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Driving Customer Acquisition and Growth with Experimentation

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Taking a narrow view of experimentation data and looking solely at basic conversion metrics like clicks, lead generation or purchases may actually be limiting your growth strategy. In this session, you’ll learn how to draw confident conclusions about your experiments and their revenue impact, and avoid common pitfalls. ClassPass optimization expert, Nina Bayatti will share her experience approaching every customer acquisition effort as a hypothesis to be tested and how even when presented with positive outcomes she takes a critical eye to the results. By leveraging down-funnel data to evaluate the full story, Nina is able to identify which experiments are truly serving her goals beyond a single conversion metric.

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Driving Customer Acquisition and Growth with Experimentation

  1. 1. Congratulations to our Outperform Award Winners! Most Dramatic Business Impact Most Customer- Obsessed Company Culture Most Transformative Innovation Most Inspiring Social Impact
  2. 2. 2  Welcome to Day 2 of Opticon!  Sessions will be recorded and available after Opticon  Share your feedback and rate sessions on the mobile app
  3. 3. Nina Bayatti Conversion Marketing Manager, ClassPass Driving Customer Acquisition & Growth with Experimentation
  4. 4. 4 About me
  5. 5. 5 Agenda  ClassPass’ iterative, minimum viable product (MVP) approach to testing  Demystifying conversion rate optimization (CRO)  Applying CRO principles company-wide  Q&A
  6. 6. 6 ClassPass is the largest studio fitness aggregator
  7. 7. 7 We’re not just testing new fitness classes. In 2018, we ran over 150 optimization tests company-wide.
  8. 8. 8 How did we run 150 optimization tests company-wide?
  9. 9. 9 Build minimum viable product (MVP) • How can we test this idea in a low-lift, high- impact way? • De-risk resource investment • Maintain high test velocity Boost test velocity & de-risk resources with an iterative, MVP approach
  10. 10. 10 Build minimum viable product (MVP) • How can we test this idea in a low-lift, high- impact way? • De-risk resource investment • Maintain high test velocity Launch & monitor • Ask CX team to flag test-related outreach • Monitor web behavior & analytics Boost test velocity & de-risk resources with an iterative, MVP approach
  11. 11. 11 Build minimum viable product (MVP) • How can we test this idea in a low-lift, high- impact way? • De-risk resource investment • Maintain high test velocity Launch & monitor • Ask CX team to flag test-related outreach • Monitor web behavior & analytics Iterate & re-launch • Anticipate 2-3 iterations ahead • Continue to utilize MVP-first approach • Utilize initial test data, customer feedback & web analytics Boost test velocity & de-risk resources with an iterative, MVP approach
  12. 12. 12 Build minimum viable product (MVP) • How can we test this idea in a low-lift, high- impact way? • De-risk resource investment • Maintain high test velocity Launch & monitor • Ask CX team to flag test-related outreach • Monitor web behavior & analytics Iterate & re-launch • Anticipate 2-3 iterations ahead • Continue to utilize MVP-first approach • Utilize initial test data, customer feedback & web analytics Productize • Share learnings • Consider impact when allocating resourcing for productization build Boost test velocity & de-risk resources with an iterative, MVP approach
  13. 13. 13 Demystifying CRO: Beyond the CTA color test
  14. 14. 14 Understanding down- funnel impact of your CRO initiatives
  15. 15. 15 • Bounce rate • Click through rate • Pageviews • Lead captures • Purchase conversion rate Your primary KPI is not telling the full story
  16. 16. 16 Reach a confident conclusion with down- funnel data • Quality of leads • Duration of sales cycle • Customer acquisition cost • Operational cost • Customer retention rate • Bounce rate • Click through rate • Pageviews • Lead captures • Purchase conversion rate Your primary KPI is not telling the full story
  17. 17. 17 Measuring the down- funnel impact of our re-engagement optimization
  18. 18. 18 We tested extending our winback offer • Winback offer serves as a re-trial period for inactive members • Inactive members can experience new product features & newly added classes • Tested extending winback offer period from 1 to 2 weeks
  19. 19. 19 We tested extending our winback offer Hypothesis: If we extend our winback offer from 1 to 2 weeks, then our reactivation rates will increase because members will have more time to experience new features and classes. And the lift in reactivations will offset the costs of the increased duration of the free offer.
  20. 20. 20 Extending our winback offer lifted our reactivation rate by 25% Reactivations +25% ReactivationCVR B: Extended OfferA: Control
  21. 21. 21 Despite the lift in reactivations, our marginal acquisition was not cost-effective Control Extended Offer Delta Reactivations* 100 125 +25% CVR Cost of Goods (COGs) $15,000 $24,375 +30% (increased usage) Retained Members 80 95 -5% CVR Customer Acquisition Cost $187.50 Marginal CAC $625 > ⅓ Lifetime Value (LTV) *Reactivation counts are illustrative to better highlight the impact of the purchase CVR, retention CVR and increased cost of the offer.
  22. 22. 22 Identify & iterate down-funnel levers How can we maintain the 25% reactivation CVR lift while . . . • reducing COGs incurred • maintaining retention rate so that we can ultimately reach a cost- effectively increase acquisitions? Delta Reactivations* +25% CVR Cost of Goods (COGs) +30% (increased usage) Retained Members -5% CVR Customer Acquisition Cost Marginal CAC $625 > ⅓ LTV
  23. 23. 23 Marketing • Find optimal channels of acquisition • Personalize experiences across touchpoints • Optimize web to help educate, inspire & convert Finance Apply CRO principles company-wide
  24. 24. 24 Marketing • Find optimal channels of acquisition • Personalize experiences across touchpoints • Optimize web to help educate, inspire & convert Customer Experience • Find methods of reducing customer confusion • Determine optimal methods of communication with customers Apply CRO principles company-wide
  25. 25. 25 Marketing • Find optimal channels of acquisition • Personalize experiences across touchpoints • Optimize web to help educate, inspire & convert Customer Experience • Find methods of reducing customer confusion • Determine optimal methods of communication with customers • Merchandise effectively • Develop optimal subscription plans • Understand acquisition curve Finance Apply CRO principles company-wide
  26. 26. 26 Marketing • Find optimal channels of acquisition • Personalize experiences across touchpoints • Optimize web to help educate, inspire & convert Customer Experience • Find methods of reducing customer confusion • Determine optimal methods of communication with customers • Merchandise effectively • Develop optimal subscription plans • Understand acquisition curve Product • De-risk negative impact of new product feature • Determine acquisition gains Finance Apply CRO principles company-wide
  27. 27. Q&A
  28. 28. Thank you!
  29. 29.  Head to the Expo Hall for morning refreshments  Up next…Ravi Parikh, co-founder of Heap at 11:15am!

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