How to achieve user growth? Share 4 new customer acquisition techniques!

In an era where traffic costs are rising, efficiently attracting new customers has become a common pain point for companies. Regardless of the "user fission" in the past or the "private traffic pool" that is currently popular in the circle of friends, the core must be user growth and retention. How to achieve user growth goals?

The pursuit of user growth is the core goal of business operations. From the initial stage of operation to the rapid growth stage, and then to the stable mature stage, attracting new customers runs through the entire life cycle of the product. If you fail to attract new customers, your product will lack users; without users, even the most sophisticated and perfect product will be meaningless.

• How long should you spend acquiring new users?
• When is the best time to start?
• How do you know if your actions are effective?
• What methods can achieve user growth faster and better?
• …

Gabriel Weinberg, a product operations expert and founder of YaYa Search, one of the top 100 websites in the world, surveyed operations managers from more than 40 successful companies and summarized four core thinking methods for attracting new customers, helping us to re-understand operations and user growth.

The 50% Rule of Product and Operations

If you're going to build a business, it means you can create a product. Almost all failed companies have their own products. What they lack is enough users.

Many companies focus all their attention on their products and ignore everything else. Some of these companies have created great products, but have not developed a good operating strategy. When they release new products and try to attract more users, the results are often lower than the company's expectations.

In his brilliant 1961 theory of the diffusion of innovations, Everett Rogers categorized users into five distinct groups of people who would develop relationships with new innovations over time.

Innovators: They are eager to experiment and are always focused on bold and adventurous new ideas.

Early adopters: have a burning problem to solve and are driven to action by that problem; they are willing to take risks and tolerate disruptive or unsuccessful solutions in order to achieve their core values.

Early majority: are very interested in the solution and will use it when they see a product gaining widespread acceptance in their social circles. For them, if the pain point becomes intense, conversion will occur.

Late majority: Resistant to risk, limited resources, waiting for social pressure before using.

Laggards: They always look backward, reject new things, and have no need to use new things.

Many years later, Geoffrey Moore popularized and expanded Rogers' model. Moore sells the reader a fascinating story: how he turned the Apple II, a hobbyist computer, into a mainstream consumer hit, that is, how he achieved the transition from crossing the "chasm" to mainstream success by making the transition from "early adopters" to the "early majority."

Many companies focus their attention on early users. They spend time designing products that early users want based on the needs expressed by early users. However, having a product or service that early adopters love but don’t have a clear way to improve it

How to increase the number of users is a big problem. To address this, you need to examine the channels through which you acquire users while designing your product or service.

In order to acquire new users, creating something that others want is certainly necessary, but it is not sufficient. There are four possible dilemmas you can run into: you can produce products that others want, but you can't keep your business alive.

First, there is a lack of sustainable profitability. You can produce something that people want, but you can't find a sustainable operating model and the amount of money isn't growing. For example, people don't pay on time, or operations don't allow you to break even. There is no real market at all.

Second, the market size is too small. You can produce something that people want, but not enough people will buy it to make you profitable. Often the market is too small and you can’t see a clear way to scale it up. This can happen if a company's initial ambitions are not broad enough and it chooses a particularly narrow market segment.

Third, the cost of acquiring customers is high. You can produce something that people want, but it costs a lot to make them remember your product. You will find yourself facing a market that is difficult to crack.

Fourth, homogeneous competition is severe. You can produce something that people want, but a lot of other companies are also producing it. In this situation, you will find yourself in a highly competitive market and it will be very difficult to acquire users.

To avoid these situations, you need to follow the "50% rule". User growth is as important as product development and should each take half of your attention. This is what we call the “50% rule”: spend 50% of your time on the product and the other 50% on acquiring new users.

If you follow the 50% rule from the beginning, you have a good chance of avoiding these traps; but if you don't, then you will most likely find yourself in the trap and no amount of effort will help. On the other hand, if you focus on increasing user growth from the beginning, you can quickly see whether you are on the right track.

Of course, allocating time equally between product and customer acquisition will definitely slow down the progress of product development. But there are many benefits to pursuing both products and new users at the same time.

First, it will guide you in developing the right product because you can learn about market demand from your efforts to acquire new users. If you have a solid product development process and have gotten good feedback from early users. But these users are often very close to you, so the opinions they give are what you want to hear.

By attracting new users, you have the opportunity to gain a stable base of new users. Through these people, you can truly understand whether the market accepts your product. If not, you will find out where the product is lacking or which parts of the process are wrong.

The second benefit of doing product development and customer acquisition simultaneously is that you can test different customer acquisition channels before launching anything. This means that once a product is developed, the company can grow rapidly.

The three stages of user growth

The focus of the new customer acquisition strategy should always be on gradually achieving user growth goals. You need to focus on operational activities that will have a tangible, demonstrable impact on your growth objectives. It must effectively achieve your goal of attracting users, rather than being a flash in the pan.

From the perspective of gaining user growth, you can work on it in three stages:

Phase 1: Create products or services that people want.

Stage 2: Promote products or services that people need.

Phase 3: Expand business scale.

If you think of early-stage investment in new customer acquisition as pouring water into a broken bucket. At first the bucket will keep leaking. Because your product cannot fully meet users' needs and solve their problems. In other words, the product does not have enough potential yet and many users do not want to try it. Therefore, most of the money you spend on driving user growth is leaking out of the bucket.

Stage one is when your barrel (product) has the most holes. In fact, it can't hold water at all. It may seem like a futile effort, but you still need to pour a small amount of water into the bucket so that you can see where the holes are and plug them. By testing your potential channels with a steady flow of new users, you’ll see if your product’s holes have been plugged after a period of time. If you have a sound product development strategy in place, you should see good results.

The process of improving products is the process of effectively plugging loopholes. When you complete phase two , you achieve product-market fit and consumers start to flock to you. Now you need to make a bigger effort in terms of potential energy: the bucket is no longer leaking. You are adjusting your company's positioning and operating methods.

In Stage 3 , you have developed a sound operating model and have established an important position in the market, while also pursuing the goals of further market capture and profit.

At different stages, you will find yourself working on different operations because as the company grows, it requires different growth targets at different stages. The goal of Phase One is to attract the first batch of users and prove that your product has potential. In phase two, you need more users to achieve sustainable development. In stage three, your focus should be on increasing revenue, expanding operating channels, and creating a truly sustainable operating model.

The Bullseye Framework for User Growth

You may have a dozen channels you can use to attract new customers, but it’s difficult to find the most suitable one. So we built a simple framework — the “bull’s eye” framework — that can help you find the channels that will bring you the greatest results.

Outer ring: A little possible

The first step in the Bullseye framework is to brainstorm and list all the channels that exist for acquiring new customers. If you want to promote offline, where is the best place? If you were giving a speech, who would be your ideal audience? Try to imagine what success would look like in each acquisition channel and write it on the outer ring of the bull’s eye.

Everyone initially has biases. The purpose of the outer loop is to help you systematically address biases about new customer acquisition channels. At this step, you cannot miss any channel. One should have an idea for each channel. You need to find the one from all the channels that looks good and has the potential to make a difference to your company's goals.

Middle ring: more likely

The second step in the bullseye framework is to conduct low-cost tests on the few channels that appear to be most effective. Take a look at what’s on the outer ring and move what you think is the best new customer acquisition channel to the middle ring. Design low-cost tests for each new customer acquisition channel in the middle ring to verify whether it is really effective. These tests must briefly answer the following three questions:

1. How much does it cost to attract users through this channel?
2. How many users can be attracted through this channel?
3. Are the users attracted through this channel the ones you need right now?

Inner Ring: The Stuff That Really Works

The third and final step in the Bullseye framework is to zero in on the channels that will drive growth for your company: your core acquisition channels. If all goes well, one of the channels you tested in the middle ring will produce extraordinary results. In this case, you should put all your energy and resources into this channel.

At any stage in a company’s life cycle, there will be one channel that dominates the number of users. It’s recommended to focus on one channel at a time, but only if you find one that really seems to be working.

The goal of this step is very simple: to squeeze all the potential energy of the core channel. To do this, you need to continually experiment to find ways to optimize user growth within this channel.

The original intention of designing "Bull's Eye" is to provide a direct way to make your new customer acquisition more targeted and maximize the results. Most importantly, it forces you to look at all of your acquisition channels more carefully than before.

3 principles for achieving new customer acquisition goals

Every company has a different development direction. There are always opportunities in front of you or about to appear. You often need to improve your products and services, and there are always background tasks to bother you. How do you decide what to do?

Setting growth targets

You should always have a clear growth goal to work towards. This goal could be 1,000 paying users, 100 new users per day, or 10% market share.

The right goals will be determined largely by your business. You must set your goals carefully so that they are consistent with your company's development strategy. Your goals must be precisely aligned with your company's performance. Maybe you can achieve greater profits, raise capital more easily, or become a market leader.

The importance of choosing the right growth target should also not be overstated. Are you looking to achieve growth, profitability, or something else? If you want to raise money in a few months, what kind of momentum do you need to make it happen? Answering these questions will help you set the right growth goals.

After determining the goal, you can take a step back and set clearer, quantified, and time-divided goals, such as attracting 1,000 users in the next quarter, or achieving a 20% monthly growth rate. Clear, small goals can give you a sense of accountability. By putting attraction activities, including product development and other major company events on a calendar, you can ensure that you devote enough time to them.

Identify key paths

The path that achieves your user growth goals with the fewest steps is the “critical path”. You want to list all the intermediate steps (milestones) along the way that lead to your final goal. These milestones may not necessarily be directly related to user growth, but are absolutely necessary to achieve the goal.

The milestones you set will be different in your company, and the key is to be critical and strategic in making decisions. That is why it is called the "critical road". For example, you might decide that to achieve your growth goals you need to hire three people to integrate features A, B, and C into the product while also performing operational activities X, Y, and Z. These are the milestones that will lead you to your destination.

Do you really need feature C or activity Y? This is where entrepreneurs often make a mistake: they spend their limited resources on things other than the “critical path.” Another problem is that the milestones you set initially are usually wrong. For example, you think you need features A, B, and C to achieve your growth goals, but after you have A, you discover from market feedback that you can skip B and go straight to C. Therefore, it is necessary to conduct a careful re-evaluation after each event is completed. The best way to make sure you are not wasting resources is to re-evaluate each step on the "critical path".

In other words, the Critical Path is a framework that helps you decide what not to do. Everything you decide to do should be put to the test on this path. Every activity should fall within this framework, or don’t do it.

Overcoming prejudice

The original intention of designing "Bull's Eye" is to help you find the most suitable new channel strategy as quickly as possible. Unfortunately, many entrepreneurs fail to implement this framework because they ignore many promising new customer acquisition channels due to their subconscious biases. . Creation

There are three main reasons why businesses ignore potentially profitable new customer acquisition channels:

1. It is not within their vision and thinking. Companies often don’t consider engaging in channels like speaking engagements because it’s outside the scope of their original vision.

2. Some entrepreneurs are unwilling to seriously consider channels that they believe are not good enough, such as marketing or distribution. Just because you don’t like it doesn’t mean your users think so too.

3. A bias against things that seem boring and a waste of time. Channels such as business development and conferences are often subject to this bias.

Be honest with yourself: Which new customer acquisition channels are you currently for or against? You can overcome these biases and increase your chances of success by taking each channel seriously when applying the bullseye.

There is no product that does not need to attract new customers. As a qualified operator, how can you maintain efficient new user acquisition capabilities while reducing user acquisition costs? Be sure to try a variety of new customer acquisition strategies. Don’t just consider the channels you’re familiar with; the channels with the lowest utilization rates in an industry often perform best.

The ability to attract new customers can be continuously enhanced. The sole goal of a startup is to grow quickly. Achieving user growth means doing your best to move the growth curve to the upper right.

Related reading:

1. APP promotion and operation: How to maximize the effect of your activities?

2. APP promotion planning: 60,000 paying users increased within 7 days of beta testing!

3. APP promotion activities: How to plan a screen-sweeping event?

4. A complete list of APP promotion methods in 2019, take it and don’t thank me!

5. How to carry out APP promotion and marketing? What are the common methods?

6. APP promotion case: How to go from 0 to millions of users?

By Gabriel Weinberg

This article is excerpted from the book "New Customers: Rapid User Growth" published by CITIC Press