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Mobile Product & Growth Hacking RoundTable #playbookRT by @amitsomani & @VishalAnand

Having a completed a half century of RoundTables, the iSPIRT team was back with the 51st RoundTable on what’s currently the hot topic of discussion and debate in the startup community – mobile! A lot of startups are also trying to figure out their mobile strategy and this was evidenced in the great interest shown by startups in participating in this RoundTable. And why not? It’s not too often that you get a chance to deeply interact and learn from senior industry practitioners like Amit Somani, who was the facilitator and Vishal Anand, co-facilitator for the RoundTable.

The participating startups were from different domains (healthcare, HR, payments, consumer services etc.) and across stages (already have something up and running on mobile, tried something on mobile, but didn’t work, yet to figure out mobile strategy and so on). There was a round of introductions with each startup giving a context about their company and industry, the key challenges and their expected takeaways from the RoundTable. The iSPIRT RoundTables are highly collaborative in nature with a lot of peer learning and feedback as part of the discussions. As the introductions were happening, the facilitators were mapping the areas that startups were looking for help to the mobile journey. With the introductions complete, the group had a fair sense of the key areas that would be taken up for discussion during the RoundTable.

One of the first topics that came up for discussion was ‘Activation’ – how do you get the user to make the first action on your app. Many points came up for discussion – coupons, notifications, social/referral and so on. But two stood out, which Amit stressed upon – one was how do you get the users to have their aha moment and secondly, how do you ensure that you’re scaling this in a sustainable way? While the current sentiment seems to be around growth at any cost, Amit mentioned that it’s important to start looking at the unit economics sooner rather than later. Some of the key points mentioned around Activation where:

Mobile Playbook

  • Coupons:
    • This is perhaps the simplest and easiest way, but could you be smarter in doing this? Could you create different segments of users and offer targeted coupons instead of a blanket coupon? E.g. Say, an iPhone user is more valuable than other users. Could you then possibly offer her a higher value coupon?
    • You’d also need to be careful about the positioning and perception of your brand? If the focus is on coupons, will you come to be known as brand offering coupons rather than be known for your service? Also, with coupons, are you sure that you’re attracting the right kind of users or you’ll end up acquiring only ‘deal-hunters’?
    • While coupons are an effective channel, it’ll be helpful to create segments to as minute levels as possible and offer them to users appropriately.
  • Supply Side Users
    • Some of the companies participating in the RoundTable were marketplaces that had users on the ‘supply side’ as well. Key points mentioned were – a) show demand to the supply side user. b) Some kind of revenue calculator/estimator. These would help the supply side user get a sense of the demand and then take the necessary action (create listings, upload products etc.)

There were some companies that were still in the early stages of their mobile play or were evaluating how to go about their mobile strategies. Some of the points discussed were around:

  • Building in-house v/s Outsourcing
    • There is limited availability of high quality mobile developers and designers these days and startups have to compete with some heavily-funded companies for the same talent pool. Given this scenario, does it make sense to outsource mobile development and design? Participating companies had interesting experiences to share. For some of them, outsourcing hadn’t worked well. Some of them were able to find high quality freelancers and engaged them effectively.
    • However, one insight that Amit shared found resonance among the audience – one way to perhaps go about outsourced mobile development could be to breaking down the deliverables into design, frontend, backend etc. Perhaps engage a good designer for design and do the rest in-house? Also, in most cases, the backend is core to the company and that’s perhaps something that needs to be done in-house.
    • Similarly,
  • Does mobile lend itself to a one-time use use case?
    • For example, if there’s an app for employees in a company to check and update their records etc, does it really lend itself to a strong use case for mobile? Can one create enough hooks to engage the user to come back frequently to the app?

The next key discussion was around metrics and tools to use to measure the metrics.

  • Amit gave a simple, yet powerful formula to look at metrics – Record everything, Track 12 and focus on 3. This will help in identifying the really important metrics and drive the company’s energy to focus and improve on those.
  • An ideal comparison for Lifetime Value (LTV) to Customer Acquisition Cost (CAC) is LTV > 3*CAC. In a lighter vein, Amit mentioned that given the amount of marketing spends companies have these days, he’d be very eager to meet and invest in a company that even has LTC = CAC! That said, the importance of thinking through the right economics and working towards it with reasonable visibility is something Amit stressed throughout the session.
  • Rather than averages, Amit mentioned it might be useful to look at percentages, have cohorts to measure movement and perhaps look at percentiles as well depending on the metrics.
  • (Daily Active)/(Monthly Active) >= 15% is a good number for any app. Also, (Monthly Active Users)/(Install Base) >= 25% is good as well.
  • Some of the tools mentioned during the discussion were:
    • Google Analytics for simple and basic analytics
    • Flurry – gives comparative data and is free.
    • AppAnnie – for comparative data
    • Appfigures for Ranking / Review and Ratings – Daily reports
    • App bot (sentimental analysis on Reviews)
    • Crashmetrics –  Crash reports
    • Uninstall.io – for tracking uninstalls
    • Branch.io – post install deeplinking
    • Segment.io – integrates different tools used

MobilePlaybook

The participants left with a lot of food for thought and actionable takeaways that they hope to put into practice at their startups. There were also some very interesting books recommended by Amit to deeply understand user engagement and get some insights:

  • Hooked
  • Made to Stick
  • Influence
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Before you start with Growth Hacking

Building a product startup is exciting. Most startups look to raise capital early and investors look no other measure but traction to take their bets. This need for traction puts immense pressure on the founding team to grow their startup. That leads to implementing multiple tips and tricks to improve the key product metrics – most importantly to show traction to investors. Founders get into the so called ‘growth hacking’ mode.

Growth hacking is the new buzzword in the startup town. There is nothing wrong with ‘hacking growth’ – most of the tricks attempted in this phase end up being short-term techniques. They might work for a while, bring traction for a while (which might lead you to raise investments) but these techniques don’t help in long term and the growth is not sustainable and quickly falls off.

Startups tend to neglect the simplest rules of product management before starting with growth hacking. According to me, here are the 5 Basic Rules of Product Management:

  1. User Engagement > Growth Hacking
  2. Retention > Acquisition
  3. Context > Activity
  4. Own growth channels > External channels
  5. Being Valuable > Being Social

A. User Engagement > Growth Hacking
Remember startups like BranchOut, Glassdoor, Viddy, Socialcam – that famously hacked growth through Facebook Dialog Feeds? Though they showed amazing growth curve initially, it soon fell off. Most users dropped off the product as quickly as they signed up never to return again. Reason – zero engagement on the product. Ensure that there are enough engagement loops on the product before you do any sort of ‘growth hacking’.

B. Retention > Acquisition
Acquiring users is the simplest thing to do, retaining them is the key. Any user acquisition technique should retain a good percentage of acquired users. Not just that., over a period of time the users who dropped off should be reactivated – there should be enough methods to pull them back – emailers / network effects / and so on. If the product has strong engagement features, retention is a easy task.

C. Context > Activity
Most products undermine the importance of context. In today’s world – anything that is not context is considered spam. The finest examples of a context driven product is Quora that lets you follow topics of your interest and helps you discover relevant content. Also important are products like Twitter (that lets you follow users) and Pinterest (that lets you follow boards) to build a information stream in context thats relevant to you. Think of context when you build features.

D. Own Channels > External Channels
Many startups focus on external channels for growth. Branchout was focussed on Facebook Dialog Feeds, Zynga was focused on Facebook Activity Wall, Viddy was focussed on Facebook Open Graph. Perfectly fine – if there are enough engagement loops and good retention strategy. However depending on external channels might not be sustainable – many startups hacked the Facebook Open Graph to get significant users – this led to users complaining about to the noise on Facebook wall, Facebook in return built many approvals / controls to prevent applications from spamming the users and giving users ease to block spam applications.

Large startups like Facebook, Dropbox, WhatsApp were completely focussed on driving growth through channels owned by self and had very little or no external dependence for growth. Don’t depend too much on external platforms like Facebook, Twitter, Google (SEO) for growth – build our own channels. Facebook’s journey of growth hacking is well documented. Also Dropbox as mentioned in next point.

E. Being Valuable > Being Social
There are also startups that focus on building ‘too-many’ social sharing features, expecting users to share almost everything and anything on to their social profiles (Facebook, Twitter, etc). Users are smart – they don’t fall in this trap and founders keep wondering why no social sharing happens. Instead of trying to be forceful on social, focus on being valuable.

Example –  Dropbox, it was a very valuable product that had super methods to hack growth – by connecting FB or Twitter account with Dropbox and providing users additional storage space by asking them to spread a message to their social circle or invite email contacts.

Concluding Notes:
Can you hack growth first and implement these rules later? No. There are startups that hacked user acquisition and raised initial investment on traction., and later things did not go according to the plan. Not just startups, that leaves even investors wondering what went wrong after the initial impressive growth metrics.

Startups are about growth, no doubt. Getting Techcrunche’d (PR release), top position on Hacker News or Video that goes viral might bring one-time traffic boost / user sign-ups. You can get good amount of traffic by integrating with Facebook Open Graph, optimizing site for Google (SEO) or even paid user acquisition – but make sure that the product has enough engagement, retention loops, value and context to sustain the users you are acquiring!

You may hack growth., but you can’t hack success. Building the next billion dollar company is a big deal!