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Discover the pirate metrics framework, the key metrics to track to be profitable and growth hacks from other companies.
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Pirate Metrics & Growth Hacks To Improve Your Profit
INTRODUCTION Speakers
Anna Ruete Entrepreneurship Program Manager – La Salle Technova Barcelona [email protected]
INTRODUCTION Speakers
Pol Valls Soler @polvallssoler Key Account Manager at La Salle Technova Creator of: iOS app for discovering people nearby: joinerapp.com Reddit for spanglish geeks: zumogeek.com [email protected] slideshare.net/polvallssoler
INTRODUCTION Speakers
Juan Pérez Rodríguez Director – La Salle Technova Barcelona 10 years working with entrepreneurs and investors [email protected]
INTRODUCTION Speakers
EXERCISE 1 Metrics
Company A It is a social network for runners. They launched the platform in 2011. Closed 2013 with 2 Millions of users and 1.5 Millions of Euros of Net Profit. They expect the following KPI for 2014: Cost marketing: 600.000 € New users: 400.000 # Visits / day: 374.000 Conversion Rate: 5% Average time: 00:03:48
Company B It is a social network for pregnant. They are in the market since 2012. Closed 2013 with a community of 95.000 users and a Net Profit of 0.5 Millions of Euros. For 2014: Cost marketing: 100.000€ New users: 60.000 # Visits / day 42.000 Conversion Rate 5% Average time: 00:01:27
Which one of these two companies is the best for you?
CONTEXT Before 2000 – After 2008
Before 2000 Sun Servers!Oracle DB!Exodus Hosting!12-24mo dev cycle!6-18mo sales cycle!<100M people online!$1-2M seed round!$3-5M Series A!Sand Hill Road crawl!!Big, Fat, Dinosaur Startup!
After 2008 AWS, Google, PayPal, FB, TW!Cloud + Open Source SW!Lean Startup / Startup Wknd!3-90d dev cycle!SaaS / online sales!>3B people online!<$100K incub + <$1M seed!$1-3M Series A!Angel List global visibility!!Lean, Little, Cockroach Startup!
Source:500startups!
AARRR Pirate Metrics for startup’s and mAAARRketing for startups
ACQUISITION ACTIVATION RETENTION REFERRAL REVENUE
PROFIT
AARRR Pirate Metrics for startup’s and mAAARRketing for startups
ACQUISITION Users come to the site; you have their attention BLOG EXAMPLE: users come to the site and stay for at least 2 minutes ! SaaS EXAMPLE (pdf to html conversion service): user signs up for the service
AARRR Pirate Metrics for startup’s and mAAARRketing for startups
ACTIVATION User performs some key activity that indicates a good first visit BLOG EXAMPLE: user signs up for RSS/newsletter ! SaaS EXAMPLE (pdf to html conversion service): user successfully makes a document
AARRR Pirate Metrics for startup’s and mAAARRketing for startups
RETENTION User continues to do that key activity indicating they like your product BLOG EXAMPLE: user reads at least one post a week or opens the newsletter ! SaaS EXAMPLE (pdf to html conversion service): user continues to make documents. As long as they're successfully making documents they will continue to use the service.
AARRR Pirate Metrics for startup’s and mAAARRketing for startups
REFERRAL User gets other users to join BLOG EXAMPLE: user promotes your blogs contests and drives traffic ! SaaS EXAMPLE (pdf to html conversion service): Users send other users to our web, possibly with a coupon code
AARRR Pirate Metrics for startup’s and mAAARRketing for startups
REVENUE User pays you BLOG EXAMPLE: user buys your ebook
SaaS EXAMPLE (pdf to html conversion service): yay!
money! !
AARRR FUNNEL Customer Lifecycle / Conversion Behavior
AARRR FUNNEL Customer Lifecycle / Conversion Behavior
AARRR Conversion Metrics Example
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% $25
AARRR FUNNEL Customer Lifecycle / Conversion Behavior
AARRR CAC & LTV
CAC: Costumer Adquisition Cost
LTV: Costumer LifeTime Value
EXERCISE 1 Metrics
Company A CAC=600.000€/400.000users= 1.5€ LTV= 1.500.000€/2.000.000users= 0,75€ LTV/CAC= 0,75 / 1,5 = 0,5
Company B CAC=100.000€/60.000users= 1,66€ LTV=500.000€/95.000users= 5,26€ LTV/CAC = 5,26 / 1,66 = 3,16
Which one of these two companies is the best for you?
AARRR CAC & LTV
KEY METRICS TO TRACK…
ACQUISITION Key Metrics To Track:!!
• Volume(#) !• Cost ($)!• Conversion (%)!
!
ACQUISITION
ACQUISITION
Acquisition tips (for the top 10 - 100 words)!• Your brand / Products!
• Customer needs / Benefits!• Competitor’s brand / Products (Steal traffic)!• Semantic equivalents!
• Misspellings !!
ACQUISITION
Extra tip: Reverse Engineered App Store’s ranking algorithm (approximation)!
! AppStore Ranking = H + D + R + E + S
H = # of installs weighted for the past few hours D = # of installs weighted for the past few days R = Reviews (star rating + number of reviews) E = Engagement (# of times app opened etc.) S = Sales ($)
!!
Extra tip: How to get your first 100 users!
1) What existing solution do you believe your product is better than? 2) Where can you find a critical mass of people who use the existing solution? 3) Go there. Talk to them. Show them your product.
ACTIVATION
!!
Key metrics to track:!• Pages per visit (2-3+ page views)!• Time on site (10-30+ seconds)!• Conversions (1 key feature usage)!• Clicks (3-5+ clicks)!• Bounce rate (low)!
Activation Tips:!• Less is more!• Focus on UX / Usability!• Provide incentives & call to actions!• Perform A/B tests and iterate fast!
RETENTION
!!
Key metrics to track:!• Source (email, RSS, affiliates…)!• Volume (Low spam rating)!• Conversions (20% open rate / CTR)!• Visitor Loyalty (1–3+ visits per month)!• Session Length!• Long customer life cycle / Low decay!• Identify fanatics and cheerleaders!
RETENTION Retention Tips:!
• Email is simple and it works!• But make Unsubscribe easy!• 80% subject line / 20% body text!• Actually… 99% subject line / 1% body text!
• Status / “best of” weekly/monthly emails!• “Something happened” emails!• Lifecycle emails @ +3, +7, +30 days !• RSS / News feeds!
• Widgets / Embeds!• Gamification!• Fanatics = Virality + affiliate channels (like bloggers)!
REFERRAL Key metrics to track:!
Viral Growth Factor = X * Y * Z!!
!X = % of users who invite other people!!Y = average # of people that they invited!!Z = % of users who accepted an invitation!
A viral growth factor > 1 means an exponential organic user acquisition.!
Referral Tips:!• Personal send to friend (Email / IM)!• Social Media!• Widgets / Embeds!• Affiliates!
REFERRAL
REVENUE Key metrics to track:!
• Conversion to revenue (%)!
• Volume ($$$)!
Revenue Tips:!
• Don’t just rely on AdSense, iAd…!
• Offer something free (at least when starting out)!
• Subscription / Recurring transactions!
• Qualify your customers / Traffic for lead generation.!
• Sell somethig (physical or virtual)!
REVENUE
How do we improve the funnel?
Growth Hacking
Less Budget, More Creativity, More Automation -> Maximize Output
As simple as…
Different landing pages according to traffic source!(Search Engines for SEO –> Footer vs Direct !Traffic -> No footer)!
Groupon ACQUISITION !
Groupon ACTIVATION & RETENTION!!
Groupon RETENTION!!
Groupon REFERRAL!!Sharing is in Groupon’s DNA
Linkedin ACTIVATION !!
Gamification example:
Linkedin RETENTION & REFERRAL!!
Linkedin REVENUE!!
Linkedin ACQUISITION & REFERRAL!!
This person passed away about a year ago. For the majority of her life, she ran a small hardware shop and she barely understood email, let alone LinkedIn.
From Linkedin’s People You May Know page…
(NOT THE BEST THING TO DO… people can hate you)
Dropbox ACQUISTION !!
Signup driven homepage:
Dropbox REFERRAL!!
Sharing simplicity and availability on Multiple Devices & Platforms:
Dropbox REFERRAL & REVENUE!!
Get more space
Dropbox ACQUISTION & REFERRAL!!Dropbox Great Space Race!
Dropbox REFERRAL & REVENUE!!
Dropbox growth hack in numbers…
1. September 2008: 100,000 registered users!
2. January 2010 (15 months later): 4,000,000!
3. Mostly from word-of-mouth and viral:!
• 35% of daily signups from referral program!
• 20% from shared folders, other viral features!
• Sustained 15-20%+ month-over-month growth since launch!
It doesn’t need to be online (initially)!
It doesn’t need to be online (initially)!
It doesn’t need to be online (initially)!
ACQUISITION: SEO hacks !
ACQUISITION !
ACQUISITION & REFERRAL!
PS: I Love You. Get Your Free Email at Hotmail
ACQUISITION & REFERRAL!
ACQUISITION & REFERRAL!
ACQUISTION, ACTIVATION, RETENTION & REFERRAL!
ACQUISTION, ACTIVATION & RETENTION!
Extra tip: Reverse Engineered App Store’s ranking algorithm (approximation)!
AppStore Ranking = H + D + R + E + S !
!H = # of installs weighted for the past few hours!!D = # of installs weighted for the past few days!!R = Reviews (star rating + number of reviews)!!E = Engagement (# of times app opened etc.) !!S = Sales ($)!
!!
Luck? AppStore Bot? Dark pattern?
ACQUISITION, REFERRAL & REVENUE!
ACQUISITION & PROFIT !
REFERRAL!
REFERRAL!
REFERRAL!
REVENUE & PROFIT !
REVENUE & PROFIT !
REVENUE & PROFIT !
REVENUE & PROFIT !
Unlock all books is the clear top revenue generator.
REVENUE & PROFIT !The $144,146,165 Button
When cabs were cash only, the average tip was roughly 10%. After the introduction of this system, the tip percentage jumped to 22%. Those
three buttons resulted in $144,146,165 of additional tips per year.
When Growth
Hacking Goes Fail Hacking
Path Facebook blocked Path’s “Find Friends” access following spam controversy
Path Path texts your entire phonebook
Glide & Tinder Same…
Rap Genius: No SEO Genius
Rap Genius fell from around 700,000 uniques a day to around 100,000.!
Rap Genius: No SEO Genius
Facebook Fraud
Facebook Fraud
Tools for metrics analysis
…
http://blogs.salle.url.edu/emprendedores
@LaSalleTechnova
https://www.facebook.com/LaSalleTechnova
Speakers
Anna Ruete Entrepreneurship Program Manager – La Salle Technova Barcelona [email protected]
Pol Valls Soler @polvallssoler Key Account Manager at La Salle Technova Creator of: iOS app for discovering people nearby: joinerapp.com Reddit for spanglish geeks: zumogeek.com [email protected] slideshare.net/polvallssoler
Speakers
Juan Pérez Rodríguez Director – La Salle Technova Barcelona 10 years working with entrepreneurs and investors [email protected]
Speakers
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