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The Art & Science of Growth Hacking
The document discusses the modern approaches to sales and marketing, emphasizing the importance of understanding customer needs and behavior in the sales funnel. It outlines strategies for effective growth hacking, funnel design, customer engagement, and retention, while suggesting that companies must evolve to meet the expectations of informed consumers. The text combines key concepts of metrics, buyer personas, and tactics for reducing churn to enhance business success.
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Discusses core concepts such as upsell, virality, engagement, freemium, and conversion rates.
Explores growth hacking for increased sales through effective funnel design and marketing roles.
Highlights how customer research and a strong online presence influence marketing today.
Communicates that products serve as sales tools and the importance of data in sales strategies.
Emphasizes the combination of marketing and technical skills required to analyze and optimize growth.
Introduces fundamentals of funnel design with emphasis on converting suspects to loyal customers.
Illustrates an ideal product marketing scenario emphasizing clear customer calls to action.
Discusses common buyer questions and how they shape the funnel design and marketing strategy.
Describes the buyer's journey from awareness to purchase and the processes involved in nurturing leads.
Identifies external triggers that drive customer decisions impacting funnel design and marketing.
Focuses on metrics for measuring customer engagement and the importance of actionable data.
Analyzes various metrics to assess conversion rates and the efficacy of lead sources.
Addresses the potential problems with sales capacity and strategies for improving recruitment.
Discusses methods for optimizing sales processes through coaching and understanding customer needs.
Highlights the significance of considering the customer’s perspective in funnel design.
Explores customer motivations and concerns that influence purchase decisions and marketing strategies.
Discusses methods for improving website traffic through search optimization and engaging content.
Communicates the concept that free trials can effectively showcase products to potential customers.
Encourages the removal of friction in customer onboarding processes to improve trial experiences.
Explains the need for identifying blockage points in the customer journey for better conversion.
Highlights the importance of tailoring marketing strategies to different buyer personas and communication.
Emphasizes the impact of churn on SaaS businesses and strategies for reducing customer loss.
Discusses how startups should market by emphasizing business value over features to engage customers.
Analyzes the importance of defining buyer personas to enhance marketing and sales efforts.
Provides a call to action to visit the blog for additional insights on sales and marketing.
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The Art & Science of Growth Hacking
- 1. BUILDING A SALES& MARKETING MACHINE Upsell/ Cross Sell CAC/LTV Virality Engagement Retention Freemium Conversion Rates BY DAVID SKOK Free Trials
- 2. THE ART &SCIENCE OF GROWTH HACKING Upsell/ Cross Sell CAC/LTV Virality Engagement Retention Freemium Conversion Rates BY DAVID SKOK Free Trials
- 3. GROWTH HACKING Accelerate Growth Through Workon Funnel A PERSONAL DEFINITION INCREASE FLOW & CONVERSION
- 4. THIS USED TOBE MARKETING’S JOB WHAT’S CHANGED?
- 5. TODAY’S WORLD • Freelyavailable information • Free Trials • On-line reviews • Social Media commentary THE CUSTOMER IS DOING THEIR RESEARCH BEFORE THEY COME AND TALK TO YOU
- 6.
- 7. THE PRODUCT IS YOURSALESPERSON
- 8. THERE’S A RICHFLOOD OF NEW DATA
- 9.
- 10. REQUIRES A NEW COMBINATIONOF SKILLS BOTH MARKETING AND TECHNICAL
- 11. Data Science THE GROWTH HACKER Creative Marketing Inbound Marketing Customer Experience& Product Design Funnel Optimization Instrumentation & Metrics
- 12. THE BASICSOF FUNNELDESIGN
- 13. Suspects Closed Deals Loyal Customers whoare Advocates
- 14. Suspects Closed Deals Loyal Customers whoare Advocates Virality
- 15. IN A PERFECTWORLD… 1 Step
- 16. IN A PERFECTWORLD… MyProduct.com HOW IT WORKS DESCRIPTION Our product allows you … BUY NOW! Only $9,999.99
- 17. BUYER THE QUESTIONS & CONCERNS •Will this solve my specific problem? • Is this the best product in the market? • Can I trust this vendor? • How hard is this to implement & use? • Is it a safe choice? (Who else is using it?) • Will I get a return on my investment? • Is it scalable, secure? • Etc.
- 18.
- 19. WHAT IS AFUNNEL? ACTION MOVEMENT ACTION MOVEMENT ACTION MOVEMENT
- 20. HOW DO WEDESIGN THE ACTIONS?
- 21.
- 22.
- 23. TRIGGERS • Moving house •Movers, phones, cable TV, furniture, insurance, etc. • Starting a new software project • PaaS (Platform as a Service), Dev Tools, etc. • Need to hire a lot of new employees • Applicant Tracking System • Just lost my data in hard drive crash • Backup software/service • Read about a new scary computer virus • Anti-virus software
- 24. Suspects ToFu Top of the Funnel MoFu Middleof the Funnel Closed Deals Sales Bottom of the Funnel Loyal Customers who are Advocates Customer Sucess Retention Funnel Retain Expand Upsell / Cross sell Nurture & Qualify Inbound & Outbound Marketing Typical B2B Funnel AWARENESS CONSIDERATION PURCHASE
- 25. Suspects ToFu Top of the Funnel RawLead Inbound & Outbound Marketing ToFu – Top of the Funnel AWARENESS Email address or other contact info
- 26. Suspects ToFu Top of the Funnel Inbound& Outbound Marketing ToFu – Top of the Funnel AWARENESS Latent Need? • Buyer not aware they have a need • Or not aware there is a solution Apparent Need? • Buyer is aware they have a need, and they are looking for a solution
- 27. Suspects ToFu Top of the Funnel Inbound& Outbound Marketing ToFu – Top of the Funnel AWARENESS Latent Need • Market needs Education Apparent Need • Understand how they are looking • Ensure you get found during their research
- 28. Suspects ToFu Top of the Funnel Inbound& Outbound Marketing ToFu – Top of the Funnel AWARENESS Inbound Marketing • Content Marketing • Blogging, YouTube, etc. • Social Media for distribution Outbound Marketing • Cold calling – (Sales Development Reps) • Outbound email • Working with Partners
- 29. MoFu Middle of the Funnel Nurture & Qualify MoFu– Middle of the Funnel CONSIDERATION Raw Lead MQL - Marketing Qualified Lead
- 30. MoFu – Nurtureand Qualify Nurture Qualify Lead Nurturing Database Raw Lead MQL
- 31. MoFu – Segment,Nurture & Qualify Personalized Nurturing QualifyRaw Lead MQL Segmented Database
- 32. What do weknow about them? Buyer Attributes What do their actions tell us? Behaviors DATA: THE CROWN JEWELS
- 33.
- 34. ENGAGEMENT / PRODUCTUSAGE SCREEN SHOT FROM TOTANGO
- 35. EXAMPLES OF USAGE: •IN APP MESSAGING – “We noticed that you haven’t tried X feature. It has the following benefits. Here is a link to a Video showing you how to use it.” • EMAIL – Send to all RAW LEADS that are in the FINANCE vertical, we have a Webinar showing how Customer X uses our product to do fraud detection. • SALESFORCE.COM QUEUES – Add all Trial Users whose Engagement Score is below 50 to the Customer Success Teams call queue
- 36. METRICS "IF YOU CANNOT MEASURE IT, YOU CAN NOT IMPROVE IT." - LORD KELVIN
- 37. METRICS FLOW /QUANTITY CONVERSION RATE
- 38. WHAT TO MEASURE FOREACH STEP / ACTION: NO OF ACTIONS % CONVERSION RATE TIME TIME
- 39. VISITORS CAMPAIGNS TO DRIVE TRAFFIC TRIALS CLOSED DEALS CONVERSION % CONVERSION % THEKEY METRICS OVERALL CONVERSION %
- 40. Visitors Trial 5% 10% $5,000 Customer NOT ALLLEAD SOURCES ARE EQUAL Google Ad Word Funnel FaceBook Ad Funnel Visitors Trial 2% 20% $8,000 Customer
- 41. ROI by LEADSOURCE OVERALL CONVERSION % (BY LEAD SOURCE) Cost per lead Lifetime value of the Customer
- 42.
- 43. Raw Lead Marketing Qualified Lead SalesAccepted Lead Opportunity Closed Deal FUNNEL MATH 20% 90% 25% 20% CONVERSION RATES
- 44. Raw Lead Marketing Qualified Lead SalesAccepted Lead Opportunity Closed Deal REVERSE FUNNEL MATH 20% 80% 25% 20% CONVERSION RATES Closed Deal1 Opportunity5 Sales Accepted Lead 20 Marketing Qualified Lead 25 Raw Lead125
- 45. SALES CAPACITY –A KEY PROBLEM • An extremely common scenario: – Portfolio companies miss their bookings by not having enough sales capacity 0 1 2 3 4 5 6 7 8 9 10 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Bookings Actual vs Budget Actual Budget Shortfall
- 46. SOLUTION • Track SalesCapacity as a key metric • Hire ahead of the budget and sales plan • Build a recruiting machine • Build a superb On-Boarding training program
- 47. REFINING THE SOLUTION •Become experts at Sales Coaching – Measure each step of the sale process • Outbound calling • Leaving messages • Doing Demos • Closing – Take the best at each stage and use to coach the worst • Quickly remove the consistent non-performers
- 48. BUT EVEN IFYOU ARE MICROSOFT, CISCO, ORACLE, OR GOOGLE YOUR FUNNEL WILL HAVE BLOCKAGE POINTS Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects Suspects
- 49. IN DIAGNOSING MANYFUNNEL BLOCKAGE POINTS, I HAVE FOUND THAT THERE IS A CLEAR PATTERN…
- 50. NOT MOTIVATED TODO THAT THEY ARE CUSTOMERS WILL DO SOMETHING YOU ARE HOPING YOUR
- 51. IN OTHER WORDS… YOUDESIGNED YOUR FUNNEL THE WAY YOU HOPED IT WOULD WORK… BUT YOU MAY NOT HAVE THOUGHT ENOUGH ABOUT THE CUSTOMER’S POINT OF VIEW
- 52. JBOSS EXAMPLE CUT THEDOWNLOAD RATE BY MORE THAN 10X PUT A REGISTRATION FORM ON THEIR WEB SITE BEFORE A FREE DOWNLOAD IMPACT
- 53. FRICTION GET INSIDE YOUR CUSTOMER’SHEAD CONCERNS
- 54.
- 55. JBOSS EXAMPLE • Making$27,000 a month selling documentation • Solution: • Give away documentation to get their email address
- 56. EXAMPLE: DRIVING TRAFFICTO YOUR WEB SITE GETTING FOUND Not going to find your site unless: - On top page of Google search results - Recommended by a trusted source - Referred to in social media or blogosphere friction & concerns
- 59. LESSONS FROM WEBSITE GRADER •Free tools drive viral spread • Low customer work required • High value delivered • Score leverages competitive urge, and acts as a trigger • Builds trust through clear demonstration of expertise
- 60. GOOD LINKAGE TONEXT STEP
- 61. using engineering formarketing GROWTH HACKING
- 62. USING DATA TODRIVE WEB TRAFFIC SYSOMOS: SOCIAL MEDIA MONITORING LEVERAGED THEIR DATABASE TO CREATE BLOG POSTS WITH DATA ON TOPICS OF CURRENT INTEREST: • IRAN ELECTION RIOTS • TWITTER’S GROWTH • FACEBOOK USAGE
- 64. LED TO: SYSOMOS ARTICLESIN ECONOMIST, NY TIMES WEB TRAFFIC TO READ THE FULL REPORT LEADS – IMPRESSED BY THE CAPABILITIES OF THE SOFTWARE
- 65. FREE TRIALS THE PRODUCTIS YOUR SALES PERSON
- 66. WHAT IS YOURTIME TO WOW! ? Thanks to Gail Goodman of Constant Contact WOW!
- 67. TIME TO WOW! •How many steps? • How much time does it take? • How much FRICTION is involved
- 68. REMOVE STEPS & REMOVEFRICTION e.g. Provide Sample Data instead of requiring them to load their own
- 69. WOW! ANALYZE TRIAL STEPSAS THOUGH THEY WERE FUNNEL STEPS Create a full profile Import Contacts Do a search for Prospects See search results Imagine a Sales Rep signing up for the old LinkedIn
- 70. WOW! LOOK FOR BLOCKAGEPOINTS Create a full profile Import Contacts Do custom search for Prospects See search results Imagine a Sales Rep signing up for the old LinkedIn HIGH FALL OFF RATES HERE
- 71. For an Outlook/ExchangeUser WOW!Create a full profile Import Contacts Do custom search for Prospects See search results Download an App Install the App Run the App
- 72. APPLY BLOCKAGE POINTTHINKING WOW! FRICTION MOTIVATION CONCERNS Replace the downloaded App with request for email credentials and get contacts from Exchange. Create a full profile Import Contacts Do a search for Prospects See search results
- 73. • Concern: – Ihave tons of very private and confidential emails. I don’t want anyone to read those. You want me to give you the password to login to my email?!!!
- 74. APPLY BLOCKAGE POINTTHINKING WOW! FRICTION MOTIVATION CONCERNS Replace the downloaded App by connecting to Contacts on iOS/Android Create a full profile Import Contacts Do a search for Prospects See search results
- 75. RE-THINK THE PROCESS Source:Josh Porter – Designing for Social Traction CONVENTIONAL APPROACH SIGN UP FOR TRIAL CONVERT TO CUSTOMER WOW! WOW! FIRST, REGISTER LATER WOW! SIGN UP CONVERT TO CUSTOMER
- 76. MAY VARY FOR DIFFERENT CUSTOMERTYPES E.g. LinkedIn • Different personae: – Recruiter – Sales person – Individual looking to find a job MAKE SURE THERE IS A CLEAR PATH FOR EACH ONE WOW!
- 77. A/B TESTING WEB SITE,LANDING PAGES, PRODUCT DESIGN
- 78. ADD VIRALITY Customer first sees yourapp Tries it Creates/sees information that they want to share Creates an invitation, looks up addresses, and sends Friend receives information + invite to join Friend decides to take a look
- 79. MEASURE FLOW &CONVERSION Customer first sees your app Tries it Creates/sees information that they want to share Creates an invitation, looks up addresses, and sends Friend receives information + invite to join Friend decides to take a look CONVERSION %
- 80. APPLY BLOCKAGE POINTANALYSIS Customer first sees your app Tries it Creates/sees information that they want to share Creates an invitation, looks up addresses, and sends Friend receives information + invite to join Friend decides to take a look
- 81. FOR MORE ONVIRALITY The Science behind Viral Marketing http://www.forentrepreneurs.com/the-science-behind-viral-marketing/
- 82. WHY CHURN ISSO IMPORTANT SaaS & RECURRING REVENUE
- 83. Revenue Lost with2.5% monthly Churn Renewals Lost due to Churn YEAR 3 $3m $7m Becomes harder & harder to replace this with new bookings Renewals Lost due to Churn YEAR 6 $30m $70m
- 84.
- 85. PROACTIVE STEPS TOREDUCE CHURN • Identify high risk customers (CHI score) – Messaging (In-App, email) to try to correct – Calls from Customer Success team
- 86. PRODUCT STICKINESS CONTRASTING EXAMPLES •SEO – High value in first 90 days – But not sticky • Marketing Automation – Valuable Data that grows over time – Part of important daily workflows
- 87. NEGATIVE CHURN INCREASED REVENUE FROM RETAINEDCUSTOMERS LOST REVENUE FROM CHURNED CUSTOMERS >
- 88. IMPACT OF NEGATIVECHURN MRR (Monthly Recurring Revenue) $- $1,000.0 $2,000.0 $3,000.0 $4,000.0 $5,000.0 $6,000.0 $7,000.0 $8,000.0 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58 5% Churn 0% Negative 5% Churn
- 89. REQUIRES PRICING THOUGHT Atleast one axis where pricing increases: Enterprise Edition Pro Edition Basic Users Features Depth of Usage Examples: - Mailing list size - Database size - Amount of storage used
- 90.
- 91. MOST STARTUPS MARKET AROUNDFEATURES
- 93. • Ensure theproduct delivers this value • Ideally in a measurable way • Focus Customer Success team on getting this result • Measure the increase/change from a baseline • Provide feedback on ROI by quarterly email WHAT IS YOUR BUSINESS VALUE?
- 94. BUYER THE THE KEYS TOSUCCESS GET INSIDE YOUR BUYER’S HEAD
- 95. BUYER PERSONA What characteristicmost clearly identifies this Persona? • Job role? • Looking for a particular type of product? When purchasing this kind of product: • What pain are they trying to solve? • What are their desired Business Outcomes? • What are their key Decision Criteria? • Is this buyer persona going to be receptive to our product? • If not, what would they be receptive to? • Feature changes • Competitive products • What are their Perceived Barriers to making a purchase?
- 96. BUYER PERSONA • Role/ job description? • What is the primary goal of this person’s job? • What is the greatest pain in this person’s work life? • What is their role in the decision making process? • Who do they report to? • How does their boss measure their success? • Who are their key influencers? • What publications do they read, & what events do they attend? • What messaging will appeal to them? Secondary Questions – useful for Messaging & Content Marketing
- 97. For More information •Visit my blog at www.forEntrepreneurs.com