Brian Balfour: Building A Growth Machine

BUILDING A GROWTH MACHINE BY: BRIAN BALFOUR

Brian Balfour :: @bbalfour :: http://www.coelevate.com

http://twitter.com/bbalfour

http://www.Coelevate.com

ONE MISSION, ONE GOAL




AUTHENTIC GROWTH





GROWING IN A WORLD OF SOFTWARE HAS CHANGED…

The Lines Between Marketing and Product Are Blurring Where does marketing end and product begin in software? 1





The Lines Between Marketing and Product Are Blurring Where does marketing end and product begin in software? 1Marketing Has Become More Technical & Quantitative “Mad Men” skills aren’t as important. 2





The Lines Between Marketing and Product Are Blurring Where does marketing end and product begin in software? 1Marketing Has Become More Technical & Quantitative “Mad Men” skills aren’t as important. 2Data Is Becoming More Accessible Gathering quantitative and qualitative data is becoming easier 3





The Lines Between Marketing and Product Are Blurring Where does marketing end and product begin in software? 1Marketing Has Become More Technical & Quantitative “Mad Men” skills aren’t as important. 2Data Is Becoming More Accessible Gathering quantitative and qualitative data is becoming easier 3Scale and Speed Of Growth Is Accelerating Time to 1M Users/ARR has accelerated. 4



Revenue

Referral

Activation

Retention

Acquisition

GROWTH ≠ ACQUISITION




GROWTH EFFORTS REQUIRE…


Product

Engineering

GROWTH

Marketing

Data



GROWTH AND PRODUCT IS DIFFERENT

BUILDING CORE VALUE

GETTING THE LARGEST % OF OUR AUDIENCE TO EXPERIENCE CORE VALUE AS QUICKLY AS

POSSIBLE

GETTING USERS TO EXPERIENCE THAT

CORE VALUE AS OFTEN AS POSSIBLE




GROWTH EFFORTS CREDIT: ANDY JOHNS

0

10000

20000

30000

40000

NATURAL ADOPTION

TRUE GROWTH POTENTIAL

PURPOSE OF GROWTH

EFFORTS




GROWTH IS MORE ABOUT A CHANGE TO TEAM STRUCTURE, PEOPLE, METHODOLGY,

PROCESS NOT TACTICS/HACKS




LEARNING HOW TO GROW AUTHENTICALLY DOESN’T START WITH TACTICS




PROCESS




PROCESS?!?!?!WHAT CAN BE SO SPECIAL ABOUT PROCESS?




4 REASONS TO FOCUS ONPROCESS FIRST, TACTICS SECOND




14

1. WHAT WORKS FOR OTHERS, WON’T WORK FOR YOU

YOUR AUDIENCE IS DIFFERENT




YOUR PRODUCT IS DIFFERENT




YOUR BUSINESS MODEL IS DIFFERENT




YOUR CUSTOMER JOURNEY IS DIFFERENT




YOUR BUSINESS IS DIFFERENT PLAIN AND SIMPLE




20

2. GROWTH = SUM(1, 2, 3, 4….X)Brian Balfour :: @bbalfour :: http://www.coelevate.com





MOST PEOPLE FOCUS ON WHAT HAPPENED HERE




BUT WE SHOULD ASK ABOUT ALL THE THINGS

HERE AND….HERE





HERE AND….HERE





HERE AND….HERE




23

SILVER BULLETS DON’T EXIST



24

3. RATE OF CHANGE IS ACCELERATINGBrian Balfour :: @bbalfour :: http://www.coelevate.com


SEO No Keyword Data, Author Rank, Content Freshness, Social Shares, Search Result Format

DISPLAY RTB, No Cookies, Mobile

EMAIL Tabbed Inboxes, Inbox Actions, Unsubscribe, Mobile

FACEBOOKNewsfeed Ads (4 formats), Video Ads,

Optimized CPM, CTA Format, Custom Audiences, etc, etc

Effe

ctiv

enes

s

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

WOM Novelty

Email

MySpace

Craigslist

Twitter

Mobile iOS

Android

Facebook

Ooga Labs

EVOLUTION OF CHANNELS

CREDIT: JAMES CURRIER

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4. YOU NEED A MACHINEBrian Balfour :: @bbalfour :: http://www.coelevate.com


A GROWTH MACHINE IS…

1

2 PREDICTABLE

SCALABLE

3 REPEATABLE

THE MACHINE PRODUCES THE TACTICS THE PROCESS MAKES THE MACHINE




BUILDING A GROWTH MACHINE THE PROCESS

THE GOALS OF OUR PROCESS

1

2

LEARNING Constant learning of our customer, product, channels and feeding that learning into the process to improve.

3 AUTONOMY Individuals decide what they work on to achieve the OKR’s.

4 ACCOUNTABILITY With autonomy, comes accountability. You don’t have to be right all the time, but there is an expectation to improve.

RYTHYM Momentum is powerful. Establish a cadence to fight through failures, get to successes, and find momentum




1. Brainstorm (Backlog)

2. Prioritize (Experiment Doc + Backlog)

4. Implement

5. Analyze (Experiment Doc)

3. Test (Experiment Doc)

6. Systemize (Playbooks)

Set Goals OKR’s

Explore Data Qualitative and Quantitative

Find Levers Growth Model

DAILY/WEEKLY

FINDING LEVERS BUILDING A GROWTH MODEL

GOAL IS TO FIND THE HIGHEST IMPACT AREA THAT WE CAN FOCUS ON RIGHT NOW GIVEN LIMITED

RESOURCES.




FINDING LEVERS YOUR TOOL IS YOUR GROWTH MODEL






GOAL IS WAU’s, BUT WHAT EFFECTS WAU’s?






WAU’s = New Activated + Retained






WAU’s = New Activated + RetainedNew Activated = (RegisteredFB ADS * ARFB ADS) + (RegisteredViral * ARViral)+…







RegisteredViral = Imp * Conversion Rate * Invites/User * Email CTR * Landing Page CR







RegisteredViral = Imp * Conversion Rate * Invites/User * Email CTR * Landing Page CR

Retained = (New ActW-1 * RetentionW-1) + (New ActW-2 * RetentionW-2)…




FINDING LEVERS THREE THINGS TO UNDERSTAND ABOUT THE INPUTS

1

2 CEILING

BASELINE

3 SENSITIVITY OVER TIME



4. Implement




Set Goals OKR’s



DAILY/WEEKLY

HOW WE SET GOALS (OKRs)OBJECTIVE: Qualitative statement

TIMEFRAME: 30 - 90 Days

KR1: Measurable Goal 1 (Hit 90% Of Time) KR2: Measurable Goal 2 (Hit 50% Of Time) KR3: Measurable Goal 3 (Hit 10% Of Time)




AN EXAMPLE…OBJECTIVE: MAKE VIRALITY A MEANINGFUL CHANNEL

TIMEFRAME: 90 Days

KR1: 1.5% Viral/WAU KR2: 2% Viral/WAU KR3: 3% Viral/WAU




1

2 IN OUR FACE

INPUTS NOT OUTPUTS

3 CONCRETE

OKR’s will never be set on on the output (WAU) the will always be set on the inputs.

OKR’s will be somewhere that we can’t forget them. Review daily and weekly.

Goals will change mid-OKR VERY rarely.

OKR PRINCIPLES



4. Implement




Set Goals OKR’s



DAILY/WEEKLY

HOW WE GET GROWTH INSIGHTS

INSIGHT

Quantitative Qualitative

Intuition

1

2 QUANTITATIVE

QUALITATIVE User Surveys, 1 on 1 Conversations, Full Story Videos, Customer Support Tickets

GA, Mixpanel, Datastore. Goal is to answer questions we don’t know about our user, product, or channel. Break it into pieces.

EXPLORE DATAUNDERSTAND THE INPUTS OF THE INPUTS




BUILD A MINI MODELUNDERSTAND THE INPUTS OF THE INPUTS

1

2 CEILING

BASELINE

3 SENSITIVITY

UNDERSTAND THE WHYUNDERSTAND THE INPUTS OF THE INPUTS

Why do users who get to invite page not covert?

<— Super targeted to the variable we are trying to improve

<— Open ended question to allow for all types of answers

<— Email looks like a personal email to create a sense of importance

UNDERSTAND THE WHYUNDERSTAND THE INPUTS OF THE INPUTS

Bug 7%Other

8%

Would Prefer To Just Share On FB 10%

Don't Want You To Spam Friends 11%

Reward Not High Enough 29%

Didn't Know Who To Invite 35%



4. Implement







STEP ONE: BRAINSTORM

BRAINSTORM ON THE INPUTS NOT THE OUTPUTS…




STEP ONE: BRAINSTORM

ACTIVATION RATE = STEP 1 CONV * STEP 2 CONV * STEP 3 CONV

IF WE WANT TO IMPROVE THIS

WE BRAINSTORM ON THESE




4 WAYS TO COME UP WITH GROWTH IDEAS

1 OBSERVE How are others doing it? Look outside of your immediate product space. Walk through together.

2 QUESTION Question brainstorming. Why? What is… What if… What about… How do we do more of…

3 ASSOCIATE Connect the dots between unrelated things. i.e What if our activation process was like closing a deal?

4 NETWORK Growth mastermind groups. Build your network of growth people. I’m on the phone every day for ideas






4. Implement







STEP TWO: PRIORITIZE

1

2 IMPACT

PROBABILITY

3 RESOURCES

LOW - 20%, MEDIUM - 50%, HIGH - 80%

Comes from your prediction. Take into account long lasting effects vs one hit wonders.

Marketing, Design, Engineering

STEP TWO: PRIORITIZE CREATING A HYPOTHESIS

IF SUCCESSFUL, [VARIABLE] WILL INCREASE BY [IMPACT], BECAUSE

[ASSUMPTIONS].




STEP TWO: PRIORITIZE JUSTIFYING YOUR ASSUMPTIONS

1

2 QUALITATIVE

QUANTITATIVE

3 SECONDARY

Previous Experiments, Surrounding Data, Funnel Data

Surveys, Support Emails, User Testing Recordings

Networking, Blogs, Competitor Observation, Case Studies




STEP TWO: PRIORITIZE CREATE EXPERIMENT DOC






4. Implement







STEP THREE: TEST

WHAT IS THE MVT (MINIMUM VIABLE TEST)

TO UNDERSTAND OUR HYPOTHESIS?




1 EFFICIENCY What is the least resource intensive way to gather data about the hypothesis.

2 VALIDITY The experiment must take into account how to get a valid result by designing a control and required amount of data.

STEP THREE: TEST




STEP THREE: TEST WRITE THE EXPERIMENT DESIGN IN EXPERIMENT DOC






4. Implement







STEP FOUR: IMPLEMENT

GET SHIT DONE






4. Implement







STEP FIVE: ANALYZE

1

2 IMPACT

SUCCESS/FAIL

3 WHY?

How close to your prediction?

The most important question you can ask. Why did you see the result that you did?

Be prepared for a lot of failures.

STEP FIVE: ANALYZE LEARNINGS + ACTION ITEMS IN EXPERIMENT DOC






4. Implement







STEP SIX: SYSTEMIZE

1 PRODUCTIZE Productize as much as you can with technology and engineering.

2 PLAYBOOKS For the things you can’t productize, build into step by step playbooks to make them repeatable.








4. Implement


REPEAT




WHAT A TYPICAL WEEK LOOKS LIKE

Monday Tuesday Wednesday Thursday Friday

Growth Meeting - Learnings - Goal Review - Blocking Items/

Strategies

Predicting, Prioritizing, Implementing, Analyzing, Systemizing




WEEKLY GROWTH MEETING DON’T GET ATTACHED TO IDEAS

1

2 GOALS

LEARNINGS

3 BLOCKING

Learnings, not updates. You can monitor experiment updates in the pipeline.

Progress against goals

What blocked you from doing something this week?

WEEKLY GROWTH MEETING TEMPLATE




MACRO OPTIMIZATION (REVIEW QUARTERLY)

1

2 ACCURACY

BATTING AVG

3 THROUGHPUT

How many successes to failures? Our we improving over time?

Are our predictions getting more accurate?

How many experiments are we running in a given time period? How do we do more?

MACRO OPTIMIZATION HOW WE IMPROVE

1

2 INFRASTRUCTURE

TEAM

3 PROCESS

Improve current teams skills. Add to the team.

Experiment, analytics, and qualitative feedback infrastructure

Refining the process for more efficiency or quality of ideas, implementation, and analysis.

A FINAL WORD PART ONE

ITERATION DOES NOT EQUAL INCREMENTAL




A FINAL WORD PART TWO

IT IS NEVER TOO EARLY TO START THIS PROCESS




A FINAL FINAL WORD

THERE IS NOTHING SPECIAL ABOUT THIS PROCESS. SUCCESS COMES DOWN TO

GRIT, FOCUS, AND PERSISTENCE.




THANKS!




Software

Brian Balfour: Building A Growth Machine