The universal formula for user growth

Liang Ning said:

“Growth capability is the ability to make correct decisions consistently”

At the end of 2019, our team was reviewing the entire year's planning, and we were thinking: What has enabled our products to maintain rapid growth for three consecutive years?

The conclusion is as follows:

An industry worthy of continuous investment or a common vision; a continuously learning organization where we spend a lot of energy on personnel selection and capacity building; the ability to respond to various changes in a timely manner and the resilience to turn around and start all over again at any time.

Of course, the above three major issues are problems that team managers need to think about and solve. I will introduce them in future product team management articles. In fact, what we have gained more in the past three years is the continuous accumulation of small details and operational plans about product growth.

As usual, I don’t like to talk nonsense, so I’ll get into the growth step-by-step. Let’s first look at the data of a product:

Do you think this is a successful product? However, let’s take a look at the growth curve of this product:

It was born on a mountain that many products could not reach, but died in the spring 7 months later. In fact, everyone is familiar with this product: Luo Yonghao: Chatbao (Bullet SMS).

Do you have countless questions in your mind at this time? What exactly caused such a tragic outcome?

Is it because the investment is not strong enough? Acquire 440,000 customers per day. Where can you find such a campaign?

Is it because of lack of market capabilities? PRs were flying everywhere at that time.

Auntie summarized the story in one sentence:

If you are a pig without wings flying in the wind, it is only a matter of time before you fall down.

There is a saying that goes, growth based on luck will eventually be lost based on ability, so what are these wings ? In fact, you just need to figure out what the essence of your growth is? Interested fans should have heard of Luo Yonghao's product launch conferences, which are almost always the following routines:

• First, he used a long speech to explain the problems he encountered;
• Then, tell everyone from various angles how rubbish the opponent is;
• The bottom line is how our products perfectly solve these problems.

Everyone! Did you hear the problem?

All of this thinking is based on self-centeredness . There is no mention of what users really need anywhere in the article. This! This is exactly the thinking logic of a joke teller. How are you, how am I, how am I better than you.

What is the essence of making products? User-oriented

It is foolish to talk about products and growth without considering the user's pain points. So to achieve good growth, please remember these three sentences:

1. The essence of product growth is user pain point exploration , user verification and user accumulation;
2. User pain points and solutions are essentially unknown , so use exploration instead of execution.
3. When doing growth, the first thing you should verify is the user's pain level , and then other things.

So next, give your little hand to your auntie.

Step-by-step guide: How to discover and verify user pain points?

Product managers with a science-based mindset are good at describing problems in short sentences, for example: I want to solve everyone’s pain points when eating.

People with liberal arts thinking like to use various adjectives and attributives to describe problems, for example: I want to solve the pain point of programmers wanting to have midnight snacks on weekdays but not knowing how to make them.

What do you feel after reading these two descriptions? Does adding an adjective make the question very specific?

Therefore, many times we feel that we are discovering problems based on user pain points but we have not made the problems concrete. When we explore pain points, please do as your Chinese teacher taught you: users, scenarios, and problems . None of the three elements can be missing.

This is because, if any one of the three elements is missing when discussing pain points, it may lead to inaccurate pain point judgment and the creation of false pain points; secondly, if any one of the three elements is different, the problems encountered will also be different, and the solutions will also be completely different.

For example: the pain point of eating.

Ele.me, Dianping, and Meituan all seem to be solving the pain point of eating, but in fact the actual problems they face are different, which is why all three products are doing well.

So, have you learned the first trick?

Even for the same users, the solutions can be completely different in different scenarios and problems. In the future, please give up on competitor analysis and spend more time on user pain point research. Only by visualizing the pain point problems can you find your precise users in the right scenarios.

Step 2: Pinch the pain point to see if it hurts enough

When it comes to pain points, I guess many children like to use wild imaginations and have wild ideas; however, for humans, who are social creatures, pain points can be explored from the following aspects:

A smart baby should know the origins of these aspects, right? That’s right, it’s Maslow’s hierarchy of needs theory.

(1) Survival: Any urgent problem that affects the user’s life and property may be a pain point.

Alipay, a solution to insecure payment during shopping, has an annual revenue of over 370 billion yuan; Lufax, a solution to insecure financial management, has an annual transaction volume of over 380 billion yuan; Yilibao, a solution to food safety and drinking water hygiene, has an annual sales volume of 13 billion yuan. Almost all of these companies are born out of the most direct survival pain points.

(2) Efficiency: Solve problems more efficiently without having to use your brain.

What exactly is hindering the improvement of efficiency? You can think about it from the following aspects:

• Takes too much time: Dianping solves the consumption decision-making when choosing a restaurant; Baidu Maps solves the route planning and waiting when users travel.
• Distance is too far: VIP solves the needs of high-end users to enjoy North American foreign teachers across distance;
• The experience is too bad: The birth of the iPhone solves the pain caused by the inconvenience, slowness, complexity and tediousness of using smartphones.

Humans all hate to pay, and being able to help users be lazy is a common proposition of all tool products.

(3) Buy the products you want at a lower price

Xiaomi and Costco both solve the problem of providing products with higher cost-effectiveness.

(4) Need to show your role to others

Kuaishou, Douyin, Moments, and official accounts allow you to show off in various ways and at various angles and occasions.

(5) The pursuit of realizing one’s inner spiritual world

Honor of Kings and Xiaohongshu demonstrate the users’ presence and value, but is everything fine once we find this pain point? No! Cutting a finger and amputation are both painful, but can the two be confused? !

Thinking further, we can analyze it from the following three perspectives: urgency, growth, and substitutability.

1. Regarding urgency , it refers to how urgently your users want to solve this pain point. The same mineral water, if it’s from store, on the top of a mountain, and in the desert, has completely different value, right?
2. Growth refers to the commercial value that a product can bring, including two aspects: the size of the market and continued growth in the future. This directly determines the potential and space for user growth . For example: the current shared bicycles and the shared bicycles in 2016.
3. Alternatives, are there any alternative solutions currently on the market? Substitutability largely determines the intensity of market competition and will directly affect user growth. If there is already an alternative with a good reputation and a large user base, please turn around this demand in time. For example: WeChat.

The areas that are urgent, have growth potential, and have no better alternatives are the areas that should be invested in the most.

Step 3: Find a metric to measure your wins and losses and guide you forward

Does the following scenario sound familiar to you?

• The product manager said: After this revision, the PV of this function increased by 100,000;
• The channel colleague said: Our channel launch this week brought 4,000 downloads;
• The operations staff said: Our teacher live class attracted 5,000 new fans;
• A colleague in the marketing department said: This product video has received 1 million impressions.

Do you think these indicators are meaningful? ? In my opinion, these indicators are all vanity indicators: they only show the results but cannot lead you to move forward. so! Please don't use KPI targets as your North Star indicator.

Auntie teaches you step by step how to find the North Star indicator:

Here are some North Star indicators for each scenario:

• Page traffic download: conversion rate;
• Growth operations: viral coefficient K;
• Market launch: accurate customer acquisition cost (CVC*first retention);
• In-product sharing volume-generating activities: percentage of volume-generating users (volume-generating users/active users);
• Product health: daily activity, second retention rate.

Only by finding the North Star indicator of your product can you guide your direction forward.

Have you learned it? My little cuties? After learning these three steps, I believe that your product’s daily activity is not just a dream.

To achieve growth, ask yourself three questions every day:

1. Who are my most important customers?
2. How to find more users like this? When, under what circumstances and for what reasons will they appear?
3. How can you ensure that he can find you in that scenario?

Author: Lisa Deng

Source: Lisa D's Product Notes