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SaaSFest 2015 - "Retention is King" by Dan Wolchonok of HubSpot

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Too many people think of acquisition as the main lever for growth when in reality retention is king. Dan Wolchonok who leads up part of the Growth Team at HubSpot walks through how HubSpot measures growth, as well as how they work to experiment with ways to improve retention to ensure a long lasting business or product unit.

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SaaSFest 2015 - "Retention is King" by Dan Wolchonok of HubSpot

  1. 1. RETENTION EXPERIMENTS DAN WOLCHONOK
  2. 2. ALL DATA IN THIS IS FAKE DISCLAIMER
  3. 3. IF YOU HAVE POOR RETENTION, NOTHING ELSE MATTERS BRIAN BALFOUR
  4. 4. Dan Wolchonok - @danwolch - http://danwolch.com BAD RETENTION
  5. 5. Dan Wolchonok - @danwolch - http://danwolch.com GOOD RETENTION
  6. 6. Dan Wolchonok - @danwolch - http://danwolch.com RETENTION’S IMPACT ON $
  7. 7. HIGHER RETENTION HIGHER LTV HIGHER ACQ. BUDGET
  8. 8. HIGHER RETENTION HIGHER VIRALITY LOWERS YOUR ACQ. ECONOMICS
  9. 9. HIGHER RETENTION HIGHER UPGRADE RATES LOWER PAYBACK PERIOD
  10. 10. VIRALITY, LTV, PAYBACK PERIOD IMPACT OF RETENTION
  11. 11. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 RETENTION CHART
  12. 12. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 GOOD BAD RETENTION GOALS
  13. 13. Dan Wolchonok - @danwolch - http://danwolch.com RETENTION GOALS 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 THE IMPORTANT PART IS THAT IT FLATTENS OUT
  14. 14. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 ANALYZING RETENTION Week 1 Retention - Can you get your users to use your product more than once?
  15. 15. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 ANALYZING RETENTION Mid-term retention - Can you establish any pattern of usage?
  16. 16. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 ANALYZING RETENTION Long-term retention - How does your product become an indispensable tool?
  17. 17. Dan Wolchonok - @danwolch - http://danwolch.com IMPROVING RETENTION Long-term retention - How does your product become an indispensable tool? 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10
  18. 18. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 IMPROVING RETENTION New Features
  19. 19. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 IMPROVING RETENTION W1 Retention
  20. 20. Dan Wolchonok - @danwolch - http://danwolch.com IMPROVING RETENTION Long-term retention - How does your product become an indispensable tool? 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 Feature Tweaks Retention Hooks Product Quality Resurrection
  21. 21. Dan Wolchonok - @danwolch - http://danwolch.com EVERNOTE “SMILE GRAPH” Long-term retention - How does your product become an indispensable tool?
  22. 22. IT’S NOT ROCKET SCIENCE, HERE’S AN EXAMPLE
  23. 23. HUBSPOT SALES PLATFORM
  24. 24. Dan Wolchonok - @danwolch - http://danwolch.com THE PROBLEMS 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 March April May
  25. 25. Dan Wolchonok - @danwolch - http://danwolch.com THE PROBLEMS 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 March April May PROBLEM 1: COHORT RETENTION WORSE IN LATER MONTHS
  26. 26. Dan Wolchonok - @danwolch - http://danwolch.com THE PROBLEMS 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 March April May PROBLEM 2: RETENTION DOESN’T PLATEAU
  27. 27. WHY AREN’T PEOPLE USING IT AFTER 1 WEEK?
  28. 28. Dan Wolchonok - @danwolch - http://danwolch.com 0 0.2 0.4 0.6 0.8 1 ACTION 3 ACTIONS 5 ACTIONS 7 ACTIONS 9 ACTIONS “Drive By” Usage in Week One WHY WOULD USERS ONLY TAKE A SINGLE ACTION?
  29. 29. Dan Wolchonok - @danwolch - http://danwolch.com
  30. 30. Dan Wolchonok - @danwolch - http://danwolch.com 10% 10% 10% 10% 30% 30% Didn't see Value Didn't Understand Product Disappeared Product Failure Another Browser Competitor “Drive By” Reasons in Week One
  31. 31. RETENTION EXPERIMENTS
  32. 32. Dan Wolchonok - @danwolch - http://danwolch.com
  33. 33. Dan Wolchonok - @danwolch - http://danwolch.com
  34. 34. Dan Wolchonok - @danwolch - http://danwolch.com
  35. 35. Dan Wolchonok - @danwolch - http://danwolch.com
  36. 36. Dan Wolchonok - @danwolch - http://danwolch.com 7 Experiments Later…
  37. 37. Dan Wolchonok - @danwolch - http://danwolch.com 7 Experiments Later…
  38. 38. Dan Wolchonok - @danwolch - http://danwolch.com
  39. 39. Dan Wolchonok - @danwolch - http://danwolch.com
  40. 40. Dan Wolchonok - @danwolch - http://danwolch.com 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 May June WEEK 1 IMPROVEMENTS CASCADED OVER TIME WEEK 1 IMPROVEMENTS
  41. 41. Dan Wolchonok - @danwolch - http://danwolch.com THE PROBLEMS 0 25 50 75 100 WEEK 0 WEEK 2 WEEK 4 WEEK 6 WEEK 8 WEEK 10 March April May PROBLEM 2: RETENTION DOESN’T PLATEAU
  42. 42. Dan Wolchonok - @danwolch - http://danwolch.com FIGHTING LONG TERM CHURN
  43. 43. BREAK DOWN THE FEEDBACK BY WHETHER IT’S ACTIONABLE Brian Balfour
  44. 44. Dan Wolchonok - @danwolch - http://danwolch.com QUALITATIVE RESULTS FOR LONG TERM CHURN Reason % Possible action Actionable? Left Company 30% Capture Personal Email, Recapture Email Campaign Yes “Stopped Working” 15% Fix Operating System / UI Issues, Bugs Yes Cost Confusion 10% Iterate on copy within the app Yes New Computer 10% Recapture email campaign Yes Competitor 5% Needed a feature of a competitor No
  45. 45. Dan Wolchonok - @danwolch - http://danwolch.com CUT DOWN ON NOISE, COGNITIVE ENERGY REQUIRED BY OUR APP ACTIONABLE LONG TERM CHURN
  46. 46. Dan Wolchonok - @danwolch - http://danwolch.com RESURRECTING USERS
  47. 47. Dan Wolchonok - @danwolch - http://danwolch.com INVESTING IN OUTLOOK
  48. 48. RETENTION TAKEAWAYS ▸ Soak time ▸ Weekly / Monthly cohorts take awhile to mature ▸ Cohort sizes ▸ You need large cohort sizes to run many experiments ▸ Retention problems sneak up on you ▸ Your top level metrics may be going up
  49. 49. RETENTION TAKEAWAYS ▸ Ownership ▸ We set up a NUX (new user experience) team that was directly responsible for on boarding and W1 retention ▸ Alignment of goals ▸ Ensure that other teams are excited about optimizing for growth metrics and are willing to make sacrifices to help improve retention
  50. 50. QUESTIONS

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