Archives for July 2018

July 31, 2018 - 2 comments

Stay the f*ck away from growth tactics

While rookies use tactics, pros use processes

So, let’s get started!

You’ve probably been hearing for tactics. People are talking about tactics, everywhere.

“I learned this great hack where you can get thousands of emails.”

“Let’s do CRO to our landing pages.”

“Let’s A/B test our website buttons.”

“I heard Lead Nurturing and Lead Magnets are awesome.”

“Let’s add a referral option to our app and go viral.”

That's all really nice and attractive. Who doesn't want to grow exponentially?

But with all those growth tactics available, how come that 75% of venture-backed startups fail?

Well, having a bunch of screws, bolts and tools doesn't build a machine.

First, you have to find your process- a schematic if you prefer, and then identify which tactics might work in your favor.

Probably most of the content you find about growth is wrong because most of the content is about tactics. 😵

“Stop looking for tactics first, and start focusing on establishing a growth process.” — Brian Balfour

Brian Balfour is mostly famous about being Founder/CEO @ Reforge and Previously VP Growth @ HubSpot. He occasionally writes here. You’ll find great stuff in there.

Another great individual to follow is Sean Ellis, he’s the Founder and CEO of GrowthHackers.com. Before that, he led early growth strategy at Dropbox, Lookout, Eventbrite, LogMeIn (launch to IPO), Uproar (launch to IPO).

Sean talked about high tempo testing.

“We grew from 90,000 MAU to 152,000 MAU in about eleven weeks without spending a dollar on advertising or increasing the size of our growth team.” — Sean Ellis

The more tests you run, the more you learn about how to grow your company. So the goal here is to run as many tests per period of time as possible.

That’s the main idea behind high tempo testing.

Test.Learn.Repeat. 🚀

Growth is about running experiments, analyzing results, and learning quickly. And for this, you really need two things:

  1. A method for running experiments
  2. A system for tracking and reporting

By running an A/B test once a month doesn’t count! You need a process, a tempo.

Keep the same tempo for every team member over there!

What we do in Viral Loops

We read a lot.

We test a lot.

We (try to) systemize everything.

We repeat.

We’ve built a weekly process which helps us have everything documented and in order. The truth is that growth is the sum of small parts, there is never a silver bullet.

You can grow by putting effort into many small things and not in a few big. That’s how you’ll learn your channel, product, and customers better than your competitors and this will help you take risks based on those learnings.

Learnings are everything.

Failed experiments liver-punched me enough times to make want to quit. But the shock was an indicator that my team was doing something in a very wrong way.

Keeping a tight documentation about your learnings will save you a ton of time if you aim to grow your team anytime in the future.

Imagine having to teach all the past failures to every new team member. Nightmare.

Your fails should be accessible company-wide, at any moment. It makes it easier to draw the big picture.

“The only way to tackle growth is to get the whole company focused on it” — Sean Ellis

We try to systemize our process for testing and learning in order to keep a tempo.

 

1. Brainstorm

We keep our ideas in a backlog and try to put everyone one on the team to contribute their ideas. It doesn’t matter what their day to day job is. Growth needs to become everyone’s job.

You can use spreadsheets or any project management tools to keep these precious ideas in one place.

2. Prioritise

We categorize our backlog of ideas by using the AARRR framework (Acquisition, Activation, Retention, Referrals, Revenue). Then we give every idea a score from 1 to 10 by using the “ICE” system. ICE stands for Impact, Confidence, and Ease of execution:

Impact. If this idea works, how much impact will it have?

Confidence. How confident are you that this idea will work?

Ease. Is this idea something that will be easy to test?

e.g.

 

Let's say we have an idea with the following individual scores:

Impact: 9/10

Confidence: 5/10

Ease: 7/10

The final ICE score of the idea is simply the sum of the individual score, divided by 3.

This gives our idea an ICE score of 7. The higher the ICE score of an idea, the higher it's priority.

3. Test

After picking the top ideas to run based on our prioritization, we have to think of a hypothesis and move these ideas to the upcoming tests list. Try to run simple tests.

4. Implement

Upcoming tests are moved to the to-do list and it’s time for implementation. A test might need skills from more than one team member; that’s why we try to work as a team here. 😎

5. Analyse

Once the test has finished, write down the results. Did the experiment change the situation upwards? Or downwards? Did it work or not?

Be cautious. This part might be your "getting liver-punched" arc.

Don't get frustrated.

6. Systemise

This is the point where learnings are born. Write down what you’ve learned, how important it was and how it affects your company and your team.

The main goal is to get learnings at a high tempo. The more testing you do, the more learnings you’ll have. But the key is to share those learnings with the rest of your team.

As I said, we like to keep everything documented. We write down our learnings on a weekly basis (Weekly Learnings doc). Also, we keep track of some basic metrics in the AARRR funnel (Weekly Metrics Spreadsheet). The documents we’re using are the ones below.

We couldn’t be organized without using

  • GrowthHackers Projects to track our experiments
  • Google Docs and Notion to have all our docs in one place
  • Trello and Asana to write down tasks and experiment ideas
  • Slack for team communication. (sometimes we work remotely)

Delivering value to customers is so damn important

When you’re focused on growth, sometimes you get caught up in the data, but be careful, you might lose your path.

Your path is your customers.

If you keep your customers at the top of your priorities and you continuously deliver value to them, growth will follow.

Everything you build has to be for your customers.

Happy customers are the real key to growth ❤

Generate ideas. Run experiments. Learn. Repeat.

If you run out of ideas, always remember:

Cheers 🙂

Note: Puggy recently started spreading her knowledge on Referral Marketing, so 👉 Push the "Send to Messenger" button below to grab her exclusive content 🐶

July 25, 2018 - No Comments!

Announcing the Viral Loops Story for Shopify

Your audience already spreads the word about you by sharing your content or simply talking about you to their friends and family. You can now build and expand on that by giving clear incentives to your customers and prospects to promote your brand.

Enter the Viral Loops Story for Shopify increase your word of mouth sales and build a strong brand.

Anyone has the ability to become an ambassador for your business, even if they haven’t purchased anything yet.

By plugging Viral Loops into your Shopify ecommerce store, your brand ambassadors... are able to spread the word about your business and get rewarded for helping you build your brand.

Ambassadors win for every sale they refer as they get discount coupon codes they can use for their next purchase. The coupon codes are automatically generated and sent via email.

The best part is that zero maintenance is required!

But your marketing efforts shouldn’t stop there.

As you’re building your brand, the growth of your audience, is of high importance too. Reward your ambassadors for all the email subscribers they bring to your newsletter.

With the Viral Loops Story for Shopify, you can set-up several milestones with different rewards for subscriber growth and offer unique rewards to your ambassadors as they refer their friends and reach those milestones.

If you aim for your online store to never stop improving, we promise that your referral campaigns won’t as well.

That's the reason Viral Loops as a product takes the "Story" approach, leaving behind the outdated concept of templates.

You see, a template is simply some part of that strategy (eg. a milestone referral campaign for getting more email subscribers), and Viral Loops Stories aims to be much more than that.

A story is a complete word-of-mouth marketing strategy for your use case (“Grow your ecommerce store with an ambassador campaign”) and each story comes with several chapters.

Each chapter acts as specific part of your marketing strategy and you can “deploy” them as you see fit and when it’s the right time.

For example, there’s a chapter dedicated to building an email list, which will allow you to bring more sales, but also a chapter dedicated to getting more sales with word-of-mouth.

We thought your marketing never stops and you need to keep things fresh for your potential and existing customers otherwise, they’d stop engaging with your referral campaign.

Stories help you with that because you always know what to do next, the next thing that will keep everyone excited and engaged.

So, the Viral Loops Story for Shopify is ever-evolving and you will get suggestions for improvements and future actions, just in time to keep your campaign fresh and your audience engaged.

We strive for your thrive.

Prepare to go “Cha-Ching” 💸💰

 

July 17, 2018 - 1 comment.

How Referral Marketing will increase your ecommerce sales

When buying a new car, what’s the first thing you do? 🚗

If you’re like the vast majority of consumers, you talk to friends and family. 👨‍👩‍👧‍👦

Even if those close to you aren’t car experts, you’ll likely ask them which brands to buy and avoid.

Why?

Because you trust their opinions.

How do we know?

A recent study found that 82% of surveyed individuals said they consult friends and family before making a purchase.

82%!

That means more people seek out a referral than drink water daily. 🚰

As an e-Commerce retailer, this research should stop you in your tracks 🛑 and prompt you to evaluate your referral marketing strategy.

After all, missed referrals mean missed $$$. 💸💸💸

Don’t have a referral marketing strategy?

Grab a cup of coffee (or better yet, a glass of H2O). You’re in for a great read packed with tips to get your customers talking and, more importantly, referring new customers.

Reduce Bounce, Increase Cha-Ching

An effective e-commerce referral marketing strategy gets people to your site and turns those visitors into buyers, and then into ambassadors.

When your customers’ nearest and dearest receive an email singing your company’s praises (and then those loved ones click through your site), web traffic increases.

And that referred traffic…

Research suggests that referred individuals are substantially more likely to make a purchase than those who happen upon your site. In fact, consumers are four times more likely to 💰 buy something 💰 when a friend recommends it.

If you’re not already using referral marketing for your ecommerce, ask yourself:

“Why am I not doing something I know would increase the likelihood of customer purchases by a whopping four times?”

Dangle that Carrot

With numerous independent studies supporting the positive impact referral marketing communications have on buying behavior, can we agree on the importance of encouraging your customers to refer your products and/or services?

Good. Then let’s discuss the “how” of your referral marketing plan.

One word—incentivise.

Some might argue that you simply create a wonderful product and customer experience and the word will get out naturally.

Frankly...that only gets you part of the way.

Even when they’ve had positive online experiences, only 58% of consumers are likely to talk about them online.

That’s where referral marketing comes in—a means to incentivize customers to blab about their amazing interactions with your business.

Just like a horse will do almost anything to get the carrot, customers are motivated by discounts, bonus gifts, VIP access or any number of perks that can come from simply delivering a complimentary tweet or referral email.

Powerful and well-planned referral marketing provides the carrot 🥕, or incentive, for happy-as-a-clam customers to shout their satisfaction from the mountain tops (or, at least, tweet it—’cause we all know mountain climbing is tough).

The key🗝️ is to implement an on-brand (dare I say, brilliant) referral marketing campaign. You can’t simply say, “Hey, tell your former college roommate about us, and we’ll give you $1 off your next purchase.”

Why not?

Consumers will make judgments about the quality of your referral marketing programme based heavily on what you’re offering as an incentive. And if the incentive is too meager, they’ll likely forego participating altogether.

Find Proof in the Payout

Along with Gilt, Airbnb, and Robinhood, the roster of businesses using referral marketing is overflowing with success stories.

Thanks to the inherent flexibility of referral marketing as a means of advertising, each company was able to prepare and implement a programme tailored to their products, their needs, and their customer base. Here are a few examples:

Paypal

Though now a household name, Elon Musk’s Paypal was once unknown. One secret to their growth? A strong referral marketing program that grew customer base from zero to 100,000 in just one month. 📅

And what more appropriate way for a company named PAYpal to incentivize than with cold, hard cash?

Paypal’s programme of choice was simple. Sign up for Paypal, and you get $20. 💵  Refer a friend who signs up; get another $20. 💵  

All told, the programme cost the company $60 million.

The company today, however, is valued by experts at $49.6 billion dollars.🤑 🤑

I guess Paypal’s risk has paid off.

Erin Condren

The drug of choice for consumers who’ve craved organization, ErinCondren.com, grew from obscurity to a $40 million valuation in 10 years.

Capitalising off the close-knit community of stationery lovers ✉️ and organic word-of-mouth has always been part of the Erin Condren growth model.

So adding a referral marketing program designed to amplify their social growth was a perfect and profitable fit.

ErinCondren.com customers take advantage of an ongoing referral program offering rewards to both the referrer and the referred. When a customer refers a friend, the friend receives a $10 discount offer.

If the friend makes a purchase, the referrer also receives a $10 voucher. Because users can refer as many friends as they want, devotees to the customized planners offered on the site can email their way to discounted and free products.

Amazon Prime

Everyone loves free, two-day shipping. 📦

But not everyone loved the $79 price tag when the service launched in 2005.

Despite the fact that Amazon.com boasted approximately 200 million users in 2012 — 7 years after the launch of Prime — the company had secured only 25 million paid Prime users.

To get customers over the sticker shock of this annual membership cost and induce more people to give Prime a go, Amazon turned to referral marketing.

Following the fall 2014 launch of Prime’s referral program in which referrers earn credits to spend on Amazon.com, the Prime membership count lept.

It continued to climb, more than tripling to 90 million subscribers by September of 2017.

Reap Returns on Investments in Referral Marketing

Money invested in referral marketing provides a more significant return than investing the same amount of money in traditional advertising, suggests research.

According to a Boston Consulting Group study, consumers trusted word of mouth anywhere from two to 10 times as much as traditional advertising. 🤝

Make your customers' top-notch experiences work for you. Define your company's referral carrot, then dangle it proudly for your consumers to covet.

Next, you can try our e-Commerce template (inspired by Gilt), and if you're a Shopify user you can run a Milestone Referral campaign, similar to the one we run for our ambassador program.

Finally, sit back and watch as the referrals (and dollars) roll in.

Note: Puggy recently started spreading her knowledge on Referral Marketing, so 👉 Push the "Send to Messenger" button below to grab her exclusive content 🐶

July 3, 2018 - No Comments!

How Airbnb’s Referral Program Built a Billion $ Growth Formula

Remember when people first started using “google” as a verb?

It’s every startup’s dream—beyond making lots and lots of money, of course.

It’s the arrival. The moment when there’s a universal acceptance that your company as the go-to provider of a product or service…so much so, that people now use your brand as generic noun or verb.

Pass the Kleenex. Xerox a copy. Relax in the jacuzzi. Enjoy fish and chips with a coke.

And now...paying to stay overnight in a neighborhood flat or borrowing a local family’s rollaway bed while you travel...you’re airbnbing.  

So how did this scrappy, born-out-of-necessity, startup make their claim to fame?

For starters, they had a great idea. But everybody’s got an idea, right? What brought Airbnb to billion-dollar status was how they grew that idea, that is, how they increased their number of guest arrivals from 21,000 in 2009 to 80,000,000 in 2016. 😲

It was its well-timed and well-implemented referral marketing program.

Let’s talk about how they did it.

How Airbnb Built a Billion $ Growth Formula

Let your customers do the convincing

So you’ve got a new product, but the world is not knocking down your door to download your app or use your service?

Well, you’re not alone.

Not everyone wants to be an early adopter, and that was certainly the case for Airbnb.

What’s more, when Airbnb launched their service model, they were met with concerns—travels and hosts alike worried if they could trust a stranger.

Jumping that hurdle began with this fundamental insight: a whopping 92 percent of people say that they find recommendations from a peer more compelling than advertising.

We know how powerful word-of-mouth advertising is when used to sell any product or service. But for the services Airbnb offers, the power of a word-of-mouth was be even more critical for accelerating growth.

By building a refer-a-friend-like program that gave experienced customers the mic—along with background checks and a hefty insurance policy—Airbnb could reduce (if not eliminate) those fears, making travelers and their hosts more travel-ready.

Current customers became the trusted brand advocates new customers really want and need to hear from.

As Jason Bosinoff, Airbnb engineering manager, said in an article for Medium, “Airbnb experiences are so personal. People use Airbnb to unlock incredible experiences — anything from weekend getaways with friends, cultural exchanges, and once-in-a-lifetime events like honeymoons.”

And the referral approach is just that...personal.

Go big…and go home

When starting a referral program, everyone has the same question: What will entice people to sign on, sign up and most importantly, to refer others to do the same?

For Airbnb, the answer was simple.

Experiences. 🗽 🌉 🗼

They wanted to build a database of world travelers, ready to rent apartments, rooms, and homes the around the globe.

So the home-sharing company incentivized would-be travelers offering travel credits—$25 when a referred friend rented from Airbnb and $75 when a referred friend listed his or her property for rent on the site.

What’s particularly advantageous about this referral tactic is that Airbnb can detract swag hunters simply looking to collect loot or swag and instead, increase referrals of people who would actually travel. ✈🚆 🚁 🚍 

How Airbnb Built a Billion $ Growth Formula

Travelers who participate in the program can earn up to $5000 worth of lodging fees they can use to try out the service. 💰 🤑 💰

That’s certainly enough to pay for lots of mini-breaks weekends. 🚗 🏘

It’s up to the traveler to decide whether to spend these credits as they are earned, or save them up and use all at once.

Sounds really awesome to a traveler, doesn’t it?

For Airbnb, however, the approach was a little risky.

Here’s why...

To offer these travel incentives, Airbnb had to open up their wallet and pay some cold-hard-cash. When a traveler got a credit for accommodations, Airbnb still had to pay the host.

With this double-sided reward model, Airbnb was (and still is) putting their money where their mouth is betting that once customers try their service, they’ll return. Otherwise, Airbnb is just tossing money out the window.

If you’re confident in your product or service model — as Airbnb was — taking this sort risk just might be worth it, as the reward can be so sweet.

BTW if you want to build a referral program similar to Airbnb, we have a video tutorial about it:

Know your bullseye and keep score

Before you launch a referral program, you need to set a realistic goal and identify metrics that you’ll use to measure success or failure.

How Airbnb Built a Billion $ Growth Formula

Airbnb made sure they were aiming at a reasonable target by first running a closed beta test of its referral program.

To start, Airbnb offers the travel credit incentives for referral only to their existing 2,161 existing members.

The result? 2,107 new members joined, this nearly 1:1 growth ratio was a clear indication that this program would be a likely success.

From there, Airbnb identified six specific metrics to track, including:

  • Number of monthly active users sending invites
  • Number of invites per inviter
  • Conversion rate to new user
  • Conversion rate to new guest
  • Conversion rate to new host
  • Revenue impact potential

They looked at their growth in these areas historically (before the referral program) to see what they could reasonably expect from this program.

The results determined that the Airbnb team could expect their numbers in these categories to increase anywhere from 20 to 90 times their current standings.

This range provided a way to decide if the live referral program was successful in their attempts at bolstering their business through referral.

To see how their actual performance measured against their projection, Airbnb tracked growth every step, A/B testing new content and landing pages and using customized dashboards to make the information accessible.

And Airbnbers surely delighted in watching the numbers climb, as we know now exactly how successful this effort proved to be.

Ultimately, what Airbnb is trying to do is build a community of travel-loving followers. And their referral program is only one of the ways they are making “airbnbing” a choice preferable to booking some boring old hotel room.