LEAN & AARR
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Transcript of LEAN & AARR
@oxygenaccel www.oxygenaccelerator.com
PAIN, LEAN & AARRR
Simon Jenner CEO, Oxygen Accelerator
@simonjenner
@oxygenaccel www.oxygenaccelerator.com
you are here
success
@oxygenaccel www.oxygenaccelerator.com
deadpool road
Not Lean I think the problem is X The solution looks like this:
A website with social logon Location based HTML 5 mobile ready front end Cloud based, multi continent hosting for resilience Ability for users to like each others profiles Monetization via adverts We can launch in 6-9 months
YOU JUST CREATED A PRODUCT THAT NO ONE CAN USE OR WANTS
Feel the pain
@oxygenaccel www.oxygenaccelerator.com
Pain Threshold
Pain is felt
No pain is felt
Cure for cancer
Ferrari
In the beginning
@oxygenaccel www.oxygenaccelerator.com
Lean manufacturing - Toyota
2011
How to drive a startup
@oxygenaccel www.oxygenaccelerator.com
Vision
Strategy
Product Optimization
Pivot
True North
STRATEGY IS BASED ON ASSUMPTIONS
@oxygenaccel www.oxygenaccelerator.com
Customers can be acquired for $1 Customers will use a mobile app
Each customer will invite 0.5 other customers Customers wants to do X We can build in in 3-months
Advertisers will pay $3 per customer There are 100,000 early adopters
We will attract customers via social media
Customers will come back to the app daily
LEAP of FAITHs
@oxygenaccel www.oxygenaccelerator.com
Some assumptions are Leaps of Faith iPod - People want to listen to music on the move - People will pay for music
KEY ASSUMPTION
@oxygenaccel www.oxygenaccelerator.com
Value creation Growth
BUILD, MEASURE, LEARN
@oxygenaccel www.oxygenaccelerator.com
BUILD LEARN
MEASURE
IDEAS
PRODUCT DATA
BUILD
@oxygenaccel www.oxygenaccelerator.com
Build a key assumptions solving Minimum Viable Product (MVP)
MEASURE
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Must be real data What to measure – everything AARRR – Pirate metrics
LEARN
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Test data with customers Must impact business results
CYCLE FAST
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BUILD LEARN
MEASURE
IDEAS
PRODUCT DATA
PIVOT or PERSEVERE
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Get enough data then make Data based decisions Customer based decisions
PIVOTS
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- Zoom in pivot –more niche - Zoom out pivot – less niche - Customer segment pivot - Customer need pivot - Technology pivot - Business model pivot - Channel pivot
PIVOT
@oxygenaccel www.oxygenaccelerator.com
sortedlocal.com
Assumptions - People wanted unskilled tasks doing (customers) - People wanted unskilled per hour work (sorters) - Attracting sorters was going to be difficult - Customers will want to use mobile
An unskilled tasks market place
PIVOT
@oxygenaccel www.oxygenaccelerator.com
sortedlocal.com
MVP - Customer task led mobile app
- Customer creates profile & then task “I need a cleaner on Friday at 4pm to clean my flat”
- Sorters respond via messaging system saying they will do it & their price per hour
- Customer selects a Sorter & pays
An unskilled tasks market place
PIVOT
@oxygenaccel www.oxygenaccelerator.com
sortedlocal.com
Data 1st Month - 1st task posted was an advert not a task - 600 Sorters signed up - 20 Customers signed up - 60% bounce rate on website - Zero tasks completed - Customers saying to many responses to task, takes to long to
message each sorter, trust issues with sorters
An unskilled tasks market place
PIVOT
@oxygenaccel www.oxygenaccelerator.com
sortedlocal.com
Pivot – Live for 2 weeks - Sorter led task market place - Each sorter has a profile - Customer searches by task & location (i.e. cleaning) - Customer selects Sorter from a list of profiles
An unskilled tasks market place
PIVOT
@oxygenaccel www.oxygenaccelerator.com
sortedlocal.com
Data – 2 weeks old - 2000 customers signed up - 31 tasks posted - 5% bounce rate on website - Zero tasks completed (via site) - Transactions are being taken off-line - 150+ clicks on Book now button on Sorter profile
An unskilled tasks market place
GROWTH ENGINES
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- Sticky Engine - Viral Engine - Paid Engine
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LAUNCH
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AARRR – Pirate Metrics
Simon Jenner CEO, Oxygen Accelerator
@simonjenner
AARRR
@oxygenaccel www.oxygenaccelerator.com
- Acquisition - users come to the site from various channels
- Activation – users enjoy 1st experience
- Retention - users come back re-visit site
- Referral - users like it enough to refer others
- Revenue – users pay
AARRR
@oxygenaccel www.oxygenaccelerator.com
ACQUISITION
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- What?
- SEO, Social Media, Blogs, Email - Affiliates, Direct, pay per click adverts
- Measure? - Unique visits, visitor sources, user demographic,
cost per acquisition
CPA
ACTIVATION
@oxygenaccel www.oxygenaccelerator.com
- What?
- Landing page optimization - UI/UX iterations - Value proposition
- Measure? - Conversions (signup, download) - Bounce rate - Dwell time CPA
RETENTION
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- What?
- Email reminders, notifications, newsletters - Notifications, popups - Re-target advertising
- Measure? - Monthly active users (MAU) - Web re-visits - Email open % - Click though % from reminder/notification LTV
REFERRAL
@oxygenaccel www.oxygenaccelerator.com
- What?
- Social sharing, discounts, invitations, competitions
- Measure? - Viral Loop or virality ratio - Invite to signups (1:0.2)
CPA
REVENUE
@oxygenaccel www.oxygenaccelerator.com
- What?
- In app purchases, subscription, one off payment
- Measure? - Revenue per user
LTV
FUNNEL
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£££££
Visitors Clicks on more information button
Clicks on start free trial
Completes registration info Verifies e-mail address
Logs on
Logs on twice
50,000
5,000 10:1 Funnel
2:1
100:1
KEY
@oxygenaccel www.oxygenaccelerator.com
- Cost Per Activation (CPA)
- How much do you spend to activate each user - Calculated by acquisition spend divided by the number of
signups - i.e. spend £100 to get 10 users = £10 CPA
- Life Time Value (LTV) - Revenue from customer over the length of time they stay with
you - Calculate by monthly revenue timed by average months
retained - i.e. £10 per month * 4 –months = £40 LTV
LTV CPA
@oxygenaccel www.oxygenaccelerator.com
IF IT MOVES MEASURE IT