Growing your user base

In 2018, I started and led the growth function at Quizlet, the most popular study app in the US. We managed to hit a new milestone of 50M monthly users (up 66% from 30M in 2017)! This was my first experience in growth (I have been a product and a platform PM in the past) and I’m very glad I did it as it helped me understand a key aspect of scaling a business. This post is a summary of what I have learned.

What is growth?

Imagine you have a shop selling products. The product teams help improve the products or create new products. The growth team has a different role. They get more potential customers into the store, match them with the right products and help them understand the benefits, get more visitors to purchase the products and come back for more.

Growth is a scaling function — you should invest in growth only after you have evidence of a product-market fit i.e. your product solves a need for a target user base. The tactics that you use for getting to product-market fit or to get your first batch of users are very different from those that will help you scale your user base. Prematurely focusing on growth can be pretty damaging (more on that here)

So how can you get started with growth?

1. Understand your product and your users

Every product or marketing job starts here. You need to understand the product that you are selling and the customers who use them or would want to use them.
  • What does your product do? What “job(s)” does it do for users?
  • Not all users are the same. Segment your users by their needs or by their workflow. For e.g., at Quizlet, we have both student and teacher users, and their needs are pretty different.
  • Understand each segment — what jobs are they hiring your product for? what’s their “hiring criteria”, frequency of need and workflow, what is their aha moment?
You can get to these answers with user surveys, user interviews, by talking to key people in your company and with data analysis. A good practice is to document, share and iterate on these answers with your team.

2. Understand the Growth equation

The key measures of growth are typically the number of “active” users over a period of time and how that number is growing over time.
  • How you define “active” depends on your business. Typically, you’d count a user as active if they benefited from your product and/or performed action(s) that contributes to near or long-term success of your business.
  • The period of time also depends on your business. It can be monthly, weekly, daily etc. depending on the average frequency at which your customers use your product. At Quizet, we use 28 days instead of monthly as months have different number of days.
These key metrics tell you how you are growing but don’t help you figure out how to improve. For that, it helps to break down the key metric into its components.
Monthly active users = first-time actives + returning actives
But that’s still a bit high level, so you can break it down further.
Monthly active users = new actives this month +returning actives (returning actives from last month) + resurrected actives (returning actives from previous months)
You can break down returning actives even further:
Monthly active users = new actives this month + [actives last month — churned actives (active users who didn’t return)]+ resurrected actives
This equation makes clear the different components that contribute to your growth and what you can do about it — increase new actives, reduce churn and resurrect churned actives.

3. Understand the funnel

You should get familiar with these numbers and you’ll also have to see a 13 month+ trend to understand the seasonality of your business. Set up some sort of dashboards and monitor them regularly. All this may take a while and require developer/analyst cycles, so prioritize the important metrics (italicized) first.

Acquisition or traffic
  • Monthly traffic
  • New vs returning
  • Channels and traffic per channel. Common channels are search, referrals and paid ads
  • Traffic per platform and geography
Active users
  • Monthly active users
  • New vs returning
  • Conversion rate from traffic to active
  • Conversion rate of different acquisition channels and flows that convert the best
  • Conversion rate in different acquisition channels and flows that convert the best
  • Actives per segment, channel, platform and geography
Retention and Resurrection
  • Month over month retention: How many users from the previous month returned. It‘s better to track retention by cohorts of when the user first started using your service
  • Resurrection rate: How many users from prior months (not counting active users from last month) returned this month?
  • Retention rates per segment, channel, platform and geography
Engagement level of active users
  • Number of sessions (or days used) per month or DAU/MAU
  • Quality of sessions: time spent, actions completed, transactions etc.

4. Improve the funnels

What you choose to do depends on the specifics of your business. But a couple of general things to keep in mind.
  • Focus! In growth, it’s very easy to get caught in the trap of trying to do too much and spreading too thin. Prioritize and pick only 1 or 2 themes every quarter and give yourself time to try multiple ideas, iterate and go deep. For e.g. if your traffic is high, but your conversion is low, focus only on conversion first.
  • Don’t blindly A/B test. As with product development, do your research first, lay out your hypotheses and ideas, predict impact & cost and prioritize.
  • Measure, learn and iterate. Define your experiment criteria upfront, measure and understand what’s happening, share your learnings and figure out what to do next.
Here’s a laundry list of example tactics for each part of the funnel:
  • Traffic: SEO, ask existing users to refer or share, paid advertising, partnerships.
  • Conversion to active: improve messaging and UX on key landing pages, improve sign up and on boarding, improve check out flow.
  • Retention: improve first-time experience, Email and push notifications with reminders or recommendations.
  • Engagement: lifecycle marketing, expose users to more features and use-cases.

Want to learn more?

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Learn by doing!
  • If you don’t have the opportunity yet, you can start with just understanding your company’s metrics (and share your insights to be considered for that opportunity!)