How to achieve user growth? 5 key points!

In the post- mobile Internet era, whether it is a mature enterprise or a start-up, from operations , marketing, products to CEOs, the most concerned indicator is user growth .

Students who work in operations and product development may say, we are immersed in typing code, making H5, thinking about creativity, and doing communication every day and cannot extricate ourselves. Isn’t it all for growth? Among the KPI indicators, aren’t UV, PV, DAU, and GMV all required to grow?

User growth is not just the growth of these individual indicators, but also focuses on long-term user growth, retention and even the value generated.

1. User Growth System

The concept of user growth came from the United States, and the current reference cases are also from abroad. They have designed a relatively reasonable model, which is the AARRR model in the figure below. From user acquisition, activation, and retention to increasing revenue and achieving viral spread , a closed loop is formed.

This is different from the users that operations and products acquire and activate by paying attention to an event.

So, what are the factors that affect user growth?

2. Factors that influence user growth: products, activities, data, and users

1. Products

Products are the lifeblood of user growth, and user growth requires long-term thinking and practice.

Some companies, especially start-ups, introduce a large number of users too early, before their products have been tested in the market. As a result, the products are simply unable to accommodate the influx of users, and users end up leaving disappointed. The damage caused to users in this way is actually permanent.

[Case Study] The tragedy behind the halo of a hotel’s special offer: a painful lesson from premature rapid growth

The "Hotel Specials" app was launched on September 21, 2011. At that time, they expected explosive growth as soon as it went online, but the actual situation was that the first six months were a huge tragedy. The APP reached the second place in the Apple APP Store ranking list on the second day after it was launched, surpassing QQ and Fruit Ninja, and gained great fame in the market.

Almost everyone on Weibo and in the TMT circle is discussing this app. Of course, there are also many people wondering why an app that is so ugly and stupid can get so much discussion.

Next, it was reported by more than 200 media outlets including CCTV, and was very successful in public opinion, instantly gaining millions of users. However, the performance at that time was 23 orders sold in one day, and a total profit of only 300 yuan.

Sometimes, there are hundreds of thousands of users pouring in every day, but there are only 10 orders, which is very bleak.

Its founder summarized the reasons for the failure:

1. At that time, mobile payment was not mature, but we insisted on only mobile prepayment. Users were unwilling or unable to pay, resulting in an extremely low payment success rate. Only 10 out of 200 orders were successfully paid.
2. Users feel that there are too few hotels, coverage is insufficient, and there are no hotels to stay in nearby.
3. We had no idea what users wanted (user needs), whether users would buy into our solutions (solutions), or whether we had the ability to offer the promised prices (our own capabilities). We just guessed.

2. Activities

Internet companies are very keen on using various creative content, red envelopes, etc. to attract new users or activate new customers. According to consumer psychology, there is nothing wrong with this, and an event will usually produce a good report card. However, after the event ends, user retention is low, which is still ineffective growth.

【Case】 Baidu Nuomi

Baidu Nuomi, backed by Baidu, did not win in the food delivery market despite having strong traffic and capital resources, and was even swallowed up.

Why?

The essence of the problem is that the merchant supply is insufficient and the gap with competitors is too large, which leads to the inability to continuously meet user needs, and naturally the platform transfer will occur.

Although a large amount of user growth has been achieved, without user retention and growth, it is still ineffective growth.

In the past two years, the subsidy war in the Internet industry has become increasingly fierce. Excessive subsidies will attract a large number of non- target users . These users come purely for the benefits and will not generate any retention.

Therefore, when operations and product managers are designing a new customer acquisition campaign, they must also pay attention to subsequent user retention.

3. Data

Every indicator we set must be quantifiable before it can be evaluated. For example, when we talk about user experience , this is not a quantifiable indicator. We can replace it with user retention rate and user rating, which is a quantifiable indicator, to measure whether what we are doing is effective.

4. Users

Since we are working on user growth, we naturally have to pay attention to user experience.

First of all, no matter what period, the indicators we focus on cannot harm the core value of users.

LinkedIn has a core principle: if a product affects the experience of non- paying users , then this feature is a bad feature, no matter how much money it makes for the company.

For example, some Internet companies use commercial revenue as their core indicator. In order to achieve the commercial revenue KPI, the product team will add more and more commercial content, even resulting in more advertising content than what users normally need; this greatly damages the user experience, and in the long run will lead to user loss , which will ultimately affect commercial revenue.

Second, focus on the value of core users.

You should know that in terms of retention rate , paying users have a higher retention rate than non-paying users; core users have a higher retention rate than non-core users, and sometimes core users are even free spokespersons for the brand .

In short: user growth is a method, not a technique, and it is worth exploring and digging into by the market, products, and operations.

3. How to increase user growth

1. User acquisition

With the rising cost of acquiring customers and the slowing growth of the Internet audience, it is extremely important for any company to acquire new users.

During the user acquisition phase, the first thing to do is to find the core channels for user growth. Marketers often mistakenly believe that running marketing campaigns simultaneously across a variety of channels is best for growth.

But the result is that resources are spread too thin, preventing teams from focusing on optimizing the one or two channels that might be most effective.

In fact, it only takes two steps to lock in the best channel for you: discovery and optimization.

For example: The core of the e-commerce model (2C type) is to attract as many potential consumers as possible to browse the website, so search advertising and search engine optimization are obviously key channels.

Once you have found a highly matched channel, you should strive to maximize the channel’s cost-effectiveness and influence while expanding its scale, and focus on optimizing those channels that have the highest cost-effectiveness for you.

2. User Activation

After finally attracting potential users, how do you activate them? The focus of stimulating activity is product details and product creativity.

First, we need to sort out all the nodes leading to the core of the product, record every step of the user's operation, find out the moments when the product makes the user's eyes shine, let new users experience the product highlights faster, truly discover the core value of the product, and turn early users into super users and ambassadors of the product.

Next, create a conversion funnel report. Regardless of the product, the key point is to track all key steps in the user journey before reaching the activation moment.

In addition to tracking conversion rates for key actions, reports should also track the paths or channels through which visitors came into contact with your product. Through the data, it is possible to find the differences between active users and users who have never been activated.

3. User retention

The replacement of old and new users of a product is inevitable, but the proportion of lost users and the changing trend can illustrate the product's ability to satisfy user needs and its competitiveness in the market. Program loopholes, constant push harassment, the decline in popularity of phenomenal products, and the emergence of other better competing products are often the main reasons for user loss.

You can decide how long the initial retention period of a product should be based on the product’s industry standards and your analysis of user behavior . The more value users get from a product in the early stages of retention, the more likely they are to use it long term.

In order to retain users, the role of the growth team is to ensure that the product continues to bring greater value to users. The team must experiment with various methods to continuously improve the product and help the product development team decide when to upgrade existing features or launch completely new features.

4. Monetization

In the Internet age, almost all products are designed for profit. As with other growth hacking techniques, the first step to cracking monetization is to analyze the data and identify the experiments with the most potential.

Each business model uses different strategies. After the growth team finds pages and features with high revenue-generating value on the product, website or app, they can start experimenting with ways to increase revenue.

Since users need to be divided into a large number of groups when analyzing user data and evaluating profit opportunities, and the focus is on the revenue contributed by each group, it is recommended to establish groups based on the level of revenue generated by users. Subscription services usually divide groups according to the tiers of the subscription plan. Find correlations between each group and benefits to help the team find ideas for experiments.

5. Viral Spread

What makes growth hacking different from general product operations is that growth hacking can enable products to achieve explosive viral spread, thereby bringing massive user growth.

And viral spread is based on social relationships. The two core indicators of viral transmission are the K factor (the degree to which a user spreads a product to others x the proportion of infected users converted into new users) and the viral cycle (the time it takes from a user sending a viral invitation to a new user completing the conversion). The K factor can be increased by inviting friends, increasing channels, optimizing landing pages to improve conversions, etc., while reducing operating costs and simplifying processes can shorten the cycle.

In addition to these methods, we must also make full use of users' psychological preferences, profit-seeking, reciprocity, seeking help, showing off, competing for scarce resources, fear of losing and missing out, and laziness.

The author of this article @尹为业 is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting!

Product promotion services: APP promotion services, advertising platform, Longyou Games