Hacking Product Growth in 2023 [by Sean Ellis]

How do you go about hacking product growth in 2023?

This is what Sean Ellis discussed in his talk at this year’s Product Drive Summit hosted by Userpilot.

Sean Ellis is the founder of Qualaroo and Growth Hackers, a former Growth VP at Bounce, the author of the bestseller, Hacking Growth, and a lecturer at Harvard Business School.

Let’s check out what he had to say!

TL;DR

• Hacking product growth means focusing your resources on the initiatives that make the biggest impact.
• According to Sean Ellis, the biggest impact comes from the ‘must have’ experience. Such an experience hooks the users and makes them come back to the product.
• Next, you need to lead your users to the ‘must have’ experience, or activate them.
• To do it effectively, define the Aha! moment for your product and optimize the onboarding to reduce the time users need to reach it.
• The growth hacking process is a process of rapid iterative experimentation: you analyze the current situation, generate ideas for improvement, prioritize them, and test their impact.
• This should happen at all stages of the funnel, but priority should go to activation because it has the biggest impact on growth. Next, focus on retention, revenue, referral, and acquisition (in this order).
• To support the process, it’s vital to align cross-functional teams around the same goals and processes.
• To achieve the alignment, work together to define what constitutes your product value.
• Next, choose your North Star metric to guide your efforts and measure progress.
• After that, collaboratively diagram the growth engine at your SaaS.
• Finally, choose the right tool stack that will help you understand user behavior, conduct experiments and surveys, and drive user activation and product adoption.
• If you want to see how Userpilot can help you implement the growth hacking process at your SaaS, book the demo!

What hacking growth is all about: Focus on delivering maximum impact

Hacking product growth is all about focusing your resources on initiatives that have the biggest impact.

This is particularly important in the current economic climate as SaaS companies find it more difficult to secure funding. How can you do that?

1. Deliver ‘must have’ experience

The process starts by delivering the ‘must-have’ experience to your users. This is usually a feature that keeps users engaged and makes them come back to use the product again.

How do you make sure that you have that kind of experience?

Through the Sean Ellis test, aka the PMF test.

Here’s how it works:

You trigger a survey to ask your users how disappointed they would feel if they couldn’t use your product or its particular feature anymore.

If 40% or more of your users respond ‘very disappointed’, you’ve got it – you’re delivering the ‘must-have’ experience!

2. Activate your users

Once you nail your ‘must-have’ experience, it’s time to activate your users. That’s basically when you lead them to the critical feature and help them realize its value.

The whole idea there is that you want to get people to an experience where they actually say, oh my *** this product is amazing. I can’t live without this product.

To successfully activate users, you first need to understand their intent. That’s what their needs and wants.

Next, build the desire around the intent. That’s your promise to satisfy their needs and set expectations based on the must-have experience.

Finally, lead your users to experience the value of the product or the Aha! moment.

What’s that?

For Slack, the Aha! moment comes after the user sends about 2000 messages, for Facebook connecting with 7 friends in 10 days and for Uber – the 1st drive.

Figuring out the Aha! moment for your product may require a fair bit of analysis and experimentation.

For some products, reaching the Aha! moment could be a lengthy process.

For example, Noom, a weight loss app, needs a 60-step onboarding process to truly convince users they can reach their target weight using the app.

The main challenge at this stage is to eliminate all the unnecessary friction from the customer so that they can reach the Aha! moment as quickly as possible.

You can do this by adjusting the length of the onboarding flows and fine-tuning the messaging.

The Agile process of continuous improvement

The growth hacking process is a rapid experimentation process that helps you identify the best opportunities to increase the value that you deliver to customers.

The process consists of 4 key steps:

1. Analyze – use product usage analytics, surveys, and user and usability testing to decide why the process is/isn’t effective.

2. Generate ideas – identify ways to improve it.

3. Prioritize the ideas – use techniques like ICE to select solutions that will bring the biggest impact

4. Test – track product performance and carry out experiments to determine if the solution is working and identify further opportunities for improvement.

Mind you, the experimentation process shouldn’t be limited to the activation stage. Activation is the stage that makes the biggest impact on value delivery, but experimentation needs to happen at all stages of the funnel.

According to Sean, the recommended order of focus for impact is:

• Activation
• Engagement/Retention
• Revenue
• Referral
• Acquisition

Create the right culture and processes

To successfully implement the growth hacking process, product leaders need to create the right culture and processes in their organizations.

One of the biggest challenges that businesses face is the lack of alignment between teams from across the organization.

How to get people on the same page?

Agree on the must-have value and how to measure growth

The first step to creating a shared understanding in cross-functional teams is defining the goals and ways to measure them.

Define what constitutes value

The primary force driving growth is the value that the product delivers to the customers.

The issue here is that various teams could have different ideas of what makes the product valuable. Hence, it’s essential for them to work together on the definition of value.

In other words, all teams need to understand what ‘must have’ experience you’re trying to deliver to the user.

Find the North Star metric

The North Star metric is one key metric that aligns the work of all the teams involved in product delivery.

For Slack and Facebook, it’s the daily active users, and for Amplitude – weekly learning users. This is how they measure growth.

What’s your North Star metric? Work with all the departments in your SaaS to pick one.

Diagram value delivery engine

Having defined the North Star metric, it’s time to decide how you will improve it.

To do so, diagram the growth engine in your business.

For best results, work as a team. Bring together all the key stakeholders, like the heads of Product, Marketing, Engineering, Design, Data, and so on. In this way, you’ll get a much richer view of the engine and all its levers.

Choose the right tool

Only when you know your growth goals and have a plan on how to deliver and measure them can you start looking for the right tools to support the process.

These should include tools to:

• understand (user behavior tracking, surveying, and integrating various data sources).
• improve (A/B testing, in-app engagement).
• learn (a system for centralizing customer research and learning).

More and more analytics and feedback tools offer AI functionality and according to Sean, this will soon become the norm. AI-powered analytics will enable teams to recognize opportunities faster and tighten the experimentation loops.

Hacking product growth with Userpilot

Userpilot is a product adoption platform with advanced analytics, feedback, and engagement features. If want to hack your product growth, this is an excellent solution for the job.

Democratize data to improve alignment between teams

Userpilot can help you improve alignment between various teams by democratizing data.

How exactly?

Userpilot is a completely code-free solution. This means that even non-technical users can use it to effectively track key product performance metrics and set up experiments without help from data scientists or engineers.

What’s more, Userpilot makes it easy for team members to save and share reports to improve communication. As a result, all teams from across the organization can easily access the data they need and stay on the same page.

Test for PMF with in-app surveys

With Userpilot, you can easily create and trigger in-app surveys for the Sean Ellis tests (and collect all kinds of feedback).

Want to know the best part?

You don’t have to build the surveys from scratch.

Simply head over to the template library and search for the PMF survey (or any other industry-standard survey, like NPS or CES). All you have to do is customize the look of the survey.

In the surveys, you can follow up the main question with an open-ended one to collect qualitative insights, which you will soon be able to analyze for patterns and trends with an AI analytics feature.

Once that’s done, choose the user segment to target and schedule the survey.

Identify friction with funnel and path analysis

Userpilot analytics allow you to track and analyze all aspects of user behavior inside the product so that you can optimize all the levers of product growth.

With funnel analysis, you can easily spot where in the customer journey users come across bottlenecks while Paths gives you a granular view of all the actions leading up to conversions – or drop-offs.

Thanks to that, you can optimize conversion rates at key touchpoints.

Activate users with onboarding experiences

With Userpilot, you can create personalized onboarding flows to enable users to reach the Aha! moment in less time.

Userpilot offers 6 different UI onboarding patterns:

• modals
• slideouts
• tooltips
• banners
• spotlights
• driven actions

You can trigger them individually, for example, to contextually help a user discover a relevant feature, or in sequences.

For instance, you can bundle them up into an interactive walkthrough or trigger them from a checklist that will introduce the key features that users need to start using the product effectively.

Just like with surveys, you can trigger the flows for specific user segments, which enables personalization, and schedule their publication for specific dates.

How difficult is it to create the patterns? I’d say it’s pretty effortless.

That’s thanks to the visual editor which enables easy customization and the AI-powered writing assistant that helps you write microcopy from scratch or optimize the existing messages in no time.

Improve your onboarding with flow analytics

Once you create and publish your onboarding flows, you can track their performance with Flow analytics.

Why does it matter?

You can use it to optimize the onboarding flows to remove friction and reduce the time users need to reach the Aha! moment.

For example, the Steps Breakdown shows you how well each step of the flow performs. Just like funnel analysis, it makes it easy to spot where users drop off.

You also get access to the data at the user level, so you can easily reach out to specific users to seek their feedback or push them back onto their path to activation with additional guidance.

Now, imagine you’ve made changes to the onboarding flow. Userpilot allows you to track and visualize the flow analytics data over time so that you can easily assess the impact of the changes.

Test your flows with A/B experiments

With Userpilot, you can also run experiments to choose the best onboarding flows.

Specifically, there are 3 test types:

• Controlled A/B test – to compare the performance of a new flow to an existing one.
• Head-to-head A/B test – to choose between two new flows.
• Controlled multivariate tests – to compare how multiple new flows stack against the existing one.

How useful is this?

Suppose you’ve identified a step in the onboarding flow where users drop off and you’ve decided to tweak the copy and design of the in-app message. You can create various new designs and run the experiment to choose the best one. How cool is that!

Conclusion

To hack product growth in 2023, you need to prioritize your efforts better than ever before.

Out of all the growth levers, user activation is the one that has the biggest impact. That’s because once you let users experience the product value, it’s much easier to retain and convert them.

If you want to see how Userpilot can help you design the ‘must have’ experience, lead users to activation, and optimize all other growth levers, book the demo!