Usually after completing a transaction, we can share a red envelope on social channels. The goals of sharing red envelopes are to attract new customers and promote activation. Here we only analyze around the goal of attracting new customers to make our analysis more focused.

1. Product Goals

The goal of acquiring new users is achieved by having old users share red envelopes on social networks to reach new users. In different periods, there are different definitions of "efficiency".

2. Metrics

Customer acquisition cost/average cost per order/conversion rate/number of new customers

Of course, after old users share the red envelopes, those who come to grab the red envelopes may be new users or old users. Since this article only discusses new users , readers can think about it afterwards. If the users who come to grab are old users, how should our strategy be designed?

Next, let’s look at how the strategy works in the three stages of reach, cognition, and conversion.

Growth Strategy Framework:

1. Reach

Definition: Where are the target users mainly located? How to find the target users? What is the quality of users in each channel?

Method: Continue to segment channels through technical means; determine how to circle and identify target user groups in different channels

2. Cognition

Definition: What means can the relevant channels use to influence users (including the means already provided by the channel and the means built by the platform); determine the utilization rate and conversion rate of the traffic by such means

Method: Continuously test the combination of different channels and means; when the product means include content, make more accurate content recommendations for different users.

3. Conversion

Definition: How much does it cost to bring about a conversion; what is the minimum cost and conversion rate for different users and different means of subsidies?

Method: Through continuous testing, users are continuously segmented and refined to determine the lowest cost of leveraging different users.

3. Reach

At this time, the reach channel is the old users who have completed the transaction . The channel quality we want to judge is the channel quality of the social circle of this old user. We need to see whether there are valuable users in the social circle of this old user and whether it is necessary to invest in new users.

How to perform a cold start? In fact, it is quite difficult. We don’t know what his social circle is like. We can only roughly assume that there is a certain correlation between the people in the old user’s social circle and his own characteristics.

1. Cold start

Through the historical consumption behavior and other characteristics of old users on the platform, we can judge their consumption level, interest tendencies, price sensitivity and other factors to obtain the channel quality as the cold start value of [the old user channel].

Once the strategy is running and data feedback is generated, subsequent iterations will be easy.

2. Self-circulation

Based on the subsequent user conversion situation, that is, the efficiency of this old user in bringing in new users and the performance of subsequent orders from new users, we will continue to optimize our judgment on this channel and decide whether to continue investing in it as an effective channel for attracting new users.

If there are many old users who continue to bring in new users, then for the old users, which characteristics are truly linked to the quality of their social circles and how they are linked, and which characteristics are not related to the quality of their social circles, this series of questions can also be continuously iterated.

4. Cognition

At this point, we need to consider what form and content of the red envelopes to give to users in the old user channels, whether it is a discount or cash, what means of transportation, taxi, express or designated driver, etc.

1. Cold start

A) Use the consumption level and interest tendency of old users as the cold start value of the user group to be reached, and determine the content of the red envelope

B) Set up multiple AB tests at the same time, and let users test the control effects of other contents

Why not set up AB test when running the channel?

Because in the channel link, all we need to judge is whether this old user has a target user, and whether the new user converted can bring value to the platform. This ability or not is a statistical problem of 0 or 1, and actually does not require comparative testing. If the number of converted users is large and of high quality, we just need to continue investing in this channel. If it does not bring in new users, then we just don't need to invest.

But in the cognitive stage, the content is different. We don’t know which type of content has a higher conversion efficiency. This is not a question of 0 or 1, but a question of 0.3 or 0.5. And there are many factors that affect the results, which may include competitors, weather, etc. So how can we know who is the 0.5 more efficiently? Conclusions can only be drawn by comparing small traffic volumes over the same time period.

2. Self-circulation

Continuously adjust content distribution according to the conversion rate after different coupons are received to achieve the best conversion rate, and use the relevant data as a new label for [this old user channel]

5. Conversion

1. Cold start

A) Use the price sensitivity of old users as the cold start value of the user group to reach, and decide the type and amount of the red envelope (full discount or cash coupon, and the amount/discount range)

B) Set up multiple AB tests at the same time to test the control effects of other types and amounts

2. Self-circulation

According to the conversion rate of different coupons after receiving them, the type and amount are constantly adjusted to achieve the best conversion rate or ROI. The relevant data is used as the new label of [this old user channel]

Source: Zhang Jin_lohas