Looking at user growth from the perspective of the AARRR model

User growth is a proposition that Internet products can never escape, but we cannot unilaterally understand user growth as an increase in the number of users. Attracting new users is only a part of user growth. Even if the number of new users is large, if the product does not provide corresponding value, users will quickly leave. This is not real user growth.

In this article, the author uses the AARRR model to explain the specific process of user growth to help everyone better understand user growth.

1. Acquisition

1. Identify target users

Before we officially invest resources to attract new users, we should first identify our target users.

Targeting users can be considered from two aspects: demographic attributes and user needs:

• Demographic attributes include age, region, gender, income, consumption level, occupation, etc.
• User needs are very diverse, such as entertainment, learning knowledge, collecting information, etc. For example, Douyin's initial target users are young people who pursue fashion trends in first- and second-tier cities.

Of course, we also need to look at who the target users of competing products in the market are. If the scale of competing products is already relatively large, we should make certain differentiation in target users.

2. Determine the acquisition method

After completing the positioning of target users, we can determine the method of acquiring users. User acquisition methods can be divided into third-party channels, event promotion, social fission, content promotion and other methods.

1) Third-party channels include app stores, ad networks, SEM, mobile phone pre-installation, joint promotion and other channels. In this way, we need to pay attention to the quality and quantity of users acquired through different channels? Is it accurate? What is the ROI? Continuously adjust channel investment and combination based on data to refine customer acquisition.

2) The method of content promotion is mainly to choose a content platform suitable for promoting products, and use content to attract users to pay attention to the products, such as posting soft articles on WeChat official accounts, Xiaohongshu, and Zhihu, and posting short videos on Douyin and Kuaishou; the delivery method can be cooperation with big Vs, self-operated accounts, information flow advertising, etc.

There are three points to note when promoting content:

• The content should highlight the product highlights to attract users to click;
• The content should be appropriately adjusted according to the platform's product tone to avoid causing user disgust;
• The content can be appropriately combined with hot topics to gain more popularity.

3) Event promotion is a means of attracting users to use products by holding events. The following points should be noted when holding events:

• The activity process should be smooth enough and continuously optimized through the funnel model;
• Activity incentives should include material incentives and spiritual incentives. Material incentives can include physical goods, red envelopes, vouchers, memberships, virtual props and other rewards; spiritual incentives mainly use users' psychological factors to promote user participation in activities. For example, limited edition cultural and creative products use users' sense of scarcity and desire to show off, red envelope rebates use users' desire to get a small bargain, and honorary certificates use users' desire to seek a sense of recognition and respect.
• Consider the input-output ratio of the activity, the budget, the estimated number of users that can be acquired, and the duration of the activity.

4) Social fission encourages users to spread products to their own relationship chains to acquire new users, and the customer acquisition cost is generally low, and the quality of users and their trust in the product are generally high; the incentive method can be red envelope rebates, virtual currency that can be exchanged for items or cash, participation in lotteries, special benefits, vouchers, etc.; Qutoutiao, which has emerged in recent years, targets the mentality of users in the sinking market who are greedy for small profits. It can earn cash by attracting new users, and has accumulated hundreds of millions of users in just a few years. Against the backdrop of increasingly high channel customer acquisition costs, social fission has become the best means of acquiring customers for new products.

In addition to these ways of attracting new customers, it is also very important for us to understand user needs, continuously optimize the user experience of our products, cultivate user reputation for our products, and achieve self-propagation of our products. Only truly excellent products can retain users.

2. User Activation

User activation mainly refers to guiding users to complete the critical path of the product, which will lead to two problems: How to define the critical path of the product? How to guide users through the product’s critical path?

1. Define the critical path

The critical path will vary greatly depending on the product attributes. For example, the critical path of Bilibili is watching videos, and the critical path of Facebook is adding friends and interacting with them. But we still need to further refine the critical path. How many videos should we watch? What is the total duration? How long will it take to complete? How many friends do you want to add? How many interactions are needed? These are all things we need to consider.

The definition of the critical path cannot be decided on a whim. We should optimize the critical path based on feedback from user data. For example, if the user retention rate of completing path A in the test is higher than the user retention rate of completing path B, then path A may be more suitable as the critical path.

We need to first screen out user behaviors that can serve as critical paths, then test them one by one, determine the critical path through user data feedback, and guide users to complete the critical path.

2. Optimize product flow

When users first enter the product, they still lack awareness of the product, so concise and clear guidance and short and smooth product processes are very important; starting from the product startup page to the user registration process and the usage process, we need to shorten the user operation steps as much as possible; after all, every additional step means more loss, and too many steps will also cause user boredom.

At the same time, we also need to let users feel the value of the product as soon as possible, such as Bilibili’s must-see entry and KEEP’s training plan; there is a term in growth hacking called Aha moment, which refers to the user’s pleasure point. We need to touch the user’s pleasure point in the shortest possible time so that users are likely to stay.

Incentivize user behavior:

We can use incentives to push users to complete key paths, such as receiving coupons after completing registration, collecting points after watching 10 videos, and redeeming items in the points mall when the points accumulate to a certain value; Pinduoduo guides users to complete a shopping trip through subsidies, etc. Reasonable incentives can make users stay in the product temporarily, and then use the product value to make users really willing to stay.

3. User Retention

Ways to retain users include establishing a user growth system, event operations, and PUSH.

1. User growth system

The user growth system reflects the product's expectations and appropriate guidance for user behavior, and provides certain incentives for user behaviors that are beneficial to the product; while harmful behaviors are punished accordingly. At the same time, the user growth system can increase user stickiness and improve user retention rate.

Common user growth systems include point systems, level systems, membership systems, medal systems, etc. We can flexibly design user growth systems based on product characteristics.

2. Event Operation

Activity operation is an operational means to achieve explosive effects by guiding user behavior in the short term, thereby achieving long-term product goals.

For example, Bilibili’s incentive plan for financial creators will encourage financial creators to produce more high-quality content and gain more user attention in the short term; in the long run, the platform will have more high-quality financial content in stock, and content producers will have more fans, gradually realizing Bilibili’s long-term product goal of going beyond the circle.

3. PUSH

PUSH is an important means for products to continuously reach users and recall lost users. PUSH needs to pay attention to the frequency, time and content of push. The push frequency cannot be too high, which will cause users to be bored. The time of push is generally in line with the user's product usage habits, such as when users just get up in the morning, commute, eat at noon, and browse information products before going to bed. Of course, if the content is immediate and users will care about it, it can also be pushed immediately, such as the Lakers winning the championship, the latest news on the epidemic, etc.

The pushed content can be divided into popular content and personalized content: popular content includes the latest developments in the epidemic, National Day holiday arrangements, the US election, and other content that the public is widely concerned about and accepts; and personalized content includes content that users prefer. For example, if the user likes technology and the stock market, he will be pushed content such as the development progress of brain-computer interfaces and today's stock market trends; there is also a type of content that is pushed to local users based on their location. After all, people are always most concerned about what is happening around them.

Because push notifications are mainly text-based, an eye-catching title and a topic that users will care about are very important. The content of the push notifications also needs to be refined, and the title and topic should be continuously optimized to increase the user opening rate.

4. Revenue

The business models of Internet products include: e-commerce, games, value-added services, advertising, content payment, etc.

Advertising is a model in which products monetize by attracting users' attention and getting advertisers to pay.

There are two types of e-commerce. One type is that the platform purchases goods on a large scale itself and earns the difference by concentrating consumer demand and improving bargaining power with suppliers. The other type attracts both consumers and merchants to gather on the platform and monetizes by charging advertising fees, commissions, etc., which is essentially a traffic model.

Games, value-added services, and paid content are monetized by attracting a large amount of traffic and using the funnel model to get some users to pay.

5. Referral

In fact, nowadays, recommendation and broadcasting are generally not placed in the last step. As the most effective way to acquire customers, social fission will run through the entire life cycle of the product. There are only two ways to get users to recommend and spread:

• One is to promote new users through incentives, such as Pinduoduo’s red envelope rewards;
• One is to make the product really well, meet user needs, build user reputation, and use product means to appropriately guide user sharing to achieve self-propagation of the product; for example, in the early days of WeChat, before the traffic of Tencent products was introduced, without using too many operational means, it had achieved daily self-growth of hundreds of thousands of users.

Without good operational methods, it is difficult for products to reach users; without good products, no matter how many users you have, they will be lost.

Author: Gong Yu chats about products

Source: Gongyu Chat Products