Increase Trial to Paid conversions by 10%

Sep 8

Increase Trial to Paid conversions by 10%

Our own product/design team were on a call with a UX expert this week. We were asked “whats your key usage metric?”.

There was a cavernous pause until someone said “perhaps David can answer that”.

It was a humbling moment.¬† Despite being a company that talks about: product management, user journeys, goals, “aha moments” and OKRs – we could not enunciate an answer that should really be a team mantra.¬†

As I opened my mouth to respond, I realized our OMTM (one metric that matters) is too glib and too obvious.

Laughably obvious.

What is our OMTM?

MRR: Monthly recurring revenue and MRR month-on-month growth are the metrics that investors want to see. But that is totally wrong at an execution level.

Many small-to-mid size teams (including us) get pulled in many different directions. It’s the CEO and the Product Manager’s job to keep re-iterating tangible goals that a team can execute on.¬†

Patrick Collins explained how Zip don’t use roadmaps but 90-day OKRs.¬†

To focus product teams, inherit from a larger  business metric like MRR:

Breaks down to at least, some macro areas:

  • Acquisition of Triallers (marketing team)
  • Trialler to Customer Conversion (Product Team, Customer Success)
  • Customer Retention (Product Team)
  • Plans and billing methods that work for customers (VP Product, VP Sales)

Then a product team would negotiate with the business that: “Trialler to Customer Conversion” can be expressed as a 90-day OKRs. For example:

“Increase Trial to Paid conversions by 10%”

But this may be still too abstract for the product team – they could formulate more granular metrics:

“20% increase of triallers complete and preview their first guide within 1 day”.

We now have a clear answer for “what is your key user activation metric?”

The team runs experiments focussed on hitting this goal and is a mantra for daily sanity checks on tasks. 

How Pointzi helps

Pointzi guides allow you to:

  • Target specific users. For example you may have several personas that connect into your App. You can guide each differently.
  • Track their interaction with the guide (did they use it or dismiss it)
  • Tie the guide to a Goal (your Product Metric).¬†
  • Do this without writing code. By having a no-code approach to helping user engagement with your product – you can keep your engineers focussed on features and fixes.

Proxy Metrics

Gibson Biddle, former CPO at Netflix has a 2019 series that is worth reading multiple times. Specifically relating to Proxy Metrics his piece on “How to define a metric to prove or disprove your hypotheses and measure progress”.¬†

He covers how you can map from a higher level business metric to a product level proxy metric. 

In the case above, even “Trialler to Customer Conversion” is large and too abstract for a product team, so breaking this down to “20% increase of triallers complete and preview their first guide within 1 day” is making a hypothesis that it “will move the needle” on the more abstract metrics.

I won’t reiterate Gibson’s full epic post but he suggests:

  • Is measurable.
  • Is moveable.
  • Is not an average.
  • Correlates to your high-level engagement metric.
  • Specifies new v. existing customers.
  • Is not gameable.

He also cautions that its not a quick fix: “we made decisions quickly, but isolating the right proxy metric sometimes took six months.”. Keep that in mind, you will be iterating on your metrics and the hypotheses that formed them.