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Many elements of the Lean Startup Methodology have been warmly embraced by startups. However, only a few product innovations have successfully transitioned into high growth businesses. Why are new product failures still so prevalent? Why do so few attain the scale needed to become successful businesses? Nitzan Shaer, Managing Partner and Co-Founder of High Start Group shares how growth hacking can help overcome some of these barriers, and how to align the product, marketing and engineering teams to focus on product growth. “Growth hacking” has become one of the most contentious terms in the product development community. Despite a healthy debate, there’s still much to be explored, and the interest to determine how growth hacking can help entrepreneurs, product managers, and marketers achieve sustained growth (searches on the topic are at an all-time high, according to Google). We were happy to recently host a presentation and discussion on Growth Hacking with the Boston Product Managers Association (BPMA).... To read the rest of this blog post, please go to: http://www.highstartgroup.com/growth-hacking-next-frontier-lean-startup/ Partial Text From Growth Hacking Deck: From Lean Startup to Growth Hacking The next frontier in Successful Product Innovation Product managers play a pivotal role in company growth Which products does the market want? Who are the right customers? What is the right experience? Optimal price? The desired benefits? Outperform the competition? That fits our company strategy? That we are capable of building? Which methodologies can help them deliver success? Methods to be used by product lifecycle stage Introducing: High Start Group HSG helps companies grow by creating products and services that people love. We are passionate about understanding customer attitudes, needs and behaviors. By utilizing qualitative and quantitative research techniques, we uncover the forces that drive customers to adopt new products and service, and deliver market success. The traditional product development process • Start with a firm vision • Design & develop specifications • Converge to a massive “launch” • Let the sales roll in Highlights of Lean Startup A methodology that favors EXPERIMENTATION over elaborate planning, CUSTOMER FEEDBACK over intuition, and ITERATIVE design over traditional “big design up front” development. @EricReis “The Lean Startup” @SteveBlank “The four steps to Epiphany” The 3 Principles of Lean Startup Rather than writing a long winded business plan, jot down your hypotheses that if proven true, will deliver success “Get out of the building”. Use ‘customer development’ to test your hypothesis. Talk not only about features but price, distribution, and customer acquisition strategies. Continue to iterate as the product idea matures. Take an agile development approach. Produce a minimal viable product and iterate and test. Fast.
Citation preview
FROM LEAN STARTUP TO GROWTH HACKING
THE NEXT FRONTIER IN SUCCESSFUL PRODUCT
INNOVATION
JULY 2014
Nitzan Shaer, Managing Partner @nitzans
Shobhit Chugh, VP Product @shobhitchugh
2
Which products does the market want?
Who are the right customers?
What is the right experience?
Optimal price?
The desired benefits?
Outperform the competition?
That fits our company strategy?
That we are capable of building?
Product managers play a pivotal role in company growth
Lean Startup Growth Hacking
Which methodologies can help them deliver success?
3
Sustained Growth
Methods to be used by product lifecycle stage
Lean Startup
Growth Hacking
Product Market Fit
4
HSG helps companies grow by creating
products and services that
people love.
We are passionate about understanding customer
attitudes, needs and behaviors. By utilizing qualitative
and quantitative research techniques, we uncover the
forces that drive customers to adopt new products and
service, and deliver market success.
Introducing: High Start Group
5
The traditional product development process
•Start with a firm vision
•Design & develop specifications
•Converge to a massive “launch”
•Let the sales roll in
Source: Steve Blank, The 4 Steps to the Epiphany via www.slideshare.net/rishi12/the-new-rules-of-early-stage-product-development
Product
DevelopmentLaunch
Alpha/Beta
Test
Concept and
Business Plan
6
Highlights of Lean Startup
@EricReis “The Lean Startup”
@SteveBlank “The four steps to Epiphany”
A methodology that favors EXPERIMENTATION over
elaborate planning, CUSTOMER FEEDBACK over
intuition, and ITERATIVE design over traditional
“big design up front” development.
7
1 Sketch Out Your Hypotheses
Rather than writing a long
winded business plan, jot
down your hypotheses
that if proven true, will
deliver success
The 3 Principles of Lean Startup
2 Listen to Customers
“Get out of the building”. Use
‘customer development’ to test
your hypothesis. Talk not only
about features but price,
distribution, and customer
acquisition strategies. Continue
to iterate as the product idea
matures.
3Take an agile development
approach. Produce a minimal
viable product and iterate and test.
Fast.
Quick, Responsive Development
Ideas
BuildLearn
ProductData
Measure
8
Lean Startup – Core Concepts
Minimum viable product
A product with just those
features that allows you sell to
early adopters and validate
demand
Pivoting
Course correction to the
proposed set of hypotheses,
based on market learnings
The business model canvas
A view of all nine building
blocks of a business on one
page and their relative
hypotheses
9
10
Sustained Growth
After Product-Market Fit is achieved, Growth Hacking begins
Lean Startup
Growth Hacking
Product Market Fit
11
What is Growth Hacking?
A set of FRAMEWORKS, TACTICS AND BEST PRACTICES designed
to help companies think critically about CUSTOMER GROWTH.
“It’s what lean companies do once they’ve found product-
market fit. Instead of minimum viable products, growth
hackers develop minimum viable growth strategies.
@MattanGriffle@SeanEllis
12
How Skype achieved exponential growth
13
Separating Growth Hacking from traditional thinking
The Team Organization
Product as a Growth
Driver
Growth Metrics
Growth Tactics
Test & Learn
14
Traditional
1. The Growth Hacking Organization
Define Product
Develop
Deliver Growth
Growth Hacking
Engineering
Product
Marketing
Product Engineering
Marketing
Deliver
Growth
15
Traditional
2. The product as the ultimate growth hack*
Marketing dollars drive acquisition Product elements play a key role
in driving growth
Examples:
• Viral elements embedded in product – as Skype friends grows, the more valuable
• Cross platform integration - enable chats with Facebook friends
• Integrate to current user behavior – enable IM’s as SMS’s and calling to landlines
• Leverage other’s customers – enabled SkypeMe buttons in email and web
• The ultimate user experience – superior voice quality to traditional phones
Growth Hacking
*Coined by Kyle Wild
16
Traditional
3. Test & Learn Environment
Execute against the annual plan Be a scientist
Continually test hypothesis
Accept failures as learning
Examples:
• Creating a marketing test matrix –hypotheses and how to evaluate them
• A/B and multi variant testing
• Engage with customers weekly / daily – customer Wednesday. All hands customer service
• Test customer engagement models – constant Contact found that if you upload 10 customer email
addresses and sent two, you were 80% more likely to convert
• Resist detail (and rigid) project plans – consider disadvantages of MS Project
Growth Hacking
17
Traditional
4. Growth Tactics
Traditional channels Creative
Freedom to explore
Entrepreneurial
Examples:
• Accelerate customer engagement: provide coaching during my free trial
• Finding a new company voice: re-write error message copywriting on our site using famous quotes from
classic movies. Use a ‘playful’ tone that connects with customers
• Expand platform reach: enable users to post their listings on Craigslist. Integrate to phone address book
• Customer support: requests triggered a drip email campaign of amusing videos from YouTube
• Make your customer the hero: highlighted daily stories of families and friends reconnecting
Growth Hacking
18
Traditional
5. Growth Metrics
Focus on acquisition and activation Focus on Retention and Referral
LTV is key
Cohort analysis
Examples:
• Going beyond acquisition and activation – moving
the focus to retention and referral. Harder to do, but
more critical to long term growth
• Skype: dashboard included ‘months active’ (retention),
active contact list (referral) and conversion to paid
• Twitter: If you followed 10 people that you were
interested in, you would engage. Twitter hence help
users find those people
Growth Hacking
Acquisition
Activation
Retention
Revenue
Referral
19
5. Growth Metrics (Cont.):Cohort analysis connects experiments to LTV
Cohort analysis helps understand how changes in marketing and product
experience affect the effected cohort over time
20
A Growth Hacker’s Tool Box
Product
Optimization and
Research
Landing pages and
Multivariate TestingWeb Optimization
Email Marketing
and Automation
21
Additional Resources
Sean Ellis
Coined the term Growth Hacking
http://www.startup-marketing.com/
http://www.growthhackers.com
Andrew Chen
Entrepreneur and VC
http://andrewchen.co/
Jon Yongfook
21 Actionable Growth Hacking Tactics
http://yongfook.com/actionable-
growth-hacking-tactics.html
Ryan Holliday
Growth Hacker Marketing: A
Primer on the Future of PR,
Marketing, and Advertising
Mattan Griffel
Growth Hacking Overview
http://www.slideshare.net/mattangriffel/growt
h-hacking
Neil Patel and Bronson Taylor
The Definitive Guide to Growth Hacking
http://bit.ly/growth-hacking-guide
22
Thomas Edison
A hacker?
“I have not failed. I’ve just found
10,000 ways that won’t work.”
23
Discovering the products that customers want most
Sneak peek…
Learn more at: wevo.highstartgroup.com
$
Uncover the features and benefits customers value most
Identify the ideal customer segment
Quantify customer intent to purchase
Identify the acceptable price range
Compare the product to benchmarks
Now, challenge yourself:
How can I accelerate growth tomorrow morning?
Nitzan Shaer @nitzans
Shobhit Chugh @shobhitchugh
