Thousand-word summary of the transformation methodology of the AARRR model

Today we will continue with the conversion part about user growth.

1. List all monetizable products/features

Mark all possible opportunities to profit from users in the entire process from acquisition to retention on the user usage roadmap

2. Identify products/features that users are willing to pay for

1) Focus on providing users with products that they find valuable and are willing to pay for, rather than the options that the company thinks users need

Method: Questionnaire survey (presenting new product/feature ideas to users) and offering rewards

3. Price the product/feature and communicate it to users

1) Things to consider when determining price

2) 8 principles of pricing

(1) Prices should be set based on the value of the product in the eyes of the consumer, not the cost in your eyes.

(2) Prices should be realistic so that consumers understand what they are getting for their money

(3) Prices should be comparable within your control

(4) If you want to adjust your price, you must adjust the structure of your service or product

(5) Price differentiation is a key factor in profitability

(6) Pricing communication influences consumers’ perception of product value

(7) If you want to increase profits, you must be prepared to sacrifice some sales

(8) Avoid cognitive dissonance and maintain your first impression

Step 1: Identify the pain points to be solved or the benefits to be provided

Step 2: Determine the motivation for user purchase based on the benefit matrix

Step 3: Choose the right market positioning based on the competitors corresponding to the purchase motivation

Benefit or Value 1: The taste of chocolate tea

Competitor 1: 100g of Nescafé instant coffee; Value unit: box; Unit price: £2.49

Competitor 2: Nescafé Gold 100g; Value unit: box; Unit price: £3.39

Competitor 3: 80g Tetley tea bags; Value unit: box; Unit price: £1.79; Product pricing: 6-pack chocolate teapot; Value unit: box; Unit price: £2.79

Benefit or Value 2: Quenching Thirst

Competitor 1: Single bottle of organic yogurt; Value unit: bottle; Unit price: £1.09

Competitor 2: 250ml fresh juice; Value unit: bottle; Unit price: £1.99

Competitor 3: Single can of energy drink; Value unit: can; Unit price: £1.15

Product pricing: Single chocolate teapot; Price unit: pcs; Unit price: £1.59

Benefit or Value 3: Satisfying the Coffee Habit

Competitor 1: Small cappuccino; Value unit: cup; Unit price: £1.89

Competitor 2: Medium Cappuccino; Value Unit: Cup; Unit Price: £2.29

Competitor 3: Large Vanilla Cappuccino; Value per cup; Unit price: £3.49

Product pricing: Single chocolate teapot; Price unit: pcs; Unit price: £2.89

4. Optimize the monetization process and promote monetization behavior

(1) Draw a monetization funnel

(2) Iterating product experience

(3) Promote monetization behavior: recommend related products; provide value-added services; free trial/experience coupons; group purchase discounts; paid users upgrade their paid packages to unlock more benefits; increase prices, so late payers pay more

5. Analyze different user groups and conduct growth experiments

(1) Grouping method: revenue generation, fixed-cycle consumption, purchase volume, average order value, usual shopping time period, geography, age, gender, type of goods purchased, access device, access browser, number of visits in a certain period of time, date of first purchase, etc.

(2) For example, if it is found that users who make purchases twice within 90 days have a much higher annual consumption amount than users who make purchases once, then an experiment can be conducted to encourage users to make purchases twice within 90 days, which can increase their annual consumption amount.

(3) For example, offering a limited-time 25% off discount to users who added items to their shopping carts but did not complete their purchases will greatly promote purchase conversions. At the same time, by continuously reducing the discount, you can test the minimum cost of the discount.

1. Give first, then take

(1) Focus on giving, and don’t rush to ask users for a purchase commitment

(2) Product demonstrations can increase purchase rates, in part because consumers feel they are getting something for free and feel it would be inappropriate not to buy it.

(3) E-commerce: free shipping, order discounts…

2. Lower the purchase threshold

(1) Once you spend money on a platform, you are likely to spend money again

(2) E-commerce: Wishlist (acknowledging one’s desire to buy); providing coupons to users who have recently purchased products, which may encourage them to order again; simply asking whether they will buy products from the website again

3. Use the herd effect to arouse herd mentality

4. Showcase success stories

(1) Seeing the effects of other people’s use can improve users’ expectations of the product

(2) At the same time, the specificity of the story also deepens users’ trust in the value of the product.

5. Provide statistical data to prove the value of the product

(1) Statistics themselves are often meaningless. They should be used to illustrate a relationship. What is important is that people remember the relationship, not the numbers themselves.

(2) Numbers that are closer to our lives are easier for us to understand and trust

6. Make your product description as specific as possible

7. Use the power of authority

8. Build goodwill

(1) Use photos of real people (customers, employees) on your website

（2）Friendly welcome message on the landing page

9. Highlight scarcity

When we feel like we are about to miss out, we are more likely to take action

(1) Limited promotion time

(2) Limited time remaining quantity

(3) Restricting appointment opportunities

(4) Limit the number of people who can receive discounted products

Author: Zexue Notes V

Source: Vinson_Ze