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Growth PM > Activation and Retention Strategy > Flashcards

Activation and Retention Strategy Flashcards

1
Q

What are the traits of the Growth PM job?

A
  • scientific - hypothesis and experiments
  • adaptable - no silver bullet, interative problem solving
  • curious - connects cause and effect
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2
Q

In what kind of companies can a GPM be useful?

A

In a product-led company, that isn’t sales-first or enterprise. Being focused on having a mass user trying the product before committing (i.e. trial). This allows for experimentation.

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3
Q

What are the Growth steps when focusing on the Sign-up Flow?

A
  • Identifying (CTA, Fields)
  • Measuring (CTR/Drop-off, Friction)
  • Improving (Hypothesis, Metrics, ICE)
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4
Q

What are the types of Sign-up Flow?

A
  • Friction Sign-up - hard, fewer leads but high quality, a lot of data, loyal users, high drop-off during sign-up, not self-served
  • Frictionless Sign-up - simple, many leads but low quality, no data, low returning users rate, self-served
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5
Q

What are the types of fields and forms?

A

Fields:

  • core - necessary
  • custom - optional, too many will increase drop-off, but also loyality

Forms:

  • e-mail - newsletter
  • purchase - e-commerce (i.e. e-mail, payment options etc.)
  • subscription - for trial (i.e. phone, company name etc.)
  • service - configuring options (i.e. number of rooms in a booking)
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6
Q

What are common metrics for the Sign-up Flow?

A
  • Click-Through Rate = # people who completed the sign-up / # of total users who started the sign-up
  • Drop-Off Rate = 1 - CTR
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7
Q

How can you improve the Sign-up Flow?

A

By running experiments: [Action], so that [Result], because [Theory]

When running experiments, the impact on other teams has to be taken into consideration.
The success of an experiment is determined not only through the conversion metrics, but also by complementary ones (i.e. the technical reliability of the Result, and usage corner-cases)

The success of an experiment has to be measured through metrics (not only main metrics (not only principal but secondary metrics as well - e.g. errors that occurred)

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8
Q

How can you prioritize the experiments you want to do?

A

ICE = Impact, Confidence, Ease

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9
Q

What are the Growth steps when focusing on the Activation?

A
  • Intro to Activation (Setup, Aha, Habit)
  • % Overlap
  • Activation Funnel (segment analysis)
  • Create Experiments (increase conversion)
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10
Q

What is the Activation?

A
  • It’s a phase between Acquisition and Retention
  • It’s the moment in which the user gets the value they were expecting
  • It’s obtained by reducing the time till the “A-ha” moment
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11
Q

What are the steps of Activation?

A

Setup - Aha - Habit moments - are determined through intuition, depending on the type of the product and can consist of multiple steps

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12
Q

What’s the Setup moment?

A
  • It’s the moment when the user has completed all the needed settings in order to use the product.
  • It’s not Sign-up, it comes after
  • Common metrics: duration
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13
Q

What’s the A-ha moment and how it can be determined?

A
  • It’s the moment when the users feel the reward of using the product
  • It should be reached as soon as possible
  • It can be determined by identifying the action performed by the retained users and not by the churned
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14
Q

What’s the Habit moment and how it can be preserved?

A
  • It’s the moment after the A-ha

- It should be stimulated so that the users don’t give up (e.g. newsletters, rewards etc.

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15
Q

What is the % Overlap, wow do you calculate it, and how it can be used?

A

% Overlap = # of users (renained & performed X number of actions of a kind completed) / # of all users -> where X is the number of repetitions (i.e. # of visits, # of orders etc.)

  • This is used to determine when the users are Activated. For this, we have to first determine what actions are relevant to the product (i.e. submitting an order, visiting etc.) and how many repetitions were necessary. The highest % Overlap will give us the action and the repetitions.
  • after this moment, the user enters the Retention phase
  • The moment can be a mixture of Setup - Aha - Habit actions
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16
Q

How you can improve the Activation Funnel Flow?

A

There are three ways:

  1. improve the bad conversion delta between steps (setup, aha, habit) + analyze what might have caused poor conversion
  2. bring the aha moment sooner
  3. optimize for certain ICP (Ideal Customer Profiles) - those that perform well

Example:
Setup: 80% of all users
Setup-Aha Delta = 40/80% = 50%
Aha: 40% of all users

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17
Q

How can you segement the users during the Activation? How can you analyze these segments?

A
  • demographic
  • firmographic (license type, account size)
  • product usage (i.e. how advanced they are)

You can determine the conversion rate between each of the activation steps (setup, aha, habit) which you will further analyze, step by step, for each segment.

18
Q

How can you iterate on Acquisition based on the finding in Activation?

A

By analyzing Activation segments, you can see which ones are working well and which don’t and could be removed from the Acquisition. When deciding which segments to remove, first determine how profitable is that segment.

Total $ for a segment = (Average Selling Price - ASP) * (# users in that segment) * (% of users activated for that segment)

CAC = Customer Acquisition Cost
ASP = Average Salling Price
19
Q

How can you improve Activation?

A
  • Compare different user segments
  • Focus on bad deltas (conversion between steps) and try to understand the causes
  • Focus on good deltas (conversion between steps) and try to improve them
20
Q

What is LTV?

A

Lifetime Value = how much money will a customer bring you in a lifetime interval

21
Q

What is Retention and what are its different areas?

A

Retention refers to how many users continue to return in a timeframe.

The % of users that return in a timeframe.

  • Engagement Types (use-cases, frequency, features, intensity)
  • Engagement States (casual users, core users, power users)
  • Cohorts (measuring cohorts, retention curve)
  • Experiments (Retention Segment Analysis, Correlation vs. Causation)
22
Q

Why is Retention important?

A
  • It’s 5-25 times cheaper to retain a customer than to acquire one.
  • By increasing the retention by 5% you can determine an increase in revenue by over 25%
23
Q

What are the two elements that influence retention?

A
  • engagement = what keeps the customers

- churn = what scares the customer

24
Q

What are the elements that can increase engagement?

A
  • Use Cases
  • Frequency
  • Intensity
  • Features
25
Q

What are the engagement states and how you can determine them?

A

There are 3 types of engagement:

  • casual users
  • core users
  • power users
  1. We first have to determine “Core users” - this is determined theoretically (how it should be, not how users are actually interacting) by taking into consideration:
    - use cases (i.e. taking an online course)
    - frequency (i.e. WAU)
    - features (i.e. taking a quiz)
    - intensity (i.e. 1 hour / session)
  2. We determine “Casual” users and “Power” users by reasonable changing the “Core” user’s details (e.g. if a core user should spend 2 hours per week on Netflix, power users will be above that, while casual below)
26
Q

How do you increase use-cases?
- By creating more use cases, especially derived from those in the Activation funnel (Setup, Aha, Habit) - e.g. Spotify’s core feature is listening to music, derived features are playlists, radio etc.

A
27
Q

How do you increase frequencies?

A
  • Frequency (e.g. DAU, WAU, MAU) can be increased by adding more use-cases
28
Q

How do you increase features?

A
  • Features should be increased strategically, by analysing those that don’t back the main use-case and trying to increase their visibility (i.e. push notification, different colours etc.)
29
Q

How do you increase intensity?

A
  • Intensity (with a metric that is aligned to the main use case - e.g. time spent, # of actions, payed money) can be increased by removing the reasons for the user to leave after A-ha moment has been reached
  • Should be well though it increasing the intensity is something useful and appropriate for the product
30
Q

How can you increase engagement for “casual”?

A

Use-cases:
- We look for new use cases (i.e. “help button” etc.)

Frequency:
- We try to have them visit more often (i.e. newsletter, gamification etc.)

Features:
- We promote the features that unlock use cases (i.e. “ask a mentor”)

Intensity

  • First, determine if the increasing intensity is really needed (i.e. given the nature of the product, or if the intensity isn’t already good)
  • Determine the intensity metric (i.e. 1 hour/session) - in a theoretical session, what will the ideal user do? it can be actions, money, or time spent
31
Q

What is a Cohort?

A

A segment of users with common attributes which you can track over time in order to evaluate retention.

32
Q

How do you perform a cohort analysis?

A
  1. Choose the criteria? (Acquisition, Behaviour, Properties)
  2. Create a table with users matching the selected criteria
  3. Determine the percentage of retained users along the intervals

Details:

  • For each starting interval (e.g. 1st week, 2nd week) we only look at unique users that performed the action in that interval for the first time (e.g. users from 1st week won’t be counted in the 2nd)
  • Each track following the initial action is calculated relative to the origin interval (e.g. # of users still active after 2 weeks since they performed the action / # of users who performed the action in the origin interval)
33
Q

What are some types of Cohorts?

A
  • Acquisition (based on the timeframe when they completed an Acquisition action - i.e. a visit)
  • Behaviour (based on a specific in-product action - i.e. hit the like button)
  • Properties (based on user characteristics - i.e. lead source, job title etc.)

I.e. Users from Romania that completed 1 quiz/week.

  • “users from Romania” is the property
  • “1 quiz/week” is the behavior
  • “By week” is the acquisition segmentation
34
Q

How do you determine the retention rate?

A

By plotting the “Retention Chart” we can notice the “early retention”, “middle retention”, and “late retention”, when the graph starts to flatten (which is the actual retention rate of the product.

35
Q

How you can use the Retention Analysis to improve the product?

A
  1. Create an Activation Retention Cohort (all users that performed an acquisition action in a timeframe) in order to determine WHEN the users are leaving - and plot it
  2. Create different Cohorts based on Behavior and Properties for the same action and timeframe in order to determine WHY the users are leaving and plot them
  3. Analyze the plots and compare them, taking the Activation Cohort as baseline (reference) for the other, we will focus on those that are below the baseline
  4. Run experiments to determine which of the findings in (3) are causal or just correlation and, if causal, focus the experience on those (i.e. those properties, those behaviors)
36
Q

What is churn? Give some examples.

A

It’s the oposite of retention, it refers to customers not longer engaging with the product:

  • not renewing subscription
  • not extending license
  • deleting account
  • not returning
37
Q

What are some common metrics of churn?

A
  • # of customers lost (per week/month/year)
  • % of customers lost (per week/month/year)
  • $ revenue lost
38
Q

What is a dormant user?

A

A user that has become inactive. It isn’t yet considered a churned user and can be resurrected.

39
Q

What is a resurrected user?

A

It’s a dormant user that resumed using the product.

40
Q

What’s the lifecycle of a user and what are its stages?

A

new -> active -> retained -> dormant -> ressurected

Growth PM (3 decks)

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