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Pirate Metrics - Manly Entrepreneurs

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Part of Manly Entrepreneurs Meetup Scaling up Series

Freddy Chanut, MD at In Marketing We Trust presented a few fundamental elements on how to use pirate metrics as a series of key data points to track the health and growth of your startup.

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Pirate Metrics - Manly Entrepreneurs

  1. 1. Manly Entrepreneurs Meetup
  2. 2. 2
  3. 3. 3
  4. 4. ‣ ‣ ‣ ‣ ‣ ‣ ‣ ‣ ‣ ‣ 4
  5. 5. Slides
  6. 6. 6 Slides
  7. 7. 7
  8. 8. PICK THE RIGHT METRICS 8
  9. 9. 9
  10. 10. 10
  11. 11. POPULAR STARTUPS YOU SAID? 11
  12. 12. IF A METRIC WON’T CHANGE THE WAY YOU BEHAVE THEN IT’S A BAD METRIC Ben Yoskovitz @byosko, author lean Analytics 12
  13. 13. THE PIRATE METRICS AARRR!!! 13
  14. 14. THE PIRATE METRICS AARRR!!! 14
  15. 15. Customer Lifecycle: 5 Steps to Success ‣ Acquisition: users come to the site from various channels ‣ Activation: users enjoy 1st visit: "happy" user experience ‣ Retention: users come back, visit site multiple times ‣ Referral: users like product enough to refer others ‣ Revenue: users conduct some monetization behavior AARRR!
  16. 16. Customer Lifecycle / Conversion Behavior Website.com Emails & widgets Campaigns, Contests Biz DevAds, Lead Gen, Subscriptions, etc Homepage / Landing Page Product Features 1. ACQUISITION SEO SEM Apps & Widgets Affiliates Email PR Biz Dev Campaigns, Contests Direct, Tel, TV Social Networks Blogs Domains Emails & Alerts Blogs, Content System Events & Time-based Features
  17. 17. Example Conversion Metrics (note: *not* actuals; your mileage may vary…) Category User Status Conv % Est. Value Acquisition Visit Site (or landing page, or external widget) 100% $.01 Acquisition Doesn't Abandon (views 2+ pages, stays 10+ sec, 2+ clicks) 70% $.05 Activation Happy 1st Visit (views X pages, stays Y sec, Z clicks) 30% $.25 Activation Email/Blog/RSS/Widget Signup (anything that could lead to repeat visit) 5% $1 Activation Acct Signup (includes profile data) 2% $3 Retention Email Open / RSS view -> Clickthru 3% $2 Retention Repeat Visitor (3+ visits in first 30 days) 2% $5 Referral Refer 1+ users who visit site 2% $3 Referral Refer 1+ users who activate 1% $10 Revenue User generates minimum revenue 2% $5 Revenue User generates break-even revenue 1% $25
  18. 18. I KNOW THAT HALF MY AD DOLLARS ARE WASTED, I JUST DON’T KNOW WHICH HALF John Wanamaker 18
  19. 19. Customer Lifecycle / Conversion Behavior Website.com Marketing Channels: • largest-volume (#) • lowest-cost ($) • best-performing (%) 1. ACQUISITION SEO SEM Apps & Widgets Affiliates Email PR Biz Dev Campaigns, Contests Direct, Tel, TV Social Networks Blogs Domains
  20. 20. Example Conversion Metrics (note: *not* actuals; your mileage may vary…) Category User Status Conv % Est. Value Acquisition Visit Site (or landing page, or external widget) 100% $.01 Acquisition Doesn't Abandon (views 2+ pages, stays 10+ sec, 2+ clicks) 70% $.05 Activation Happy 1st Visit (views X pages, stays Y sec, Z clicks) 30% $.25 Activation Email/Blog/RSS/Widget Signup (anything that could lead to repeat visit) 5% $1 Activation Acct Signup (includes profile data) 2% $3 Retention Email Open / RSS view -> Clickthru 3% $2 Retention Repeat Visitor (3+ visits in first 30 days) 2% $5 Referral Refer 1+ users who visit site 2% $3 Referral Refer 1+ users who activate 1% $10 Revenue User generates minimum revenue 2% $5 Revenue User generates break-even revenue 1% $25
  21. 21. 21
  22. 22. Customer Lifecycle / Conversion Behavior Website.com Activation Criteria: • 10-30+ seconds • 2-3+ page views • 3-5+ clicks • 1 key feature usage Do LOTS of landing page tests & A/B tests - just make lots of dumb guesses & iterate QUICK Homepage / Landing Page Product Features 1. ACQUISITION SEO SEM Apps & Widgets Affiliates Email PR Biz Dev Campaigns, Contests Direct, Tel, TV Social Networks Blogs Domains
  23. 23. Example Conversion Metrics (note: *not* actuals; your mileage may vary…) Category User Status Conv % Est. Value Acquisition Visit Site (or landing page, or external widget) 100% $.01 Acquisition Doesn't Abandon (views 2+ pages, stays 10+ sec, 2+ clicks) 70% $.05 Activation Happy 1st Visit (views X pages, stays Y sec, Z clicks) 30% $.25 Activation Email/Blog/RSS/Widget Signup (anything that could lead to repeat visit) 5% $1 Activation Acct Signup (includes profile data) 2% $3 Retention Email Open / RSS view -> Clickthru 3% $2 Retention Repeat Visitor (3+ visits in first 30 days) 2% $5 Referral Refer 1+ users who visit site 2% $3 Referral Refer 1+ users who activate 1% $10 Revenue User generates minimum revenue 2% $5 Revenue User generates break-even revenue 1% $25
  24. 24. PRACTICAL EXAMPLE Sells package $400/mth Max spend per cust. $ 500 Assume: Sydney accountant (9,900/Mo) 3% of Search clicks ads 3% x 9,900 searches = 297 Cost per $3,53 x 297 = $1,048 3% of clicks generate enquiry 3% x 297 searches = 9 Cost per lead =$116 20% of enquiry Convert 20% x 9 leads = 2 Cost per cust =$524 24 Search Click Enquire Convert ACTIVATION
  25. 25. PRACTICAL EXAMPLE Sells package $400/mth Max spend per cust. $ 500 Assume: Sydney accountant (9,900/Mo) 3% of Search clicks ads 3% x 9,900 searches = 297 Cost per $3,53 x 297 = $1,048 5% of clicks generate enquiry 5% x 297 searches = 15 Cost per lead =$70 20% of enquiry Convert 20% x 15 leads = 3 Cost per cust =$349 25 Search Click Enquire Convert ACTIVATION
  26. 26. Customer Lifecycle / Conversion Behavior Website.com Automated emails are simple & easy retention feature • lifecycle emails @ +3, +7, +30d • status emails weekly/monthly • event-based emails as they occur Homepage / Landing Page Product Features 1. ACQUISITION SEO SEM Apps & Widgets Affiliates Email PR Biz Dev Campaigns, Contests Direct, Tel, TV Social Networks Blogs Domains Emails & Alerts Blogs, Content System Events & Time-based Features
  27. 27. Example Conversion Metrics (note: *not* actuals; your mileage may vary…) Category User Status Conv % Est. Value Acquisition Visit Site (or landing page, or external widget) 100% $.01 Acquisition Doesn't Abandon (views 2+ pages, stays 10+ sec, 2+ clicks) 70% $.05 Activation Happy 1st Visit (views X pages, stays Y sec, Z clicks) 30% $.25 Activation Email/Blog/RSS/Widget Signup (anything that could lead to repeat visit) 5% $1 Activation Acct Signup (includes profile data) 2% $3 Retention Email Open / RSS view -> Clickthru 3% $2 Retention Repeat Visitor (3+ visits in first 30 days) 2% $5 Referral Refer 1+ users who visit site 2% $3 Referral Refer 1+ users who activate 1% $10 Revenue User generates minimum revenue 2% $5 Revenue User generates break-even revenue 1% $25
  28. 28. Customer Lifecycle / Conversion Behavior Website.com Only encourage users to refer *after* they have “happy” user experience; avg score >= 8 out of 10 Homepage / Landing Page Product Features Emails & widgets Campaigns, Contests 1. ACQUISITION SEO SEM Apps & Widgets Affiliates Email PR Biz Dev Campaigns, Contests Direct, Tel, TV Social Networks Blogs Domains Emails & Alerts Blogs, Content System Events & Time-based Features
  29. 29. 29
  30. 30. Example Conversion Metrics (note: *not* actuals; your mileage may vary…) Category User Status Conv % Est. Value Acquisition Visit Site (or landing page, or external widget) 100% $.01 Acquisition Doesn't Abandon (views 2+ pages, stays 10+ sec, 2+ clicks) 70% $.05 Activation Happy 1st Visit (views X pages, stays Y sec, Z clicks) 30% $.25 Activation Email/Blog/RSS/Widget Signup (anything that could lead to repeat visit) 5% $1 Activation Acct Signup (includes profile data) 2% $3 Retention Email Open / RSS view -> Clickthru 3% $2 Retention Repeat Visitor (3+ visits in first 30 days) 2% $5 Referral Refer 1+ users who visit site 2% $3 Referral Refer 1+ users who activate 1% $10 Revenue User generates minimum revenue 2% $5 Revenue User generates break-even revenue 1% $25
  31. 31. UNDERSTANDING THE DATA - CONVERSION 31 http://www.youtube.com/watch?v=3Sk7cOqB9Dk
  32. 32. Customer Lifecycle / Conversion Behavior Website.com Biz DevAds, Lead Gen, Subscriptions, etc Homepage / Landing Page Product Features This is the part *you* have to figure out… I don’t know jack about your business Emails & widgets Campaigns, Contests 1. ACQUISITION SEO SEM Apps & Widgets Affiliates Email PR Biz Dev Campaigns, Contests Direct, Tel, TV Social Networks Blogs Domains Emails & Alerts Blogs, Content System Events & Time-based Features
  33. 33. Example Conversion Metrics (note: *not* actuals; your mileage may vary…) Category User Status Conv % Est. Value Acquisition Visit Site (or landing page, or external widget) 100% $.01 Acquisition Doesn't Abandon (views 2+ pages, stays 10+ sec, 2+ clicks) 70% $.05 Activation Happy 1st Visit (views X pages, stays Y sec, Z clicks) 30% $.25 Activation Email/Blog/RSS/Widget Signup (anything that could lead to repeat visit) 5% $1 Activation Acct Signup (includes profile data) 2% $3 Retention Email Open / RSS view -> Clickthru 3% $2 Retention Repeat Visitor (3+ visits in first 30 days) 2% $5 Referral Refer 1+ users who visit site 2% $3 Referral Refer 1+ users who activate 1% $10 Revenue User generates minimum revenue 2% $5 Revenue User generates break-even revenue 1% $25
  34. 34. Quantitative & Comparative Measurement ‣ Conversion Criteria: ‣ best-performing (%) channels / campaigns / copy ‣ largest-volume (#) channels / campaigns / copy ‣ lowest-cost ($) channels / campaigns / copy
  35. 35. Quantitative & Comparative Measurement ‣ Conversion Criteria: ‣ best-performing (%) channels / campaigns / copy ‣ largest-volume (#) channels / campaigns / copy ‣ lowest-cost ($) channels / campaigns / copy ‣ Measurement Components: ‣ Audience Segment (young women, regional metro, older singles) ‣ Channel Source (social network, SEM, organic, PR, etc) ‣ Campaign Theme / Brand Promise (“find a job”, “learn to cook”) ‣ Landing Page & CTA ‣ Copy & Graphics
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