPH) Behavior
 changing What will you do differently based on the results you collect?
  13. 13. The simplest rule bad
 metric. If a metric won’t change how you behave, it’s a h"p://www.flickr.com/photos/circasassy/7858155676/
  14. 14. Metrics help you know yourself. Acquisition Hybrid Loyalty 70%
 of retailers 20%
 of retailers 10%
 of retailers You are just like Customers that buy >1x in 90d Once 2-2.5
 per year >2.5
 per year Your customers will buy from you Then you are in this mode 1-15% 15-30% >30% Low acquisition cost, high checkout Increasing return rates, market share Loyalty, selection, inventory size Focus on (Thanks to Kevin Hillstrom for this.)
  15. 15. Qualitative Unstructured, anecdotal, revealing, hard to aggregate, often too positive & reassuring. Warm and fuzzy. Quantitative Numbers and stats. Hard facts, less insight, easier to analyze; often sour and disappointing. Cold and hard.
  16. 16. Exploratory Speculative. Tries to find unexpected or interesting insights. Source of unfair advantages. Cool. Reporting Predictable. Keeps you abreast of the normal, day-to-day operations. Can be managed by exception. Necessary.
  17. 17. MayAprMarFeb Slicing and dicing data Jan 0 5,000 Activeusers Cohort: Comparison of similar groups along a timeline. (this is the April cohort) A/B test: Changing one thing (i.e. color) and measuring the result (i.e. revenue.) Multivariate
 analysis Changing several things at once to see which correlates with a result. ☀ ☁ ☀ ☁ Segment: Cross-sectional comparison of all people divided by some attribute (age, gender, etc.) ☀ ☁
  18. 18. Which of these two companies is doing better?
  19. 19.   January February March April May Rev/customer $5.00 $4.50 $4.33 $4.25 $4.50 Is this company growing or stagnating? Cohort 1 2 3 4 5 January $5 $3 $2 $1 $0.5 February $6 $4 $2 $1 March $7 $6 $5 April   $8 $7 May       $9 How about this one?
  20. 20. Cohort 1 2 3 4 5 January $5 $3 $2 $1 $0.5 February $6 $4 $2 $1   March $7 $6 $5     April $8 $7       May $9         Averages $7 $5 $3 $1 $0.5 Look at the same data in cohorts
  21. 21. The Lean Analytics framework.
  22. 22. Eric’s three engines of growth Virality Make people invite friends. How many they tell, how fast they tell them. Price Spend money to get customers. Customers are worth more than they cost. Stickiness Keep people coming back. Approach Get customers faster than you lose them. Math that matters
  23. 23. Dave’s Pirate Metrics AARRR Acquisition How do your users become aware of you? SEO, SEM, widgets, email, PR, campaigns, blogs ... Activation Do drive-by visitors subscribe, use, etc? Features, design, tone, compensation, affirmation ... Retention Does a one-time user become engaged? Notifications, alerts, reminders, emails, updates... Revenue Do you make money from user activity? Transactions, clicks, subscriptions, DLC, analytics... Referral Do users promote your product? Email, widgets, campaigns, likes, RTs, affiliates...
  24. 24. Stage EMPATHY I’ve found a real, poorly-met need that a reachable market faces. STICKINESS I’ve figured out how to solve the problem in a way they will keep using and pay for. VIRALITY I’ve found ways to get them to tell their friends, either intrinsically or through incentives. REVENUE The users and features fuel growth organically and artificially. SCALE I’ve found a sustainable, scalable business with the right margins in a healthy ecosystem. Gate Thefivestages
  25. 25. Six business model archetypes. E-commerce SaaS Media Mobile
 app User-gen
 content 2-sided
 market The business you’re in
  26. 26. (Which means eye charts like these.) Customer Acquisition Cost paid direct search wom inherent virality VISITOR Freemium/trial offer Enrollment User Disengaged User Cancel Freemium churn Engaged User Free user disengagement Reactivate Cancel Trial abandonment rate Invite Others Paying Customer Reactivation
 rate Paid conversion FORMER USERS User Lifetime Value Reactivate FORMER CUSTOMERS Customer Lifetime Value Viral coefficient Viral rate Resolution Support data Account Cancelled Billing Info Exp. Paid Churn Rate Tiering Capacity Limit Upselling rate Upselling Disengaged DissatisfiedTrial Over
  27. 27. Model + Stage = One Metric That Matters. One Metric
 That Matters. The business you’re in E-Com SaaS Mobile 2-Sided Media UCG Empathy Stickiness Virality Revenue Scale Thestageyou’reat
  28. 28. Really? Just one?
  29. 29. Yes, one.
  30. 30. In a startup, focus is hard to achieve.
  31. 31. Having only one metric addresses this problem.
  32. 32. www.theeastsiderla.com
  33. 33. Metrics are like squeeze toys. http://www.flickr.com/photos/connortarter/4791605202/
  34. 34. Empathy Stickiness Virality Revenue Scale E- commerce SaaS Media Mobile
 app User-gen
 content 2-sided
 market Interviews; qualitative results; quantitative scoring; surveys Loyalty, conversion CAC, shares, reactivation Transaction, CLV Affiliates, white-label Engagement, churn Inherent virality, CAC Upselling, CAC, CLV API, magic #, mktplace Content, spam Invites, sharing Ads, donations Analytics, user data Inventory, listings SEM, sharing Transactions, commission Other verticals (Money from transactions) Downloads, churn, virality WoM, app ratings, CAC CLV, ARPDAU Spinoffs, publishers (Money from active users) Traffic, visits, returns Content virality, SEM CPE, affiliate %, eyeballs Syndication, licenses (Money from ad clicks)
  35. 35. Better: bit.ly/BigLeanTable
  36. 36. Drawing some lines in the sand.
  37. 37. A company loses a quarter of its customers every year. Is this good or bad?
  38. 38. Not knowing what normal is makes you do stupid things.
  39. 39. Baseline: 5-7% growth a week “A good growth rate during YC is 5-7% a week,” he says. “If you can hit 10% a week you're doing exceptionally well. If you can only manage 1%, it's a sign you haven't yet figured out what you're doing.” At revenue stage, measure growth in revenue. Before that, measure growth in active users. Paul Graham, Y Combinator • Are there enough people who really care enough to sustain a 5% growth rate? • Don’t strive for a 5% growth at the expense of really understanding your customers and building a meaningful solution • Once you’re a pre-revenue startup at or near product/market fit, you should have 5% growth of active users each week • Once you’re generating revenues, they should grow at 5% a week
  40. 40. Baseline: 10% visitor engagement/day Fred Wilson’s social ratios 30% of users/month use web or mobile app 10% of users/day use web or mobile app 1% of users/day use it concurrently
  41. 41. Baseline: 2-5% monthly churn • The best SaaS get 1.5% - 3% a month. They have multiple Ph.D’s on the job. • Get below a 5% monthly churn rate before you know you’ve got a business that’s ready to grow (Mark MacLeod) and around 2% before you really step on the gas (David Skok) • Last-ditch appeals and reactivation can have a big impact. Facebook’s “don’t leave” reduces attrition by 7%.
  42. 42. Baseline: Calculating customer lifetime 25%
 monthly churn 100/25=4
 The average customer lasts 4 months 5%
 monthly churn 100/5=20
 The average customer lasts 20 months 2%
 monthly churn 100/2=50
 The average customer lasts 50 months
  43. 43. Baseline: CAC under 1/3 of CLV • CLV is wrong. CAC Is probably wrong, too. • Time kills all plans: It’ll take a long time to find out whether your churn and revenue projections are right • Cashflow: You’re basically “loaning” the customer money between acquisition and CLV. • It keeps you honest: Limiting yourself to a CAC of only a third of your CLV will forces you to verify costs sooner. Lifetime of 20 mo. $30/mo. per customer $600 CLV $200 CAC Now segment those users! 1/3 spend
  44. 44. The Lean Analytics cycle
  45. 45. Draw a new line Pivot or
 give up Try again Success! Did we move the needle? Measure the results Make changes in production Design a test Hypothesis With data:
 find a commonality Without data: make a good guess Find a potential improvement Draw a linePick a KPI
  46. 46. Do AirBnB hosts get more business if their property is professionally photographed?
  47. 47. Gut instinct (hypothesis) Professional photography helps AirBnB’s business Candidate solution (MVP) 20 field photographers posing as employees Measure the results Compare photographed listings to a control group Make a decision Launch photography as a new feature for all hosts
  48. 48. 5,000 shoots per month by February 2012
  49. 49. Hang on a second.
  50. 50. Gut instinct (hypothesis) Professional photography helps AirBnB’s business SRSLY?
  51. 51. Draw a new line Pivot or
 give up Try again Success! Did we move the needle? Measure the results Make changes in production Design a test Hypothesis With data:
 find a commonality Without data: make a good guess Find a potential improvement Draw a linePick a KPI
  52. 52. “Gee, those houses that do well look really nice.” Maybe it’s the camera. “Computer: What do all the highly rented houses have in common?” Camera model. With data:
 find a commonality Without data: make a good guess
  53. 53. Circle of Moms: Not enough engagement • Too few people were actually using the product • Less than 20% of any circles had any activity after their initial creation • A few million monthly uniques from 10M registered users, but no sustained traction • They found moms were far more engaged • Their messages to one another were on average 50% longer • They were 115% more likely to attach a picture to a post they wrote • They were 110% more likely to engage in a threaded (i.e. deep) conversation • Circle owners’ friends were 50% more likely to engage with the circle • They were 75% more likely to click on Facebook notifications • They were 180% more likely to click on Facebook news feed items • They were 60% more likely to accept invitations to the app • Pivoted to the new market, including a name change • By late 2009, 4.5M users and strong engagement • Sold to Sugar, inc. in early 2012
  54. 54. Landing page design A/B testing Cohort analysis General analytics URL shortening Funnel analytics Influencer Marketing Publisher analytics SaaS analytics Gaming analytics User interaction Customer satisfaction KPI dashboardsUser segmentation User analytics Spying on users
  55. 55. Part two: Growth hacking (is a word you should hate but will hear a lot about.)
  56. 56. The Attention Economy “What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention, and a need to allocate that attention efficiently among the overabundance of information sources that might consume it.” (Computers, Communications and the Public Interest, pages 40-41, Martin Greenberger, ed., The Johns Hopkins Press, 1971.)Herbert Simon
  57. 57. Lit motors tests the risky part
  58. 58. Once, it was cool to be a DJ.
  59. 59. Supply and demand is a harsh mistress.
  60. 60. Why pop music sucks, in under a minute.
  61. 61. 92.76% 0.93% 1.39% 1.86% 1.39% 1.67% Writing camp Songwriter Producer Vocal producer Mix/Master:
 $78,000 Song roll-out:
 $1,000,000 http://www.npr.org/blogs/money/2011/07/05/137530847/how-much-does-it-cost-to-make-a-hit-song
  62. 62. 10:1 ROI on song
 2:1 ROI on marketing 2:1 ROI on song
 10:1 ROI on marketing $100K on song
 $1M on marketing Your budget: { Artist A: Awesome musician
 Not very marketable Artist B: Average musician
 Incredibly marketable
  63. 63. 10:1 ROI on song
 2:1 ROI on marketing 2:1 ROI on song
 10:1 ROI on marketing $1M song ROI
 $2M marketing ROI $3M ROI total 2.73x ROI $200K song ROI
 $10M marketing ROI $10.2M ROI total 9.27x ROI 3.4 times
 better investment $100K on song
 $1M on marketing Your budget: {
  64. 64. Attention training.
  65. 65. If it gets attention, does it need to be real?
  66. 66. $10K on song
 $10K on marketing 1,000h on interesting Better: { Artist C: Figures out how to be interesting.
  67. 67. Now: cars, insurance, furniture
  68. 68. Lagging Historical. Shows you how you’re doing; reports the news. Example: sales. Explaining the past. Leading Forward-looking. Number today that predicts tomorrow; reports the news. Example: pipeline. Predicting the future.
  69. 69. Fundamental:
 Correlation
  70. 70. 1 10 100 1000 10000 Ice cream consumption Drownings Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
  71. 71. Correlated Two variables that are related (but may be dependent on something else.) Ice cream & drowning. Causal An independent variable that directly impacts a dependent one. Summertime & drowning.
  72. 72. • Growth hacking is simply what marketing should have been doing, but it fell in love with Don Draper and opinions along the way • Optimize a factor you think is correlated with growth The growth hack
  73. 73. Guerrilla
 marketing Data- driven
 learning Subversiveness GROWTH
 HACKING
  74. 74. A Facebook user reaching 7 friends within 10 days of signing up (Chamath Palihapitiya) If someone comes back to Zynga a day after signing up for a game, they’ll probably become an engaged, paying user (Nabeel Hyatt) A Dropbox user who puts at least one file in one folder on one device (ChenLi Wang) Twitter user following a certain number of people, and a certain percentage of those people following the user back (Josh Elman) A LinkedIn user getting to X connections in Y days (Elliot Schmukler) Some examples (From the 2012 Growth Hacking conference. http://growthhackersconference.com/)
  75. 75. Why is Nigerian spam so badly written?
  76. 76. Aunshul Rege of Rutgers University, USA in 2009 Experienced scammers expect a “strike rate” of 1 or 2 replies per 1,000 messages emailed; they expect to land 2 or 3 “Mugu” (fools) each week. One scammer boasted “When you get a reply it’s 70% sure you’ll get the money” “By sending an email that repels all but the most gullible,” says [Microsoft Researcher Corman] Herley, “the scammer gets the most promising marks to self-select, and tilts the true to false positive ratio in his favor.” 1000 emails 1-2 responses 1 fool and their money, parted. Bad language (0.1% conversion) Gullible (70% conversion) 1000 emails 100 responses 1 fool and their money, parted. Good language (10% conversion) Not-gullible (.07% conversion) This would be horribly inefficient since humans are involved.
  77. 77. Turns out the word “Nigeria” is the best way to identify promising prospects.
  78. 78. Nigerian spammers really understand their target market. They see past vanity metrics.
  79. 79. Growth hacking, demystified. Find correlation Test causality Optimize the causal factor Pick a metric to change
  80. 80. A leading, causal metric is a superpower. h"p://www.flickr.com/photos/bloke_with_camera/401812833/sizes/o/in/photostream/
  81. 81. Is social action a leading indicator of donation? http://blog.justgiving.com/nine-reasons-why-social-and-mobile-are-the-future-of-fundraising/
  82. 82. Is mobile use? http://blog.justgiving.com/nine-reasons-why-social-and-mobile-are-the-future-of-fundraising/
  83. 83. AirBnB and Craigslist
  84. 84. http://www.flickr.com/photos/bootbearwdc/1243690099/ Think subversively.
  85. 85. Find other ways to collect data; everything is an experiment.
  86. 86. http://solveforinteresting.com/what-makes-a-great-startup/ Baby steps to get thereObvious in hindsight
  87. 87. Take baby steps.
  88. 88. Netflix
  89. 89. Tesla http://www.hdwallpapersinn.com/wp-content/uploads/2012/12/600-tesla.jpg
  90. 90. Twitter’s 140-character limit isn’t arbitrary. It’s constrained by the size of SMS (160 characters) and username (20 characters.) http://i.i.cbsi.com/cnwk.1d/i/tim/2011/11/18/ sms_screen_twitter_activity_stream_270x405.png
  91. 91. Black car Uberpool
  92. 92. Part three: How not to fail
  93. 93. I can’t tell you how to succeed (If I could, I’d be starting your company instead of standing here.)
  94. 94. I can tell you how to avoid failure (At least, some forms of it.)
  95. 95. Percent of businesses that fail Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 71%69%66%63%60%55%50%44%36%25% http://www.statisticbrain.com/startup-failure-by-industry/
  96. 96. Still operating after 4 years Finance Insurance and Real Estate Education and Health Agriculture Services Wholesale Mining Manufacturing Construction Retail Transportation Communication and Utilities Information 37% 45% 47% 47% 49% 51% 54% 55% 56% 56% 58% http://www.statisticbrain.com/startup-failure-by-industry/
  97. 97. Why they die http://www.statisticbrain.com/startup-failure-by-industry/ Neglect, fraud, disaster 1% Lack of industry experience 13% Lack of managerial experience 34% Incompetence 52% Emotional Pricing Living too high for the business Nonpayment of taxes No knowledge of pricing Lack of planning No knowledge of financing No experience in record- keeping Poor credit granting practices Expansion too rapid Inadequate borrowing practices Carry inadequate inventory No knowledge of suppliers Wasted advertising budget
  98. 98. 1. An entrepreneur is (maybe) not a founder The goal is to discover a new business model in an uncertain environment Learning trumps planning
  99. 99. “A startup is an organization designed to search for a sustainable, repeatable business model.”
  100. 100. Entrepreneur Known business model Out-execute the competition Less risk, less reward Steal and improve Startup founder New business model Discover new product & market first Much risk, very reward Define & invent The goal is to discover a new business model in an uncertain environment. Learning trumps planning.
  101. 101. Is your idea a roofrack or a steering wheel? http://www.datacenterknowledge.com/archives/2010/03/02/cloud-computing-the-roof-rack-problem/
  102. 102. Degrees of uncertainty Market with unmet need Job to be done Business diagram Business model Business plan Really uncertain:
 Does the market exist? Is the need real and known? Really certain:
 Can you do what you said you would, when you said you would?
  103. 103. 2. Growth Sustainable growth comes from user actions It better be over 5% a week
  104. 104. Early on, growth is everything.
  105. 105. It’s oxygen You need customers to keep learning It’s a substitute for solvency PhotobyPaulMilleronFlickr.https://www.flickr.com/photos/94674772@N03/8788576498
  106. 106. What are you growing, anyway? Reputation, Attention, and Money But really it’s all P&L
  107. 107. $
  108. 108. @
  109. 109. !
  110. 110. http://human20.com/free-reputation- for-everyone-the-three-non-traditional- economies/
  111. 111. Startup success is often about your exchange rate between the three.
  112. 112. 3. Building your business model Start with a systems diagram What’s the core job to be done?
  113. 113. http://www.flickr.com/photos/tinfoilraccoon/197640807/ A lemonade stand’s business model is simple. Yours should be too.
  114. 114. How to build a business model: Start with the customer journey.
  115. 115. Consider the morning routine. Wake up What happens here? Start the workday
  116. 116. Personal dimension Social dimension Functional aspects Emotional aspects Related jobs to be done Functional aspects Emotional aspects Personal dimension Social dimension What job are you doing? Main job to be done http://innovatorstoolkit.com/content/technique-1-jobs-be-done
  117. 117. Changes create new JTBD answers Photo by Andrew Dyer on Flickr - https://www.flickr.com/photos/andrewdyer/350938953 + = ?
  118. 118. Know what they call a product or service without a business model?
  119. 119. A hobby. PhotobyRakkaonFlickr.https://www.flickr.com/photos/rakka/6889638004
  120. 120. Business plan Financials Projections SWOT analysis Competitive landscape Go-to-market plan Product description and roadmap Positioning statement Company background Mission statement & vision Operational structure Organizational chart OMG shoot me now.
  121. 121. Asking for a business plan before you know your product and market is like asking Columbus for a world map before he leaves Spain.
  122. 122. 4. Staffing Hacker, hustler, designer, analyst Product, sales, finance CEOs TY and YT rule the valley Hiring and firing
  123. 123. http://solveforinteresting.com/hacker-hustler-designer-analyst/ Hacker Makes it real, finds the lazy angle. Hustler Builds buzz, finds deals, gets customers. Designer Compels, delights, engages. Analyst Tracks growth and keeps you honest.
  124. 124. http://solveforinteresting.com/the-three-kinds-of-ceo/ Product CEO “If the product is awesome, everything will work out.” Sales CEO “We just need customers. They’ll tell us what to build.” Finance CEO “If we can get the model right, the business will run itself.” (they’re all wrong.)
  125. 125. TY and YT http://solveforinteresting.com/yt-and-ty-four-letters-that-run-the-valley/
  126. 126. http://solveforinteresting.com/yt-and-ty-four-letters-that-run-the-valley/ The 5-minute favor AKA why game theory, bragging at meetings, and gossip run the Valley.
  127. 127. YT is how every important hire starts
  128. 128. 6. On advisors and boards Why do you have advisors? Why are investors sociopaths?
  129. 129. Why do you have advisors? They need to earn their keep Make expectations explicit Give them options, and make sure you can fire them
  130. 130. Why investors are sociopaths https://www.flickr.com/photos/peptravassos/10658028023 https://www.flickr.com/photos/46124960@N00/3471536479
  131. 131. 7. Marketing is not a bad word Sergio Zyman’s five mores The attention economy Risk is out of your control Building message maps How to construct a campaign
  132. 132. Sergio Zyman’s five mores More things To more people For more money More often More efficiently Supply chain optimization Per-transaction cost reduction Loyal customer base that returns Demand prediction, notification Maximum shopping cart Price skimming/tiering Highly viral offering Low incremental order costs Inventory increase Gifting, wish lists
  133. 133. Your growth problem is probably a marketing problem. (Things out of your control are riskier.)
  134. 134. How to build a message map. http://solveforinteresting.com/building-a-message-map/
  135. 135. I need a carA. I should buy
 a car B. It should be
 a hybridC. I should buy
 a Honda CivicD. Everyone in the world
  136. 136. People who want to drive Prospective car buyers People looking for a hybrid Honda Civic Hybrid owners I need a carA. I should buy
 a car B. It should be
 a hybridC. I should buy
 a Honda CivicD. Everyone in the world
  137. 137. “Isn’t it time you got out of the city?” campaign showing how cars make nature accessible & ridiculing urban hipsters. Ads showing how cars are needed any time (pregnancy, errands, urgent business) and how a car is a “personal assistant.” Urgency (“every time you drive a non-hybrid car you kill the planet a little”) and testimonials from buyers who’ve saved money. Honda branding ads and model- specific promotions. Follow-up satisfaction campaign to encourage buyers to tell their friends People who want to drive “I need a vehicle to get around, be productive, and enjoy my life.” Prospective car buyers “I want to own a car because it’s convenient; it’s a personal relationship; I don’t trust others.” People looking for a hybrid “I want to save money and fuel. I also care about the environment and want to be seen as ‘green’.” Honda Civic Hybrid owners I need a carA. I should buy
 a car B. It should be
 a hybridC. I should buy
 a Honda CivicD. Everyone in the world
  138. 138. People who want to drive “I need a vehicle to get around, be productive, and enjoy my life.” Prospective car buyers “I want to own a car because it’s convenient; it’s a personal relationship; I don’t trust others.” People looking for a hybrid “I want to save money and fuel. I also care about the environment and want to be seen as ‘green’.” Honda Civic Hybrid owners Those who don’t need cars • I’m too young to drive • I’m too old to drive • I can walk or take public transit Car users who won’t buy • It’s too expensive for me • I will use a shared car service • It’ll get stolen Those who won’t buy hybrids • Hybrids are gutless • Batteries are toxic & explosive • In the end it costs more than it saves I will buy another brand • I buy domestic • I’ve always driven a VW • Toyotas are reliable • I want something prestigious I need a carA. I should buy
 a car B. It should be
 a hybridC. I should buy
 a Honda CivicD. Everyone in the world
  139. 139. People who want to drive “I need a vehicle to get around, be productive, and enjoy my life.” Prospective car buyers “I want to own a car because it’s convenient; it’s a personal relationship; I don’t trust others.” People looking for a hybrid “I want to save money and fuel. I also care about the environment and want to be seen as ‘green’.” Honda Civic Hybrid owners Those who don’t need cars • I’m too young to drive • I’m too old to drive • I can walk or take public transit Car users who won’t buy • It’s too expensive for me • I will use a shared car service • It’ll get stolen Those who won’t buy hybrids • Hybrids are gutless • Batteries are toxic & explosive • In the end it costs more than it saves I will buy another brand • I buy domestic • I’ve always driven a VW • Toyotas are reliable • I want something prestigious Sponsor a driving school “Give the gift of driving” campaign for grandparents. Financing, cashback Sell to carshares; underscore their limitations PR on dangers of commuting, pedestrian deaths Theft warranty, tracking services, high-end locks Independent tests, standard metrics (0-60 in X) Lab research, studies ROI calculator; replacement programs Prove Honda hires US workers “Time to leave Germany” ads Spontaneous accel. stories Premium brand (Acura) I need a carA. I should buy
 a car B. It should be
 a hybridC. I should buy
 a Honda CivicD. Everyone in the world
  140. 140. “Isn’t it time you got out of the city?” campaign showing how cars make nature accessible & ridiculing urban hipsters. Ads showing how cars are needed any time (pregnancy, errands, urgent business) and how a car is a “personal assistant.” Urgency (“every time you drive a non-hybrid car you kill the planet a little”) and testimonials from buyers who’ve saved money. Honda branding ads and model- specific promotions. Follow-up satisfaction campaign to encourage buyers to tell their friends People who want to drive “I need a vehicle to get around, be productive, and enjoy my life.” Prospective car buyers “I want to own a car because it’s convenient; it’s a personal relationship; I don’t trust others.” People looking for a hybrid “I want to save money and fuel. I also care about the environment and want to be seen as ‘green’.” Honda Civic Hybrid owners Those who don’t need cars • I’m too young to drive • I’m too old to drive • I can walk or take public transit Car users who won’t buy • It’s too expensive for me • I will use a shared car service • It’ll get stolen Those who won’t buy hybrids • Hybrids are gutless • Batteries are toxic & explosive • In the end it costs more than it saves I will buy another brand • I buy domestic • I’ve always driven a VW • Toyotas are reliable • I want something prestigious Sponsor a driving school “Give the gift of driving” campaign for grandparents. Financing, cashback Sell to carshares; underscore their limitations PR on dangers of commuting, pedestrian deaths Theft warranty, tracking services, high-end locks Independent tests, standard metrics (0-60 in X) Lab research, studies ROI calculator; replacement programs Prove Honda hires US workers “Time to leave Germany” ads Spontaneous accel. stories Premium brand (Acura) I need a carA. I should buy
 a car B. It should be
 a hybridC. I should buy
 a Honda CivicD. Everyone in the world
  141. 141. How to build a marketing campaign http://www.yearonelabs.com/three-questions-all-marketers-must-answer/ When will you decide if it worked, and adjust? Who are you targeting? Size, reachability,
 homogeneity. What do you want them to do? Specific, measurable
 call to action. Why should they do it? Laid, paid, made,
 or afraid; message
 fits their mindset. How will you know if they did? Analytics,
 instrumentation.
  142. 142. “The most important figures that one needs for management are unknown or unknowable, but successful management must nevertheless take account of them.” Lloyd S. Nelson
  143. 143. Pic by Twodolla on Flickr. http://www.flickr.com/photos/twodolla/3168857844
  144. 144. ARCHIMEDES HAD TAKEN BATHS BEFORE.
  145. 145. Once, a leader convinced others in the absence of data.
  146. 146. Now, a leader knows what questions to ask.
  147. 147. Alistair Croll acroll@gmail.com @acroll Ben Yoskovitz byosko@gmail.com @byosko
  • IrisGuo3

    Apr. 8, 2021
  • sachiew91

    Jan. 26, 2021
  • EdwinEstrada6

    Dec. 2, 2020
  • MohamedElHachimiYall

    Oct. 24, 2020
  • Baranyur

    Jul. 24, 2020
  • dspaolucci

    Jun. 15, 2020
  • EirikSomerville

    Jun. 14, 2020
  • andyng86

    Jun. 9, 2020
  • FeiyuLu2

    May. 17, 2020
  • talub

    Feb. 2, 2020
  • AhmedViraniACCA

    Dec. 28, 2019
  • Lidalidalida123

    Nov. 5, 2019
  • vidhyasriram15

    Nov. 26, 2018
  • kimmy_chen

    Nov. 18, 2018
  • ChandraChalla1

    Oct. 23, 2018
  • vungoclinhphuong

    Aug. 15, 2018
  • lara_margarida

    Mar. 2, 2018
  • ReneeRock

    Jan. 14, 2018
  • AnthonyClark65

    Dec. 24, 2017
  • IonutAlexandruBaltat

    Sep. 10, 2017

Growth Tribe invited Alistair Croll, author of the Lean Analytics to come to Amsterdam to give a workshop about Lean Analytics & Growth Hacking. Livestream video part 1: https://www.youtube.com/watch?v=0cEfe9mSatM Livestream video part 2: https://www.youtube.com/watch?v=muu0GENRkoI Growth Tribe: http://www.growthtribe.nl/

Views

Total views

8,227

On Slideshare

0

From embeds

0

Number of embeds

755

Actions

Downloads

0

Shares

0

Comments

0

Likes

83

×