Last night, Elie Khoury, Woopra CEO gave a talk at the SF Growth Hacker's meetup where he described the importance of growing efficiently and how growth hackers can contribute to this.
Elie explained how a company that invests in growing without optimizing margins will grow quickly but hit a plateau soon after. On the other hand, a company that first optimizes and then invests in growing will enjoy exponential growth (in perfect conditions). He described how growth hackers can contribute to optimizing an organization's margins by focusing on two main areas:
- Reduce Customer Acquisition Cost
- Improve Customer Retention
Reduce Customer Acquisition Costs
To reduce customer acquisition costs, Elie explained that companies should look not only at their short term funnels (e.g. signup), but also at their long term funnels (e.g. free trial conversion), which are often ignored. When analyzing these funnels, he also recommended that growth hackers compare how different segments move through the funnel. This allows you to understand how different factors may be affecting conversions (and what you can do about it).
Despite running an analytics company, Elie warned against relying solely on numbers. He advised growth hackers to look at their metrics to understand what's happening, but to dig deeper in order to understand the reasons behind the numbers.
Lastly, Elie introduced a beta Woopra feature that will be released within the next few months. The feature, called Ghost Goals, will allow users to include optional goals within their funnels. Including optional goals (i.e. goals that the visitor is not required to do in order to complete the funnel), allows growth hackers to see where there might be alignment between certain important, but not crucial, steps and conversion.
Improve Customer Retention
When running a retention analysis, Elie recommended growth hackers compare users within similar groups. For example, he suggested growth hackers look at a retention report of users who have converted into paying customers and for how long they continue to use the product rather than looking simply at people who sign up for a trial and how long they continue to return. Following this guideline allows you to get a better understanding of how engaged users are with your product.
Elie also recommended growth hackers focus on figuring out the right repeat actions to measure in their retention reports. For example, Instagram should be measuring how long users continue to take photos, not how long they continue to open the app.
Elie's last point on retention was that growth hackers should monitor at-risk customers based on behavioral cues in order to proactively save them.
Complete Slide Deck
For a closer look at Elie's talk, check out his slides.
Interested in learning more about growth hacking? Check out our post Customer Analytics For Growth Hacking.