Systems thinking as the main driver of growth: the concept of Growth System
Often growth is perceived as a set of hacks to increase the metric. But this is only the tip of the iceberg. How to invent large-scale metrics for the multiple growth of metrics, and not just to be inspired by strangers, says Bayram Annakov, CEO of App in the Air, at the Epic Growth Conference product marketing conference .
How does the Growth System on the example of mobile products. Watch the video recording of the performance or read the transcript under the cut.
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All startups want to see exponential growth in their analytics system at least once. In the case of App in the Air, this growth happened only once, when we switched to the subscription model. But any product manager who has experienced exponential growth will agree that this is actually an approximation. There is no perfect exponential growth. This is a set of changes and new features in a given time range.
There is no perfect exponential growth.
If you want to engage in growth hacking, it is important to think first of all about the framework. A framework is a system of thinking, a concept that gives you rules or principles for work.
In order to formulate a framework for self-generating ideas for product growth, I will start with one and only concept - this is a feedback loop. Everyone is used to thinking that there is a reason and there is a consequence. But few people think that sometimes the effect causes a cause. The cause leads to the effect, but the effect intensifies the cause.
A simple example is that you have a deposit in a bank, and a certain percentage is charged on it. The more money you have in the bank, the greater the interest income. But the emergence of interest income increases the amount of money in the bank and the interest rate is triggered by a larger amount. Because of this, it generates an even greater interest income, which further increases the deposit, which further increases the interest income - as a result, you get the same exhibitor.
Growth in mobile products
Let's try to apply this framework to the growth of mobile products. You have some number of active users. The more active users, the higher the visibility of the product in the App Store. The ranking algorithms take into account not only the number of application installations, as it was before, but also the number of active users. Further, following this logic, the greater the visibility of the product, the more downloads. The more downloads, the more users. Here we see an exhibitor that will work just like money in a bank. This is the first mutually reinforcing feedback loop that works in all mobile products.
We turn to the second aspect. The more viral active users, the more people talk about your product. The more people talking about your product, the more new users will learn about your product.
The more users learn about the product, the more they want to download it, and the more they download, the more active users. Again a feedback loop that is amplified from a single point.
The third and key aspect. If you monetize the product, then this loop is directly related to monetization. The more users, the more paying, and therefore, more money that you can spend on attracting new users. The feedback loop twists.
There will be magic now. Let's try to collect all aspects into one picture.
The yellow color indicates the viral loop (loop), cyan is ASO, and green is the paying users. One of the central positions is occupied by the number of new users, and if you look a little deeper, this is the number of active users. We see that active users - the main thing that causes the growth of all these loops. This is the only thing that creates the basis for exponential growth. But for active users to be, of course, we need to get them somewhere.
In fact, you just need to do one thing - you need to calculate the transition coefficients from one state to another.
Imagine if all this could be counted in Excel, what would you lack? You understand the concept, you understand that there are three key feedback loops that are between them. How can I translate this into concrete forecasts, how will my user base grow? What is the ratio between the number of active users and visibility in the App Store? What is the ratio between visibility on the App Store and the number of new organic downloads? What is the ratio between people who are active users, and those who shirit something about your product? What is the ratio, if you zipped on WhatsApp and sent to only one user, or you zasherili on Facebook, 10% of your friends saw, and some of them eventually downloaded. You just need to calculate all these coefficients, take into account the time, the time axis and build a series of differential equations to solve this problem. In fact, there are tools that automate all miscalculations.
I want to draw your attention not to the coefficients, but to the approach. Often, the product team chooses some of the coefficients for itself and chops to increase this coefficient. But at the same time, they are missing a bottleneck in another coefficient, and this coefficient is zero. Here it is important to see the entire exponential picture, that is, the system and how it interacts. This is a key message that I would like to convey.
I am confident with a 90% probability that in a company with more than 10 people, no one sees this big picture, and the inefficiency of some people kills the excessive effectiveness of others.
When you see the whole picture, it is very easy to generate improvements in the product. For example, how many people saw on Facebook advertising your product and eventually downloaded? If the percentage is zero - this is your bottleneck. And this is your improvement lever, where the slightest 1% change can lead to a multiple increase.
Growth hacking de facto - to find a level that will give the system a shift in the right direction, taking into account its inertia. Often we focus on trees, focus on specifics, try to optimize some small part of the task, without seeing the whole picture. If you do not see the whole picture - it is very difficult to build an unambiguous understanding of this picture for the whole team or company. Therefore, the famous expression: “To see the forest, not the trees” is a key idea. Allow yourself the time and opportunity to look at what is happening in the company and see the whole picture than what each of the ants in your anthill is beating.
The question arises: "And how to do it?". The only book that I would recommend on this topic is the book by Donella Meadows, which was translated into Russian as the “ABC of Systems Thinking”. Think more systematically, try looking at the picture above than everyone can see, and solve the differential equation.
Epic Growth Conference is a product marketing conference organized by Mobio , Getloyal and Appsflyer with the support of myTarget , Appnext .
Subscribe to the Epic Growth Channel in the Telegram, and be the first to know about top content in product marketing.
Full transcript on Cossa.ru .
How does the Growth System on the example of mobile products. Watch the video recording of the performance or read the transcript under the cut.
')
All startups want to see exponential growth in their analytics system at least once. In the case of App in the Air, this growth happened only once, when we switched to the subscription model. But any product manager who has experienced exponential growth will agree that this is actually an approximation. There is no perfect exponential growth. This is a set of changes and new features in a given time range.
There is no perfect exponential growth.
If you want to engage in growth hacking, it is important to think first of all about the framework. A framework is a system of thinking, a concept that gives you rules or principles for work.
In order to formulate a framework for self-generating ideas for product growth, I will start with one and only concept - this is a feedback loop. Everyone is used to thinking that there is a reason and there is a consequence. But few people think that sometimes the effect causes a cause. The cause leads to the effect, but the effect intensifies the cause.
A simple example is that you have a deposit in a bank, and a certain percentage is charged on it. The more money you have in the bank, the greater the interest income. But the emergence of interest income increases the amount of money in the bank and the interest rate is triggered by a larger amount. Because of this, it generates an even greater interest income, which further increases the deposit, which further increases the interest income - as a result, you get the same exhibitor.
Growth in mobile products
Let's try to apply this framework to the growth of mobile products. You have some number of active users. The more active users, the higher the visibility of the product in the App Store. The ranking algorithms take into account not only the number of application installations, as it was before, but also the number of active users. Further, following this logic, the greater the visibility of the product, the more downloads. The more downloads, the more users. Here we see an exhibitor that will work just like money in a bank. This is the first mutually reinforcing feedback loop that works in all mobile products.
We turn to the second aspect. The more viral active users, the more people talk about your product. The more people talking about your product, the more new users will learn about your product.
The more users learn about the product, the more they want to download it, and the more they download, the more active users. Again a feedback loop that is amplified from a single point.
The third and key aspect. If you monetize the product, then this loop is directly related to monetization. The more users, the more paying, and therefore, more money that you can spend on attracting new users. The feedback loop twists.
There will be magic now. Let's try to collect all aspects into one picture.
The yellow color indicates the viral loop (loop), cyan is ASO, and green is the paying users. One of the central positions is occupied by the number of new users, and if you look a little deeper, this is the number of active users. We see that active users - the main thing that causes the growth of all these loops. This is the only thing that creates the basis for exponential growth. But for active users to be, of course, we need to get them somewhere.
In fact, you just need to do one thing - you need to calculate the transition coefficients from one state to another.
Imagine if all this could be counted in Excel, what would you lack? You understand the concept, you understand that there are three key feedback loops that are between them. How can I translate this into concrete forecasts, how will my user base grow? What is the ratio between the number of active users and visibility in the App Store? What is the ratio between visibility on the App Store and the number of new organic downloads? What is the ratio between people who are active users, and those who shirit something about your product? What is the ratio, if you zipped on WhatsApp and sent to only one user, or you zasherili on Facebook, 10% of your friends saw, and some of them eventually downloaded. You just need to calculate all these coefficients, take into account the time, the time axis and build a series of differential equations to solve this problem. In fact, there are tools that automate all miscalculations.
I want to draw your attention not to the coefficients, but to the approach. Often, the product team chooses some of the coefficients for itself and chops to increase this coefficient. But at the same time, they are missing a bottleneck in another coefficient, and this coefficient is zero. Here it is important to see the entire exponential picture, that is, the system and how it interacts. This is a key message that I would like to convey.
I am confident with a 90% probability that in a company with more than 10 people, no one sees this big picture, and the inefficiency of some people kills the excessive effectiveness of others.
When you see the whole picture, it is very easy to generate improvements in the product. For example, how many people saw on Facebook advertising your product and eventually downloaded? If the percentage is zero - this is your bottleneck. And this is your improvement lever, where the slightest 1% change can lead to a multiple increase.
Growth hacking de facto - to find a level that will give the system a shift in the right direction, taking into account its inertia. Often we focus on trees, focus on specifics, try to optimize some small part of the task, without seeing the whole picture. If you do not see the whole picture - it is very difficult to build an unambiguous understanding of this picture for the whole team or company. Therefore, the famous expression: “To see the forest, not the trees” is a key idea. Allow yourself the time and opportunity to look at what is happening in the company and see the whole picture than what each of the ants in your anthill is beating.
The question arises: "And how to do it?". The only book that I would recommend on this topic is the book by Donella Meadows, which was translated into Russian as the “ABC of Systems Thinking”. Think more systematically, try looking at the picture above than everyone can see, and solve the differential equation.
Epic Growth Conference is a product marketing conference organized by Mobio , Getloyal and Appsflyer with the support of myTarget , Appnext .
Subscribe to the Epic Growth Channel in the Telegram, and be the first to know about top content in product marketing.
Full transcript on Cossa.ru .
Source: https://habr.com/ru/post/359068/
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