How to grow up and to the right
Growth Hacker, User Acquisition Expert
Growth depends on two things: user acquisition and retention.
Hockey stick growth only matters if the users stick around.
Growth hacking started with entrepreneurs and gamers leveraging analytics & an engineering mindset.
Lesson: Scaling User Growth with Maud Pasturaud
Step #1 Curves: How to grow up and to the right
Growth is a very analytical, product-oriented approach to marketing. It came from the Silicon Valley and a lot of the gaming companies who put engineers in charge of growth, or data analysts. And so the challenge was, especially in gaming and in mobile, it's very hard to drive growth. It’s a lot of little things that you have to tweak and understand to really make the product bigger.
So an example, I think I would say that the best growth individuals come from gaming companies. When you look at Zynga and what makes the best sellers of Zynga, its Farmville. In Farmville, it had a specific mechanic and specific push notifications and how you're calling out your friends to invite and play with you. So this is all a process on how you optimize not only product, but how you leverage analytics to go and get more of those people and to get them even more engaged with the product. So I think it's a really good thing. It started there with the challenge of building really hard product that really needs those tactics and this mindset to now being what I believe is the default in marketing.
Today there's two areas in marketing. There’s brand and PR, talking about the story, talking about brand. And the rest of it is really the growth. It is from a custom acquisition perspective, from a lifestyle, or a life cycle perspective. How do you look at analytics to make better decisions. How do you leverage platforms to make better decisions. And it's not only looking about one thing and the other separately, it's looking at the whole funnel. So this is a change of mindset.
The reason why I got into growth is it's still a harder thing to do on mobile. You really have to look at the whole funnel, because it's the only way you're going to make the whole product work. If you look at a website, it's a bit different. Websites and a lot of big websites, the function of acquisition and the function of CRM are somewhat separate. But right now in mobile, it's so hard to get those users to discover you on the App Store, then sign up and then come back, that you really have to look at the whole funnel. And the best way to look at it, and the best way to understand it, and to do good things with it, is to be very analytical and leverage analytics as much as you can and do a bunch of experiments. So that's very product oriented as well.
It's this chart that everyone is obsessed with. You want to launch your product and it just grows exponentially and it doesn't stop there. So the concept behind growth is really to get to that. You want to get more and more users and we can talk about the different ways to do it later. But a lot of times if this user growth happens, and the users don't stick around, it doesn't make much sense. Your acquisition, and how you get those users to discover your product only matters if they stick around in the end.
You have to think about this hockey stick growth and you also have to look at a retention curve where it's at least maybe going down a bit in the first month or 30 days and you define that. Then the product the user joins your product, or uses your product. It needs to flatten out. If you have a retention curve that goes and meets the y line, then your product is going to be dead. You've got a bunch of users that didn't come back. That's the end of the story.
Those are the two really important concepts behind growth. How do you look for more users, get more users to use your product, and how do you make sure they stick around. They go together. Again, your business, if you have a bunch of users coming in and they're not sticking around, equals zero. And if you have a great retention curve, but you can't get more people to use your product, you're business is also going to suffer. So it makes sense to really think about both really hard.
User acquisition without retention equals a non-lasting business. So those are very important concepts and things to think about. You need to get to a point where you understand users who are discovering your product, you know how long they are going to stick around and what's going to be their behavior over time. You need to be able to project that they're going to come back as well.
The hockey stick growth is this assumption that you get more and more users on the platform and it never goes down. It's really important to bundle it with an asymptotic retention curve, which is that retention is going to go down at the beginning a bit, so users are excited, they're discovering a product. But over time, you need to make sure they're coming back. If the retention curve goes down, and down to zero, it means all of your users are going to be gone after a certain period of time. So it's important when you think about growth to think about those two curves and think about the two mechanics and two strategies that are going to help you reach both of them.