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Kindle Notes & Highlights
by
Sean Ellis
Read between
January 24 - February 13, 2019
Think of your funnel conversion report as your roadmap to the sources of friction in your customer journey.
The first rule of designing and optimizing your NUX is to treat it as a unique, onetime encounter with your product; as such, you should think of it as a product of its own.
The second rule is that the first landing page of the NUX must accomplish three fundamental things: communicate relevance, show the value of the product, and provide a clear call to action.
While single sign-on is more commonly used by companies offering consumer products, it can also work for B2B companies as well, as the growth team at Kissmetrics, a data analytics company, found when they tested using “Sign Up with Your Google Account” as the one and only call to action on their home page.
A particularly bold way to reduce the friction keeping your customers from experiencing the aha moment quickly is to flip the funnel, meaning to allow visitors to start experiencing the joys of your product before asking them to sign up.
Creating positive friction is a delicate art of putting manageable, ideally engaging steps in the path of visitors that help them understand what the value is and get to the aha moment with greater predictability.
In a number of studies he references, it was discovered that once people take an action, no matter how small, as long as the experience wasn’t onerous, they are more inclined to take any action in the future.
The other is taking advantage of the enormous satisfaction people feel when they are in the brain state known as flow,
Game designers combined this wisdom to craft new user experiences that lead people gently into playing their games, starting with simple challenges that can be mastered quickly, and providing them with rewards for each hurdle cleared, while orienting them to the rules of the game and the environment in the process. They then ratchet up the level of challenge, as well as the degree of reward, in exquisitely refined increments (both of which they experiment a great deal with), so that users are hooked and get into flow.
If you do decide to introduce some positive friction, there are two additional tactics in particular that have proven quite successful: questionnaires and gamifying the new user experience.
He suggests focusing on three main aspects of any gamification effort: meaningful rewards, creating surprise and delight by varying how rewards are earned and presented, and providing some element of instant gratification.
Khan Academy, an online education website, takes the more overt approach of offering points and awards as users take more courses, creating surprise and delight with rewards as users hit new milestones. The company is careful, though, not to make these the centerpiece of its user experience, as they are aware that such explicit rewards can undermine the actual intrinsic reward of skills acquisition that is offered by learning.
A great rule of thumb about deploying triggers is that your rationale for getting in touch with the users should be to alert them of an opportunity of clear value to them.
Some common types of notification triggers to experiment with are:
What triggers can we experiment with?
In crafting triggers to try out, the set of six principles of persuasion that Robert Cialdini presents in his book Influence are also invaluable.
high retention is generally the deciding factor in achieving strong profitability, for any kind of company.
As we mentioned briefly in Chapter Four, widely cited research by Frederick Reichheld of Bain & Company has shown that a 5 percent increase in customer retention rates increases profits by anywhere from 25 to 95 percent.
only 15 to 20 percent of customers ended up ordering a second cleaning.
Meanwhile, Homejoy’s competitors were achieving retention rates double those numbers.
ninety-one percent of first-year subscribers renew for a second year.
When Amazon launched Prime, some analysts argued that the company would be spending too much on free two-day shipping and discounts for Prime-eligible items and therefore the program would be unsustainable. But Amazon saw that with so many subscribers renewing and spending far above average, the program was on a highly profitable trajectory.
The email notifications and app promotions are a snap to create, and an idea for a new feature can be rapidly tested by surveying customers about how appealing it would be to them or building a quick prototype to test with a set of users.
We also discussed there that a great measure of having achieved product/market fit is a stable retention curve.
Growth teams are perfectly equipped to look for early warning signs of erosion in retention.
Teams ought to apply the rapid experimentation process to pushing retention higher and higher,
the service’s usefulness improves over time.
Many successful digital products achieve a growing retention rate over time: whether it’s for Instagram, which becomes more valuable the more photos you post and people you follow, or a business product such as QuickBooks, which gets more valuable to the company the more financial data stored within it, which, remember, is referred to as stored value.
Any kind of company can, and should, work to keep increasing the value it’s delivering to customers and their level of engagement over time.
“The reason we decided to kick off a growth team in the first place was that we felt there was a lot of low-hanging fruit in our trials/onboarding process.”
Once new users have crossed the threshold of initial retention, they move into the medium retention phase, a period when the interest in a product’s novelty often fades.
The core mission for growth teams in retaining users who are in this midterm phase is to make using a product a habit; working to create such a sense of satisfaction from the product or service that over time, users don’t need to be prodded to use it again because they have incorporated the use of the product into their routine.
Then, we’ll move on to the tactics for long-term retention. This is the phase in which growth teams can help to assure that a product keeps offering customers more value.
the basic metric of retention
This allows you to probe more deeply into your data to make discoveries about why those who are staying are doing so—and why others are not.
Tracking groups of customers by the date of their initial acquisition allows teams to discover the overall health of the customer base.
This pattern might be seen when a company runs a new ad campaign that brings in lots of new customers for whom the product is not actually particularly well suited.
Recall that the core goal during the medium phase of retention is to solidify users’ commitment to your product by making the use of it habitual for them.
The key to habit formation is convincing customers of the ongoing rewards they will receive from returning to your product or service.
In Hooked, customer behavior researcher Nir Eyal
the internal, subconscious trigger:
The engagement loop with Amazon Prime is clear and continues to reinforce itself with repeated use, which is why it works so well.
growth teams should map out their own engagement loop based on the core value their product delivers, and then set out to measure, monitor, and optimize
improving the perceived value of the rewards leads to greater retention.
But it’s also important to experiment with offering rewards that are not about money or savings, but instead about the experience customers have with your product.
Teams should be creative about thinking of ideas for such nontangible rewards to offer, and they should also experiment with blending both tangible rewards and experiential and social ones.
1. BRAND AMBASSADOR PROGRAMS
2. RECOGNITION OF ACHIEVEMENTS
3. CUSTOMIZATION OF THE RELATIONSHIP
MORE VALUE COMING SOON
RESURRECTING “ZOMBIE” CUSTOMERS
