Product Interview 5
activities of conversationalists
-responding to friend's photos on facebook -creating tweets -retweeting friend's tweets
product cost
-stage and gate 5 -costs associated with development, production, and distribution -if product is profitable (meets gate) move onto next step
Middle East Social Network Users
93M
Return on Investment (ROI)
Current value of asset - Purchase value of asset divided by purchase value of asset
New Users
Metric ga:newUsers UI Name: New Users The number of users whose session was marked as a first-time session.
purpose of demographics
age & gender. Demographic data is collected through cookies and mobile IDs (linked to Google code)
This is arguably the most difficult step of the marketing analytics process ... 1 Identify the metrics 2 Analyze the metrics 3 Take improvement actions
Take improvement actions
Customer Acquisition Cost (CAC)
The average amount that a company spends to acquire a single customer. CAC is the sum of all customer acquisition costs, including sales and marketing expenses (and salaries), divided by the number of customers acquired during the same period.
TRUE/FALSE: CLV model assumes if customer is lost (i.e. not retained), they are lost forever.
TRUE
audience properties segment
demographics, user interests, geo
ACV (annual contract value)
measures the value of the contract over a 12-month period.
increase
padidinti
revenue
pajamos
achieve
pasiekti
Email unsubscribe rate
percentage of any list of email subscribers that opt out of the list at any given period
customer journey phases
phases presenting potential battlegrounds where marketers can win or lose: 1) Initial consideration 2) Active evaluation 3) Moment of purchase 4) Post purchase experience
Competitive intelligence (CI) data collected with web-based CI tools is not useful for low-traffic websites (less than 100,000 unique visitors per month).
True
In general, social media ROI is the return a company gets from the time, money, and resources spent on social media marketing.
True
direct traffic
URL's that people type in or reach from user bookmarks
Internet Users by Major Country
USA: 286M (89%) China: 731M (52%) India: 462M (36%) Japan: 118 (93%)
Where are Event Reports Found?
Under the behavior sections
What is a reliable way to prioritize?
Using a matrix with the following headers: - Revenue - Customer Satisfaction - Ease of Implementation - (Overall Score)
Types of Integration
Vertical Integration (one member of the distribution channel owns the other members but each continues to perform a separate task.), Administered VMS (One member of the channel is large and powerful enough to coordinate the activities of the other members without an ownership stake)
% new session
an estimate of the percentage of first time visits
Lifetime value (LTV)
average gross revenue generated by a customer over the period of retention
Step 4 of 5 in design process
Define REQUIREMENTS
ACV
Definition: Annual Contract Value of a subscription agreement. The annualized version of MRR (Monthly Recurring Revenue).
Average Contract Length
Definition: Assuming a mix of different contract lengths, this gives you the average duration in months or years.
SaaS
Definition: Software as a Service. SaaS/subscription businesses are more complex than traditional businesses; traditional business metrics totally fail to capture the key factors that drive SaaS performance.
Impact of Faster Growth on P&L/Cash Flow
Explanation: If we experience a cash flow trough for one customer, then what will happen if we start to do really well and acquire many customers at the same time? The model shows that the P&L/cash flow trough gets deeper if we increase the growth rate for the bookings.
Cost Per Lead (CPL)
Measure the cost-effectiveness of marketing campaigns. Formula: Cost per Lead = Cost of Generating Leads / Total Leads Acquired - Measures how cost-effective your marketing campaigns are when it comes to generating new leads for your sales team. - It also provides important data to use in your return on marketing investment calculation. Success Indicators: - Minimize the cost per lead, a low cost per lead with a high volume of quality leads is a good indicator that your campaign is doing well.
Average Time On Page
Measure the duration of time a viewer spends on a page. Formula: (Time visitor A spends on page + Time visitor B spends on page + ... + Time visitor N spends on page)/Total visitors on page - Reporting Frequency: Weekly - Example of KPI Target: 5 minutes - Audience: Marketing Manager - Variations: Page view duration
Average Time to New Content
Measure the duration of time between the latest published piece of content and publishing piece of content and publishing a new piece. Formula: (Time between content A and B + Time between content B and C + Time between content N and X)/Total number of content pieces published - Reporting Frequency: Quarterly - Example of KPI Target: 3 days - Audience: Marketing Manager, Content Marketing Manager, Content Marketing Team - Variations: Time between content
Dormancy Rate
Measure the number of customers that are not using your product in a given time period. Formula: (Customers not using the product within time period/Total number of customers)x100 - Reporting Frequency: Monthly - Example of KPI Target: 7% dormant - Audience: Marketing Manager, Support Manager - Variations: Rate of dormancy
Unsubscribes
Measure the number of users who have previously subscribed to your site and no longer wish to subscribe. Formula: Unsubscribes/Total subscribers Reporting Frequency: Monthly Example of KPI Target: 2% unsubscribes Audience: Marketing Manager Variations: Subscribers choosing to unsubscribe
Cost per order
cost to generate an order (sale), precise form of this cost depends on the industry and is complicated by product returns and multiple sales channels
which stl categories are the smallest?
creators and collectors
Business Marketing Channels
Producer -> Manufacturer Rep. -> Business Distributor -> Customer
4 P's of Marketing
Product Price Promotion (marketing) Place (distribution)
Bottom Up vs Top Down
Bottom Up: ideas come from devs / PMs Top Down: ideas come from execs that supply long term vision
What is ACCORD
Products that are substantially better, requir new behaviors, are hard to explain, hard to observe, risky, and non-trial-able require a skim strategy
When conducting a survey, you should ask the customer as many questions as possible.
false
When considering their social media ROI, it's not important for a company to define their social media goals.
false
Lewis Jacobs
films made for working class; "workmen and families didn't mind the crowd"
If a product is in its mature stage...
focus on manufacturing, costs, and competition
How do you calculate bookings?
in a given period, typically a month or a year, bookings is the sum of the dollar value of bookings from new customer contracts, expansion bookings from existing contracts with the installed customer base, and churned bookings from customers leaving (three components are new + expansion - churn)
D1, D7, D30, W1 Retentions
indicate the percentage of users who are active after one, seven and 30 days after signing up.
purpose of geodata
location and language preference. This data is collected based on a user's browser settings.
friends/followers/supporters
looks at number of friends of the entity registered/joined a social network
CPI, CPC, and CPO
measure the average cost of impressions, clicks and customers. starting point for assessing the effectiveness of a company's internet advertising and can be used for comparison across advertising media and vehicles
Visitors
measures the number of people making those visits When an individual goes to a web site on tuesday and then again on wednesday, this should be recorded as two visits from one visitor in the week
Average revenue per user
mobile metric used for app marketers, divides total revenue by number of users
basket to buy rate
number of all completed shopping carts within a particular product / total number of shopping carts with a particular product OR number of website visitors who have submitted to shopping cart / number of unsent shopping carts
Download
number of times an application or file is downloaded
Customer Retention Rate (CRR):
percentage of customers who return to buy again.
Email click through rate
percentage of emails delivered that get clicked on
position
place product or brand occupies in consumers' minds relative to competing offerings
Digital Pros/Cons
plus- selective targeting, interactive, direct response, metrics cons- fragmented, low click through, limited creativity, privacy/transparance
What is AdSense
Program whereby websites can show Google ads on their own websites to earn ad revenue
particular
tam tikras
Unearned or Deferred Revenue
the cash you collect at the time of the booking in advance of when the revenues will actually be realized.
customer journey
the complete sum of experiences that customers go through when interacting with your company and brand - is a circular journey (research) o Subjective - what they think, not you or another customer o Context: History - steps and experience that got them there Future - their end goals (you can forecast, use data from those with similar journeys) Now - what options they have now (you can help them in real time) o Modelled by using stream or timeline data at any scale o What people are interested in and all timescales (by seconds, years) or higher scales (buying a car v coffee)
Bounce rate measures
the effectiveness of a website in encouraging visitors to continue their visit
landing page
the first page that a customer views when they arrive at a website
visit duration
the length of time in a session
Conversion Funnel Rates:
the portion of customers who make it through to the next level of each step in the journal from impression to conversion (e.g., from impression to click-through; then from click-through to placing an item in the shopping cart; then from the shopping cart to checking out).
Email response is an important way of judging
the success of email campaigns, individual emails, and lists
conversion rate
the total conversions divided by the total reach
pageviews
the total number of pages view. repeated views of a single page are counted
Participants of a lab usability test should be told up-front that:
they themselves are not what is being tested; it is the website that's being tested
motivation of conversationalists
to communicate and interact
social - organic
traffic from social networks
Computing Likelihoods of Success in Journey
visit store -> find product -> like product -> purchase product .9 x .9 x .9 x .9 = 65.61% vs. find product -> like product -> visit store -> purchase product 1 x .9 x .9 x 1 = 81.00%
One Click Rate (Single view rate, Bounce rate)
visitors land on page and exit without viewing any other page (usually 0-30% is okay)
____ = Total visits to a webpage (non-unique, including unlimited visits by the same person). _____ = Total # of sales leads by the total number of sales _____ = Total unique visitors to a webpage (monitored by IP address) _____ = The total number of new-site vs recurring visitors _____ = The amount of time a customer spends on a site _____ = Number of people who typed in the URL to get to the website _____ = Number of people who clicked a link from another website to get to the website. _____ = Number of people who reached the website by performing a search from sites like Google or Bing _____ = Number of people who found the website through social media _____ = Percentage of people who leave the webpage after viewing only one page _____ = Ratio of people who click on a link compared to the total number of people who saw the link. *** _____ = Percentage of customers who return to buy again
visits lead to close ratio Unique visitors New sessions Site Time Direct traffic Referrals Organic Traffic Social traffic Bounce rate Click through rate Customer retention rate
Number of Key User Actions per Session
vital KPI for product and customer success
"Relevant" Touchpoints (continued)
website, app, social media, store, etc. with other "relevant" entities/elements (other customers) context/environment: real, virtual, customer's mind and memory
referral
when a user ended up on a page by clicking on a link that appeared on a different website
Affordance
when the appearance of a specific control suggests its function
Customer Acquisition Cost (CAC) Ratio
CAC_current_q = [ Gross Margin_current_q - Gross Margin_previous_q ] x 4 / Sales & Marketing Costs_previous_q CAC < 1/3 (3 years or more payback) bad; refine sales model CAC > 1 (payback less than 1 year) invest more money immediately and step on gas during good times and tie growth to cash flows in downturn
What framework is used for Product Design questions?
CIRCLES
Acronym to outline steps in product design question?
CIRCLES -Comprehend the situation -ID the customer -Report customer needs x2 -Cut, through prioritization -List solutions x3 -Evaluate trade-offs, mention design criteria -Summarize recommendation
ROI
Return on Investment -Ratio btw business value and complexity
Acronym to manipulate prod/serv?
SCAMPER S.ubstitute C.ombine A.dapt M.odify/Maginfy P.ut to other use E.liminate R.everse/Rearrange
12 x 12
144
13 x 14
182
13 x 15
195
14 x 14
196
Sales Metrics: Average Sales Cycle Length, Annual Contract Value
Average Sales Cycle Length: Average # days for lead to convert to active paying customer
Product development process
1. Strategy 2. Idea generation 3. Idea screening 4. Business Analytics 5. Development 6. Test Marketing 7. Commercialization 8. New product
____ will be the major competitive differentiator for brands.
Best-in-class customer experience
In general, long tail search keywords are fairly easy to rank in Google because they have low search volumes.
True
Psychological Pricing Tactics
Price Ending, Odd-Even/Tier, Price-quantity, Reference Prices
Price Floor
Product Cost
Recurring Gross Profit Formula
RGP = MRR - Recurring COGS
What is a common example of payments to third parties?
Software license fees
Streaming Services - Paid Subscriber Base
Spotify: 100M Netflix: 150M Apple Music: 56M Pandora: 6.8M Hulu: 27M HBO Now: 8M
search - paid
advertising
recent
dabartinis
Race Films
made for black audiences
Segmentation
1) Geographic 2) Demographic 3) Psychographic 4) Behavioral
It avoids being fashionable and therefore never appears antiquated. Good design is _____________.
Long Lasting
Google Web Products (4)
chrome search toolbar bookmarks
Impression
(SERP) - users enter queries - keywords/ads eligible to match queries - high ad rank of keywords (bid X qs)
What is LTV equal to?
Lifetime Gross Profit
Books
Value of contract between company and customer
touch point
sąlyčio taškas
US Population
300M
relevant
aktualus
Revenue (Conversions x AOV)
(Website) - impression - click - cost - conversion - higher AOV - higher revenue
4Ps & 3Cs of Marketing
* Product * Price * Place * Promotion * Customers * Company * Competitors
Market-sizing Questions
- "I'm not that familiar with this market, so if my assumptions are off, please correct me." - Memorize data about the region - Write the information, best to draw a table
What is ratio from Engineers to Product HC in SaaS?
- 1 Product HC for every 5 engineers - 1 Product Manager for every 7 engineers - 1 UX person for every 7 engineers
Overview of Metric Types
-strategic metrics -support metrics
What metrics can you view in an Event report?
-total events -unique events -Even and Avg. Value
1/100
0.01
4 Different Pricing Methods
1. Cost-plus 2. Value, how much they willing to pay 3. Competitive, check competitors 4. Experimental
Active Gmail Users
1.1 billion
Japan Population
126M
US Percent Over the Age of 65
13%
US percentage over age 65
13%
Average Cost-per-click on Display Network
<$1
What is the CIRCLES Method?
A guideline on what makes a complete, thoughtful response to any design question. It's a memory aid that prevents us from forgetting a step in the interview.
Key Performance Indicator
A metric that measures if an objective has been met.
Revenue Equation
AOV x Impressions x CTR x CVR
Google Business Products (3)
Adwords Google apps for businesses, e.g. Drive, Email, Calendar, Docs, etc Cloud (remote servers)
Customer Experience Strategy
An ongoing process of assessing and managing customer experiences across the customer lifecycle.
Months to Recover CAC =
CAC / Avg. MRR per Customer X Gross Margin
*BCG and McKinsey matrixes use the same axis markings.
False
Purpose of measuring rich media display time and interaction rate
Determine how an advertisement engages viewers How long their advertisements are holding the attention of potential customers
What is Expected Lifetime (eLT)?
Expected Liftime is the length of time a company expects to keep paying a customer
CLV =
Expected revenue from customer over lifetime - Expected costs from serving customer over life
Customer Segmentation
Explanation: In all SaaS businesses there will likely come a moment where they realize that not all customers are created equal. As an example, bigger customers are harder to sell to, but usually place bigger orders, and churn less frequently. We need a way to understand which of these are most profitable, and this requires us to segment the customer base into different types, and compute the unit economics metrics for each segment separately. Common segments are things size of of customer, vertical industry, etc. Despite the added work to produce the metrics, there is high value in understanding the different segments. This tells us which parts of the business are working well, and which are not. In addition to knowing where to focus and invest resources, we may recognize the need for different marketing messages, product features. As soon as you start doing this segmented analysis, the benefits will become immediately apparent. For each segment, we recommend tracking the following metrics: - ARPA (Average Revenue per Account per month) - Net MRR Churn rate (including MRR expansion) - LTV - CAC - LTV: CAC ratio - Months to recover CAC - Customer Engagement Score Brad Coffey, HubSpot: "At HubSpot, we started to see some of our biggest improvements in unit economics when we started segmenting our business and calculating the LTV to CAC ratio for each of our personas and go to market strategies. As one good example - when we started this analysis, we had 12 reps selling directly into the VSB market and 4 reps selling through Value Added Resellers (VARs). When we looked at the math we realized we had a LTV:CAC ratio of 1.5 selling direct, and a LTV:CAC ratio of 5 selling through the channel. The solution was obvious. Twelve months later we had flipped our approach - keeping just 2 reps selling direct and 25 reps selling through the channel. This dramatically improved our overall economics in the segment and allowed us to continue growing. We ended making similar investments in other high LTV:CAC segments. We went so far as to incentivize our sales managers to grow their teams - but then would only place new sales hires into the segments with the best economics. This ensured we continued to invest in the best segments and aligned incentives throughout the company on our LTV:CAC goals. It also allowed us to push innovation down to the sales manager level. Managers could experiment with org structure, and sales processes - but they knew that if they didn't hit their LTV:CAC goals they wouldn't be able to grow their teams. Calculating LTV:CAC by segment can be challenging, especially on the CAC side. It's relatively easy at the top level to add up all the marketing and sales expense in a period and divide it by the total number of customers (to get CAC). Once you try to segment down your spend you run into questions like 'how much marketing expense do I allocate to a given segment', 'how much of the sales expense'? We solved this by allocating marketing expense based on number of leads and sales expense based on headcount but it's not perfect. For us the keys are: 1) Needs to account for all costs - no free lunch, 2) It needs to be consistent over time. Progress on improving the metric is more important than the actual value."
According to Avinash Kaushik, simply stating an average (for example, the 'average conversion rate' for a website) is a useful technique for measuring KPIs.
False
Preisdifferenzierung
Gleiche Produkte -> Unterschiedliche Preise Ziel: Gewinnsteigerung durch Abschöpfen der unterschiedlichen Zahlungsbereitschaften Differenzierung nach Raum, Zeit, Menge, Leistung Beispiele: Flugtickets
How I am sure that I am choosing right customer experience
If you meet success criteria in labs, test new design through an AB Test built by engineering team. Now you'll be able to measure your hypothesis against quantitative feedback from AB Test. If the AB test successfully meets measurements identified in hypothesis, then productionize the feature and release it to the rest of the customer base
Cost Equation
Impressions x CTR x CPC
Category
Lets you organize the events you track into groups
Annual Recurring Revenue
Measure of revenue components that are recurring in nature (excludes on-time non-recurring fees and professional services
Penetrating
Priced Low - Get everyone
One way to provide context to your data is to segment it.
True
overwhelmingly
be galo
#of people who saw your add
impression
take
imti
along
išilgai
Hits
the total number of files requested in a given period.
The Ethics of Marketing Analytics Metrics
-The "personalized shopping experience" doesn't sound like a bad thing. Do you think it is a good one? -Many companies are able to retrieve and predict personal customer information and do with it as they please. Does this make you uncomfortable? Why or why not? -What some unethical ways you believe companies are able to get personal information on customers to support their metrics?
Digital Marketing Metrics
-Total conversions -Impressions -Total Reach -Conversion rate -Micro Conversion Rate -Conversion Funnel Rate -Lead to Close Ratio -Total Visits -Unique Visitors -New Sessions -Site Time -Direct Traffic -Referrals -Organic traffic -Social traffic -Bounce rate -Click through rate (CTR) -Customer Retention rate (CRR) -Customer Acquisition Cost (CAC) -Open Rate -Mobile Traffic
market and competitive analysis
-stage and gate 4 -in-depth analysis of market (potential customers) and industry (competitors) -will look at number of potential customers, size of competitors, competitive intensity
1/8
0.125
1/6
0.16667
1/5
0.20
What is a powerful way to visualize a customer persona? What are each of the elements?
1) A 2x2 matrix. 2) - [name], the [persona] (maybe a stick-figure) - Behaviors - Demographics - Needs & Goals
Steps for Designing Product Question
1) Ask questions about problem (clarify) 2) Provide structure 3) Identify users / customers 4) Use cases? Why use product? 5) How well is product w/use cases? 6) What features / changes to improve? 7) Wrap up *Remember to define MVP. Then other features are improvements do ROI
How to Build Trust w/Stakeholders?
1) Be willing to learn and let others know 2) Understand the industry and tech 3) Use metrics / stats to reduce subjectivity 4) Communicate and be transparent...keep stakeholders up-to-date
Pricing Strategies
1) Cost Plus Pricing 2) Value Pricing 3) Competitive Pricing 4) Experimental Pricing
Revenue Estimation Question Solving Steps
1) Estimate revenue for a single store / product 2) Estimate total # of store (total units) 3) Multiple 1 and 2 for revenue
Steps for Improving Product Question and Favorite Product
1) Goals 2) Problems 3) Solve Problems 4) Validate Success 1) What problems does it solve? 2) How does it accomplish goals? 3) How does it compare to alternatives? 4) How would you improve it?
Make an App "Sticky" From the Start
1) Let the user try it with no strings attached 2) Keep away from indirect competitors 3) Advertise the possibilities and benefits first 4) Less is more 5) Bridge the gap between the physical and digital worlds
Goals of SAAS Model
1) Retain customers 2) Grow base 3) Efficient growth (balancing acquisition cost with CLTV and fostering healthy account expansion - High LTV:CAC Ratio) Sell to most valuable, sticky segments, longer term, ability to expand
Goals of SAAS Model
1) Retain customers 2) Grow base 3) Efficient growth (balancing acquisition cost with CLTV and fostering healthy account expansion)
Porter's 5 Forces
1) Rivalry among competitors 2) Buyer Power 3) Supplier Power 4) Threat of Substitutes 5) Threat of New Entrants
Population-based questions
1. Break down population by generation. 2. Make assumptions by generation. 3. Calculate %s and then numbers by generation. 4. Review final answer ** Always draw a chart
3 Overall Themes Google Interviews On
1. Design: Aesthetics of product, intuition 2. Analysis: Data-driven, knowing what you don't know, measure whether it's working 3. Business: How does this fit into larger business model
Google: 4 of their Product areas I said I wanted to work on
1. Home Automation acquisitions, like Nest and DropCam 2. E-commerce tools I used extensively while running my own company, like Google Ads and Analytics 3. Consumer products I personally use all the time, like Gmail and Drive 4. Medical hardware products where my degree in biology and experience in mass manufacturing would be useful, like Lift Lab's anti-tremor spoon and other anti-aging Calico products
My favorite products
1. Inbox. Gmail, I live in my inbox, now called Inbox, nice that it now incorporates to do list because that's what it did before, they should do conditional return to inbox 2. Kibana 3. Spoon Rocket in theory, now Sprig 4. Asana, great user experience
8 Things to Know About Company's Strategy
1. Mission: look it up 2. Strategy 3. Strengths 4. Weaknesses 5. Challenges 6. Opportunities 7. Threats 8. Future
6 Things to Know About Your Role
1. The role 2. Idea generation: bottom up or top down 3. Practical vs. crazy 4. Things to Changes: come in with ideas 5. What you want it: passion 6. Why it's a good fit
If you conduct a multivariate test in which 3 versions of an image are being tested with 4 versions of a headline, what is the total number of variations you will be testing?
12
___% of companies are able to successfully upsell or cross-sell to NEW customers
12%
Netflix Paid Subscriber Base
148M
12 x 13
156
CTR Google Search Ads
2%
Conversion
A stage in the conversion funnel where a potential customer purchases the product or services being sold by the company.
Interest
A stage in the conversion funnel where a potential customer shows that they are thinking of purchasing a product or service int he category that the business provides.
How Hits can be Organized Into Sessions Example 2
A user lands on a homepage of the google store The session begins with a pageview hit Then the user clicks the play button for a video that is being tracked with event tracking This triggers an event hit Google analytics will record two hits for that user in that session - a page view hit for the home page and an event hit for clicking the play button
CIRCLES - R - Report the customer's Needs (Use Case)
R - Report the customer's Needs (Use Case) Obtain the customer's needs Document as a user story - As a <role>, I want <goal/desire>, so that <benefit> Example: Discover New Books and Write a New Book
Referral Traffic
Measure the volume of traffic that are directed to your site from outside sources. Formula: (Traffic coming from other sites/Total traffic)x100 - Reporting Frequency: Monthly - Example of KPI Target: 1,000 refered users - Audience: Marketing Manager - Variations: Referrals
Customer Acquisition Cost (CAC)
Measure to total amount of capital it costs to gain a new customer. Formula: Total marketing spend on customer acquisition/Total new customers - Reporting Frequency: Monthly - Example of KPI Target: $142 per acquisition - Audience: Marketing Manager, Sales Manager - Variations: Average customer acquisition cost, Cost to acquire a new customer
Days to Break-Even know
Measures the average number of days it takes a customer to generate enough revenue to cover the CAC. In other words, it shows how quickly a company recovers its CAC.
ACV (Annual Contract Value)
Measures value of contract over 12 month period
Organic v/s Paid Traffic
Measuring traffic to your app or website from both organic and paid channels is necessary to understand how your product is growing. It helps you make better decisions about your marketing campaigns.
Downloads
Number of apps delivered by distribution deals
Child Audiences
"The Blue Bird" 1st feature length film by Maurice Tourneur
Gmail Monthly Cost per User (storage & bandwidth)
$0.05
US GDP
$16.8T
USA Ecommerce Sales
$400 billion
Snapchat Annual Ad Revenue
$404.5M
Google's revenue from ads in 2012
$42B
Churn rate =
(# customers lost during given period of time) / (# customers started with during given period of time)
Name 5 SaaS metrics you need to track in each segment of your business
(1) ARPA / ARPU (2) Net MRR churn (3) Gross MRR churn (4) LTV:CAC (5) Months to recover CAC
Four reasons why churn is important
(1) Acquiring customers is time and capital intensive, and the investment becomes meaningless if customers don't stay (2) It alerts you that there is something wrong with your product or your customer service (3) Churn becomes progressively more problematic as the company scales (4) High churn means you must spend more on new customers to compensate... negative churn will drive your business without acquiring a single new customer
If you had to choose one metric to judge a SaaS business by what would it be and why? What would the second be?
(1) LTV:CAC Ratio. Reason: Because what you pay for something should be a function of what it's worth - it's the only ratio that factors both the value and the cost of a customer (2) Gross revenue churn. Reason: if you can more effectively keep the customers / revenue you've already signed up and paid for, that, on average, has more of an impact than selling more to your existing customers
Breakeven formula
(P-VC)*Q = FC
How do you calculate the RICE score of a product/feature?
(Reach * Impact * Confidence) / Effort
What is the formula for Margin?
(Revenue generated by the customer) - (variable cost it takes to deliver the good or service to the customer)
Contribution Margin per Customer
(Revenue per customer) - (variable costs- any costs associated with serving customer)
Return on marketing investment formula is
(Revenue x Contribution Margin) / Marketing spending
Conversation Volume/Volume per Rep
(sometimes called "tickets") is the amount of conversations you are receiving or your reps are responding to on a regular basis. This could be an average, or a total for the amount over the past year, month, week or day. You can also determine how many conversations each of your reps is responding to.
10 Principles of Good Design
* Innovative * Useful (utility) * Aesthetic * Understandable (ease of use) * Unobtrusive * Honest * Long-lasting * Thorough / detailed * Environmentally friendly * As little design as possible
STP
* Segmentation: Grouping customers or buyers * Targeting: Choosing segments that would appreciate and seek out the product's benefits * Positioning: Develop detailed product positioning and marketing mix for the segment
10 Principles of Good Design (and best ones)
**Innovative **Makes a product useful (utility) Aesthetic **Understandable (ease of use) Unobtrusive **Honest Long lasting Thorough / detailed Environmentally friendly As little design as possible
Customer Experience Examples
- Lexus airbag recall experience at Lexus of Watertown - New Hampshire EZ-Pass experience - JetBlue in flight experience (Orlando to Boston) - Amazon bicycle-seats return experience - Zappos Bogs rainboots exchange experience
Story 6: Designing to production
- Moved to production in China - Built relationships, named Becky's baby - Organized without a hitch - Got to point where I trusted them with design
What are some common goals & metrics to clarify in a design problem?
- Revenue - User acquisition - User retention - Market share - Customer satisfaction - Conversion rate - Basket size
What are downfalls of looking at variable only CAC?
- Variable-only CAC fails to take into account things such as the segmentation work by product manager, the sales enablement tools, and the CRM system that helped bring in the deal - Variable-only CAC fails to take into account costs of onboarding - Variable-only CAC fails to recognize that fixed costs must scale over time as the company grows, usually in step-stair function as infrastructure is added
Power of Customer Experience
- beyond product: more than goods (physical products), more than services (intangible products) - beyond customer service - beyond interactions - beyond present time
Devices and Connectivity
- can increase the opportunity for, amount of, and types of interactions - smartphones, tablets, digital voice assistants (amazon echo, google home)
Phase 1: Identity Metrics
-Have a goal in mind -Come up with a question you need the data to answer -Metrics help bring meaning to the data -Metrics are quantifiable measures used to track the status of a marketing process -Metrics help determine if goals are being achieved
Design
-Starts with exploratory research -Social media analytics (likes, retweets, shares, etc.)
What's measured in concept test
-degree of liking -expected purchase frequency -price expectations -image
5. Joiners (59%)
-maintain a profile on one or more social netowkring sites and visit these sites on a regular basis
6 stages of the digital marketing funnel
1. visit 2. captivate 3. decide 4. order 5. pay 6. bind
5/4
1.25
Africa Population
1.2B
China population
1.3 billion
4/3
1.333
Asia Number of Internet Users
1.8B
US Households
100 million
Households in U.S
130 million
Population of Mexico
130 million
Brazil Number of Internet Users
139M
Middle East Number of Internet Users
141M
US Average Time Spent per Day on Mobile
3.7 hours
Scrolling
>Long Scroll - 1 long scroller >Infinite Scroll >Parallax Scrolling - 2D content moves as user scrolls
Data Management
>Search Filters (advanced search) >Settings >Context **e.g. 30 items left, or, because you viewed this item**
Campaign Objective
A goal that is specific to a campaign running for a determined length of time. An example may be for the campaign to drive 10% more traffic to a webpage during the month the campaign is running over what was driven to the same page the month previously.
Define usability metrics
A metric is defined as "a way of measuring or evaluating a particular phenomenon or thing". Usability metrics involve a user, doing something, with a product or system. Usability metrics and their measurement can show improvement, decline or indifference (i.e. no change) in a user's experience with an updated, improved or changed product or process.
Customer Churn Rate
A percentage of customers lost due to churn (cancellation or failure to renew). It is calculated by dividing the number of churned customers by the number of customers at the start of the period for which churn rate is calculated.
Break-even
A point when a company generates enough revenue from a customer to cover all the costs and expenses it took to acquire this customer.
Critical Path Dependency
A relationship where preceding tasks affect succeeding tasks in a sequence of activities.
Customer Journey
A series of all touchpoints a customer has with a company, brand, and product to reach a certain milestone.
Produktvariation
Anzahl der Produkte im Programm konstant Produktpflege Geringfügige Produktänderung (bugfixes) Produktmodifikation Produkt Relaunch, Neue Version bei umfassenden Veränderungen
Report customer needs
As a <role> I want to <goal/desire> so that <benefit>.
AIDA Customer Decision Model
Attention Interest Desire Action (Nurture)
Evaluation
Compare results to original goals
Quantitative or qualitative information that surrounds our key metrics is called:
Context
Step 3 of 5 in design process
Create PERSONAS
Customer Count Retention
Customer count retention is another metric sometimes used in conjunction with net revenue retention to get better visibility into underlying customer dynamics. It is simply based on a count of the customers active one year ago, and how many of those customers remain active today. The deficiency of this metric is that it treats all customers as financial equals, which can be misleading if the company has a wide variety of customer sizes. More often than not, the smaller, less consequential, customers churn more frequently, so this metric tends to overstate the impact of churn from a financial perspective.
____ is the number of customers of a firm for a specified period of time.
Customer counts
Churn % Formula
Customers Lost in Period / Customers Beginning of Period
Step 2 of 5 in design process
Define GOALS and CONSTRAINTS
% Churn Rate
Definition: % of customers lost per month.
ARR
Definition: Annualized Run Rate = MRR x 12ARR is annual run-rate of recurring revenue from the current installed base. This is annual recurring revenue for the coming twelve months if you don't add or churn anything.
% MRR Churn
Definition: Defined as lost revenue due to churned customers as a percentage of total recurring revenue.
Net New Customers
Definition: Net New Customers = # of new Customers - # of churned CustomersThis is the net number of new customers added once lost customers due to churn has been taken into account.
New vs. Returning User Limitations
If a user clears or has blocked their cookies in their web browser the user loses their unique ID for analytics to tell if it is a new or returning user Sessions have to happen in the same browser and on the same device for analytics to identify users over multiple sessions
Moment of Truth (MOT)
In marketing, the moment when a customer/user interacts with a brand, product, or service in a way that serves to form or change an impression about that brand, product, or service.
Anwendungsorientierte Faktoren der E Communication (3)
Individualisierung - Kommunikation segment oder Kundenspezifisch Intelligence - einfache und kostengünstige Marktforschung Interaktivität - Wechselseitiger Informationsaustausch
Order of Operations
Investors first look at GMV, bookings and revenue bc measures size of business. Then they move onto growth of company.
Logo and Gross Churn Medians in SaaS - 2018
Logo - 21% Churn (79% Retention) Gross - 12.5% Churn (87.5% Retention)
Kahn Success Matrix
Low Price, Product Brand, Experiential, Frictionless
Customer Lifetime Value (LTV)
Measure the amount of gross profit that is generated from a customer over the entire time they do business with a company. Formula: Gross margin (%) x Length of lifetime in pay periods x Revenue per subscription per pay period - Reporting Frequency: Quarterly - Example of KPI Target: $240,000 LTV - Audience: CEO, CMO, CFO, Marketing Manager, Sales Manager - Variations: LTV, CLV, Lifetime value of a customer
YouTube Channel Subscribers
Measure the number of YouTube accounts are following your posts and are receiving your channel updates. Formula: (Gained subscribers - Lost Subscribers) + Total Subscribers at the beginning of period Reporting Frequency: Monthly Example of KPI Target: 2352 subscribers Audience: Social Media Manager, Marketing team Variations: YouTube Subscribers
Profit Breakdown
Profit= (price x volume) - (Fix Cost + Variable Cost)
Types of usability requirements
Qualitative usability requirements - The system should be easy to use. Quantitative usability requirements - How long does it take to complete a specific task?
Multi-Attribute Model
Rate both importance and strength of attribute (A= sum(imp. of attributexattribute strength)
Switching costs
Redundant Relationship-Specific Investments - customers who change suppliers sometimes must invest in new software/hardware or repeat certain activities they have already completed Contractual Penalties. Companies can impose penalties on customers if they end a contractual relationship prematurely. For example, mobile phone carriers often charge an early termination fee to customers who have signed multi-year contracts
Customer Journey
Reise eines potentiellen Kunden über verschiedene Touchpoints: Von der Inspiration und Bedürfnisweckung über Informationsbeschaffung und Suche bis zur finalen Zielhandlung.
Market Entry Framework: Market Fit
Relation to existing brand promise, expertise, economies of scale, distrib channels, supplier relationship
What does ACCORD stand for
Relative Advantage, Compatibility, Complexity, Observability, Risk, Divisbility
Gross profit = Unit margin =
Revenue - COGS Selling price - Cost per unit
Pre-Tax Income
Revenue - COGS - SG&A - R&D - Interest Expense
Net Income
Revenue - COGS - SG&A - R&D - Interest Expense - Taxes
What is recognized revenue? Is it GAAP? What is it used for in the context of SaaS?
Revenue accrued for product / service that has been delivered to the customer; yes it is GAAP; useful for making accurate predictions concerning a businesses' cash flow and implementation efficacy
What is deferred revenue? Is it GAAP? What is it used for in the context of SaaS?
Revenue for which cash has been received but for which the corresponding service has not yet been delivered; yes it is GAAP; useful for making accurate predictions about cash flow and projecting operational performance
Rule of 40
Rule of thumb to help analyze business health taking into account growth and profit GP (Growth-Profit) Ratio = Growth Rate + Profit Ratio of 40% indicates healthy business MRR growth = New MRR - expansion MRR - Churn MRR Profit use net income, op income, cash flow EBITDA is good
$ tCAC Formula
S&M Expense + Onboarding Expense - Onboarding Gross Profit
Definition of SaaS
SaaS is an application or service that is provided through a browser over the Web. The business model typically associated with this is a subscription model, where a fee is paid for a service to be consumed over a set time or duration.
What Numbers can Analytics Calculate After Organizing Data By Session?
Sessions Pages per session Average session duration Bounce rate
Magazine
Site has a lot of regularly-updated content in multiple categories. Alternating sizes of columns, cards, and/or headlines
Big Picture Marketing Research
Strategy Frst, Integrated Tactics, Marketing Plan
SWOT analysis of companies and products
Strengths (internal) Weaknesses (internal) Opportunities (external) Threats (external)
What does the CAC Payback Period (CPP) represent?
The months of contribution margin to pay back the cost of acquiring a customer
Lead generation
The process of finding customers that have an interest in a product or service. Some examples of lead generation tactics (lead generators) in digital marketing are: a. email b. display advertisements c. search engine marketing d. promoted social media e. native advertising
Which step in acquisition funnel has the issue? How I can fix that issue?
The step that has the largest drop off in engagement is the one that needs to be addressed because therein lies the largest quantity of customers to engage
Why is CAC important?
The viability of the SaaS business model depends on customer unit economics, particularly the LTV and acquisition cost of a customer
DIGS
There is another DIGS framework by Lewis C. Lin which also helps to answer the behavioural question in a structured and impactful way. Dramatize the situation Indicate the alternative Go through what you did Summarize your project
What would a GMPP of 36 months suggest?
Three years are required to break even on the customer acquisition cost
Why might it be useful to maintain negative profit relationships?
To cover fixed costs
TAM
Total Addressable Market -Quantify market size / opportunity -Bottom Up: figure out how many toothbrushes sold in stores and for what cost -Top Down: market share and total market size
Total Visits:
Total visits to a webpage (non-unique, including unlimited visits by the same person)
What Else Can Event Tracking be Useful For?
Tracking outbound link clicks that lead away from your site
Channel Function
Transactional Function, Logistical Function, Facilitation Function
Search engines have distinct user bases, so it is advised that you not generalize your insights over all of them.
True
*The new product development process comprises five stages.
True. Opportunity, Identification, Design, Testing, Introduction, Life Cycle Management.
Where is the Events Report found?
Under Behvaior
Explain the purpose of usability metrics
Usability metrics provide precise, quality measures that can be used to evaluate a system or product. Usability metrics can help a company outrun its competition. Usability metrics are usually measured in the big three Es, effectiveness, efficiency and emotion.
Agile, Lose Big Picture Focus -Why? -How to fix
Why -lack of clear roadmap from PM -myopic view of team (only focused on one section of product) Fix -Story mapping
Why should we hire you? In general, what to talk about
Why good fit or what can offer company
Story Points -Why? -Key points
Why? -Avoid scope creep -Establish team velocity -Quickly establish estimates -Eliminate subject hour estimation based on developer skill -Complexity, Effort, Doubt -Not based on hours Base 2 sequence: 0, 1, 2, 4, 8, 16
When considering the frequency distribution of search keywords, the 'long tail' refers to:
a large number of keywords that each drive only a few visitors to your website
discover
atrasti
referral traffic
clicking on a hyperlink to get to a new page
choice of sales channel
deciding where to make the purchase
Product Usage - Stickiness
determines the level of engagement customers show within your solution
acquisition channel segment
how users accessed the site
AD impression
measurement of response from an AD delivery system to an AD request from the user's browser
Mobile metrics can be
non financial
spectator motivation
observe what's going on
Churn rate is the opposite of ____.
retention rate
o2o
stack it high and watch it fly -> showrooming, own customers, pickup point, convenience, experience
Qualitative data helps you answer which one of the following:
the why
1. Identify the metrics Metrics help bring meaning to what? Metrics are ( qualitative or quantifiable ) measures used to track the status of a marketing process T or F: Metrics don't help marketing analytics know whether goals are being achieved. T or F: it is difficult to determine what metrics are important.
to the data quantifiable False (they do help know if goals are being achieved!) TRUE
such
toks
uncover
atskleisti
activities of joiners
creating new profiles/maintaining existing profiles on social media sites -checking in/visiting regularly
Preferred Timespan for LTV
if you have only few months of data, the conservative way to measure LTV is to look at historical value to date
unique page views
like page views, but does not include refreshes
The RECENCY metric applies to ____ situations.
non-contractual WITH IDENTIFIABLE CUSTOMERS Example: eBay tracks active users defined as those who bid, bought, or listed an item in the past twelve months (rolling twelve) vs. previous twelve months.
Referrals
number of people who clicked a link from another website to get to the website.
Social traffic
number of people who found the website through social media.
Organic traffic:
number of people who reached the website by perform a search from sites like Google or Bing.
The ________ attribution model assigns 40% of the credit to the first interaction, 40% to the second interaction, and 20% is distributed evenly to the interactions in the middle.
position based
approach
požiūris
If the data you collect has values that are very close to each other (regardless of how close they are to the actual value of what you are trying to measure), your data has good:
precision
Return on Total Customer Acquisition Spending Formula
rCAC = LTV / tCAC
Customer Acquisition Costs
the amount of money a firm spends to convince a customer to buy a product or service (total cost of marketing outreach divided by sales in a given period)
touch points
the many critical moments when customers interact with the organization and its offerings on their way to purchase and after
further
toliau
Lead to Close Ratio:
total number of sales leads by the total number of sales (important for sales analytics)
What is the diffusion S-curve?
users increases than tapers off
organic search
using a search engine such as google to search a term
entirety
visuma
Ansatzpunkte für Produktvariation / differenzierung
Ästhetische Eigenschaften (Design) Physikalische Funktion als Eigenschaften (Material) Symbolische Eigenschaften (Marken) Value Added Services (Kundendienst)
acquisition
įsigijimas
A simple change in the wording of the call-to-action ("Submit" vs. "Support Haiti") on the Clinton Bush Haiti Fund website resulted in increased donations.
True
All testing should start with a hypothesis.
True
Lab usability tests measure a user's ability to complete tasks.
True
The authors of "A/B Testing: The Most Powerful Way to Turn Clicks Into Customers" believe that the overall testing process should begin with which of the following questions:
What do you want to test?
5 C's of Product Pricing
What is the best price for your products or services? This 5 C's framework helps you to determine the optimum price tag for your product. Company Objective Customer Cost Competitor Channel: Distribution Channel
ARM Framework
-Questions to help establish metrics A -> Acquisition and Activation -what actions do users take to get value and come a customer? R -> Retention and Engagement -what gets my users back to product? M -> Monetization and Revenue -what format of payment does product take?
Agile Key Tenants -Advantages / Disadvantages
-Respond to change quickly -Iterative and Incremental -Communication, transparency, constant feedback Advantage: respond and deliver quickly Disadvantages: hard to scale, difficult to create roadmap
Issue Trees -e.g. How can we increase our profitability?
-Use in Why Why Why -Start with high level question and break down via a tree
Comprehend Situation
-What is it for -Who is it for -Why do they need it -How does it work
1/6
.16
2/5
0.40
1/2
0.50
3/5
0.60
5/8
0.625
2/3
0.6666
3/4
0.75
4/5
0.80
5/6
0.8333
7/8
0.875
Average Conversion Rate Display Ads
0.89%
Innovation Metrics
0Measure a company's ability to innovate and develop a mix of new offerings -Measure levels of breakthrough products, next generation products, major enhancements, minor enhancements and corrections
Gross Renewal Rate Formula
1 - (($ Churn + $ Downsell) / $ Contracts up for Renewal)
Customer Lifetime =
1 / Churn Rate
What are the high-level areas to talk through when answering a design question?
1) Goals & Constraints 2) User & Use Cases 3) Prioritize Use Cases 4) Brainstorm Solutions (5) Summarize
Why Metrics?
1) Maintain focus 2) Set common goal for team 3) Hold everyone accountable 4) Object decision making
Ad Pricing
1) Pay-Per-Click 2) Pay-Per-Impression: sees ad but doesn't have to click 3) Pay-Per-Action: clicks on ad and pays for product
How should you approach any product design critique?
1) Revealing your design criteria, capping it to three. 2) Explaining how the product may or may not meet your criteria. 3) Being specific, offering evidence, and contrasting with similar products.
eCommerce Facts
# Global Purchasers: 1.6B Total Global Sales: $1.92T Total USA Sales: $390B Avg. Annual eCommerce $/User: $1,200 USA Shipping Volume: 10B
Monetization Metrics
# Paid Users Avg Rev/User Avg Rev/Paying User Avg Rev/Daily Active User Lifetime Value Conversion Rate to Paying
conversion rate
# of app visitors who complete an action divided by total # of app visitors
Average Cost-per-thousand-impressions for Android Banners
$0.15-$1.50
Avg CPM Android Banners
$0.15-1.50
Global Total Online Sales
$1.915T
Two ways to calculate LTV
(1) ARPA x gross margin x customer lifetime (2) (ARPA*gross margin)/churn rate ...(since churn = 1 / customer lifetime)
5 C's of Cloud Computing (metrics)
(1) CMRR (2) Cash Flow (3) CAC (4) CLTV (5) Churn
Why do you like working in the tech sector?
(1) Pervasiveness of tech innovation across other industries (2) Fundamental impact on humans (3) Most interesting sector to learn about from intellectual standpoint
Name all sources of MRR expansion
(1) new contracts (2) renewals of existing contracts (3) upselling (pricing increases / product upgrades) (4) cross-selling (selling new products to existing customers)
Net Retention Formula
(Beginning ARR + Upsells - Churn - Downsells) / Beginning ARR
Cost
(SERP) - ad shown - ad clicked - CPC determined by quality score
Gross MRR Churn rate
(SUM of Churn & Contraction MRR) / MRR at start of period
CIRCLES framewok
* Comprehend the situation (5Ws) * Identify customers and segment * Report customer needs / customer journey * Cut (prioritize) * List solutions * Evaluate tradeoffs * Summarize the recommendation
RICE
* Reach - how many people will this impact? * Impact - how much will this move the needle? * Confidence - how confident in success? * Effort - how long will it take?
Porter's 5 Forces
* Rivalry among competitors * Threat of new entrants * Threat of substitute products * Bargaining power of buyers * Bargaining power of suppliers
Story 3: Making custom jellyfish website
- 2 inefficiencies solved with technology: vouchers and live shipments, cut labor force - Made possible distribution through retailers - Led to working on Forward platform for all custom e-commerce
What is a suggested cutoff for eLT and why?
- 5 years - The true value of "out year" cash flows are significantly impacted by the time value of money, and it's very hard to predict customer churn behavior 5 years in the future
Story 1: Fore seeing crowdfunding
- I recognized wave of crowdfunding before anyone - Saw it's power of solving catch 22 of manufacturing - Became poster child for crowdfunding - Resourceful, had bootstrapped until then
Story 5: Using my SMB experience to help consulting clients
- Learn goals of customer - Consolidating platforms - Getting rid of inefficiencies and headaches
Story 10: Using data/analytics with JFA
- Once stabilized, used data to create rules for blogs, affiliates, flash sales, write ups, etc., very formulaic - Grew 40%, reduced headache factor which is very important, e.g. following weather patterns, gave free replacements
5W's and H
- What is it? - Who is it for? - When is it ready? - Where will it be available? - Why should I get it? - How does it work?
Why is customer experience important?
- enhance differentiation / distinction - reduce price sensitivity - reduce friction in exchange - increase loyalty - increase speed and efficiency for customers - increase profits
When & Where do Customer Experiences Occur
- touchpoints between consumer & organization, or organization-related content/entities - communication media (TV, Radio, etc.) - retail and online stores - websites - social media - influencers
industry concentration
-0-10,000: higher value more concentrated market is among small number of sellers -pure monopoly would lead to HHI value of 10,000 -compete against more, but smaller competitors or few, but larger competitors
Phase 2: Analyze the Metrics
-Companies must implement systems to track the important metrics ~Web Analytics ~Marketing Automation Dashboards -Compare current state to benchmarks ~Historical Trends ~Industry Average Performance -Most important step is to determine the root cause of why metrics perform the way they do
STRATEGIC METRICS
-Companies need an overview of the potential revenue available within the market -For market entry and exit: Market size and marketing growth should be measured -Return on Marketing Investment (ROMI): ROMI = (Marketing Revenue * Contribution Margin) / Marketing Spending
Business Oriented Metrics
-Cost to acquire a new customer (CAC) -Customer lifetime value (LTV) -Monthly recurring revenue generated (MRR) -Average revenue per user Conversion
market framework
-Datamonitor -do rules/regulations encourage or discourage competition -if law makes it difficult for new companies to enter market place--> discourage competition--> lower market framework score
Net Promoter Score
-How likely are you, on a scale of 0 (not at all likely) to 10 (extremely likely), to recommend this product or service to a colleague or friend? -A company's Net Promoter Score is the percentage of promoters less the percentage of detractors -"Detractors" answer from 0 to 6 -"passives" answer 7 or 8 -"promoters" answer 9 or 10
Google Annual Rev
$100B
What are the best design principles to cite when critiquing?
- Innovation - Utility - Ease of Use - Sense of Honesty
What is the rule of thumb for LTV : CAC metrics?
- Want to see an LTV : CAC of at least 3x, with 5x being top of class
4 Components to Good Product Strategy
1) Real Pain Points means "Who is it for?" and "What is their pain point?" 2) Design refers to "What key features would you design into the product?" and "How would you describe your brand and voice?" 3) Capabilities tackles the "Why should we be the ones doing it?"and " What is our unique capability?" 4) Logistics is the economics and channels, like "What's our pricing strategy?" and "What's the medium through which we deliver this?"
How to Gather Metrics (specific ways)
1) Usability Testing 2) Customer Feedback 3) Traffic Analysis 4) Logs 5) A/B Testing
9 Design Criteria (top 4 first)
1- Innovative 2- Usefulness 3- Unobtrusive 4- Honest 5- Aesthetic/minimalist 6- Understandable 7- Long-Lasting 8- Environmentally Friendly 9- Through down to last detail
Global Number of Users Purchasing via E-commerce
1.61B
7/4
1.75
WeChat Number of Users
1B
Total iOS Apps in App Store
2.2M
Google's # of employees
50,000
Google # of Employees
80k
Android Global Market Share
86.8%
Pay Per Click (PPC)
A concept where advertisers don't pay unless someone clicks on their ad.
Produktdifferenzierung
Anzahl der Produkte im Programm vergrößert sich Differenzierung im engeren Sinne Differenzierung für bestimmte Käufersegmente, Mass Customization Differenzierung im weiteren Sinne Differenzierung für den Gesamtmarkt, Produkvarietät
Gmail Pricing Plans
Business (15 GB), Unlimited
Estimation Steps
Clarify, log assumptions Think of Edge Cases EQ Sanity Check
User Type
Dimension ga:userType UI Name: User Type A boolean, either New Visitor or Returning Visitor, indicating if the users are new or returning.
CIRCLES - E - Evaluate trade-offs
E - Evaluate trade-offs - Use pros & cons or trade-offs approach - Trade-offs approach o Customer satisfaction o Implementation difficulty o Revenue potential
FB what are 3 fundamental review areas
Execution Product Sense Leadership and Drive
Growth Levers
Explanation: SaaS businesses are more numerically driven than most other kinds of business. Making a small tweak to a number like the churn rate can have a very big impact on the overall health of the business. Because of this we frequently see a "quant" (i.e. a numbers oriented, spreadsheet modeling, type of person) as a valuable hire in a SaaS business. At HubSpot, Brad Coffey played that role, and he was able to run the models to determine which growth plays made the most sense. Understanding these SaaS metrics is a key step towards seeing how you can drive your business going forward. Let's look at some of the levers that these imply as growth drivers for your business: 1) Churn Get Churn and customer happiness right first (if this isn't right, the business isn't viable, so no point in driving growth elsewhere. You will simply be filling a leaky bucket.) 2) Product You're in a product business - first and foremost: fix your product. - If you're using a free trial, focus on getting the conversion rate for that right (ideally around 15 - 20%). If this isn't right, your value proposition isn't resonating, or you may have a market where there is not enough pain to get people to buy. - Win/Loss ratio should be good - Trial or Sales conversion rates on qualified leads should be good 3) Funnel metrics - Increase the number of raw leads coming in to the Top of your funnel - Identify the profitable lead sources and invest in those as much as possible. Conversely stop investing in poor lead sources until they can be tweaked to make them profitable. - Increase the Conversion Rates at various stages in the funnel 4) Sales Metrics - Sales productivity (focus on getting this right consistently across a broad set of sales folks before hitting the gas) - Add Sales Capacity. But first make sure you know how to provide them with the right number of leads. This turns out to be one of the key levers that many companies rely on for growth. We have learned from experience how important it is to meet your targets for sales capacity by hiring on time, and hiring the right quality of sales people so there are fewer failures. - Increase retention for your sales people. Since you have invested a lot in making them fully productive, get the maximum return on that investment by keeping them longer. - Look at adding Business Development Reps. These are outbound sales folks who specialize in prospecting to a targeted list of potential buyers. For more on this topic, click here. 5) Pricing/Upsell/Cross Sell - Multi-axis pricing - Additional product modules (easier to sell more to existing customers than it is to sell to brand new customers) 6) Customer Segmentation Customer Segmentation analysis will help point out which are your most profitable segments. Two immediate actions that are suggested by this analysis are: - Double down on your most profitable segments - Look at your less profitable segments and consider changes that would make them more profitable: lower cost marketing & sales approaches, higher pricing, product changes, etc. If nothing seems to make sense, spend less effort on these segments. 7) International Markets - Expansion internationally is only recommended for fairly mature SaaS companies that already have honed their business practices in their primary market. It is far harder to experiment and tune a business in far off regions, with language and cultural differences.
SaaS Success Factors
Explanation: SaaS, and other recurring revenue businesses are different because the revenue for the service comes over an extended period of time (the customer lifetime). If a customer is happy they will stick around for a long time, increasing profits. On the other hand if a customer is unhappy, they will leave quickly, and the business will lose money on the investment made to acquire that customer; Retention is the key, the customer is the product.
ARR Per Customer
Income earned from each customer yearly. Consider whether it is flat or growing. With upselling and cross-selling, it should be growing (sign of a healthy business).
Sales Revenue
Income earned solely from product sales. (More value to VCs than service revenue bc it is recurring, has higher margins, and is more scalable)
Revenue
Income recognized only after service/product has been provided to customer.
which stl categories are the largest?
Joiners and spectators
Hosting Options for Perp. Model
On-premise: on-site on the customer's own server Hosted: hosted in the "cloud" in a server owned, managed or outsourced by the company Since many customers will host the software on-premise, not every perpetual license company will have hosting revenue Gross Margin: Varies but ~60-70%
preference
Pirmenybė
PLC
Product Life cycle
Two Promotional Strategies
Push/Pull
CAC Multiple Formula (most basic form)
S&M Expense / # of New Customers Added
According to the Recency definition, what is a six month customer?
Someone who purchased at least once in the last six months.
What is Li and Fung
Supply Chain service provider - deep knowledge of asian manufacturing
Likert Scale
Survey 1-7 customers "direct elicitation"
Customer Conversion Rate
The Customer Conversion Rate is a great metric to know how well you are doing to turn prospects into customers of your product. A small increase in the customer conversion rate can increase your revenues significantly. It is the percentage of prospects who end up converting to paid customers. It is measured by taking the number of leads in a particular month and dividing that by the number of new customers added during that month.
Define Recursion
When a function can call other functions, including itself.
Before actually conducting a competitive intelligence analysis, it is important to research how your tool _____________.
collects data
Customer Count Retention
customer retention, is the strongest growth engine for SaaS companies
Purpose of social media metrics (friends/followers/supporters/likes)
determine effectiveness of social networking presence
Cost per click
divides ad cost by number of clicks generated by ad
increasing time on page=
increased visitor interest
Visits
measure the number of sessions on the web site
This module describes the analysis of conversions on your website that are influenced by _________ marketing channel(s).
multiple
Provide 5-7 examples of activation metrics
new registed users Mobil app opens Number of searches on a website or app New cart started (commerce) User inforamtion given( personal, creditcard, etc) Number of accounts created
Ad Clicks (Click, Advertise Clicks)
number of clicks on a display (banner) within a given time period
Ad conversion rate
number of completed shopping carts / number of Ad impressions
Likes
number of individuals favoring a social networking post/page
Impressions
number of opportunities that have been presented to people to see an advertisement
What must you do BEFORE you count customers?
segment your POTENTIAL and CURRENT customers
moment of purchase
selecting brand at purchase
Downloads reflect the
success of an organization at getting their application distributed to users
Key Usage Metrics (actual metrics to look for)
1) Time on Site 2) Repeat Visits 3) Unique Visitors 4) Active Users 5) Feature Usage
Causes for a Bad Product
1) Tunnel Vision 2) Unclear Goals 3) Product Neglect 4) Customer Avoidance - spend at least 3hrs per week 5) Inability to Say "No"
Topics to Discuss for Marketing Strategy (understand A, B, C...)
1) Understand the Company 2) Understand the Competition 3) Understand the Customers 4) Understand the Landscape 5) Market Your Product
Every product design answer should (3):
1- ID up to 3 design criteria 2- Explain how prod lives up to design criteria 3- Be specific, use evidence, contrast w/similar prods
Summarize Design
1- Product/feature recommending 2- What it is, why is it beneficial 3- Why this solution over others
5 Types of Data Structures
1. Boolean (true false) 2. Integer (whole number, not a fraction/decimal) 3. Float (number with a decimal place) 4. Character (8-bit that represents all letters and numbers) 5. Hash table (key value pair)
factors affecting diffusion
1. Complexity of product 2. Compatibility of product with existing products and consumer knowledge 3. Whether product can be tried before being purchased 4. Relative advantage of products over existing products 5. Whether others can observe you using product
What are the 2 calculation methods for CLV?
1. SIMPLE FORMULA (quick, best for high CLV) 2. COMPLETE FORMULA (year-by-year basis, discount rate, changing revenue/costs over time)
Population of China
1.3 billion
India Population
1.3B
China Population
1.4B
3/2
1.5
Asia Pacific Social Network Users
1.5 billion
WhatsApps users
1.5 billion
Asia Pacific Social Network Users
1.5B
WhatsApp Number of Users
1.5B
Facebook users
1.8 billion
USA Parcel Shipped Volume
10B
___% of customer churn could be prevented by simple company outreach. ___% of customer churn is preventable if the customer issue was resolved at the first engagement.
11% 67%
Japan Number of Internet Users
118M
iOS Global Market Share
12.5%
If you wanted to measure the number of promotions (i.e. hearts on Twitter, likes on Facebook, +1s on Google+) of a given post, you would be measuring the:
Applause rate
_____ and _____ are especially important for services because consumers do not have as many triggers to remember service brand.
Brand recall and Brand recognition
Main consideration when looking at GMPP?
Channels that appear scalable at lower monthly additions (e.g. 100) with rapid GMPP may not scale with consistent efficiency to larger monthly additions (e.g. 1,000)
Design leader who developed 10 principles of good design
Dieter Rams
It conserves resources and minimizes physical and visual pollution throughout the lifecycle of the product.
Environmentally-friendly
Vorteil E Marketing bei Customer Journey
Erfolgsmessung mit einfachen Trackingtechnologien Untersuchung des Klick und Suchverhaltens von Kunden
EDLP
Everyday low price
How Hits can be Organized Into Sessions Example 1
If a user visited the homepage of the google store and then left immediately without clicking on anything, analytics will record one pageview hit for that user in a single session
Where see yourself in 5 years
In PM role, testing ambition
Term License
In addition to the perpetual license listed on the price list, Oracle offers 4-year, 2-year, and 1-year term licenses for practically all of its products: 4-year term = 60% of the perpetual license price 2-year term = 35% of the perpetual license price 1-year term = 20% of the perpetual license price Term license pricing is aimed at companies with small IT budgets, but whose business requires a robust software solution. Customers may extend the term of a one-, two- or four-year term license by purchasing an additional term or perpetual license. Note: Although the license fee is discounted, annual support for term licenses is the same price as annual support for perpetual licenses
Defining Sessions
In order to understand a user's level of engagement with a website, analytics groups user hits based on the time in which they were generate To measure these periods, analytics uses a metric called sessions
What are the roles in the technology adoption life cycle
Innovators- 2.5% Early Adopters-13.5% Early Majority- 34% Late Majority- 34% Laggards- 16%
Event Tracking
Is a great way to know if users are engaging with your website and performing intended actions
Perpetual License
License Fee: one time fee to use in perpetuity - you get key and use software Maintenance & Support: recurring in nature, attach rate is usually 100%, typically 20% of license, terms are generally 1 year Hosting: can be on prem or hosted in the cloud for deployment, many customers will host on prem for themselves Services: implementation, customization, configuration and other services performed by the company for the customer in relation to the software
What is Lifetime Value (LTV)?
Lifetime Value is the economic value, net of costs, delivered over the life of a customer
Profit margin
Net Income/Sales
P-Value
Null hypothesis is that metrics does not matter. P-Value <.05 means we reject the null, meaning it matters. Comfortable with anything less than .05
Consistency
Nuoseklumas
Prioritization
Once you decide the list of features or request which you plan to work, but wondering which one to pick or test first, below prioritization frameworks help you in that: Impact vs Effort Weighted scoring Kano Model
____________ analytics is the process of analyzing current and historical data to forecast future events.
Predictive
Skimming
Priced High - top part of market
Step 5 of 5 in design process
Prioritize and select a SOULTION.
Evaluate
Pros/Cons of solution Design criteria
____ is the length of time since a customer's last purchase.
Recency
____ is the ratio of the number of retained customers to the number at risk.
Retention rate
CIRCLES - S - Summarize
S - Summarize your recommendation - Summarize feature or product selection in 20-30 seconds - Approach o State which feature or product you recommend o Recap what it is and why it's beneficial to the user o Explain why you preferred this selection over others o Note any actions you'd take to explore this idea further
AIDA
Similarly, AIDA framework is also popularly used to optimize marketing channel and communication. It describes the effect of advertising media and helps to explain how an advertisement or marketing communications message engages and involves consumers in brand choice Awareness Interest Desire Action
Why I like Kibana
Simplicity bell curve (happy medium between simplicity and complexity). Works for first time users and power users. Similarly works for different users. Conveys right personality. Gets out of the way, spillway for potential energy.
SCAMPER (brainstorming)
Substitute -What part can be substituted without affecting whole? Combine -How to merge two idea in innovative way (e.g. phone tech and camera) Adapt -How to tweak and adjust for better output Modify -Change to release more innovative capabilities Eliminate -Remove a part of process / product to improve it Reverse
Typische Touchpoints
Suchmaschine Mobile Online Werbung Social Media Freunde POS TV Radio
What are billings?
The amount that you have invoiced that's due for payment shortly
Channel attribution
The breakdown of how a SaaS company allocates its marketing dollars between various marketing channels (e.g. SEO, SEM, viral marketing, social media marketing, email marketing)
Digital Transformation
The change associated with the application of digital technology to all aspects of human society.
Value Gap
The discrepancy between what a customer expects from the product and the value received or perceived.
cost per thousand (CPM)
The media cost of exposing 1,000 readers or viewers to an advertising impression (=avertising costs / 1000 page impressions)
"Conversation Rate" is defined as:
The number of conversations per social media post. On Facebook, this would be comments; on Twitter it would be replies.
What are Implementation Services?
The tasks that must be completed to successfully enable a SaaS offering in a cloud computing environment.
Customer Experience Era
The third wave of SaaS, where customers now research, evaluate, select, and share experiences that feel more like consumer experiences, including multiple touchpoints and interactions.
Bookings
The total dollar value of all new contracts signed. Usually taken as an annualized number even if the contract period is longer than one year. Since the bookings number might have a mix of different durations (e.g. month-to-month; 6 months; 12 months) this number is not very helpful for understanding the business
Contextual Engagement
This happens when the right customer receives the right messages at the right time through the right channel.
Value-Based Pricing
This involves knowing which product features customers value most.
Cost Per Conversation
This is price it costs your company to have each individual conversation answered. It is calculated by adding your employee salary, burden rate (usually about 50%-60% of salary) and the cost of your tools and then dividing it by the number of conversations for that same period.
share of voice
This method ensures one ad will not be seen any more than the other three advertisers. And, since there are typically a limited number of advertisers using a Share of Voice model, ad exposure is optimized.
In-Product Call To Action
This reveals prospects' buying intentions and helps to drive prospects to PQLs or conversion events.
Nothing must be arbitrary or left to chance. Care and accuracy in the design process show respect towards the user.
Thorough down to the last detail
Why do we exclude the initial expenses necessary to light up the new customer?
Those one time expenses were already captured in tCAC
***What is the PURPOSE of the following metric(s)? Customers, Recency & Retention
To monitor firm performance in attracting and retaining customers To count customers and track customer activity
If Orbitz derives 35% of its revenues from advertising and other sources, how much would its total revenue be? Assume that Orbitz's non-advertising revenue is $675M.
To solve for this question, you want to need to setup the equation: $657M non-advertising / (1 - 35% advertising and other revenues) = $657M / .65. You can round this to: ~$650M / .65 = ~$1B
*Marketers view products at three levels: core product, tangible product and augmented product.
True
Facebook Page Demographics
Understand the makeup of your audience. Formula: Breakdown of Likes/Impressions by age category. Best Practices: - Look-A-Like Audience Targeting A lookalike audience is exactly what it sounds like, an audience of users generated by Facebook that best-matches the characteristics of your imported email or phone number list. - Custom Audience Targeting Custom Audience Targeting allows you to show Ads to specific people on Facebook based on their email address or phone number. Simply upload a list of email addresses or phone number and Facebook will match them to their user ID on Facebook, making sure only they see your Ads.
Design which is ________ should is both neutral and restrained, and leaves room for the user's self-expression.
Unobtrusive
To the point above, is it cheaper to upsell / cross-sell into existing customers or acquire new logos?
Upsell / cross - sell into existing customers, which is why consistently having to replace customers that churn quickly and often is generally not a sustainable business model for a SaaS company
Estimation for pricing, consider
Upselling, average item at SBX $5, but ppl buy non drinks so maybe $6
5 Ways to Gather Data on Product
Usability Testing Customer Feedback - NPS Score Traffic Analysis Internal Logs A/B Testing
Pre-existing mental models
Utilizing habits people are use to e.g. flipping through photo book -> for digital photos, flick with finger
VIRO Framework
VALUE Rarity Imitability Organization
Bookings
Value of a contract between company and customer. The value = obligation for customer to pay company.
Design principle that the more easily an element is to see, the more likely users will know about them and how to use them.
Visibility
Instrumente der E Kommunikation
Werbung Banner, Pop Ups, Ad Breaks, Email Verkaufföderung Promotions, Intranet, Extranet, Allianzen Public Relations Informationsveröffentlichungen, Emails Sponsoring Site Sponsoring, Sponsorships Event Marketing Product Placement, Digital Events Direktkommunikation Direct Mailings, Newsletter, Webseitenindividualisierung Multimediakommunikation Online Kataloge, Interaktive Trainings, Internet Telefonie, Chats
Zero Data (Empty State)
What a prospect sees during their initial signup process when no data is available in the product. To address this, guide the prospect through a journey that populates, uploads, or integrates data to a product.
Customer, who added a product to a shopping cart, did not begin the checkout/payment process
What does it mean if the value of the checkout start rate metrics is smaller than the value of the cart start rate metrics?
Work on your web design
What should you do if you have a high bouncing rate on yout website?
REAN
What should your digital strategy look like? How should you market your product? Are you using the right channels? The REAN model, popularised by Steve Jackson help product manager or product marketers to answers such questions. Reach Engagage Activate Nurture
When does a Session Begin
When a user navigates to a page that includes the analytics tracking code and generates a pageview hit
How Event Tracking Works
When a user performs an action on an element with event tracking, the event tracking code will pass four parameters along with the event hit
When does margin erosion typically occur? In other words, when does COGS increase due to poor marketing?
When add features to product/service that customer does not want and is unwilling to pay for
Focus 10
When don't have a basis of estimation, think of 10 friends and determine estimate based on this. Then adjust a bit for bias
Main difference between LTV and GMPP
While GMPP is a great tool for comparing the efficiency of different cohorts from a time-to-payback perspective, LTV takes it one step further by incorporating expected lifetime
Session Time Out Settings
While sessions time out after 30 minutes of inactivity by default, you can change this setting in your configurations to better align with user behavior on your site
Why is eLT significant?
While some customers will churn out immediately and others will stick around for a long time, eLT is concerned with the average lifetime across a cohort of customers SaaS companies often have long-term contracts that suggested a predetermined minimum customer life, but the innate customer "stickiness", not contract length, is more important (after all, contracts can be renewed.. and broken)
Why is evaluating the tradeoffs of proposed solutions beneficial?
You come across as thoughtful, analytical, and objective. You protect yourself from being defensive. You mentally prepare yourself for criticism by critiquing yourself. The interviewer will also have fewer things to criticize.
How to Evaluate the momentum of a SaaS business
You would look at ACV as opposed to TCV and you would like at the year over year growth in ACV bookings as opposed to TCV as TCV will not represent the up front revenue recognized, billings is simply an accounting classification to determine when customers pay you, does not dictate when you recognize revenue
Google Media Products (5)
YouTube Books Play (music, movies, books, and apps) Picassa News
Unified Customer Profile Data
Your organization's system of record for all customer profile, company, and behavioral data.
Rich media
a term used for interactive media that allow consumers to be more actively engaged than they might be with a billboard, a TV ad, or a static display web ad
Advantage of rich media
ability of viewers to interact with it
If the data you collect has values that are very close to the actual value of what you are trying to measure, your data has good:
accuracy
purpose of interests
affinity, in-market, and other categories. This data is based on browsing history collected by using cookies.
Avinash Kaushik recommends that the 'words in English' you incorporate on a digital dashboard involve which of the following:
all of these
Who Participates in Customer Experience
any entity that can impact the customer experience: - customer - other customers - employees - media - influencers - public, communities - governments
average session duration
average length of session
2. Analyze the metrics -The measurements of the current state must be compared to ______ aka measurements of the hypothetical ideal state to see whether a campaign has under- or over-performed -The most important step in analysis step is to ... .
benchmarks determine the root cause of why metrics performed as they did
Blended CAC
blended CAC [total acquisition cost / total new customers acquired across all channels] isn't wrong, it doesn't inform how well your paid campaigns are working and whether they're profitable.
Defining the customer requires a clear understanding of both ____ and ____.
business strategy; buyer behavior ex.: retailers count transactions (i.e. receipts)
________ = is the process of creating and running a campaign through several stages
campaign life cycle
post purchase experience
compare product with previous expectations - Be careful to create positive post-purchase communication to engage customers - most important part to repetition
If a product is in its emerging growth stage, you should:
concentrate on R&D, competition, and pricing.
Discount rate
cost of capital for the organization
Which multitouch attribution analysis model is difficult to generalize to other businesses?
custom credit
MRR Churn
customer churn rate and MRR churn rate can be very different
Margin
customer revenue - cost it takes to service the customer
Sales Metrics
customer/user acquisition costs (i.e: tracked campaign), visitor value => what do your visitors do?, customer lifetime value
Purpose of measuring downloads
determine effectiveness in getting applications out to users
In terms of competitive intelligence (CI), _______________ is the type of CI analysis that is mainly focused on what is happening in the industry.
ecosystem-centric
efficient
efektyvus
4. collectors (20%)
efficient and organized users of online media. they may not create their own content, but they make it easier for themselves and others to access information
Customer Experience
every relevant phenomenon/behavior - thought - feeling/emotion - psychological process (memory, belief, attitude formation) - senses (sight, smell, sound, touch, taste) - action * customer- related phenomenon/behavior is considered "relevant" to an organization if it is in someway related to organization's brand, product, profit, etc.
post purchase experience
expectations built based on experience to inform the next decision journey
Designing a marketing campaign often starts with what type of research ?
exploratory research
motivation of critics
express their opinions
In a testing scenario, it is not necessary to define a quantifiable measure of success.
false
perceptual map
graph that displays in 2+ dimensions the location of products or brands in consumers' minds
Quick Ratio
growth efficiency of a SaaS company
Users
have had at least one session within the selected date range. Includes both new and returning users
result
how satisfied are you with your decision?
Orientation
identify your customers goals (take into account their goals can change throughout their journey)
undertake
imtis, įsipareigoti
overall
iš viso, bendrai
immediate
nedelsiant
recent
nesenas
ideal point
place on perceptual map consumer would like product to be in certain category
serving
porcija, gabalas
Three Attributes which make price important
produce revenue, flexible, top factor in customer choice
if results are not seen within a few weeks when looking at mobile metrics..
project will be shut down
Cost per impression
ratio of ad cost and the number of impressions, expressed typically as a CPM in order to make the numbers easier to manage
Estimation for stores, base off of
ratio of residents/store one area
3. critics (37%)
reactors to content, rather than creators of content
purpose of measuring mobile metrics
shows effectiveness of marketer at gaining revenue from each user
advocacy and sharing metrics
social media, a weighted rating system, quantity based on your goals (likes=1pt, comments=5pts, shares=10pts
provide
suteikti, aprūpinti
interact
sąveikauti
entire
visas, ištisas
Richard Oswald
"Different from the Others;" Germany only allowed medical professionals to view the film
George Melies
"The Temptation of Saint Anthony"
Advertising Facts
CTR for Google Search Ads: 2% CTR for Google Display Ads: 0.35% CPM for Display Ad: $2.80 CPM for Video Ad: $12.80 Avg. CPC on Google Search Ads: $2.14 Avg. CPC on Display Network: $<1 Avg. CPM for iOS Banners: $0.20 - $2.00 Avg. CPM for Android Banners: $0.15 - $1.50 Avg. Conversion Rate Search Ads: 2.7% Avg. Conversion Rate Display Ads: 0.9%
Revenue per customer
Calculate: (average order value) X (# of orders)
Enterprise Software Facts
Cloud Infrastructure Spending: $36B Traditional Infrastructure Spending: $61B Total IT Spending on Enterprise Soft: $351B Global ERP Software Spending: $34B Global CRM Software Spending: $26.3B Global IT SaaS Spending: $246B
FB: What's the high level team I'd be a part of
Community Integrity
Omnichannel Approach
Companies create contextual engagements with customers that look and feel the same across channels and devices.
4 Main Pricing Strategies
Cost Plus, Competition Based, New Product, Value-Based
Operating Margin
EBIT/Sales Operating Income/Sales Revenue - COGS - SG&A - R&D
EBITDA Margin
EBITDA / Sales or Revenue Revenue - COGS - SG&A - R&D + D&A
EVC
Economic Value to Customer - example Easy Markit SaaS
Customer Data
Information about a person that companies collect. These could be demographic data, contact details or behavioral data.
___________ surveys are good at capturing the macro experience of a customer's visit to your website.
Site-level
Customer Acquisition Cost (CAC)
Sum of Sales & Marketing Expenses / # new customers added
Average Selling Price (ASP)
The amount of revenue per customer generated.
There might be usability problems in the purchasing processes
What could a low cart completion rate and checkout completion rate indicate?
Jobs to be done
What customers need, want, or desire to get done in their work and in their lives.
Net Churn
[(MRR lost) - (MRR from upsells)] in a given month/MRR at the beginning of the month.
Customer profit formula:
customer revenue - customer costs.
increasing unique page views=
increased reach
shift
pamaina
click-through rate (CTR)
the number of times a user clicks on an online ad divided by the number of impressions for a given timer period
Conversion
(Website) - impression - click - purchase
Blended Customer Acquisition Cost (CAC)
(all costs spent on acquiring customers- marketing people, sales people, marketing programs, sometimes customer success) / (# of customers acquired during the time that money was spent)
pages/session
(average page depth) is the average number of pages viewed during a session. repeated views of a single page are counted
Empathy Map
-A way to understand the user's needs / pains...etc
Brand Metrics
-Brand recall -Brand recognition -Depth -Breadth
Change -conflict -time -communication
-Conflict is inevitable with change. How you respond determines your reactions -Success with change takes time to obtain, it is not a straight line path. -Communication should be a priority for every manager at every level of the firm -When you are so sick of talking about something that you can hardly stand it, your message is finally starting to get through
5 metrics to track for Facebook video campaign metrics
-Engagement -Reach -Likes and Follows -Video Retention -Click Through Rate (CTR) -Can be accessed through your business page
Types of Roadmaps
-Gantt -Scrum Sprints -Story Map
Marketing analytics strategy
-Success of campaigns need to be measured -How much money to spend on them -How to improve outcomes -Marketing analytics is a continuous function of measuring results of campaigns
stage-gate system
-also known as the product development process -multiple stages a new product must pass through before being commercialized -gate serves as the comparison point
1/17
.058
1/15
.067
Population of Africa
1 billion
Avg Conversion Rate Display Ads
1%
The 5 C's (product pricing)
1) Company 2) Competitors 3) Customers 4) Collaborators 5) Climate
What are the two sides of customer value?
1. Customer profitability 2. Customer experience
Top Digital Ad Spend formats
1. Display, 2. Search, 3. Lead Gen
Marketing Analytics Strategy
1. Identifying the metrics 2.. Analyze the metrics 3. Take improvement actions
7 Things to Know About Company's Products
1. Products: What are the major ones how do they all fit 2. Competitors 3. Customers/Market 4. Revenue 5. Love/Hate: What are customers' strong opinions 6. Metrics: What are they doing well / poorly at? 7. News and Rumors: Form an opinion
4 Stages of Product Life Cycle
1. Research/Planning 2. Design 3. Implement/Test 4. Release
4 Steps in a Product Launch
1. The Product 2. Launch Goals 3. Launch Design 4. Implementation pre and post
Philly Population
1.5M
Global Smartphone Install Base
2.8B
Global internet users
3.2 billion
Global Number of Internet Users
3.2B
US percentage with Bachelor's degree
30%
Population of the United States
325 million
Population of U.S.
330 million
US Corporate Tax Rate
35%
Africa Number of Internet Users
353M
iOS US Market Share
36.5%
Latin America Number of Internet Users
385M
Asia population
4 billion
Population of Asia
4 billion
What is the true arbiter of go vs no-go for a new feature?
A/B Testing
What is ACV and how is it calculated?
ACV = annual contract value of a SaaS contract; if a contract is 3 years and is worth $240, the ACV is $80
ARR Formula
ARR = MRR x 12
Product-Led Go-To-Market Strategy
An action plan that describes repeatable and scalable processes for how a company acquires, retains, and grows customers, driven by in-product customer behavior, feedback, product usage, and analytics
What is Onboarding Gross Profit?
Any gross profit generated from onboarding a new customer cohort
Customer Retention Cost (CRC)
Average retention costs should be lower than acquisition costs
Customer Lifetime Value (CLV) BENEFITS: DRAWBACKS:
BENEFITS: upper limit that helps firms determine what they would be willing to pay to acquire the customer relationship DRAWBACKS: assumptions lead to imprecision
What is the chasm?
Between scarcity and social proof, early adopters + late majority
Companies with Strong Focus on Customer Experience
- disney - benihana - amazon - apple - google - costco
What Makes a Good PM?
-Ownership of product -Convincing and persuasive (lead / influence) -Be optimistic and positive -Get technical -Celebrate others -Be fearless when discussing ideas
Customer Oriented Metrics
-Product usage or adoption -Percentage of prospects who take an action in response to campaign -Percentage of users who take action in product -Customer retention or churn rate -Quality (# of bugs)
Implementation
-Time to do everything to ensure success of campaign -AB Tests are useful doing this stage
Bass Model
-diffusion model -Nt: # of people owning product at time t m: market potential p: coefficient of innovation/probability of someone buying product bc of marketing q: coefficient of imitation/probability of someone buying product bc of word-of-mouth
Most an Advertiser Would Pay for Ad
-expected profit from click -conversion rate typically 2-5% max for ad = expected profit per click = conversion rate * profit per conversion
product line
-group of related products sold by same company -metrics used to assess are depth, width, and revenue: used to compare to other companies and assess if following stated strategy
2. Conversationalists (33%)
-users who are actively communicating via social media -tend to be the youngest category and the most heavily female category
6 Ways to Hold Data
1. Array (list) 2. Hashtable (key value pairs) 3. Trees and Graphs (nodes and edges in a tree) 4. Linked Lists (problematic) 5. Stack (list, added/removed from top) 6. Queue (list, added/removed from bottom)
***8 Steps to Design/Improve a Product
1. Ask questions to understand problem 2. Outline structure of how you're going to answer 3. Identify diff users 4. Identify use cases 5. Identify current alternatives strengths/weaknesses 6. Identify features to address those weaknesses 7. How validate solution THINK FUTURISTIC 8. Summarize
8 Steps to Estimation (quantitative) Question
1. Clarify, repeat back, ask about ambiguities 2. Catalog data you know 3. Make equation 4. Think about edge cases and incorporate (5. Combine all the equations) (6. Review and state assumptions) 7. Do the math, make sure correct units 8. Sanity check, e.g. order of magnitude
Design process
-Often starts with exploratory research -Coke→ custom built listening software -Find out what is going on; likes, shares, comments -Form hypotheses about which strategies work well and which do not
What does a cohort with high LTV : CAC but very long GMPP denote?
A substantial need for capital to weather the storm until it becomes profitable
5 Whys
A technique in which you repeatedly ask the question "Why?" to help peel away the layers of symptoms that can lead to the root cause of a problem
Customer Journey
A tool used to help visualize the customer's experience as they interact with a company's marketing and sales efforts.
AARM Framework and when to use it
Acquisition Activation Retention Monetization Use it to identify a metric
The 3 C's Marketing
Customer -unmet need?, segment?, price sensitive? Competition -strengths / weaknesses, concentration, potential substitutes Company -strengths / weaknesses, value chain, value add?
% Renewal Rate ($'s)
Definition: Similar to the number above, but instead of looking at the number of customers, it looks at the dollar value of the renewed contracts. It's important to look at both, as they each tell an useful part of the story. If you were losing a lot of customers, you'd want to know why. Similarly, if you were only losing a few customers, but they were your biggest $ value customers, you'd also want to know that as well.
Effectiveness
Effectiveness -Percent of tasks completed -Ratio of successes to failures Workload -Number of features or commands used
Days from PQL to Customer
Measures the average number of days it takes a PQL to become a customer.
First Visit Metric
Understand how people are finding your website and how engaged they are on their first visit. - Traffic Sources - Average Time on Site - Pages per Visit
Good design emphasizes the product is ________ whilst disregarding anything that could possibly detract from it.
Useful
VULNERABLE CUSTOMERS: FREE RIDERS: STAR CUSTOMERS: LOST CAUSES:
VULNERABLE CUSTOMERS: High profitability; low customer experience (valuable but do not RECEIVE much value). At risk to competition. FREE RIDERS: Low profitability; high customer experience (highly satisfied). Upsell. STAR CUSTOMERS: high profitability; high customer experience. Keep loyal. LOST CAUSES: low profitability; low customer experience. What is the cost of keeping?
Product Adoption
combined effort of successfully onboarding new users while retaining existing customers
Feature Adoption
feature announcements and feature adoption become important to make sure that your customers follow the developments in your product roadmap
Visitors and unique visitors are the
same metric
interaction
sąveika
Revenue Post GMV
the portion of GMV that the marketplace "takes". Revenue consists of the various fees that the marketplace gets for providing its services; most typically these are transaction fees based on GMV successfully transacted on the marketplace, but can also include ad revenue, sponsorships, etc. These fees are usually a fraction of GMV.
motivation of creators
to create something new and cool
particular
ypatingai
It is recommended that you make global changes or redesigns to your website based solely upon the results of a lab usability test.
False
Media mix modeling involves conducting experiments and changing one variable at a time in an effort to determine which campaign should receive credit for a conversion.
False
*Reviewing the company's portfolio of products needs to be done only once.
False. It must be continuous.
Story 13: Making choices with a trade off
Firing people with jellyfish art vs taking VC money. Building things in a certain order at Simility despite everything broken. Led with sales centric features.
Financial Terms -Fixed Cost (examples) -Variable Cost (examples) -Gross Profit -Market Penetration -Operating Margin
Fixed Cost -Insurance -Rent -Utilities -Advertising Variable Cost -Materials / Labor -Shipping Gross Profit = Revenue - Cost of Goods Sold -In accounting, gross profit, gross margin, sales profit, or credit sales is the difference between revenue and the cost of making a product or providing a service, before deducting overheads, payroll, taxation, and interest payments Market Penetration = Customer / Potential Customers Operating Margin = Operating Income / Total Revenue
DIGS Method
For behavioral questions: - Dramatize the situation: provide context and details that emphasize your importance - Indicate the alternatives: be thoughtful and analytical by listing three approaches to problem - Go through what you do: emphasize yourself as the driving force - Summarize your impact: provide numbers and qualitative statements the validate your impact
CIRCLES Method
For product design questions: - Comprehend the situation: ask clarifying questions and state assumptions - Identify the customer: list potential customer personas and choose one to focus on - Report the customer's needs: provide a user story that conveys their goals, desires and potential benefits - Cut, through prioritization: prioritize, assess tradeoffs and make decisions - List solutions: brainstorm at least three ideas that exploit future trends and customer behavior - Evaluate tradeoffs: define your tradeoff criteria and analyze the solution through a pro and con list - Summarize recommendation: specify which you would recommend and explain why
Cut, through prioritization
For use case. - If a certain feature is a win/lose, use corp strategy to decide ○ e.g. feature increases revenue by 5% but decreases engagement by 3%. What is company's strategic goal? Large company don't care about additional rev and big on engagement and making a sticky platform. Or younger company paying off debt.
Net Promoter Score (NPS)
For your product to grow, your customers need to become promoters. Net Promoter Score or NPS uses the question "How likely are you to recommend the product to someone" and asks the respondents to rate it on a scale of 1-10. Promoters are the ones who rate it in the range of 9-10 and detractors in the range of 1-6. Subtracting the percentage of detractors from that of the promoters gives you the NPS. It is to be noted that NPS is not a percentage but a whole number.
Social Interactions
Formula: # of valuable social interactions summarized over X period Success Indicators: A high level of engagement that corresponds to the completion of key marketing objectives. Viral posts that require little or no nurturing on your behalf. Sustained engagement over a long period of time.
Gross Margin Payback Period Formula
GMPP = tCAC / RGP
What is Gross Margin Payback Period (GMPP)?
GMPP is the number of months required to breakeven on the cost of acquiring a customer
What else does GMPP offer insight to in a business and why?
GMPP offers insight into the intrinsic capital efficiency of a business Often times, customers pay in advance, as in the common "annual subscription, paid up front" arrangement. Rather than focusing on GAAP revenue recognition, operators should focus on cash (i.e. billings based) payback periods, as upfront payments are an effective way to finance growth
GMV vs. Revenue
GMV = Total sales dollar volume on eCommerce Take rate = % that company takes from GMV
Step 1 of 5 in design process
Gather BACKGROUND
Mobile OS Market Share
Global: Android: 87% iOS: 13% USA: Android: 61% iOS: 37%
LTV / CAC
Good measure to determine CAC payback Calculated as CAC / (Average MRR) or CAC / (LTV/average life)
How Hits can be Organized Into Sessions Example 3 Cont.
Google analytics will record two separate sessions for that users The first session will include a pageview hit and the second session will include an event hit, since the first session will have timed out, while the user was viewing the second tab
Top Companies Digital Ads
Google, Facebook, Amazon, insta
Ad Revenue by Platform
Google: 80B Facebook: 30B Twitter: 2.5B Snapchat: 400M
Churn
Gross Churn = MRR lost in given month/beginning month MRR Net Churn: MRR loss net of upsell revenue divided by beginning MRR
Gross burn
Gross burn on the other hand only looks at your monthly expenses + any other cash outlays.
Gross churn
Gross churn: MRR lost in a given month/MRR at the beginning of the month.
***What is the GOAL of customer management?
Grow the business profitability by acquiring, retaining and developing THE RIGHT customers.
Data Privacy
Guidelines and laws that describe how a customer data should be treated to protect individuals and give them knowledge of how their information is being used by companies.
What is likely to happen if a majority of your customers are VULNERABLE customers?
High turnover
Key Social Metrics
How effective is your website at building an audience? Formula: Referrals, conversions, and events of current month compared to previous month - Referrals: The number of friends who see shared content on Facebook, Twitter or an email message and click to visit your website. - Conversions: The number of referred visitors (friends) that convert when they get to your site - Events: Events are user interactions with content that can be tracked independently from a web page or a screen load. Downloads, mobile ad clicks, gadgets, Flash elements, AJAX embedded elements, and video plays are all examples of actions you might want to track as Events Best Practices: - Pay special attention to the traffic metrics from your social sites. They may showy you significant differences in the performance of one social network versus another. - Ensure that you aren't spending time on social media marketing if the referral traffic you're able to procure from these sources doesn't ultimately convert on your home site - At least once a month, take the time to measure the number of conversions generated on your site by visitors from different social media websites.
First Response Time
How long it takes for your team to reach your customers. It is averaged across all customers for a certain period of time: a day, a week, a month, or a year.
Rule of 72
How long until something doubles -increase x% /yr -double after 72 / x yrs e.g. 72 / 8 (compound int rate) = 9 yrs to double
Measurement Protocol Defines
How to construct your hits using a customized tracking ID and send those hits to your designated google analytics account
FB in Leadership and Drive, what 4 things they looking for + 3 personality traits (jfa tough leadership)
How you earn trust and take ownership How you process and grow from past experiences How you support the people around you How you overcome difficult situations + empathetic collaborator + conviction + be bold
FB in product sense, what are 4 things they're looking for. +2 bonus (blind)
How you identify who to build for and what their needs are. How you focus on creating value and impact. How you make intentional design choices. How you handle critique, constraints, and new data. + use whiteboard + build social value
External Website Links
Improve Your Website Rankings and Traffic Volume by Monitoring External Links. Benchmarks: - Monitoring the number of external links to your website and measuring them against those of competitors can be an important KPI for companies who depend on inbound web traffic to generate business. Best Practices: - Is your page trustworthy? Receiving links from sources with inherent trust - such as the homepages of major university websites or certain government web pages - is a strong trust endorsement. - How popular is the external link? Is it important on the internet? A popular page is one that many other quality websites are externally linking to as well. - Consider how relevant the link is to the content on your website. Make sure the content between the source page (your website) and the target page are similar. - Don't just throw the URL on your page, use anchor text! Anchor text maintains the flow of your page and doesn't distract users from the purpose of their visit to the page. Be careful though, there is good and bad anchor text:
Google Annual Revenue
$110 billion
Cost-per-thousand-impressions for Video Ad
$12.80
Global Ecommerce Sales
$2 trillion
Average Cost-per-click on Google Search Ads Overall
$2.14
CPM Display Ad
$2.80
Global CRM Software Revenue
$26.3B
Facebook Annual Ad Revenue
$26.8B
Facebook Annual Ad Revenue
$27 billion
Global Enterprise Resource Planning Software Revenue
$34B
User Journeys
-Break down into stages of interacting with the product -For each stage, write down the key actions Good User Journeys help to... 1) Empathize with the customer 2) Discover product improvement opportunities
cost per unit
-CPU -cost associated with each unit sold -costs associated with development, distribution, production, marketing, advertising, and others
Market Entry Checklist -Characteristics
-Market Size -Market Growth -Profit Margins -Market Trends
What are marketing analytics metrics?
-Metrics are measures of a data-driven project to maximize effectiveness. -Marketing analytics metrics allow marketers to maximize marketing returns on investment (ROI) and minimize marketing costs. -Marketing analytics metrics assess a marketing analytics strategy.
From using metrics in ISO 9241, what are the some of the usability objectives?
-Suitability for the task -Appropriate for trained users -Learnability -Error tolerance
Social technographic ladder (STL)
-puts customers into 6 categories based on how they use and interact with social media and online content -categories are not exclusive; people can belong to multiple categories -categories 1-6 vary in their level of involvement with social media and online content
diffusion
-rate by which product is adopted into market place -usually follows S-shaped curve
product scoring model
-stage and gate 2 -quantify idea relative to competing products -lower-level employees can give feedback -rate described product relative to competing products along dimensions that will likely determine product success (ease of use, durability, etc.) -scores added or averaged together -info comes internally
What are the 3 steps of the *"marketing analytics process":*
1 Identify the metrics 2 Analyze the metrics 3 Take improvement actions
Key Product Metrics (users, conversion...etc)
1) Users / Traffic 2) Conversion 3) Referral Rates / Types 4) Engagement 5) Retention 6) Revenue 7) Costs
Key Product Factors (e.g. users / goals...etc)
1) Users and Goals 2) Strengths 3) Challenges 4) Why Why Why 5) Priorities / Values 6) Competitors 7) Trade offs
2 general product design tips
1- Think big and extreme, not small/mundane 2- Practice thinking of 2-3 solutions on spot, but present 1 indepth
4 Overall Themes Facebook Interview On
1. Technical/Logical: quantitative, metrics, some code 2. Design 3. Futurist: what will it be like 4. Guru: What are your core strengths
William Foster
1st black man to own film production company
Alice Guy Blanche
1st female director: "The Cabbage Fairy"
Picture storage size
2 MB
US People per Household
2.5 people
Snapchat usres
300 million
India Smartphone Install Base
300M
Snapchat Number of Users
300M
Pandora Paid Subscriber Base
6.8M
Google employees
70,000
China smartphone install base
700 million
European population
700 million
Seattle population
700,000
Avg CPC Display Network
<$1
Lifetime Value Question Solving Steps
= Ave contribution per sale * Sales per year * # of years per customer
Loyalty Loop
A continuous process of delivering substantial value and customer experience to keep customers using the product, adopting new features, increasing usage, and renewing.
Free Trial
A customer acquisition strategy that provides a partial or complete product to prospects free of charge for a limited time. Typically, a free trial runs for 14 or 30 days.
Customer Experience (CX)
A customer's perception about a company, brand, or product, based on all touchpoints, interactions, and engagements
Business Objective
A goal that is set for an entire business. An example of this may be for the business to grow their revenue by 5% during the year.
Executive Summary
A part of a marketing plan that summarizes the overall plan in a quick and easy to understand way.
Target Audience Summary
A part of a marketing plan where research is done about potential customers to determine how to best market to them.
Market Analysis
A part of a marketing plan where research is done about the challenges and opportunities of the industry and where a service or product will be doing business.
Orders of Magnitude
A*B = n digits (A) + digits (B) = digits (A*B) 823 * 1032 has 6 or 7 digits
Product Success Metrics acronym
AARM -Acquisition - Sign ups, low bar since many things free now. Lazy registration, bare minimum -Activation - Getting users to fully 'register', do things like upload photo, complete profile, etc -Retention - Getting users to use service often, e.g. adding data , checking feed, inviting others -Monetization - # paid users, avg rev per user
Billings
Adding the change in deferred revenue from previous quarter to the revenue in new quarter.
The ____________ quality of a product is integral to its usefulness because products we use every day affect our person and our well-being.
Aesthetic
When sheet metal is on a door, suggesting that it is too be pushed, rather than pulled, this is an example of what design principle
Affordance
Product Engagements
All of the interactions that prospects have inside of your product. See "Non-product engagements."
Non-Product Engagements
All of the interactions that prospects have outside of your product. See "Product Engagements."
SIMPLE CLV FORMULA CLV =
Annual profit contribution per customer x Average number of years that they remain a customer (-) Less the initial cost of customer acquisition
Card Web Layout
Browsing large part of site interaction, but displaying the details for each item would clutter the screen.
How are Events Organized?
By category
____ is the amount of customers or subscribers who cut ties with your service or company during a given time period.
Churn rate
Why you want to work here? In general what to talk about
Company research and relevant experience
Facebook Ads CPM and CPP (last 7 days)
Compare cost per impressions and cost per 1000 people reached over the past 7 days from your Facebook Ads.
SEO Visibility
Compare this week's SEO visibility to the previous week and discover the trend. Ways To Improve SEO Visibility: - Technical SEO: Are the right pages of your site indexed? Do you have "extra pages" or "ugly listings" in the SERPs? - Content Marketing and Optimization: What kind of content drives search engine exposure to your site and your competitors? Your industry? Your specific target client segment(s)? - Inbound Links and Social Signals: Does anyone who matters care about your content? Best Practices: - Active participation in communities, groups and online conversations
Having all action buttons follow a similar design pattern in an application is an example of this design principle
Consistency
Havining similar operations and similar elements for achieving similar tasks.
Consistency
____ in how you count customers is very important to measure over time.
Consistency
Grid Web Layout
Content-heavy sites want to display all primary items with equal hierarchy.
Immersion
Customer Journey muss geräteübergreifend online und offline betrachtet werden. Die Grenze zwischen Online und Offline verliert immer mehr an Bedeutung. Hybrider Kunde: Wechselt kontinuierlich zwischen Verkaufskanälen hin und her. ROPO: Research online, buy offline
Price Ceiling
Customer Perception of value
What is a common example of the cost of customer delivery?
Datacenter Usage
Wichtige Kriterien der Customer Journey
Dauer der Kaufentscheidung Anzahl der Kanalkontakte Abstand zwischen den Kanälen Anzahl der genutzten Kanäle
Net New MRR
Definition: Net New MRR = New MRR + Expansion MRR - Churned MRR This is the sum of the three different components that will change MRR during each month.
INVEST -story best practices
Independent Negotiable Valuable Estimable Small Testable
What are common segmentations to make in SaaS (i.e. to run cohorts off of)?
Industry Customer size Plan type (i.e. product model) Selling type (e.g. direct vs. reseller) Lead source (e.g. PPC, video ads, inbound marketing)
Payback Period
Initial Investment / Annual Cash Flow
What are he stages in the product lifecycle
Introduction Growth Maturity Decline
CIRCLES - L - List solutions
L - List solutions - Be creative and list your solutions - Possible methods o Reversal Method - i.e. if the problem for the user is they need a new car buying experience since they don't have time to visit a car dealership, a potential solution could be the car dealership can deliver cars to test drive to the user o Attribute Method - List all possible attributes that make up a potential solution and mix and match it o Why? Method - outside of the box/status quo...i.e. create a coffee mug with insulation in it - Think big - Have at least 10 ideas...only discuss the top 3
Why is it useful to look at LTV : CAC?
LTV: CAC provides a churn-adjusted view of unit economics by combining GMPP with expected customer lifetime
Customer satisfaction (CSAT)
Lets you see how customers are feeling specifically about your support interactions, and can take a pulse of how your team's responses are being received. .
DEVELOPMENT METRICS Low cost metrics Customization metrics Quality Metrics Responsiveness Metrics Innovation Metrics ____ = measure the ability to deliver goods and services at low cost.
Low cost metrics (ex; Boeing => reduce costs in aerospace manufacturing. Can also measure the degree to which supply chain efficiencies and purchasing capabilities lower costs).
Market Entry Framework
Market Characteristics Competition Company Fit
Net Promoter Score
Measure Customer Satisfaction and Loyalty. Formula: Net Promoter Score = Proportion of Detractor Scores - Proportion of Promoter Scores Benchmarks: Highest Scores - Department & Specialty Stores: 58 Brokerage & Investments: 45 Table Computers: 44 Smartphones: 40 Lowest Scores - Software & Apps: 19 Health Insurance: 12 Cable/ Satellite TV Service: 3 Internet Service: -3
What is the Label Parameter?
Optional, further describe element
paid CAC
Paid CAC [total acquisition cost/ new customers acquired through paid marketing] informs whether a company can scale up its user acquisition budget profitably
Three Types of Media
Paid, Owned, Earned
Bounce Rate:
Percentage of people who leave the webpage after viewing only one page
What is every prioritization matrix or scorecard ultimately based on?
ROI
Return on Marketing Investment (ROMI):
ROMI = (Marketing Revenue * Contribution Margin) / Marketing Spending
Revenue
Recognized when the service is provided or ratably over life of the subscription agreement
Where are vast majority of Google's ads shown
Search results
T or F: In order for a company to be competitive, it needs to have a firm understanding of its brand. T or F: A lot of marketing is for the purpose of investing in the long-term value of a brand rather than seeking immediate sales. .
T T
How many ideas should you share when presenting solutions for a design problem?
THREE. Think up ten and choose the best three.
Gross vs Net churn
The difference between the two is significant. Gross churn estimates the actual loss to the business, while net revenue churn understates the losses (as it blends upsells with absolute churn).
PESTEL
The outcome of PESTEL is an understanding of the overall, external picture surrounding the company. Political Economic Social Technological Environmental Legal
MRR Expansion Rate (a.k.a. Net Revenue Retention Rate)
The percentage of MRR that is gained due to upsells and cross-sells to existing customers for the period for which MRR expansion is calculated. It is calculated by dividing the amount of expansion MRR by the starting MRR.
Define usability requirements
The primary purpose of Usability Requirements is to ensure that the system meets the expectations of its users with regard to its ease-of-use.
The social media metric, "Engagement", measures which of the following:
The total number of likes, shares, and comments on a post
New Sessions:
The total number of new site versus recurring visitors.
Unique Visitors
Total unique visitors to a webpage (monitored by IP address)
Broad, 'category' keywords are usually associated with the:
Upper portion of the search keyword funnel
If a product is in its growth stage...
emphasize marketing and competition
Rich media metrics, also known as audience interaction metrics
how long people spend viewing the ad as a proxy for how interested they are in the content of the ad
The ________ attribution model assigns 100% of the credit to the second to the last channel before conversion.
last non-direct click
The _________ attribution model assigns the same amount of credit to all interactions.
linear
What is the Category Parameter?
organize events into groups "videos" or "social shares
journey based thinking
process-based thinking by grouping people by the route, not destination --> continuous improvement • customer segmentation - customers grouped by product purchased • route segmentation - customers grouped by the route they took to buy the product • devices you "touch" capture Customer Journey data o all channels and devices that have an IP address (e.g. cookers, fridges) o all stages on each journey - shopping, working, social media, travel • digital data examples of better journeys Maintenance done for customer instead of just informing the car issue Fit fix into journey of owner
How to Build Effective Customer Experience
stimulate positive emotions/feelings and memories by qualitative research: - identify journey, path, or buying-related process - construct a map of journey including potential paths - understand what makes for success and for failure during each pat of journey - develop mechanisms to reduce the likelihood of failure and increase likelihood of success - identify customer experience related "clues" that are perceived by consumers via their senses and influence their feelings, thoughts, and actions
The best available measures of impressions use
technology in an effort to judge whether a given advertisement was actually seen (never perfect- many recorded impressions are not actually perceived by intended viewer - opportunity to see)
Open Rate:
the number of people who open an email that has been sent to them dividing by the total number of people to whom the email was sent.
direct search
typing a URL into a web browser
Sales Capacity
Explanation: In many SaaS businesses, sales reps play a key role in closing deals. In those situations, the number of productive sales people (Sales Capacity) will be a key driver of bookings. It is important to work backwards from any forecasts that are made, to ensure that there is enough sales capacity. I've seen many businesses miss their targets because they failed to hire enough productive salespeople early enough. It's also worth noting that some percentage of new sales hires won't meet expectations, so that should be taken into consideration when setting hiring goals. Typically we have seen failure rates around 25-30% for field sales reps, but this varies by company. The failure rate is lower for inside sales reps. When computing Sales Capacity, if a newer rep is still ramping and only expected to deliver 50% of quota, they can be counted as half of a productive rep. That is often referred to as Full Time Equivalent or FTE for short. Another important metric to understand is the number of leads required to feed a sales rep. If you are adding sales reps, make sure you also have a clear plan of how you will drive the additional leads required. There is much more that could be said on this topic, but since it is all very similar to managing a sales force in a traditional software company, we will leave that for other blog posts.
Single Customer Cash Flow
Explanation: In many SaaS businesses, this also translates into a cash flow problem, as they may only be able to get the customer to pay them month by month. To illustrate the problem, we built a simple Excel model which can be found here. In that model, we are spending $6,000 to acquire the customer, and billing them at the rate of $500 per month.
Single Customer Cumulative Cash Flow
Explanation: In many SaaS businesses, this also translates into a cash flow problem, as they may only be able to get the customer to pay them month by month. To illustrate the problem, we built a simple Excel model which can be found here. In that model, we are spending $6,000 to acquire the customer, and billing them at the rate of $500 per month.
Customer Retention (Churn)
Explanation: In the early days of a SaaS business, churn really doesn't matter that much. Let's say that you lose 3% of your customers every month. When you only have a hundred customers, losing 3 of them is not that terrible. You can easily go and find another 3 to replace them. However as your business grows in size, the problem becomes different. Imagine that you have become really big, and now have a million customers. 3% churn means that you are losing 30,000 customers every month! That turns out to be a much harder number to replace. Companies like Constant Contact have run into this problem, and it has made it very hard for them to keep up their growth rate. Ron Gill, NetSuite: One oft-overlooked aspect of churn is that the churn rate, combined with the rate of new ARR adds, not only defines how fast you can grow the business, it also defines the maximum size the business can reach (see graph below).
Impact of Success on P&L/Cash Flow
Explanation: However, even though there is a trough in the short-term, eventually there is enough profit/cash from the installed base to cover the investment needed for new customers. At that point the business would turn profitable/cash flow positive - assuming you don't decide to increase spending on sales and marketing. And, as expected, the faster the growth in customer acquisition, the better the curve looks when it becomes positive. Ron Gill, NetSuite: "If plans go well, you may decide it is time to hit the accelerator (increasing spending on lead generation, hiring additional sales reps, adding data center capacity, etc.) in order to pick-up the pace of customer acquisition. The thing that surprises many investors and boards of directors about the SaaS model is that, even with perfect execution, an acceleration of growth will often be accompanied by a squeeze on profitability and cash flow. As soon as the product starts to see some significant uptake, investors expect that the losses / cash drain should narrow, right? Instead, this is the perfect time to increase investment in the business. which will cause losses to deepen again. The graph illustrates the problem. Notice in the example graph that the five customer per month model ultimately yields a much steeper rate of growth, but you have to go through another deep trough to get there. It is the concept of needing to re-enter that type of trough after just having gotten the curve to turn positive that many managers and investors struggle with. Of course this a special challenge early-on as you need to explain to investors why you'll require additional cash to fund that next round of acceleration. But it isn't just a startup problem. At NetSuite, even as a public company our revenue growth rate has accelerated in each of the last three years. That means that each annual plan involves a stepping-up of investment in lead generation and sales capacity that will increase spending and cash flow out for some time before it starts yielding incremental revenue and cash flow in. As long as you're accelerating the rate of revenue growth, managing and messaging around this phenomenon is a permanent part of the landscape for any SaaS company.
Marketing analytics strateigy is a ____________________ kind of process
"rinse, lather, repeat"
Market Entry Framework: Competitive Env
# of competitors, their partner ecosystem, access to distribution channels, differentiated products
How do you calculate customer renewal rate? How do you usually look at it?
# of customers who renewed their contracts / total # of contracts up for renewal; usually calculated on a logo basis and on a revenue basis to get a sense of the full picture
Avg CPC Google Search Ads
$2.14
Twitter Annual Ad Revenue
$2.5B
Cost-per-thousand-impressions for Display Ad
$2.80
Apple Annual Revenue
$215 billion
Global IT SaaS Spending
$246B
Total IT Spending on Enterprise Software
$350 million
Total IT Spending on Enterprise Software
$351B
Cloud Infrastructure Spending
$36 billion
GSuite Pricing Plans
$5 and $10 per month per user
Google Annual Profit
$60B
Google's 2013 revenue
$60B
Traditional Data Center Infrastructure Spending
$61B
Google Annual Ad Revenue
$79.4B
Google Annual Ad Revenue
$80 billion
Rate of Adoption
% of healthy users
Three types of budget
% of sales, parity, objective and task
What are two ways to look at the CAC ratio and what does each tell you?
(1) (Annualized Q2 MRR)*(subscription GM%) / (Q1 S&M expense) -> this method tells you the % of your prior quarter's S&M that will be recovered from NTM profits of the customers you signed up (magic number / sales efficiency metric) (2) Inverse of (1) -> this method tells you the payback period of the S&M investment (i.e. how many months/years will it take to recover S&M investment for a given quarter based only on the annualized GM for the next quarter)
What are the three types of churn?
(1) Customer / logo churn: measures the number of customers you lose over a period of time (2) Gross dollar churn: measures the total lost revenue both from customers leaving and downgrading (3) Net dollar churn: equals gross dollar churn less the gains from expansion (i.e. upselling, cross-selling, adding more paid users)
4 things needed to calculate LTV:CAC
(1) Customer acquisition cost ($) (2) Avg. MRR per customer (3) MRR churn (4) Software gross margin % Use 2,3,4 to calculate LTV
Name three main trends driving software innovation
(1) Increasing verticalization of software solutions (2) Improvements in prescriptive software (3) Digitalization of previously non-software industries
What are the benefits of running cohort analyses to understand churn?
(1) Within a cohort, it can show you when you're losing most of your customers (2) By comparing cohorts, you can see if measures were effective in reducing churn (3) It can tell you if and when churn stabilizes at some point in time
3 reasons why tracking bookings is important
(1) indicates momentum based on revenue that's already been committed (2) crucial metric to keep tabs on the cash that will be coming into your business (3) able to be sliced by product, sales rep, industry, etc to provide insights about where you should be focusing selling efforts
Gross Retention Formula
(Beginning ARR - Churn - Downsells) / Beginning ARR
How do you calculate net MRR churn?
(Churned MRR - expansion MRR) / previous months' MRR
BRAND EQUITY INDEX
(Effective Market Share) x (Relative Price) x Durability
ROIC
(Gain on investment - Cost of Investment)/ Cost of Investment (Value - Initial Investment)/ Initial Investment
Gross Churn
(MRR lost in a given month) / (MRR at the beginning of the month.)
CAC Multiple Formula (in-depth)
(S&M Expense + Onboarding Expense - Onboarding Gross Profit) / # of New Customers Added
Clicks
(SERP) - ad is shown - people see ad (Ad Rank) - people decide to click on ad
Paid Customer Acquisition Cost (CAC)
(total acquisition cost) / (new customers acquired through paid marketing) more reliable for VCs bc excludes organically gained customers and targets customers gained through marketing spending (Not typically in SaaS)
CLICKS framework
* Comprehend and clarify the situation * List metrics * Identify tradeoffs * Choose North Star metric and justify * KPIs — what drives this metric * Summarize
Questions to Ask About Role
**What are top 3 qualities looking for in a candidate -How technical is the role? -How much time on writing requirements... managing timelines... building roadmap... etc -Where do ideas come from? Bottom-up or Top-down? -Manage innovation? Is product relatively change averse or willing to take informed risks? -How do you make design decisions? Surveys... studies... A/B testing? -What is most challenging about being a PM here?
What is a suggested cutoff for LTV and why?
- 5 years - Same reason as GMPP; the true value of "out year" cash flows are significantly impacted by the time value of money, and it's very hard to predict customer churn behavior 5 years in the future
What are the SaaS Application Delivery Options?
- AWS - 64% share and growing - Google Cloud - 7% share and growing - force.com platform - 3% share and plateauing - Microsoft Azure - 5% share and growing - Self-Managed - 13% and in heavy decline
What are some common constraints & assumptions to clarify in a design problem?
- Deadlines. When do we have to achieve our goal? - Resources. How much money, engineers, and other resources do we have to achieve the goal? - Scalability. How many visitors are we expecting? What's the distribution of read vs write operations? What kind of write operations are we expecting? Is it lightweight like text updates, or is it substantial like video upload? - Platform. Is it for web, iOS, or other? - Geography. Which country or region is this for? Are there technology constraints such as limited device penetration or slow, inconsistent Internet access? Are there regulatory constraints?
Google: Why want to work there
- Fertile for entrepreneurs, it's a collection of startups but with distribution of a large company. Very telling that acquired entrepreneurs stay there for a long time - The obvious - Google thinks 10X - Googlers are curious
What are the two items out of all of these that are the most significant to look at and why?
- GMPP and LTV : CAC - By utilizing GMPP and LTV : CAC together, we can determine the time required to recoup the cost of acquiring a customer and the expected return on acquisition spend - These two metrics together are crucial when making decisions about the most efficient ways to allocate resources
What is the issue with an LTV : CAC below 3x? What does a low LTV: CAC mean?
- LTV : CAC below 3x doesn't leave much to cover operational expenses beyond the acquisition expense and Recurring COGS - Low LTV : CAC means a company earns little over the life of each customer and new customers have to be added quickly to replace ones that churn
Why is it useful to look at LTV : CAC, in conventional terms?
- LTV: CAC provides a churn-adjusted view of unit economics by combining GMPP with expected customer lifetime - In conventional terms, this is the ROI on the spend to acquire a customer - perhaps the most important thing to know when analyzing a SaaS business model
Story 4: Growing pains going through YC
- Leadership - Moved into much bigger warehouse - 15 employees + other suppliers - Had to establish company culture
What is likely to occur if you attract, retain and develop THE RIGHT customers?
- Lower churn rate - Higher customer satisfaction - Higher profitability
Types of Questions
- Market Sizing - Population Based - Household - Worldwide Market - sizing - Preposterous Cases: silly questions - Factor questions: "What factors would you consider if..." - Written Group Case and Tests. - Written Exercises
What kind of solutions should you avoid when thinking big for a design question?
- Me too ideas. - Integration ideas.
What is NFC
- Near Field Communication - Short 5cm RFID tech - Just bring two things close, no pairing needed - Tag doesn't need batteries
What qualities would you look for in a good SaaS investment opportunity?
- Niche or fragmented industry with potential for lots of M&A activity and future consolidation - Targeted / vertical end-market w/ large but focused TAM opportunity - Defensible IP rights or other barriers to entry / replication - Highly recurring revenues (90%+) - High operating leverage (i.e. ability to earn outsized profits as customer base grows) - High FCF conversion (i.e. profits being generated are acually converted to FCF and not absorbed by high NWC, CapEx, or interest payments) - Good SaaS metrics: 90%+ gross MRR retention, <12 month CAC payback period, >3.0x LTV:CAC
What does the RICE acronym stand for?
- Reach. How many people will be impacted? - Impact. What's the benefit of that user story from low to high? - Confidence. What's the probability of success? - Effort. How much time will it take?
Story 8: Selling Other Company's Refurbished Tanks
- Resourceful - Loophole in cheap way to manufacturing - Started getting press early, set up steady traffic
Story 7: Selling Tank to Seattle Restaurant
- Sales skills, $25K and had nothing - Resourceful, used that to build infrastructure for company
Story 2: Converting from VC funded to profitable
- Saw a problem and fixed - Difficult challenge: laying people off - It worked, led to acquisition - Company culture important - Worked only with good people then
Types of Implementation Services
- Self-Service Provisioning System: Generally for simple applications that are typically made available via public clouds - Private Enterprise: SaaS offerings which are designed for private enterprise use frequently require hands-on configuration that must be taken by the independent software vendor for SaaS enablement to occur
What are a few "bonus" criteria that can help to make prioritization more complete?
- Strategic Importance - Probability of Success - Workaround Availability
What are COGS line items in SaaS?
- Support, Services, CSMs and COO
What are typical recurring COGS items?
- The cost of customer delivery - The cost to support the customer - Payments to third parties
What is the proper way to incorporate costs of customer renewal and upsell when thinking about LTV? Why?
- There is no clear-cut answer, but generally recommended to capture these costs in Recurring COGS - Rationale is that tCAC captures all costs to acquire a "net new" customer and Recurring COGS captures all costs related to ongoing service delivery and support as well as the periodic costs of renewing or upselling
FB: What are 4 types of relevant teams Oscar mentioned?
- Topic: eg terrorism, child safety. Specialists in that adverse behavior no matter where it shows up. - Behavior oriented: eg extortion, behavior not content. - Structure: metrics, ml models - Surface: in charge of protecting their particular surface like pages or messenger and work with other teams
10 elements of customer delight
- Understanding the 10 key elements can assess company's success at delivering them and taking the action needed to transform - 10 elements create a service design and delivery report card to help measure how successful company is in creating a superior experience with and for you customers - Assessment created to set priorities for improvement 1. Empathy 2. Expectations 3. Emotions 4. Elegance 5. Engagement
What is a common mistake when measuring customer payback and why is it a mistake?
- Using revenue rather than gross profit to measure customer payback - It is a mistake because using revenue fails to account for the true costs of supporting a customer and can lead to faulty conclusions
Story 9: Selling Chargerito to the Press
- What worked and didn't - Shotgunned it in a few weeks - Secret is good product, everything else follows, I recognized it when I saw it - Voluntarily turn down PR offers
What does it mean if there is a GMPP of 36 months and monthly churn of just 3%? How should operators proceed in this scenario?
- eLT = 33.3 (1 / Churn) - These customers will never be profitable because their lifetime is only 33.3 months against a 36 month payback period - Operators should redirect resources away from cohorts displaying this sub-par performance
What does a GMPP of 12 months or less indicate? How should operators proceed?
- tCAC will be repaid within a year - Assuming manageable churn, a company with such a short GMPP should be throwing fuel on the fire and investing in efficient growth
Wider Span of Customer Experience
- the greater the opportunity for interaction with or availability to consumers the wider the span of the customer experience which can be engaged by marketers
1. Creators (24%)
- the true content developers in social media (lead users)
A/B Testing -names -best practices
-A.k.a split testing or bucket testing -Version A (control) vs Version B (challenger) to see which has higher conversion rate -"cooked" term for when test is complete -Lift = increase Best Practices -Test should run until at least 95% chance to beat control -Test for a minimum of 7 days (takes into account weekdays and weekends -Do not focus on just one metric. Make inventory of important metrics before and after every test you run -Create segments and run A/B tests on them separately to gauge big picture
Common PM Duties
-Analyze log files for data trends -Prioritization of backlog -Launch preparation -Post launch analysis -Create mock-ups
Examples of analyzing metrics
-Analyzing Website Metrics using Google Analytics -Analyzing Email Marketing Campaign Metrics -Facebook video campaign metrics
Support Metrics
-Brand metrics -Customer Metrics -Digital Marketing Metrics -Development Metrics
Heart Framework -and Goals Signals Metrics
-Categories used to help define metrics -Try to have a few metrics in each category Happiness: measure of user attitude (via survey)... net promoter score, satisfaction Engagement: level of user involvement (# of visits per week) Adoption: new users of product / feature Retention: rates at which users are returning (churn) Task Success: behavioral metrics such as efficiency, effectiveness and error rate
Key SCRUM Meetings
-Daily Scrum -what'd you do yesterday? -what will you do today? -any blockers? -Sprint Review -1/2 day; demo work to stakeholders -acknowledge achievement -Sprint Retrospective -Sprint Planning -1/2 day; 60% must haves -Backlog Refinement
Personas -Why?
-Develop a deeper understanding of customer needs and how to solve for them -Guide product development by creating features that help them achieve their desired outcomes -Prioritize which projects, campaigns, and initiatives to invest time and resources on -Create alignment across the organization and rally other teams around a customer-centric vision
Quality Metrics
-Ensure that companies produce high quality products and services -Includes certifications, training, employee involvement, etc. ~Hospitals often conduct ongoing training for surgical staff to ensure that they are constantly delivering top-quality healthcare
Implementation process
-Ensure the success of the campaign -Coke→ using their data, generated over 300 customizable responses -Carefully and regularly monitor results and making adjustments when necessary
5E's Framework
-Entice. What event triggers a user to enter into the UX funnel? -Enter. What are the first few steps in the UX funnel? -Engage. What task(s) is the user trying to accomplish? -Exit. How does the user complete the task? -Extend. What follow-up actions occur after the user completes the task?
Evaluation process
-Evaluate whether a campaign has met its goals or not Coke→ social reach, over 22-million, increase happiness exposure by 200% -Determine how many resources should be spent in the future, if any
Market Entry Checklist -Company Fit
-Expertise -Economies of scale -Access to distribution channels -Good relationships with suppliers -Related to existing brand promise
How do you improve the user experience?
-Human centered design principles - User labs for small group qualitative direction -Develop a hypothesis around a new design that says "I believe [insert design change] will [insert improvement to experience and relation to goal]. I will know this is successful if [insert some metric of success]. -Test hypothesis by executing task analysis against new designs in User Labs with a few users. They will provide rich qualitative direction to help refine design.
KPIs
-Key Performance Indicator -Do not answer why -Measure performance, monitor progress, data for decision making -KPIs are derived from the product vision and tell you how well your product is meeting the vision Examples -Deviation of set hours of work -Planned budget deviation -Missed milestones -Cost variance metrics
Phase 3: Take Improvement Actions
-Most difficult step in the process -Changes aren't always obvious so marketers use analytical and creative skills to develop solutions ~A/B testing allows marketers to make isolated changes until the best performing marketing effort can be achieved -Invest their resources in areas that need the most improvement
Agile Issues
-Not enough design time -Sprints are too short -Not enough user feedback -No sprint planning -Lacking big picture -Poor communication -Dependency issues
Brand Recall
-The ability to retrieve a brand from memory. When you think of soda, you think of Coke, Sprite, etc... ~When you think of fast-food, you think of McDonalds, Taco Bell, etc... -Brand recall guides our decisions every day.
Customer Profit
-The profit a company makes off a customer or customer group over a period of time -Seeks to acknowledge customer value
ID Customers
-Think of a few personas, pick 1 -Think of demographics (age sex income location) -Think of user behaviors (go to class, take notes)
What channels can be used for showing digital offers? Which channel will be more useful and why?
-Web, mobile and email channels can be used for showing digital offers because their outreach, CTR and conversion rates can be tracked digitally -The more you can allocate your marketing budget into lower CAC channels, the more customers you can obtain for a fixed budget amount
supplier push
-amount of power suppliers have -if small number of suppliers, each one has a lot of power as buyers don't have many options -if large number of suppliers, suppliers have less power bc buyers have more options
conjoint analysis
-consumers evaluate attractiveness of various combinations of features and forces people to make trade-offs among various features -part of assessing the market (stage 4)
competitive intensity
-extent to which companies exert pressure on one another -determined by Herfindahl-Hirschman Index (HHI)
customer pull
-how much power customers have -if small number of customers, each customer has a lot of power bc companies need their business -if large number of customers, each customer has less power bc company can sell to other customers
Cohort Analysis
-how users engage with product over time -shows how much users like your product -"cohort" is a group of users -look at retention of cohorts after 6-12 months
activities of critics
-post ratings/review of products and services -comment on someone else's blog -react to actions of customers and firmm within a company sponsored online forum or brand community
gates for product scoring model stage
-previous products -competing products -other ideas
Herfindahl-Hirschman Index (HHI)
-quantifies competitive intensity -square all market shares of all companies selling products in given industry and add them together
Datamonitor's market competitive intensity index
-quantifies nine metrics in three areas: market framework, supplier push, customer pull
concept test
-stage and gate 3 -assessing customer acceptance of product idea prior to introducing it to the market -described to consumer -info comes externally -still an idea so may be hard for consumer to understand
test marketing
-stage and gate 6 -selling product on limited basis to assess actual customer response -track consumer trial, revenue, and consumer awareness -if they meet the gate then full scale launch
Funnel -Uber example
-start broad then narrrow -broad inputs that narrow down into final product or output -develop, measure and optimize -a funnel is made up of the measurement of the key event at each step of the flow or user journey -By putting these measurements together you can see where the leakage is in the funnel. The leakage is where people stop completing the task they set out to do 1. Discover the pain points 2. Find the reason for the problem 3. What is the impact of the problem Uber's 2 Funnels 1) on boarding 2) booking transportation
Customer Lifetime Value (CLTV) Basic W/ WACC Advanced
. Best evaluated with CAC. Basic Formula = Recurring revenue / % Churn W/ WACC = Recurring revenue / % Churn + WACC Advanced = (Recurring revenue - Average Cost of Service) / % Churn + WACC or = ARPU x Gross margin % / % Churn + WACC
1/11
.09
1/9
.11
1/8
.12
1/7
.14
1/50
0.02
1/25
0.04
1/4
0.25
1) US GDP 2) US GDP Growth Rate 3) US Corporate Tax Rate 4) US Smartphone Penetration 5) US % Under 18 6) US % Over 65
1) 17 trillion 2) 2% 3) 35% 4) 70% 5) 23% 6) 13%
1) US population 2) Ave people per household 3) # households in US 4) Life expectancy US 5) Life expectancy World 6) Storage cost per GB
1) 300mm 2) 2.5 3) 100mm 4) 80yrs 5) 65-70yrs 6) AWS is 0.023/gb
1) World population 2) European population 3) Asia population 4) Hours in a year 5) Minutes in a year 6) San Fran / NYC population 7) # airports in US 8) # cities in a state
1) 7.2 billion 2) 700mm 3) 4 billion 4) 9000 5) 500,000 6) SF = 850k NYC = 8.3MM 7) 5000 8) 100
CIRCLES Method (how to approach design problem)
1) Comprehend Situation 2) Identify Customer 3) Report Customer Needs 4) Cut through prioritization 5) List solutions 6) Evaluate trade-offs 7) Summarize Recommendations
Steps to Plan Analytics Implementation
1) Define the product vision 2) Define the KPIs that meet the product vision 3) Define the metrics that allow you to hit your KPIs 4) Define the funnels (via user journeys) that affect your metrics
Ways to Change Competitive Strategy
1) Diversifying revenue sources 2) Building barriers to entry 3) Being the "One-Stop Shop for ___" 4) Being the Low-Cost Leader 5) Reducing Reliance on a Key Buyer or Supplier 6) Testing a New Market
Managing Change -Kotter's 8 Steps
1) Establish sense of urgency 2) Create guiding coalition 3) Develop a vision and strategy 4) Communication change vision 5) Empower broad-based action 6) Generate short-term wins 7) Consolidate gains and produce more change 8) Anchor new approaches in culture
Common Problems with Products
1) Falling profit 2) Falling revenue 3) Falling sales volume 4) Declining new customers 5) Increase in costs 6) Decline in traffic 7) Decline in new visitors
Pricing Models
1) Free, Ad-Supported 2) Freemium: basic is free but premium costs $$ 3) Tiered 4) A La Carte 5) Subscriptions 6) Free Trial 7) Razor Blade Model
Survey Best Practices
1) Keep the survey short Max 5 minutes to fill out Include progress bar 2) One question at a time 3) Explain the survey to users in beginning and thank them at the endd 4) Order the questions properly Add sensitive questions at the end
4 P's Framework (marketing plan)
1) Product (establish uniqueness / value) 2) Price 3) Promotion (where to advertise) 4) Place (where to sell)
SWOT Analysis (strength / weaknesses and threats)
1) Strengths 2) Weaknesses 3) Opportunities 4) Threats Strengths: characteristics of the business or project that give it an advantage over others Weaknesses: characteristics of the business that place the business or project at a disadvantage relative to others Opportunities: elements in the environment that the business or project could exploit to its advantage Threats: elements in the environment that could cause trouble for the business or project Y-Axis: Internal / External X-Axis: Helpful / Harmful *Strengths / Weaknesses can be about product offering not just organization
Topic to Covers for Launch Strategy
1) Target Market 2) User Types 3) MVP or Full Product 4) Distribution 5) Rollout 6) Buzz 7) Partnerships 8) Risks
How should you summarize your product/feature design recommendation?
1) Tell the interviewer which product or feature you'd recommend. 2) Recap on what it is and why it's beneficial to the user and/or company. 3) Explain why you preferred this solution vs others. 4) Note any actions you'd take to explore this idea further.
3 Pillars of Design
1. *Feasibility* - How technically possible is the feature given the resources and tools you currently have? 2. *Desirability* - Do your customers actually want it? 3. *Viability* - How does this feature relate to or support your overall strategy and the requirements of the market?
What 3 pieces of information are needed to calculate the SIMPLE CLV formula?
1. Annual profit per customer 2. Retention rate 3. Cost to acquire
2 Ways to Search
1. Binary: Divide list in half and compare midpoint to desired element, repeat keep dividing in half. 2. Graph: can be depth first or breadth first. With depth, search A node and ALL it's children before trying B node. Breadth (wide) is opposite.
What are the 4 steps to calculating CLV?
1. Confirm formulas (COGS, gross profit) 2. Calculate customer 'lifetime' per segment (i.e. how long customer stays with you) 3. Calculate CLV per segment (total profit, probability make successive purchases, value of future revenue) 4. Apply (i.e. set budget)
CUSTOMER METRIC What are the two main complications in CONTRACTUAL situations?
1. Contracts that cover two or more people --> firm must select standard definition of customer (i.e. household) 2. Treatment of customers with multiple contracts with single firm --> avoid double counting
6 Things to Know About Company's Culture
1. Culture, what is it 2. Values, motto 3. History 4. Interviewers, meh 5. Key People, executives 6. Organization
What 3 things do you need to calculate a unit margin?
1. Define a unit 2. Determine (variable) costs 3. Selling price (to first level)
Conjoint Analysis
1. Define attributes/levels 2. Set hypothetical products 3. Members evaluate (rank choice etc.) 4. Part worth utilities
What are the 3 stages in a campaign life cycle:
1. Design of a marketing campaign 2. Implement 3. Evaluate if a campaign has met its goals .
6 Example Market Strategies/Reasons for a Product
1. Diversify revenue sources 2. Build barriers to entry 3. Be one stop shop for ____ 4. Be low cost leader 5. Reduce reliance on key supplier 6. Test new market
7 Pricing Models
1. Free, ad supported 2. Freemium 3. Tiered, segmented by feature, customer or volume 4. A la carte, pay each feature separately 5. Subscriptions 6. Free trial 7. Razor blade model
What are your top 3 SaaS metrics and why?
1. Gross revenue retention - because it measures how well you retain revenue from a customer cohort w/o the impact of cross-selling and up-selling, which can obscure churn 2. CAC payback period - measures how long until you start making money from your customers (and can be inverted to give you your CAC ratio / magic number / sales efficiency metric) 3. LTV:CAC - because it gives you a sense of how worthwhile your CAC spend is in the grand scheme of your customer lifetime
Weaknesses
1. Have not worked in big corporate environment, but with small business when managing vendors, retailers, accounting, etc., really managing team of several dozen people. 2. Move too fast, too resourceful, often have shotgun approach err on side of brute force.
Prioritization Methods
1. Impact / Effort Matrix 2. Feasibility, Desirability, Viability 3. ROI Analysis 4. Theming 5. RICE 6. Kano Model
behavior/site interaction segment
1. Isolate people who have visited a particular website page 2. Isolate people who viewed products over a certain amount 3. Isolate people who have place products in their shopping cart but did not complete the check out.
Kundenbeziehungsprozess
1. Kontaktprozess / Awareness Aufgabe: Produkt platzieren, Potenzielle Kunden erkennen E Business: Online Werbung, Big Data Analytics 2. Auftragsgewinnungsprozess / Consideration Aufgabe: Präferenzen erzeugen, Vorzüge aufzeigen E Business: Big Data Analytics, Email Info 3. Kaufprozess / Purchase Aufgabe: Kaufzeitpunkt erkennen, Angebot E Business: Elektronisches Angebot, Email Information 4. Nutzungsprozess / Consumption Aufgabe: Verhinderung von Enttäuschung, Service, Zufriedenheit erzeugen E Business: Service Webseite, Kundenforum, Email 5.a Neuauftragsgewinnungsprozess / Reconsideration Aufgabe: Präferenzen erhalten, Infos über Updates E Business: Big Data Analytics, Web Forms, Angebote 5.b Abwanderungsprozess / Dissatisfaction Aufgabe: Verhinderung, Analyse der Gründe, Beschwerdemanagement E Business: Analyse der Kundenhistorie aus Datenbank 5.c Rückgewinnungsprozess / Reconsideration Aufgabe: Auswahl der Rückgewinnungstargets, Kundenvertrauen wiederherstellen E Business: E Kundendialog, Service Webseite, Incentives
Divide each development project into:
1. Low cost 2. Customization 3. Quality-oriented development 4. Responsiveness 5. Product innovation
4 Ways to Sort an Array
1. Merge Sort: first left, then right, then merge. Splits in half 2. Quick Sort: Starts with a pivot point and sorts from there 3. Insertion Sort: Uses sublists? 4. Bubble Sort: Goes through list and orders elements
Steps to provide a reccemendation
1. Propose 3 solutions 2. Discuss the pros and cons of each recommendation 3. Make a single recommendation
KPI -holy trinity
1. Retention 2. Growth 3. Montization
What are the 3 strategies for CUSTOMER PROFITABILITY?
1. Reward 2. Grow 3. Fire
3 Part Structure of a Story
1. Situation 2. Action 3. Result
Qualities of Great Product Manager
1. Strategic Thinker — Understanding the current needs of the product and how it fits with the company's overall vision. 2. Passion for Products — Love what you make, love what you do. 3. Empathizes with the Customer — and understand the customer's wants and needs. 4. Interviews Customers — Gather insights from your customers, learn their pain points and discover opportunities. 5. Aspires to Build Great Experiences — Understands that user experience is paramount for product success. 6. Keeps Score — Identify the key metrics and track performance, establish baselines to measure success. 7. Ability to Prioritize — Keep things in order, understand what needs to be completed first and what needs to wait. Use customer feedback for prioritization. 8. Collaborative Leader — Management is a collaborative process, you cannot be dictatorial and expect to inspire your team. 9. Execution — Action-oriented, you get things done.
Case Interview Process
1. Structure a. Listen and ask clarifying questions. b. Layout your structure first and steps you'll need to take. Then add numbers 2. Assumptions: a. Don't worry if they are off. b. Base them in some sort of logic. 3. Estimate or round off numbers to make calculations easier. 4. Answer: a. Review your answer. b. If it's off, tell the interviewer and pick new number but don't explain the process again.
8 Things to Think About For Product Launch
1. Target Market 2. User Types 3. MVP or Full Product 4. Distribution 5. Rollout, to whom first, gradual, bet? 6. Buzz 7. Partnerships 8. Risks
4 Ways to Describe Favorite Product
1. What problems does it solve, how 2. Why users fall in love with product 3. How compare to alternatives 4. How could be improved
Creating Mass Audiences
1. avoid controversial issues 2. avoid politics 3. avoid minorities
Consumer Buying Behavior
1. problem / need recognition 2. search behavior 3. alternative evaluation 4. purchase behavior 5. post purchase behavior
Global Ecommerce Shoppers
1.6 billion
Population of Vietnam
100 million
Households in the U.S.
100 million (3 per household)
Spotify Paid Subscriber Base
100M
13 x 11
143
"The Boys in the Band"
1st film to market to gay viewers
"The Pullman Porter"
1st w/ all black cast and director
How many smart phone users in the world
2 billion
US GDP Growth
2%
Total Android Apps
2.6M
Avg Conversion Rate Search Ads
2.7%
Average Conversion Rate Search Ads
2.70%
Global smartphone install base
2.8 billion
Population of Australia
20 million
GDP of US
20 trillion
US smartphone install base
226 million
USA Smartphone Install Base
226M
US Percent Under the Age of 18
23%
North America Number of Internet Users
320M
Twitter Number of Users
321M
United State Population
323M
Asia Population
4.4B
Population of Canada
40 million
Percentage of internet users in the world
40%
Population of South America
400M
Europe Social Network Users
412M
South America Population
423M
Population of Italy
60 million
Europe Number of Internet Users
636M
Japan Smartphone Install Base
63M
___% of companies are able to successfully upsell or cross-sell to EXISTING customers.
65%
___% of consumers who switched brands did so because of poor service ___% of customer churn due to poor service was preventable.
66% 85%
Seattle Population
687K
Global population
7 billion
World population
7 billion
China Smartphone Install Base
717M
China internet users
731 million
China Number of Internet Users
731M
Bounce rate
A bounce rate is the percentage of visitors that enter the website and immediately leave instead of continuing to browse it. A high bounce rate is not a good thing as it means your website isn't captivating the users.
What is the 'Reversal Method'?
A brainstorming framework. Reversing the situation helps uncover new possibilities.
Customer Lifecycle
A framework that describes the process a customer goes through when considering, buying, using, and advocating a product or service. There are four critical stages: acquisition, adoption, retention, and expansion.
Three loops and when to use it
A framework that describes the three different ways users can add value to a company Data Loop Viral Loop Compulsion Loop
Product Lifecycle
A framework that helps a company organize its marketing and sales of a product, from introducing it to the market to when sales peak and decline.
Channel Objective
A goal that is specific to a marketing channel. An example my be to increase the number of followers on Twitter by 5% in the next quarter.
Marketing Objectives
A goal that is specific to a marketing function of a business. An example of this may be for . marketing to increase leads by 5% in the next quarter.
What does a higher LTV : CAC generally denote?
A higher LTV : CAC provides more headroom to cover expenses and reinvestment
Customer Behavior Index (CBI)
A metric (often normalized) that measures how engaged your prospects and customers are based on their in-product activity and usage.
Competitive Analysis
A part of a marketing plan where research is done about other businesses with a similar product or service to evaluate opportunities and threats the business my face.
Product-Qualified Lead (PQL)
A prospect that signed up and demonstrated buying intent based on product interest, usage, and behavioral data.
Single Tenancy
A single instance of the software and all of the supporting infrastructure serves a single customer. With single tenancy, each customer has their own independent database and instance of the software. With this option, there's essentially no sharing going on. Everyone has their own, separate from everyone else.
Customer Engagement Touchpoint (or Customer Engagement Interaction)
A single moment when a prospect or customer comes in contact with your brand, company, people, product, or message through various channels and devices.
Consideration
A stage in the conversion funnel where a potential customer would like to learn more about a company or product and are beginning to select which companies or products best fit their needs.
Awareness
A stage in the conversion funner where a potential customer first learns of a company or product. Stage 1
Kano Model
A technique that categorizes customer requirements into three types: 1. basic needs - Does the product work? table stakes 2. performance needs - How efficient is it? stated, more is better 3. attractive needs (delighters) - what makes me love it? unspoken, surprising
How Hits can be Organized Into Sessions Example 3
A user visits the store and lands on the homepage They immediately open a new tab in their browser to view another website and they spend more than 30 minutes on that site Then they go back to the tab with the google store and click the play button on the video
What is ARR and how is it calculated?
ARR = MRR*12 = annual run-rate of recurring revenue in the coming 12 months from the current installed customer base (i.e. you don't add or churn anything)
Lab usability tests can be conducted on which of the following:
All of the choices
When calculating the amount of money a company spends on their social media campaigns, which of the following should be included in that sum:
All of these
What is ARR?
Annual Recurring Revenue - the average annual recurring revenue per customer
ARR (annual recurring revenue)
Annualized Run Rate = MRR x 12ARR is annual run-rate of recurring revenue from the current installed base. This is annual recurring revenue for the coming twelve months if you don't add or churn anything. A measure of revenue components that are recurring in nature. It should exclude one-time (non-recurring) fees and professional service fees.
What does a good design critique include? Why?
Any good design technique includes a scorecard. Why? It's an objective way to determine if a product passes or fails based on predetermined criteria.
LTV / CAC Logic
As long as the sum of the discounted future cash flows are significantly higher than the CAC, then people will argue it is warranted to "push the accelerator," which typically means burning capital by aggressively spending on marketing. The best SaaS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8. And many of the best SaaS businesses are able to recover their CAC in 5-7 months (<12).
General Creativity Templates
Attribute Dependency, Replacement, Subtraction, Multiplication, Division
ARPU
Average Revenue Per User -figures out value users place on your product -Total Revenue / # Users in Period
Average Revenue Per User (ARPU)
Average Revenue Per User or ARPU is the amount of money you get from a customer on an average every month. If your pricing remains constant and yet you are getting more ARPU with every passing month, it means what you and your team is doing to generate more value, is working. Better marketing and customer support can help in this regard.
What is ARPA / ARPU
Average revenue per account / user (average MRR per account / user)
What is backlog?
Backlog represents the total amount of bookings yet to be recognized; backlog moves in the same direction as deferred revenue but isn't necessarily equal (e.g. a customer could pay for 50% of their contract upfront, which would increase bookings by the full contract amount but increase backlog only by 50% of the contract amount)
Social Sentiment
Brand Perceptions and Brand Equity. Best Practices: - It's essential that you understand the methodology behinds the social sentiment platform you use - especially the margin of error - to help you understand the context of your reports. - It's good to always keep an eye on the social sentiment of your brand, but it's especially important to check sentiment before and after a campaign to determine campaign success.
BRAND METRICS ______ = the ability to retrieve the brand from memory. ______ = the ability to confirm a prior exposure to a brand. ______ = the ease with which a brand comes to mind ______ = is the range of usage scenarios for a brand.
Brand Recall Brand Recognition Depth Breadth
Bundling
Bundling entails selling, in a single transaction, two or more items that could conceivably be sold separately. A printed newspaper, for example, is a bundle of news stories, classified ads, comics, obituaries, stock tables, sports scores, etc. Microsoft Office bundles several productivity applications in a software suite. Benefits are capturing a greater share of customers' willingness to pay - two customers buy both products for a lower price each but a great net profit in total to the vendor - each buy A and B separately for $10 each bringing $20 of profit to the firm or each buy A+B in a bundle for $15, bringing $30 of net profit to the firm
How do SaaS companies build enterprise value?
By realizing multiples of tCAC
How do you calculate customer payback period?
CAC $ / (avg. MRR per acquired customer)*(subscription gross margin %) OR Inverse of the CAC ratio [use this formula only if the CAC ratio was calculated with S&M in denominator and already accounts for subscription gross margin %] ...this is the same as saying: Total S&M of prior quarter / 12*(new MRR of current quarter)*(subscription gross margin %) [ideally, these metrics would be calculated for specific customer cohorts]
What is a CAC ratio and why is it important?
CAC Ratio = [(GM Q2 - GM Q1)*4] / (S&M Q2) The CAC ratio captures the cost of acquiring customers
Google's Key Executives
CEO: Larry Page Chairman: Eric Schmidt Co-Founder: Sergey Brin
Why is customer lifetime value important?
CLV is connected to a firm's value/earning potential
Customer Lifetime Value equation
CLV= (margin)x (retention rate/(1+discount rate-retention rate)
MRR vs CMRR
CMRR is more insightful because it includes all MRR, plus signed contracts currently committed and going into production, and minus "churn," which is the MRR that is no longer committed from customers that have turned off the service, or are anticipated to do so in the future
In non-contractual situations with identifiable customers, what is a major complication? What is the solution?
COMPLICATION: customer purchase activity is sporadic --> cannot count current customers SOLUTION: recency
Typical click through rate
CTR: 1%
% New Sessions
Calculated Metric ga:percentNewSessions UI Name: % New Sessions The percentage of sessions by users who had never visited the property before. Calculation: ga:newUsers / ga:sessions
What are Total Events?
Calculated as total number of interactions with tracked element
What is a common example of the cost of customer support?
Call Centers
What is another common term for customers who left or were lost in a period?
Cancellations
Web Design Patterns: Layouts (3)
Card Grid Magazine
Parameter Types
Category Action Label Value
Churn
Churn = # of customers who churned / total # of customers
Churn Rate
Churn Rate is the percentage of customers who stop using your product every month. To get the churn rate, you have to divide the number of customers lost in a month by the previous month's total customers. It is a good indicator of product health and is absolutely critical for monthly subscription products. You cannot make your churn rate zero as no matter how good your product is, some customers will still leave. What you can definitely do is keep the churn rate healthy and continuously strive to make the product better to lower it.
CTR
Click Thru Rate -1.3 to 3% is target depending on industry -ratio of number of clicks to impressions (Total Clicks on Ad) / (Total Impressions)
Self-regulation
Companies or industries who create their own rules or guidelines that they pledge to follow. This is often done as a method for stopping legal measures from being established by lawmakers.
Optimal Value Proposition
Company Value, Customer Value, Collaborator Value
What does each letter stand for in the CIRCLES Method?
Comprehend the Situation Identify the Customer Report the Customer's Needs Cut, Through Prioritization List Solutions Evaluate Tradeoffs Summarize Your Recommendation
Before and After Analysis
Consider the before and after impacts of your proposed change
A toaster only accepting sliced bread and a form only accepting certain data rules are examples of this design principle.
Constraints
Limiting the range of interaction possibilities for the user to simplify the interface and guide the user to the appropriate next action relates to this design principle.
Constraints
funnel metaphor
Consumers start with number of potential brands in mind (funnel's wide end), marketing directed as they reduce that number (move through funnel), emerge the one brand they choose to purchase o Today - funnel concepts fail to capture all touch points/key buying factors resulting from explosion of product choices and digital channels, emergence of increasing, well-informed consumer o Need a more sophisticated approach to help marketers navigate this that's less linear and more complicated
Retention applies to ____ situations, in which customers are either retained or not.
Contractual
CUSTOMERS METRIC Contractual situations: Non-contractual situations:
Contractual: count number of customers CURRENTLY under contract and the percentage retained Non-contractual: count number of customers of a specified recency
Total conversion rate
Conversion Rate of entire funnel (CTR * Conversion Rate)
Provide 5-7 examples of Retention metrics
Conversion rate recommendation engine conversion rate Shopping cart size visits from activated users per month Daily and monthly active usage Time in app Star rating sessino length % of userse that rate the app Interval between logins Churn( or turnover)
Cost per Click (CPC)
Cost Per Click (CPC) refers to the actual price you pay for each click in your pay-per-click (PPC) marketing campaigns.
Which method can be used to measure the impact of offline advertising on your website?
Creating redirects
Growth & Expansion Metrics: Customer Acquisition Cost (CAC) Quick Ratio Customer Lifetime Value LTV:CAC Ratio Payback Period MRR Expansion Rate
Customer Acquisition Cost = Sum of Sales & Marketing Expenses / # new customers added Quick Ratio (measure of company's ability to grow recurring revenue in spite of churn; growth efficiency; estimate of avg. cost of acquire a new ratio = (New business MRR + Expansion MRR) / (Churned MRR + Contraction MRR) CLTV = Basic Formula = Recurring revenue / % Churn W/ WACC = Recurring revenue / % Churn + WACC Advanced = (Recurring revenue - Average Cost of Service) / % Churn + WACC or = ARPU x Gross margin % / % Churn + WACC LTV:CAC Ratio = Approximate return ROI for customer acquisition; ratio of 3:1 is generally good for SaaS; $1 of acquisition cost returns $3 of lifetime value Payback Period (Average time taken for CAC to be recouped through MRR) = CAC / (ARPU x Gross Margin%) MRR Expansion rate (rate of new recurring revenue added from existing customers) = (Expansion MRR at End of Month - Expansion MRR at beginning of Month) / (Expansion MRR at beginning of Month) x 100
continuous improvement
Customer Journey -> Collect Data -> Improvement (then loop back) • Map journey using stages and sub-stages in a Customer Journey model to understand your customer's journeys • What data can you collect at each stage? o 10Es o Love & Hate model • Analyse the data, find patterns, make improvements, repeat to loop
____ encourages firms to shift their focus from quarterly profits to the long-term health of their customer relationships.
Customer Lifetime Value (CLV)
Customer profit equation
Customer Profit = customer revenue - customer costs
_____ = Total marketing costs over a period of time / Total amount of new customers in that same time period _____ = The number of people who open an email that has been sent to them dividing by the total number of people to whom the email was sent ____ = The number of people who see the marketing content through a mobile device
Customer acquisition cost Open Rate Mobile traffic
What Are Four Ways You Can Reduce CAC?
Customer acquisition cost is designed to measure and maintain the profitability of your acquisition teams. If your costs to get the customer through the door are higher than your Customer Lifetime Value (CLTV, LTV) than the business cannot be viable. The best rule of thumb is to be spending 33% or less of your customers lifetime value. With that being said lets put this knowledge into action today. Here are some ways you can reduce your CAC and optimize for profit. Optimize your funnel: Quantify each step of the process, and understand how many visits lead to leads, how many leads lead to opportunities, and how many opportunities lead to customers. The best way to do this is to apply the Balfour Method of growth process to your funnel, which ensures proper mechanics in your channels. Optimize your pricing: Remember a huge portion of CAC feeds into the recovery period, as well as your CAC ratio. As such, if you optimize your pricing to gain cash up front to recover your CAC, in the form of mandatory training, integration costs, etc., you can ensure you start making a profit as soon as possible. Check out more on value based pricing strategy here on our Price Intelligently blog. Strengthen the effectiveness of Sales and Marketing spend: Take a lean approach to marketing and sales expenses. Put money into channels that have proven returns so that you aren't wasting any more dollars. Quickly engage new customers and prospects: Cut down the time it takes to get new customers engaged with your product. The quicker product engagement happens per customer the cheaper acquisition cost becomes per customer
Churn Formula
Customers Lost in Period / Customers at Beginning of Period
Expressed permission
Customers actively request or approve of being contacted in the future. An example of this would be filling out a form where the user checks a box to ask for an email newsletter to be sent to them.
Implied permission
Customers indirectly agree to being contacted, often by not removing technology or pre-populated elements that indicate approval. An example of this would be websites that place coookies on a visitor's computer by alerting the customer that by using their site, cookies will be placed on their computer. In this situation, the customer is giving an implied permission (or implied consent) by continuing to use the computer without updating their computer's settings to remove or block cookies.
A profit maximizing firm should only serve which customers?
Customers that contribute more than they cost.
_____ = measures the ability to tailor products and services to customers. Which metrics includes measures of certifications, training, employee involvement? Which metrics involves configuration systems, flexible manufacturing and *just-in-time inventory?* _____ = measure whether companies are attentive to customer needs. _____ = ensure that companies produce high-quality products and services. _____ = measure a company's ability to innovate.
Customization metrics Quality Metrics Customization metrics Responsiveness Metrics Quality Metrics Innovation Metrics
Trends in Retail Coverage
DTC, Disintermediation, Omnichannel, Channel Conflict, Data Analytics
Provide 5-7 examples of acquisitions metrics
Daily sessions Cost per Acquistion Cost per Click Cost per Impression SEO mailing list open rate Mailing list conversion rate mobile app downlods Number of instals Cost per install Amount of leads Amount of impressions
ARPA
Definition: Average monthly recurring Revenue per Account. This number is tells you the average monthly revenue per customer. It is useful to look at this for just the new customers booked in the month. Plot a trend line to show you the average price point that your new customers have chosen.
Customer Lifetime
Definition: If you start with a cohort of 100 customers and apply a constant churn rate every month, you'll get an exponential decay, as shown in the following graph (which uses a 3% monthly churn rate): http://goo.gl/tGDDsb Note that if the Customer Churn rate is a monthly % or yearly %, then the Customer Lifetime will be for the same time period. Here is a monthly and annual example to illustrate the point: a) If the Monthly customer churn rate is 3%, then the Customer Lifetime will be 1/0.03 which is 33 months. b) if the Annual customer churn rate is 20%, then the Customer Lifetime will be 1/0.20 which is 5 years.
LTV
Definition: Lifetime Value of a Customer. (To truly get an accurate picture of LTV, you should take into consideration Gross Margin. However in most SaaS businesses, the gross margin % is high (above 80%), and it's quite common to use the simpler version of the formula that is not Gross Margin adjusted. Assumes ARPA is constant; if not, see: http://goo.gl/U413PX)
MOF
Definition: Months up Front; Average of months (or years) of payment received in-advance with new bookings. Getting paid in advance has a big positive impact on cash flow. This metric has been used at both HubSpot and NetSuite in the past as a way to incent sales people to get more paid up front when a new customer is signed. However asking for more money up front may turn off certain customers, and result in fewer new customers, so be careful how you balance these two conflicting goals.
Revenue
Definition: Revenue is amount of money that can be recognized according to accounting policy. Even if it is paid for upfront, usually subscription revenue can only be recognized ratably over time as the service is delivered.If more money has been paid than can be recognized, the difference goes into a balance sheet item called Deferred Revenue.
Net Promoter Score
Definition: Since it is likely that customer satisfaction is likely to be good predictor of future churn, it would be useful to survey customer satisfaction. The recommended way to measure customer happiness is to use Net Promoter Score (NPS). The beauty of NPS is that it is a standardized number, so you can compare your company to others. (http://www.netpromoter.com/why-net-promoter/know/) The Net Promoter Score, or NPS®, is based on the fundamental perspective that every company's customers can be divided into three categories: Promoters, Passives, and Detractors. By asking one simple question — How likely is it that you would recommend [your company] to a friend or colleague? — you can track these groups and get a clear measure of your company's performance through your customers' eyes. Customers respond on a 0-to-10 point rating scale and are categorized as follows: Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth. Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings. Detractors (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word-of-mouth. To calculate your company's NPS, take the percentage of customers who are Promoters and subtract the percentage who are Detractors.
SaaS Growth
Definition: So why is SaaS growth so important? We have suggested that as soon as the business has shown that it can succeed, it should invest aggressively to increase the growth rate. You might ask question: Why? SaaS is usually a "winner-takes-all" game, and it is therefore important to grab market share as fast as possible to make sure you are the winner in your space. Provided you can tell a story that shows that eventually that growth will lead to profitability, Wall Street, acquiring companies, and venture investors all reward higher growth with higher valuations. There's also a premium for the market leader in a particular space. However not all investments make sense. In the next section we will look at a tool to help you ensure that your growth initiatives/investments will pay back: Unit Economics.
New MRR
Definition: The increase in MRR (Monthly Recurring Revenue) from new customers in the current month/year.
Expansion MRR
Definition: The increase in MRR from expansion in your installed base in the current month.
Churned MRR
Definition: The lost MRR from churning customers in the current month.
# of churned Customers
Definition: The number of customers lost due to churn this month
# of new Customers
Definition: The number of new customers added this month
% Net MRR Churn
Definition: This is the number that will go negative if the Expansion revenue from existing customers starts to outstrip the lost revenue from churn. Getting to negative Net MRR Churn is a great goal for a SaaS company.
Page Authority (PA)
Determine the effectiveness of your link-building efforts by measuring the "trust" factor of each individual page, based on the links to it; also influenced by the DA of the website.
______ = measures the success of marketing efforts in digital media environment
Digital marketing metrics
Days Since Last Session
Dimension ga:daysSinceLastSession UI Name: Days Since Last Session The number of days elapsed since users last visited the property, used to calculate user loyalty.
STAR
Do you struggle to give concise answers to interview questions? Are you unsure how to share your accomplishments during an interview without sounding boastful? The STAR interview response technique can help. Situation Task Action Result
Net Dollar Renewal Rate
Dollar Renewal Rate = $ from customers who renewed their contracts - Expansion MRR / total $ of contracts up for renewal Similar to the metric above, but also takes into consideration Expansion MRR:If your Dollar Renewal Rate is greater than 100%, you have negative churn, which is a very good thing to have achieved. Example: If you are looking at DRR on an annual basis, another way to think about what DRR represents, is to think of a specific month's cohort (e.g. the January cohort). As an example, let's say that at the end of January the revenue from this cohort is $100k. A year later, you will have lost some customers, (for example let's say $10k of that cohort's revenue), but the remaining customers have also purchased $20,000 more from you (Expansion MRR). So we will have $110k of revenue left from that January cohort a year later. This means that our DRR is equal to 110%.
'Upper funnel' or 'top of the funnel' keywords are the search keywords used during what point of a customer's consideration life cycle:
Early, when they have not yet made up their mind
Negative Churn
Explanatin: The ultimate solution to the churn problem is to get to Negative Churn. There are two ways to get this expansion revenue: 1. Use a pricing scheme that has a variable axis, such as the number of seats used, the number of leads tracked, etc. That way, as your customers expand their usage of your product, they pay you more. 2. Upsell/Cross-sell them to more powerful versions of your product, or additional modules. To help illustrate the power of negative churn, take a look at the following two graphs that show how cohorts behave with 3% churn, and then with 3% negative churn. http://goo.gl/5kIeZX http://goo.gl/dnoHHA (In our graphs below, a different color is used for each month's cohort, so we can see how they decline or grow, based on the churn rate.) In the top graph, we are losing 3% of our revenue every month, and you can see that with a constant bookings rate of $6k per month, the revenue reaches $140k after 40 months, and growth is flattening out. In the bottom graph, we may be losing some customers, but the remaining customers are more than making up for that with increased revenue. With a negative churn rate of 3%, we reach $450k in revenue (more then 3x greater), and the growth in revenues is increasing, not flattening.
Guidelines for Churn
Explanation: If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business. At 2% monthly churn, you are losing about 22% of your revenue every year. That is nearly a quarter of your revenue! It's a clear indication that there is something wrong with the business. As the business gets bigger, this will become a major drag on growth. We recommend that you work on fixing the problems that are causing this before you go on to worry about other parts of your business. Some of the possible causes of churn are: 1) You are not meeting your customers expectations. -The product may not provide enough value - Instability or bugginess 2) Your product is not sticky. It might provide some value in the first few months, and then once the customer has that value, they may feel they don't need to keep paying. To make your product sticky, try making it a key part of their monthly workflow, and/or have them store data in your product that is highly valuable to them, where the value would be lost of they cancelled. 3) You have not successfully got the customer's users to adopt the product. Or they may not be using certain of the key sticky features in the product. 4) Your sales force may have oversold the product, or sold it to a customer that is not well suited to get the benefits 5) You may be selling to SMB's where a lot of them go out of business. It isn't enough that what you're selling is sticky. Who you're selling it to must also be sticky. 6) You are not using a pricing scheme that helps drive expansion bookings The best way to find out why customers are churning is to get on the phone with them and ask them. If churn is a significant part of your business, we recommend that the founders themselves make these calls. They need to hear first hand what the problem is, as this is so important for the success of the business. And they are likely to be the best people to design a fix for the problem.
Uses for SaaS Guidelines
Explanation: 1. One of the key jobs of the CEO is to decide when to hit the accelerator pedal. The value of these two guidelines is that they help you understand when you have a SaaS business that is in good shape, where it makes sense to hit the accelerator pedal. Alternatively if your business doesn't meet the guidelines, it is a good indicator that there is more tweaking needed to fix the business before you should expand. 2. Another way to use the two guidelines is for evaluating different lead sources. Different lead sources (e.g. Google AdWords, TV, Radio, etc.) have different costs associated with them. The guidelines help you understand if some of the more expensive lead generation options make financial sense. If they meet these guidelines, it makes sense to hit the accelerator on those sources (assuming you have the cash).Using the second guideline, and working backwards, we can tell that if we are getting paid $500 per month, we can afford to spend up to 12x that amount (i.e. $6,000) on acquiring the customer. If we're spending less than that, you can afford to be more aggressive and spend more in marketing or sales. 3. There is another important way to use this type of guideline: segmentation. Early-stage companies are often testing their offering with several different uses/types of customers / pricing models / industry verticals. It is very useful to examine which segments show the quickest return or highest LTV to CAC in order to understand which will be the most profitable to pursue.
SaaS Viability
Explanation: In the first version of this article, I introduced two guidelines that could be used to judge quickly whether your SaaS business is viable. The first is a good way to figure out if you will be profitable in the long run, and the second is about measuring the time to profitability (which also greatly impacts capital efficiency). Over the last two years, I have had the chance to validate these guidelines with many SaaS businesses, and it turns out that these early guesses have held up well. The best SaaS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8. And many of the best SaaS businesses are able to recover their CAC in 5-7 months. However many healthy SaaS businesses don't meet the guidelines in the early days, but can see how they can improve the business over time to get there. The second guideline (Months to Recover CAC) is all about time to profitability and cash flow. Larger businesses, such as wireless carriers and credit card companies, can afford to have a longer time to recover CAC, as they have access to tons of cheap capital. Startups, on the other hand, typically find that capital is expensive in the early days. However even if capital is cheap, it turns out that Months to recover CAC is a very good predictor of how well a SaaS business will perform. Take a look at the graph below, which comes from the same model used earlier. It shows how the profitability is anemic if the time to recover CAC extends beyond 12 months: http://goo.gl/BFG1yC I should stress that these are only guidelines, there are always situations where it makes sense to break them.
Running a SaaS Business
Explanation: It takes time for most initiatives to have an impact. We've learned from some tough lessons that planning has to be done well in advance to drive a SaaS business. For example if you are not happy with your current growth rate, it will often take nine to twelve months from the point of decision before the growth resulting from increased investment in sales and marketing will actually be observed; it is important to plan ahead. Hopefully what you will have gathered from the discussion above is that there are really three things that really matter when running a SaaS business: 1) Acquiring customers 2) Retaining customers 3) Monetizing your customers The second item should be first on your list of things to get right. If you can't keep your customers happy, and keep them using the service, there is no point in worrying acquiring more of them. You will simply be filling a leaky bucket. Rather focus your attention on plugging the leaks. SaaS businesses are remarkably influenced by a few key numbers. Making small improvements to those numbers can dramatically improve the overall health of the business. Once you know your SaaS business is viable using the guidelines provided for LTV:CAC, and Time to recover CAC, hit the accelerator pedal. But be prepared to raise the cash needed to fund the growth.
Lead Source ROI
Explanation: Our experiences with SaaS startups indicate that they usually start with a couple of lead generation programs such as Pay Per Click Google Ad-words, radio ads, etc. What we have found is that each of these lead sources tends to saturate over time, and produce less leads for more dollars invested. As a result, SaaS companies will need to be constantly evaluating new lead sources that they can layer in on top of the old to keep growing. Since the conversion rates and costs per lead vary quite considerably, it is important to also measure the overall ROI by lead source. Growing leads fast enough to feed the front end of the funnel is one of the perennial challenges for any SaaS company, and is likely to be one of the greatest limiting factors to growth. If you are facing that situation, the most powerful advice we can give you is to start investing in Inbound Marketing techniques (see Get Found using Inbound Marketing). This will take time to ramp up, but if you can do it well, will lead to far lower lead costs, and greater scaling than other paid techniques. Additionally the typical SaaS buyer is clearly web-savvy, and therefore very likely to embrace inbound marketing content and touchless selling techniques.
SaaS P&L / Cash Flow Trough
Explanation: SaaS businesses face significant losses in the early years (and often an associated cash flow problem). This is because they have to invest heavily upfront to acquire the customer, but recover the profits from that investment over a long period of time. The faster the business decides to grow, the worse the losses become. Many investors/board members have a problem understanding this, and want to hit the brakes at precisely the moment when they should be hitting the accelerator. In many SaaS businesses, this also translates into a cash flow problem, as they may only be able to get the customer to pay them month by month. To illustrate the problem, we built a simple Excel model which can be found here: http://dskok.wpengine.netdna-cdn.com/wp-content/uploads/2012/09/SaaS-Economics-101.zip (Data used in following graphs; explains the Cash Flow Trough)
Customer Engagement Score
Explanation: Since churn is so important, wouldn't it be useful if we could predict in advance which customers were most likely to churn? That way we could put our best customer service reps to work in an effort to save the situation. It turns out that we can do that by instrumenting our SaaS applications and tracking whether our users are engaged with the key sticky features of the product. Different features will deserve different scores. For example if you were Facebook, you might score someone who uploaded a picture as far more engaged (and therefore less likely to churn), than someone who simply logged in and viewed one page. Similarly if you sold your SaaS product to a 100 person department, and only 10 people were using it, you would score that differently to 90 people using it. So the recommendation is that you create a Customer Engagement Score, based on allocating points for the particular features used. Allocate more points for the features you believe are most sticky. (Later on you can go back and look at the customers who actually churned, and validate that you picked the right features as a predictor of who would churn.) And separately score how many users are engaged with specific scores. Over time you'll also come to discover which types of use are the best indicators of possible upsell. (HubSpot was the first company that I worked with who figured this out, and they called it their CHI score. CHI stands for Customer Happiness Index. It evolved to be a very good predictor for churn.) Brad Coffey, HubSpot: "At HubSpot we had a lot of success looking at this metric - we called in Customer Happiness Index (CHI). First - by running the analysis we identified the parts of our application that provide the most value to customers and could invest accordingly in driving adoption in those areas. Second - we used this aggregate score as an early proxy for success as we experimented with different sales and onboarding processes. If a set of customers going through an experiment had a low CHI score we could kill the project without waiting 6 or 12 months to analyze the cohort retention."
MMR Bookings
Explanation: This chart shows the three components of MRR (or ACV) Bookings, and the Net New MRR (or ACV) Bookings. By breaking out each component, you can track the key elements that are driving your business. The one variation we would recommend making to this chart is to show a dotted line for the plan, so you can track how you are doing against plan for each of the four lines. This is one of the most important charts to help you understand and run your business. Ron Gill, NetSuite: "This chart is really good. I also like to look at this data in tabular form because I want to know y-o-y growth rates. E.g. "Net new MRR is up 25% over June of last year". The Y-o-Y % is a metric easily compared with increased spending, sales capacity, etc."
*A/B testing and conjoint analysis cannot be used for new product development.
False
A/B tests are more expensive to conduct than multivariate tests.
False
Avinash Kaushik recommends that you only pay attention to a usability test participant's comments, not their body language.
False
Design principle of making it clear to the user what action has been taken and what has been accomplished
Feedback
Using visual, tactile, audio elements to communicate to the user that they have takenan action and the consequence of doing so are examples of this design principle.
Feedback
Field Sales / Inside Sales and reliance on Marketing?
Field Sales roughly 70% of costs in Sales and other 30% in Marketing; Inside Sales roughly 65% of costs in Sales and 35% in Marketing
CAC
Full cost of acquiring users (stated on per user basis) Paid CAC is the best method: Total Acquisition Cost / New Customers Acquired through Paid Marketing Blended CAC includes users acquired organically across all channels which can sometimes be lower Note: CAC typically goes up as you go to a broader audience. Easier to acquire first 1,000 users than it is to acquire next 1,000 users
Fixed costs paid off in LTV
G&A / R&D
What is GMPP fundamentally an indicator of? Is a shorter or longer GMPP better and why?
GMPP is fundamentally an indicator of the working captal needs of the business A shorter GMPP is better because the time to recoup customer acquisition costs should be as quick as possible
According to Elay Cohen, what is right ratio of Enablement to number of employees?
Generally speaking 1 Enablement for every 100 employees. If Solution is complex and requires it can be as low 50 or 75.
Walmart Principles
Geographic Segmentation, Tight control on distribution channels, EDLP, Agent for Customers
Favorite Google product and why
Gmail: - I live in my inbox - Simple enough for my mom to use, hugely powerful for superusers - 3rd party apps can add powerful functionality. Companies literally started on gmail platform.
Dieter Rams Ten Principles of Good Design
Good design is: 1) Innovative * 2) Makes a product useful * 3) Aesthetic 4) Understandable * 5) Unobtrusive 6) Honest * 7) Long-lasting 8) Thorough down to the last detail 9) Environmentally friendly 10) As little design as possible
Google Social Products (3)
Google Plus Blogger Hangouts
If a User Clears their Browser Cookies
Google analytics will set a new unique ID the next time a browser loads a tracked web page Analytics will then count that user as new rather than returning
5Es Framework
Helps brainstorm different stages of the customer experience:
4 D's
Here's a very simple yet effective time management technique. Before responding to any request, filter them through the 4D's framework, a simple yet effective time management method: Do's Defer Delegate Dump
Vendor Pros of SaaS
Higher Revenue Visibility Broadens Reach to Underserved Customers - SMBs and other customers are increasingly adopting SaaS to gain access to enterprise-class technology at significantly lower costs
Returning Visitor Metric
How effective is your website at building an audience? - Average Browse Rate (pages per session) - Average Time On Site
SEO Traffic
How many customers are visiting your website from organic and paid search traffic? - Traffic: The visitors to your site. - Organic Search: Organic search results are the Web page listings that most closely match the user's search query based on relevance. Also called "natural" search results, ranking high in the organic results is what SEO is all about. - Paid Search: Paid search marketing means you advertise within the sponsored listings of a search engine or a partner site by paying either each time your ad is clicked (pay-per-click - PPC) or less commonly, when your ad is displayed (cost-per-impression - CPM). - Traffic Rank - The ranking of how much traffic your site gets compared to all other sites on the internet. You can check your traffic rank on Alexa.
Link Building Metrics
How many links are directing users to or through your website? - Backlinks are links that are directed towards your website from another website. Another name for backlinks is inbound links. The number of backlinks indicates to the search engine that page is popular or important. - Deeplinks Ratio SEO Metric: Compare your domain's homepage links and deeplinks on a pie chart. Deep linking is a tool used by websites to a point a visitor directly to a page within the website instead of the landing page or front page of the site. Best Practices: - Deep links should be natural. Don't pile all your links onto one page of your website. This may seem like an easy way to improve your SEO
Brand Recognition
How well can you recognize these logos without the brand name?
CIRCLES - I - Identify the customer
I - Identify the customer List potential personas. Identify and use one for the case. Use a 2x2 Matrix o Name and image o Demographics o Behaviors o Needs and Goals Note: Always ask interviewer for their preference or if they want you to prioritize it (i.e.
How to preface design problems
I'll think about -Goals -User & use cases -Prioritize use case -Brainstorm solution
Digitale Customer Journey
Im stationären Verkauf: Produktauswahl nach Anbieterauswahl Im E Commerce, erst Produkt, dann Anbieter Problem dabei: Viele Informationskanäle führen zur Informationsüberlastung (Information Overload) Wichtig den Kunden da abzuholen, wo die Entscheidung entsteht -> Emotion wichtig, einfache Prozesse
Cloud / SaaS Subscription
In a SaaS model, the license, maintenance and hosting are bundled into one, recurring fee. Terms: Can vary but most commonly 1-year contracts, paid annually upfront. Price: the traditional comparison for SaaS pricing is parity in total cost of ownership ("TCO") over 3 years, vs. the perpetual model Same services component
Service Revenue
Income earned from rendering services. **Ask for example in SaaS company
Email Website Traffic Metrics
Increase your goal conversion rates with the right email website traffic data. Email Traffic Performance: This metric displays the most important data that digital marketers need to effectively monitor their email traffic performance. Tracking traffic statistics, conversions, and user behaviour alongside a clear visual comparison between key data points allow marketers to quickly assess their traffic performance and make improvements. - Traffic Stats: This section in the metric displays the number of users reached through email marketing, and the number of instances that the email content was interacted with (either opening the email, clicking a link on the email, repluing to a prompt on the email, etc.) - Conversions: This section of the metric monitors goal completions and conversion rates. A goal can be anything from getting a user downloading a piece of content to clicking on another page on your website - Bahaviour: This section tracks how leads interact with your content, specifically, how long users stay on your page, and the overall percentage of bounces. - Bounce Rate: A soft bounce occurs when an email that was sent to a user bounces back because that user's mailbox is full or the serve was down. A head bounce occurs when the email address the email is being sent to is either invalid or does not exist. Campaign Performance: This metric is a great way to evaluate the effectiveness of an email campaign and whether to improve on the email and landing pages related to it, to build similar email campaigns, or to discontinue the campaign all together
Technological development is always offering new opportunities for ____________ design. But ____________ design always develops in tandem with ____________ technology, and can never be an end in itself.
Innovative
What company created and made popular the RICE method of prioritization?
Intercom
4 Stages of Product Diffusion
Introduction, Growth, Maturity, Decline # of firms peaks btwen intro and growth, sales volume peaks at maturity, profits between growth and maturity ex. Chinese bikshare
Gross Profit
Investors want to understand how profitable that revenue stream is. Gross profit provides that measure.
Action
Is the action the user took when they initiated the event
What do you need to track events?
JavaScript tracking code attached to each element
Billion / Million B/M
K
What is the common equivalent ratio of rCAC?
LTV : CAC
LTV Formula
LTV = ((ARPU (average revenue per user)-Costs (annual costs to support the user in a given period)) Multiplied by the Avg. Cust. Lifetime, n (This is the inverse of the churn, n=1/[annual churn])
Lifetime Value Formula
LTV = RGP x eLT
LTV Formula
LTV is annual subscription revenue per user multiplied by a subscription gross margin to get contribution margin per subscription user and then divided by revenue churn to get to LTV Two points that the traditional LTV calculation misses 1) contribution per customer may vary substantially for different customer segments, and 2) the annual contribution per customer is likely to change over the life of a customer relationship Can offset these mostly by doing cohort analyses but hard to completely offset
This week, which methodology are you using to collect qualitative data on visitors to your website?
Lab usability testing
Avinash Kaushik believes that your first A/B test should contain bold, substantially different versions because the difference between your results will likely be ______.
Large
What does being a PM mean to you?
Leader Define Goal Explain Vision -responsible for guiding the success of a product and leading the team that is responsible for improving it -liaison between stakeholders and implementation teams -PMs are extremely valuable to build the bridge between the outside (market, customers, external stakeholders, partners) and the inside (all the sources around the product)
Linking
Linking data from other google marketing tools like google ads, adsense, or the google search console This allows information like google ads clicks, impressions and cost data to be viewed in your analytics account
Having an automobile chair control that looks like a chair is an example of this design principle.
Mapping
This design principle is about having a clear relationship between controls and the effect they have on the world.
Mapping
Google Geo Products (2)
Maps Earth (buildings, monuments, natural monuments, etc)
SEO Keyword Ranking
Measure and analyze your keyword rankings to drive search traffic to your website. Ways To Improve SEO Keyword Ranking: - Track the right keywords - Focus on long-tail keywords, as they're less competitive and more targeted Best Practices: 1. Build a strong website 2. Build a social following 3. Do your keyword research 4. Evaluate your competition 5. Check keyword difficulty 6. Do not suddenly increase internal linking to a post that is getting down on SERP
Top Viewed Posts
Measure and monitors which pieces of content pull the most viewers. Formula: Total unique pageviews - Reporting Frequency: Monthly - Example of KPI Target: 40% conversion on top 3 pages, 2049 subscriptions from top pages - Audience: Content Marketing Manager, Content Marketing Team - Variations: Popular Posts, Successful posts, Top Viewed Content
Email Marketing Engagement Score
Measure how effective email marketing campaigns are at engaging your audience. Formula: Depends on campaign - # of leads generated / # of contacts made Open Rate = (Emails Opened/ Emails Sent - Bounces) x 100 Click Rate = (# of Clicks / # of Emails Sent) x 100 - List Subscribers: The number of people who subscribed to an email list maintained by your marketing team. - Open Rate: The percentage of list subscribers that open an email message sent by your team. - Click Rate: The percentage of list subscribers that click links included in your email message, including calls to action, social share or follow links, or generic links back to your website. Benchmarks: -Business and Finance - Open Rate: 21.31% Click Rate: 2.76% -Marketing and Advertising - Open Rate: 18.22% Click Rate: 2.04% -Construction - Open Rate: 22.53% Click Rate: 1.96% -Non-Profit - Open Rate: 25.20% Click Rate: 2.84% -E-Commerce - Open Rate: 16.80% Click Rate: 2.47% -Professional Services - Open Rate: 20.82% Click Rate: 2.61% -Manufacturing - Open Rate: 22.70% Click Rate: 2.04% -Software and Web App - Open Rate: 21.43% Click Rate: 2.38% Success Indicators: - A high and/or improving open rate - A high and/or improving click rate
Goal Completion Rate
Measure how effective your campaigns are at prompting your audience to complete a goal. Formula: Goal Completion Rate= # of Web Visitors / # of Goals Completed - Goals: A marketing objective for your audience to complete, such as subscribing to a mailing list. - Lead: An individual that has expressed interest in your product or service by completing a goal. Success Indicators: - A high goal GCR shows that your campaign is encouraging your target audience to act. - A high lead to win rate shows that your campaign is generating highly qualified leads for your sales team. Best Practices: - Different campaigns will have different objectives. Set clear requirements for goal completions at the beginning of your campaign.
Newsletter Signup Conversion Rate
Measure how many users visit your website and signup for your newsletter. Formula: (# of visitors who completed form) / (# of people who saw it) x 100 Best Practices: - People like to be in control, submitting the form without knowing what exactly will happen. - Less is more, every field you ask them to fill increases friction. - Timing: interrupting people before they've had some time to orient themselves and skim your site is perceived as rude. - Placement: You want input from people who have demonstrated interest in your site - not just "drive-bys". For that reason, the homepage is often not the best place to ask your question. Pricing/plan pages are often better; fewer people see them but they're the people who are your most likely customers. - Wording: Ask a yes-no question, and you'll get a "yes" or "no" answer - not every helpful.
Keyword Click-Through Rate
Measure how often your search listings generate clicks. Formula: # of clicks / # of searches - Click-Through Rate: The number of clicks compared to the total number of search impressions. - Goals: A marketing objective for your audience to complete, such as subscribing to a mailing list. - Completion Rate: The number of web visitors divided by the number of goals completed. - Organic Traffic: Visitors that discover your website by entering a keyword in a search engine (Google, Bing, Yahoo) and that click on your listing. Success Indicators: - A high click-through rate for a search term - A high goal completion rate for a search term Benchmarks: B2B: 2.55% E-Commerce: 1.66% Health & Medical: 1.79% Real Estate: 2.03% Technology: 2.38% Consumer Services: 2.40% Best Practices: - Attractive search results, especially those with images and well-written meta-descriptions, are much more likely to attract visitors.
Click Through Rate (CTR)
Measure how often your site on an SERP prompts users to click and navigate to your page. Formula: Visitors that click on page result/Visitors that view the page result - Reporting Frequency: Monthly - Example of KPI Target: 7.5% CTR - Audience: Marketing Manager - Variations: Click through ratio, Ad CTR
Keyword Performance
Measure keyword rankings to understand how effective your SEO efforts are at driving traffic to your website. Formula: Rank keywords based on position in SERPs, CTR, and GCR - Keyword: A search term that is entered into a search engine like Google or Bing. - Click-through Rate (CTR): The percentage of people that click on a search listing compared to the number of impressions or the number of times the listing appear in search results. CTR is the most important PPC metric to pay attention to because it is one of the most important factors in determining Quality Score and tells you whether or not your ads are relevant to searches. - Goals: A marketing objective for your audience to complete, such as subscribing to a mailing list. - Completion rate: The number of web visitors divided by the number of goals completed. Success Indicators: - Improving rankings for a keyword or keyword group - Improving click-through rates for ranked keywords - Improving goal completion rates for organic traffic visitors
Magic Number
Measure of sales efficiency = (Current Q Revenue - Previous Q Revenue ) x 4 / Previous Q Sales & Marketing Expense Magic number of 1 means you paid back CAC in one year timeframe
Annual Recurring Revenue (ARR)
Measure of total recurring revenue components per 1 year. Should NOT include one-time (non-recurring) fees.
Average Lead Score
Measure the Quality of Marketing and Sales Leads. Formula: Avg. Lead Score = Sum of Individual lead scores over a given period of time (day, week, month, etc.) / Total number of days in that period - Lead Scoring: The process of measuring the quality of marketing and sales leads based on predetermined criteria and targets. These criteria and targets can range from demographics to buyer behavior and user activity, and they are typically determined by evaluating the characteristics of a current customer base. - Lead Scoring: can be incredibly important to businesses that spend a large proportion of their marketing and sales budgets generating and following up on leads (online and offline); it can save them time and money by focusing their media buys and efforts on the leads that are most likely to convert to paying customers. - Average Lead Score: is an aggregate measure of the quality of leads that are being generated over a given period of time.
Return On Marketing Investment (ROI)
Measure the ability of marketing campaigns to generate new revenue. Formula: Return on Marketing Investment (ROI) = (Sales Growth - Marketing Cost) x 100 / Marketing Investment - Leads: New prospects generated by a marketing campaign - Incremental sales: New revenue generated by a marketing campaign - Wins: New customers generated by a marketing campaign
Customization Metrics
Measure the ability to tailor products and services to customers -Can include modular design, configuration systems, flexible manufacturing, and JIT inventor -Dell allows customers to configure and customize their PC to their liking, using online configuration tools.
Instagram Followers
Measure the amount of Instagram users are following your account. Formula: Total number of users following your account Reporting Frequency: Monthly Example of KPI Target: 800 followers Audience: Social Media Manager, Social Marketing Specialist Variations: Instagram popularity
Lead Conversion Rate
Measure the amount of leads that are converted into sales. Formula: (Leads converted to Sales/Total Leads)x100 - Reporting Frequency: Monthly - Example of KPI Target: 36% conversion rate - Audience: Marketing Manager - Variations: Lead to customer conversion, Average conversion rate, Leads converted to sales
Social Shares
Measure the amount of times your content has been shared on social media platforms. Formula: Total number of shares of your content Reporting frequency: Weekly Example of KPI Target: 82 Shares Audience: Social Media Manager, Marketing Manager Variations: Social media shares
Total Visits
Measure the amount of users that have visited your site or page. Formula: Total number of unique viewers on a page. - Reporting Frequency: Monthly - Example of KPI Target: 180,000 viewers - Audience: Marketing Manager, Marketing Team - Variations: Total views, Total page visits
Pageviews per Session
Measure the average number of pages a user views during a single session. Formula: (Pageviews per session with user A + Pageviews with user B + ...+ Pageviews with user N)/Total number of user sessions - Reporting Frequency: Weekly - Example of KPI Target: 11 pages - Audience: Marketing Manager - Variations: Page depth, Depth of visit
Customer Share by Category
Measure the number of customers that come from a specified category, such as Region, Industry, or Company Size. Formula: (Total number of customers that fall within category N/Total number of customers)x100 Reporting Frequency: Quarterly Example of KPI Target: 20% from SMBs (Small and Midsize Businesses) Audience: CMO, Marketing Manager Variations: Percent of customer base share by category, Share of customer base by region, Share or customer base by industry, Share of customer base by company size
Bounce Rate
Measure the number of visitors that arrive at your site and leave without navigating to any other page on your site. Formula: (Visitors leaving the site after only viewing one page/ Total site visitors)x100 - Reporting Frequency: Weekly - Example of KPI Target: 18% bounce rate - Audience: Marketing Manager - Variations: Visitor bounce rate, Single access ration, Percent exit & SAR
Customer Attrition
Measure the rate at which your company loses customers over time. Formula: (Customers lost in a given time period/Total number of customers)x100 - Reporting Frequency: Quaterly - Example of KPI target: 1.5% loss - Audience: CEO, Sales Manager, Marketing Manager - Variations: Customers lost in a given time period, Customer turnover
Funnel Conversion Rate
Measure the rate of which leads move through the marketing funnel. Formula: (Number of leads that have moved to the next stage in the funnel/Leads in funnel stage)x100 - Reporting Frequency: Monthly - Example of KPI Target: 22% conversion rate - Audience: Marketing Manager - Variations: Funnel Goals Completed Rate
Web Traffic Concentration
Measure the ratio of site visitors on a specific page, in comparison to total site visitors. Formula: Visitors on a page/Total site visitors - Reporting Frequency: Weekly - Example of KPI Target: 8% on page - Audience: Marketing Manager - Variations: Traffic Concentration, Search Traffic Concentration
Response Rate
Measure the total number of customers who respond back to your company's communication efforts. Formula: (Customers responding/Customers exposed to communications)x100 - Reporting Frequency: Monthly - Example of KPI Target: 42% response - Audience: Marketing Manager - Variations: Return Rate
Content Downloads
Measure the total number of pieces of content that have been downloaded. Formula: Total number of content downloads - Reporting Frequency: Weekly - Example of KPI Target: 236 downloads - Audience: Marketing Manager - Variations: Asset Downloads, Downloads of additional information
Unique Visitors
Measure the total number of unique individuals that view your website. Formula: Total number of unique visitors - Reporting Frequency: Monthly - Example of KPI Target: 10,000 visitors - Audience: Marketing Manager - Variations: Unique visitors on site
Social Followers
Measure the total number of users that are following your account on social media platforms. Formula: Total follower count for each social platform Reporting Frequency: Monthly Example of KPI Target: 8600 followers per platform Audience: Social Media Manager, Social Media Specialist Variations: Social media followers, Social network followers & Followers on social media platforms
Pageviews
Measure the total number of views a particular page has received. Formula: Total number of users that have viewed a specific page - Reporting Frequency: Monthly - Example of KPI Target: 29374 views - Audience: Marketing Manager - Variations: Page Impressions
Marketing Originated Customers
Measure the total share of all customers that come directly from marketing efforts. Formula: Customers that started out as a marketing lead/Total Customers - Reporting Frequency: Quarterly - Example of KPI Target: 26% of customers - Audience: CEO, CMO, Marketing Manager - Variations: Marketing Share of Customer Base
Responsiveness Metrics
Measure whether companies are attentive to customer needs -Include measures of development speed, attentiveness to needs, and market feedback -Many companies release new updates in the App Store to better the users experience.
How to Add Data From External Systems?
Measurement protocol Linking
Development Metrics
Measures a company's ability to leverage competitive advantage and product or service development.
What are median direct sales commission rates in SaaS?
Median is 12.4%. High seen is 21% with a low of 6%.
Generally speaking, what % of revenue should a company of around 5-10M ARR generate in upsell / expansion?
Median is 20% for this band. 45% if greater than 50M ARR
What are FB's 5 core values
Move fast Be bold Focus on impact Be open Build social value
Multi-Tenancy
Multi-tenancy means that a single instance of the software and all of the supporting infrastructure serves multiple customers. Each customer shares the software application and also shares a single database. The data is tagged in the database as belonging to one customer or another, and the software is smart e1nough to know who the data belongs to.
Enables of SaaS
Multi-tenant architectures, which provide a degree of efficiency in providing the same service to many different constituents ('one-to-many') Access to much greater bandwidth and ubiquitous broadband Internet availability Much faster and cheaper memory
TRUE/FALSE: all customers are created equal.
NO
Native advertising
Native advertising is the use of paid ads that match the look, feel and function of the media format in which they appear. Native ads are often found in social media feeds, or as recommended content on a web page.
What is negative churn and why is it so powerful?
Negative churn occurs when the expansions/up-sells/cross-sells to your current customer base exceed the revenue that you are losing because of Churn; It's so powerful because (a) you don't have to pay as much for it (one-time benefit) and (b) it increases your MRR (multi-period benefit)
Net churn
Net churn: (MRR lost minus MRR from upsells) in a given month/MRR at the beginning of the month. Gross churn estimates the actual loss to the business, while net revenue churn understates the losses (as it blends upsells with absolute churn).
How do you calculate net new MRR for a given period?
Net new MRR = new MRR from new customers + new MRR from expansion within existing customers - churned MRR from lost customers; expansion MRR = MRR from renewals + up-sells + cross-sells + increase in # of users
CUSTOMERS METRIC In ____ situations, it depends largely on whether the individual is identifiable. What happens if customers are NOT identifiable? What happens if customers ARE identifiable?
Non-contractual NOT identifiable: count visits or transactions Identifiable: count how many have bought during certain period of time (i.e. recency)
LTV:CAC Ratio
Notes: Our guideline for a successful SaaS business is that this number should be higher than 3.
Months to Recover CAC
Notes: To be perfectly accurate, this should include a Gross Margin adjustment, however in our guideline which states that Months to Recover CAC should be less than 12, we are assuming that you are using the simpler formula, and have a Gross Margin of 80% or higher.
5 Ms of Ad Planning
Objectives (Motivation), Budget(money), Message/Media, Evaluation (Metrics)
OKRs
Objectives and Key Results
SMART
Objectives should be Specific, Measurable, Achievable, Realistic and Timebound
What is the most basic way to look at tCAC?
Only looking at variable costs of customer acquisition, such as sales commissions and marketing campaign expenses
Clickthrough rates
Percentage of impressions that lead a user to click on an ad Describes the fraction of impressions that motivate users to click on a link, causing a redirect to another web location Used by most internet businesses These metrics should not dominate analysis Typically a low percentage
Porter 5 Forces
Porter's Five Forces Framework is a tool for analyzing competition of a business. It draws from industrial organization (IO) economics to derive five forces that determine the competitive intensity and, therefore, the attractiveness (or lack of it) of an industry in terms of its profitability. It helps you in product strategy & roadmap planning. Threat of New Entry Threat of Substitute Power of Suppliers Power of Buyers Market Rivalry
6 Parts of Price Planning
Pricing Objective, Estimate Demand, Determine Costs, Pricing Environment, Prcing Strategy, Pricing Tactics
Chain of Activities in global world
Product/brand Development, Raw Material Sourcing, Production Planning, Factory Sourcing, Manufacturing Control, Quality Assurance, Export Documentation, Shipping Consolidation
Produktdifferenzierung: Mass Customization
Produktion von Produkten und Leistungen, welche die unterschiedlichen Bedürfnisse jedes Nachfragers treffen mit der Effizienz einer vergleichbaren Massenfertigung. Grundlage: Co Design Prozess (von Hersteller und Kunde) zur Definition der individuellen Leistung, zwischen Anbieter und Nutzer Geht über Individualisierung hinaus, da Kunden kollaborativ auch in den Wertschöpfungsprozess miteingebenden werden
Types of Metrics
Qualitative: usability testing Quantitative: traffic analysis Comparative: A/B testing Competitive: monitor competitors
Prozess der E Kommunikation: Sender Empfänger Modell
Quelle - Organisation / Individuum, die Botschaft sendet Kodierte Botschaft - Technische Übersetzung der Botschaft, Digitalisierung Medium zur Übertragung - Methode zur Übertragung, Email, Banner, Video Dekodierte Botschaft - Interpretation der gesendeten Botschaft - Technisch: Umwandlung in analoge Form Empfänger - Organisation / Individuum, die Botschaft empfängt Feedback zurück an die Quelle - Bewertung der Reaktion des Empfängers - Interaktion als aktive Reaktion auf die Botschaft Umwelteinflüsse auf allen Ebenen - Störungen, die Botschaft überlagern - Veränderungen der Botschaft - Missverständnisse, Ablenkung
What is Recurring Gross Profit (RGP)?
RGP is the gross profit generated each month by a customer
What model should be used for prioritization?
RICE Model Reach - How many people will be impacted? Impact - What is the benefit of that user story (L to H)? Confidence - Probability of success Effort - Complex + How much time it will take (i.e. 8 mos) Reach * Impact * Confidence / Effort Put into a table. Can modify this approach When: Selecting the User Persona, Use Case/Pain Point, Final Solution
Click Through Rate (CTR):
Ratio of people who click on a link compared to the total number of people who saw the link.
MRR Movements (5 types)
Reactivation Expansion New business Contraction Churn
Customer Renewal Rate
Renewal Rate = # of customers who renewed their contracts / total # of contracts up for renewal It can be confusing to look at both your renewal rate (which should be just 1- Churn) in addition to churn. However in a model where you have yearly contracts being renewed, the two numbers can actually be different. For example, in the early days of a startup, you might have low churn because many of your customers have not yet reached the point where they could drop your service because of the length of their contract. In that situation, your churn number will not accurately predict what is really going to happen when you reach steady state. So a better number to look at is how many of your customers are renewing at the point where their contract expires. That is what this number measures. When you reach steady state, this number should be equal to 1 - % Customer Churn.
Brand create retail?
Retail stores become ads, market coverage, control message, offer full product line, profit
What are common variable costs of customer acquisition?
S&M Expense, and within that sales commissions and marketing campaign expenses
MVP Alternatives -SLC -RAT
SLC - Simple, Lovable, Complete -adds value the way it is, doesn't need a v2 -Snapchat started w/simple photo -simple is good, incomplete is not RAT - Riskiest Assumption Tests -only build enough to test biggest unknown -"Is this the smallest thing we can do test our riskiest assumption?"
Recent management shake up at Google
Sundar Pichai, former SVP of mobile and chrome, now second in command overseeing everything except YouTube and offshoots like Nest/Calico
TRUE/FALSE: Churn rates are dependent on the industry standard - can vary dramatically between industries
TRUE
TRUE/FALSE: Companies often aren't selling directly to customer - what customer pays versus what you get (as a company) is the added value provided to the consumer (e.g. retailer provides customer service and ~sometimes~ delivery).
TRUE
5W's & H
The 5W's & H also help product manager in asking a right question and gather information about the problem before jumping into solution or some conclusion. What is it? Who is it for? Why do they need it? When is it available? Where is it available? How does it work?
Need recognition
The first stage of the buyer decision process, in which the consumer recognizes a problem or need
What is $ CAC?
The fully burdened cost required to sign up a new customer, including all one-time onboarding costs
Net MRR Churn (a.k.a. Net Revenue Churn)
The percentage of MRR change based on churned and expansion MRR for the same period. It is calculated by subtracting expansion MRR from churned MRR and dividing that by MRR at the start of the period. Net MRR churn is the percentage of MRR lost from existing customers in a period.
PQL-To-Customer Rate
The percentage of PQLs that convert to customers. It is calculated by dividing the number of customers by the number of PQLs. The PQL-to-customer rate shows how effectively your company converts PQLs to customers.
Product Champion
The person who has the highest level of engagement with your product, and has a good understanding of who will be using your product in his/her organization, as well as which roles each user has.
Average Customer Life (ACL):
The total time (in days) of a relationship between a customer and the company. It measures an average number of days (or months) between the day a prospect becomes a customer and when the customer churns (or cancels)
CIRCLES - C - Comprehend the situation
There are 3 parts! Touch on each 1. Context - What is it? Who is it for? Why do they need it? How does it work? If no answers, make assumptions. 2. Goals and Metrics - Revenue, user acquisition, user retention, market share, customer satisfaction, conversion rate, basket size 3. Constraints and Assumptions - Deadlines, resources, platform (i.e. iOS, Android), Geography/Market Note potential competitors in the space. And SUMMARIZE before moving on to the customer
Google's Company Mantra
To organize the world's information
CAC Formula
To put it simply - CAC is the total cost of sales and marketing efforts that are needed to acquire a customer. It is one of the defining factors in whether your SaaS company has a viable business model that can yield profits by keeping acquisition costs low as you scale. If you have a successful business model your CAC will be sufficiently lower than LTV. If your CAC is higher than LTV right now don't panic. As seen in the image above - CAC is a seesaw that may experience some ups and downs. With the information and steps we are about to show you, you can surely get your SaaS business on the right end of the seesaw. CAC: Here you take the sum of all your sales and marketing expenses over a given period of time (Salaries, tools, spend) and divide by the number of new customers acquired in that same time period.
Why is calculating CUSTOMER PROFITABILITY important?
To understand which customer relationships are better than others
Retail Metrics
Total Revenue, Gross Margin, Revenue Per Square Foot, Inventory Turn (COGS)
Total Contract Value
Total Value of contract (includes one-time, professional service fees, and recurring charges)
GMV (gross merchandise volume)
Total sales dollar volume of merchandise transacting through the marketplace in a specific period. It's the real top line, what the consumer side of the marketplace is spending. It is a useful measure of the size of the marketplace and can be useful as a "current run rate" measure based on annualizing the most recent month or quarter.
Brand Awareness Metric
Track how people are hearing about your brand on social media and search engines. - Facebook Posts and Fans - Twitter Followers - Brand Mentions - Branded Search - Brand Awareness and comparison time periods (%MoM - month over month)
Email Subscribers Metrics
Track your email subscriptions and set the foundation for future growth. List Stats: This metric tracks the number of active subscribers, unsubscribers, and bounces for a particular email list. With views into current day, current month, and overall total, the List Stats metric provides up-to-date data on your email marketing list. - Subscribers: These are prospects who are interested in your email content. They have signed up to your email list and wish to continuously receive messages from your company. - Bounces: A soft bounce occurs when an email that was sent to a user bounces back because that user's mailbox is full or the server was down. A hard bounce occurs when the email address the email is being sent to is either invalid or does not exist. New Active Subscribers (Last 30 Days): Monitor the growth of your email marketing lists over the last 30 days and see how it compares to previous list growth with this email marketing metric. Use this data to analyze growth performance and understand what content is inspiring subscription. This particular metric is great for at-a-glance analysis and monthly email marketing reporting. Email Subscriber Stats: Stay on top of your subscriber statistics over the last 30 days with this Campaign Monitor metric. - Active: Subscribers are users who are wish to regularly receive your email content. - Bounced: A soft bounce occurs when an email that was sent to a user bounces back because that user's mailbox is full or the server was down. A hard bounce occurs when the email address the email is being sent to is either invalid or does not exist. - Unsubscribed: Unsubscribes occur when a lead who used to receive regular messages from your company no longer wishes to receive them. In order to ensure this number stays low, digital marketers should continuously analyze and update their content. - Unconfirmed: The unconfirmed count measures the number of users that are added to an email list without confirming their email. - Deleted: The deleted section of this metric counts the amount of emails that have been manually removed from the email list in the past 30 days. New Subscribers (Last 30 Days): This metric displays the number of new email subscribers per day for the last 30 days. Track how well your email marketing is performing on a daily basis and analyze days where there are surges in subscribers.
Vergleich traditionelle vs E Communication
Traditionelle Kommunikation Unternehmen pusht auf Kunde, Kunde gibt Antwort Interaktive Marketing Kommunikation Unternehmen und Kunden stehen in Pull / Push Relation zueinander. Das Antwort äußert sich als Feedback, das wechselseitig in beide Richtungen geht.
Kommunikationsmatrix (2x2)
Traditionelle Massenmedien - TV, Radio, Print, Plakate Direktkommunikation - Vertreter, Handelsvertreter, Kundenservice Allgemeine Online Kommunikation - Email, Banner, Digitale Reklame, Virales Marketing, Portal Sponsoring Persönliche Online Kommunikation - Personalisierte Werbung, Persönliche Email, Persönliche Webseite
*A/B testing is a marketing experiment that tests a number of variations of a campaign and determines which performs better by showing various campaigns to the same audience.
True
*Companies review their product offerings mainly because they seek to identify unprofitable elements of their portfolio.
True
*Conjoint analysis is a method for assessing customers' preferences that decompose overall preferences for product bundles into preferences for each product attribute option (part-worth utilities).
True
A multitouch conversion occurs when a customer is exposed to several advertisements, promotions, and/or email campaigns prior to converting.
True
According to Avinash Kaushik, the primary purpose of a dashboard is to drive action.
True
An example of context for your website's bounce rate would be to compare this metric from two different time periods.
True
There are 4 stages of a lab usability test: Preparation, Conducting the test, Data analysis, and Follow-up.
True
Facebook People Talking About This Metric
Understand how people are engaging with your page. Formula: People Talking About This = likes + comments + shares + mentions + event RSVP + review - Likes: The number of people who click the like button on your post - Comments: The number of people who comment on your posts. These are visible on your page, found under the post the user commented on - Shares: The number of times a user shares your post on their own page. This will show in their timelines as well. - Mention: The number of times a user mentions and links your page in a post. These are visible on a user's timeline. - Event RSVP: The number of users who agree to attend an event that you have created. - Review: When a user completes a review on your Facebook page. This will add to your overall rating which is shown on your company's page under the page likes. Success Indicators: - Increase in People Talking About This - Increase in overall engagement
Facebook Page Like Metric
Understand the effectiveness of your company's Facebook page. - Page Likes: When a user chooses to follow your company's Facebook activities by clicking the like button - Visits: The number of users who have visited your Facebook page in the last 7 days Success Indicators: - Increase in Page Likes - Increase in Page Visits - Increase in Engagements Best Practices: 1. Optimize your Facebook Page InfoPost Engaging Content: make sure you fill out as much of your Page Info as you can. Select the categories and subcategories that best describe your company, include your website URL, list your address, phone number, and hours of operation (if applicable). 2. Post Engaging Content: It's important to post engaging, entertaining, and interesting content on your business Page. Facebook constantly updates its Edgerank algorithm, and rewards posts that receive engagement (likes, comments, shares) with increased reach. 3. Be Active: People are unlikely to like your Facebook page if you don't post regularly. How often should you post? Best practice guides suggest 3x a week to once a day. 4. Promote your Facebook Page, everywhere: Once you've got great content on your company's Facebook Page, make sure you share your Facebook presence on all evergreen content you own and manage. 5. Invite your existing community: You have a community that's easily within reach: employees, current customers, business & industry partners. 6. Use Facebook Social Plugins: The Facebook Page Plugin lets you easily embed and promote your Facebook Page on your website. Just like on Facebook, your visitors can like and share the Page without having to leave your site. 7. Use data to entice new community members to like you: This step goes hand-in-hand with #2 "Post Engaging Content" and helps inform your overall content strategy. 8. Pay to play with Facebook Ads: You need to pay to play in order to be seen on Facebook today. 9. Run a contest: Companies run Facebook contests all the time to build their audience and get more likes. 10. Use social media monitoring to measure analyze, and learn: Use Facebook Insights to find useful metrics on your Page performance.
Twitter Followers Metric
Understand the effectiveness of your company's Twitter page. - Followers: When a user chooses to stay updated on your company's Twitter activities by following your brand. - Following: When a brand follows users on Twitter, they stay updated on their activities. Success Indicators: - Increase in followers - Increase in engagements Twitter Followers Benchmarks: 1. Aspirational - Shoot for the stars by benchmarking with some of the biggest and best brands 2. Trended - Aim to meet the high standards you've achieved in the past 3. Earned - Track new campaigns side-by-side with successful campaigns from before. 4. Inspirational - Find inspiring, influential accounts in your field and seek to reach their level. Best Practices: 1) Follow more people. Research shows a correlation between the number of people followed and the number of followers. 2) Use a tool like Hootsuite or SproutSocial to schedule your tweets. Posting regularly will increase your engagement and visibility, thereby increasing your follower count. 3) Use Twiends to find new Twitter users you can connect with. Once you're listed on the platform, other users with similar interests will also be able to find and follow you. 4) Optimize your Twitter bio. Make sure it's professional, complete and that it does a great job of representing you and your business. 5) Use links in your tweets. Tweets with links get more retweets than those without.
Facebook Engagement Metrics
Understand which posts are most effective in your campaigns. Formula: Engagement = likes + comments + shares + clicks + reach - Likes: The number of people who click the button on your post. - Comments: The number of people who comment on your posts. These are visible on your page, found under the post the user commented on - Shares: The number of times a user shares your post on their own page. This will show in their timelines as well. - Clicks: The number of times a user clicks on an image or link in your post. This will take users to the link you choose. - Reach: The number of people who have seen your post in their timelines. For boosted posts (Facebook Ads), you will be shown the reach as organic and paid. Success Indicators: - An increase in overall engagement - An increase in post reach - An increase in website visits from Facebook Benchmarks: - Above 1% engagement rate is good - 0.5%-0.99% is average - Below 0.5% engagement likely means that you need to realign your messages to that of your audience's expectations - and in the process attract more compelling and engaging contributions from your community members Best Practices: - You should monitor your rate of engagement consistently because they will fluctuate a lot. Engagement means nothing if it doesn't stimulate your audience to action. - Successful Facebook marketers measure engagement, but are focused on actions. For example purchases, newsletter sign-ups, downloads or simply visiting your website or landing page. Keep in mind that it has become very easy to measure conversions to actions. - People don't want to hear about your products all the time. Ask questions, post photos, have a Facebook contest, crowed source for answers, have a call to action and implement Facebook Ads - Timing is extremely important when it comes to posting on any social networks. It would be better to post after work or or when people are in transit.
Web Traffic Sources
Understand which traffic sources are driving visitors to your website. Formula: # of visitors for each source - Direct Traffic: Visitors that visit your site by typing your URL into their browser, or through an undefined channel. - Referral traffic: Visitors that visit your site by clicking on a URL on another website. - Organic Search Traffic: Visitors that discover your website by entering searching a keyword in a search engine (Google, Bing, Yahoo) and that click on your listing. - Organic Search Traffic: Visitors that discover your website by entering searching a keyword in a search engine (Google, Bing, Yahoo) and that click on your listing. - Campaign Traffic: Visitors that visit your website through a dedicated campaign or clicking on a link with certain tracking parameters.
Purchase Funnel
Understand your customer acquisition process from awareness to purchase. Formula: For each step of funnel, show relevant metrics (eg: conversion rate) - Funnel Stage: Five key stages that represent the typical customer acquisition process. 1. Awareness 2. Education/Interest 3. Capture/Consideration 4. Engage/Preference 5. Close/Purchase - Conversion rate: The percentage of people that move from one funnel stage to the next.
Populations: USA
United States: 320M NYC: 8.4M Los Angeles: 3.9M Chicago: 2.7M San Francisco: 800K Seattle: 700K
Listing Solutions stage of CIRCLES
Use SCAMPERS or General Creativity Templates to brainstorm x2-3 Tip: think big
rawson et al 2013
Use whole journeys, not just touchpoints • Companies have focused on touchpoints but this narrow focus on maximizing satisfaction at these points -> distorted picture that customers are higher than they actually are and divert attention from the important customer's end to end journey • Organisations successfully managing the entire experience -> enhanced customer satisfaction, reduced churn, increased revenue, greater employee satisfaction • More touchpoints, more complexity - companies need to embed journeys in their operating models (identify journeys they need to excel, understand performance) • Identify key journeys - draw on customer and employee surveys to assess performance • Understanding current performance - examine each key customer journey to understand causes of performance (additional research) • Journey-based transformations take years to perfect, but reward is high customer and employee satisfaction, increased revenue, lower costs
User satisfaction
User Satisfaction -Rating scale for usefulness of the product or service -Rating scale for satisfaction with functions and features -Number of times user expresses frustration or anger -Rating scale for user versus technological control of task -Perception that the technology supports tasks as needed by the user
Prioritizing what interface elements are on screen and hiding those less important is an example of this design principle
Visibility
Estimate Question Math -Volume of Sphere
Volume of Sphere -4/3(pie)(r^3)
Indicates a few visits resulted in an order
What does a low value of order conversion rate indicate?
What to consider when developing a product
What is special about this product? Are there simlair products out there? What are the advantages and disadvantages of this products? How does this product fit in our existing product mix? Does it complement anything we're already doing? What is the goal of introducing this product?
Conjoint Analysis High Level
What is the relative importance of different features?
Improve your purchase page (high shipping costs, complex checkout process, high product price, product information, SSL security, ability to save product for later consideration)
What should you do if you have a high checkout start rate?
Improve the word out about the business (SEO)
What should you do if you have a low value of visitors coming to your website?
Populations: World
World: 7.4B Europe: 738M Asia: 4.4B South America: 423M Africa: 1.2B China: 1.4B India: 1.3B Japan: 126M UK: 65M
Pick a product in the room. List three personas & pick one. List two user stories.
Write them down!
Three types of demand pricing strategies
Yield Management, Dynamic Pricing (coke machinge) , Target Costing (toothbrush)
How to Collect Event Data from a Website
You will need to add javascript to the individual elements on the site you with to track
Note for Setting Up Event Tracking
You will need to set up separate event tracking for each element or state you wish to track
Monthly Cash Burn
[(cash balance at the beginning of the year) - (cash balance end of the year)] / 12. Quarterly better than annualy bc annualy leaves out months that are high spend.
Net Burn
[revenues (including all incoming cash you have a high probability of receiving) - (gross burn)] is the true measure of amount of cash your company is burning every month.
Digital marketing metrics: _____ ____ = The number of people who have taken a desired marketing outcome, examples include completing a checkout on an e-commerce site, filling out a lead form. _____ = The number of times marketing content has been displayed, including the same person multiple times and regardless of whether there is any response to the marketing content _____ = The number of people who received impressions _____ = The total conversions divided by the total reach _____ = The conversion rate at the campaign or platform level (e.g., the conversion rate for a particular marketing video delivered to new site apps on a mobile phone) _____ = The portion of customers who make it through to the next level of each step in the journey from impression to conversion
____ Conversions Impressions Reach Conversion Rate Micro conversion rate Conversion funnel rates
purpose of customer journey mapping:
able to view digital marketing from the perspective of the consumer, identify market growth opportunities, develop innovative operating processes, insight into synergy between channels, helps identify what organizational changes are needed to facilitate product realization, evaluation and improvement of the realized product and provides direction for handling the process of measuring customer experience.
visit or session
an interaction by an individual with a website consisting of one or more page views in a certain period of time
Concentrates on the essential aspects, and the products are not burdened with non-essentials.
as little design as possible
Impressions, pageviews and hits are metrics used to
assess website traffic and activity
performance
atlikimas, pasirodymas
Objectives for advertising (book)
awareness, preference, action
If you think you might lose customers if you don't make an investment, what should you consider?
balance decision against the future value of that customer
Initial consideration
consumer considers an initial set of brands (Based on brand perceptions, exposure to recent touch points) - Brands in initial consideration can be 3x more likely to be purchased eventually
The RETENTION RATE metric applies to ____ situations.
contractual ex.: Netflix - customers either renew or cancel subscription
value of data sets available
correlating data give most power
lead generating metrics
cost per lead, lead conversion rates, email subscriptions rates, lead source ROI
If a Product is in its Declining Stage....
define a niche market, analyze competition's play, or think exit strategy
Purpose of measuring email metrics
determine effectiveness of email campaigns
Purpose of bounce rate
determine the effectiveness of the web site at generating the interest of visitors
purchase decision
disrupted by negative customer feedback and motivation to accept it
Cost per customer acquired
divide the advertising cost by the number of new customers who make an order
Audience Segmentation
dividing an audience into smaller groups w/ similar characteristics, wants, needs
Expected Lifetime Formula
eLT = 1 / Churn
Pine & Gilmore 1998 "Welcome The Experience Economy" Harvard Business Review
economic value increasingly differentiated by experiences factors of demand: experiences= memorable, personal, sensations
Open rate
emails opened divided by emails delivered
Internet of Things
enables more of the physical and natural world to be integrated into and to become accessible via the internet enables greater access and connection to customers
Monitoring downloads is a way of tracking _____________ with an organization
engagement
W1 retention
essential metric that you need to optimize to increase customer retention. The majority of users churn during the first week after sign up.
appropriate use of Audience overview report in Google analytics
establish users, new users, bounce rate, pageviews, sessions
Behavior targeting is the process of determining whether customers are happy or sad when they see an advertisement.
false
information search
find best solution searching internal/external environments (print, visual, WOM), options open, online search, staff help
tools used to track us
fitbit, cell phone, website searches, cloud, credit cards, public records, social media, GPS
Marketing Software
hardware= stores, warehouses, salespeople, etc. software= set of programs/plans/designs that enable, guide, or influence the customer experience
satisfaction
if satisfied --> brand loyalty (skip information search and evaluation)
increased unique page views per user=
increased visitor interest:your visitors want to learn more by clicking on other pages and going deeping into the site
Active Users (DAU and MAU)
indication of engagement and activation
Mobile metrics are easily tied to an
individual
Objectives for advertising (N)
inform, persuade, remind
Digital marketing funnel
is a channel of goals that the marketer wishes to lead as many consumers down as possible
ARR per customer
is it flat or growing? If upselling/cross-selling your customers, it should be growing
substantially
iš esmės
joiners motivations
join in, be a part of the group
path
kelias
search - organic
keyword optimization.
The __________ attribution model assigns full credit for a conversion on your website to the last interaction.
last click
Avinash Kaushik believes that we live in a world of __________ marketing.
nonline
willingness
noras
Total Conversions
number of people who have taken a desired marketing outcome, as defined by the marketing team. Examples include completing a checkout on an ecommerce site; filling out a lead form; subscribing for a service; or signing up for a newsletter
Direct Traffic
number of people who typed in the URL to get to the website.
width
number of product lines
depth
number of products in a line
Product Impressions
number of requestes web pages of a product wihtin a certain time period (how often different products are requested on a website)
look to click rate
number of website visitors who clicked on a product webpage and initiated next transaction steps (clicks) / number of website visitors who viewed a product webpage
click to basket rate
number of website visitors who have placed the product in the shopping cart / number of website visitors who have viewed a particular product webpage
consistent
nuoseklus
6. Spectators (70%)
on the periphery of social communities, these people are also called lurkers
Time to Value
onboarding metric which truly defines the success of your business
What is the Value Parameter?
optional numeric value like amount of time it takes for video to load or how much a specific action is worth
motivation of collectors
organize!
social - paid
paid ads
attain
pasiekti, gauti
Customer profitability measures the ____. CLV measures the ____.
past; future
advisor
patarėjas
satisfied
patenkintas
engaging
patrauklus
Bounce rate is expressed as a
percentage and represents the proportion of visits that end on the first page of the web site that the visitor sees
Conversion rate
percentage of consumers who buy a product (made a transaction) after viewing it (overall conversion rate = number of transactions / number of unique visitors)
impact
poveikis, įtaka
active evaluation
process of researching potential purchases, adding/subtracting brands as they evaluate what they want (e.g. information gathering, shopping) - Brands under consideration can expand rather than narrow as consumers seek information/shop a category - Most touch points involve internet reviews, WOM from family, recollections e.g. GM - strong sales incentives to win during this phase but the real challenge is the initial-consideration and post purchase (e.g. Honda dominates with loyal purchasers that generate positive WOM)
purchase and start using
purchase product, receive product
Bounce rate in email marketing is a measure of
quality of the list and is essentially independent of consumer action
Types of Rates/Metrics
reach, frequency, CPM, PPC, CTR (.06-.12), CPA
spectator activities
read blogs -watch videos from other users -peruse forums -utilize ratings -download user generated products
problem recognition
recognition of the need (internal or external stimuli like adverts, awareness)
Abandonment
refers to shopping carts - total number of shopping carts used in a specified period is the sum of the number abandoned and the number that resulted in complete purchases. Abandonment rate - ratio of the number of abandoned shopping carts to the total
Rich media display time
represents an important way of tracking the success of internet advertising
Evaluation of alternatives
research on all other options available online to find the right one
After determining a customer's lifetime value, a company can make better ____ decisions.
resource allocation decisions. ex.: advertising/promotion budget, choosing customers to acquire/retain, rewards program entitlements
Reactivation Revenue
revenue generated through customer who had cancelled their subscription but were pulled back by customer success or sales
Sample collection in which some parts of the intended population are not represented as much as others is an example of
sample bias
evaluation of alternatives
shortlist options, influenced by customer's attitude and involvement
interact
sąveikauti, bendrauti
What is the acronym for $ CAC factoring in all components and what does it stand for?
tCAC (Total CAC)
truer
teisingiau
High bounce indicates
that the website isn't doing a good job of attracting the continuing interest of visitors
Customer Buying Process
the consumer typically passes through these stages before purchase and they can skip or reverse the steps Aim - make it easy from problem recognition to purchase decision, but more important for customer to be successful and be loyal o Used in context of customer journeys and is modelled to understand their different stages 1) Problem recognition 2) Information Search 3) Evaluation of alternatives 4) Purchase decision 5) Satisfaction 6) Loyalty 7) Post-purchase experience
Micro Conversion Rate:
the conversion rate at the campaign or platform level (e.g., the conversion rate for a particular marketing video delivered to newsite apps on a mobile phone).
Total Reach:
the number of people who received impressions. Or the total number of followers, retweets or friends.
Mobile Traffic:
the number of people who see the marketing content through a mobile device.
Impressions:
the number of time marketing content has been displayed, including the same person multiple times and regardless whether there is any response to the marketing content.
Page views
the number of times a page on a website is accessed or displayed to users Every web page is composed of a variety of individual objects and files which can contain text, images, audio, and video
bounce rate
the percentage of single-page visits (i.e. visits in which the person left your site from the entrance page without interacting with the page)
therefore
todėl
Sessions
total number of sessions within the date range; period of time a user is actively engaged with your website, app, etc. All usage data (screen views, events, ecommerce, etc) is associated with a session
Purpose of measuring visits, visitors and abandonment
understand web site users behavior
enable
įgalinti
what we know about customer experience
• Customer experience dynamics - customer's dynamic external env large influence on customer experience (e.g. economic situation, recession) • Mapping the customer journey - customer journey analysis to understand/map the journey from the customer perspective and requires customer input • The multichannel journey - differing preferences and usages of channels and segments can be identified • The multidevice and mobile journey - mobile channels offer location based, time sensitive oppt to create touch points, better suited for search then for purchase • Customer experience measurement - multiple customer feedback metrics predict customer behaviour
Questions About ACV
What is the size? Are you getting a few hundred dollars per month from your customers, or are you able to close large deals? Of course, this depends on the market you are targeting (SMB vs. mid-market vs. enterprise). Is it growing (and especially not shrinking)? If it's growing, it means customers are paying you more on average for your product over time. That implies either your product is fundamentally doing more (adding features and capabilities) to warrant that increase, or is delivering so much value customers (improved functionality over alternatives) that they are willing to pay more for it.
When would it be more accurate to use renewal rates instead of retention rates?
When you're looking at a business with an average customer contract term of 1+ years. In this case, generally calculating all retention rates based only on the contracts up for renewal is a more accurate measure of retention
User Engagement Metrics
active users, average session duration, and number of key actions already provide a pretty good framework to assess engagement
reveal
atskleisti
weaving
audimas
Purpose of measuring click through rate
capture customers initial response to web sites
repositioning
changing consumers' perceptions of a brand or product using marketing mix (on a perceptual map)
unique visitors
the number of individual people visiting the site one or more times within a set period of time - each individual is counted only once
page views
the number of times a page was successfully loaded by a visitor (includes refreshes)
Customer Acquisition Cost (CAC)
Every business needs to scale profitably and a Product Manager needs to understand how to do so. Acquiring customers is a big cost associated with every business. Customer Acquisition Cost or CAC is the estimated cost of getting one new customer. For example, if for every $1000 that you spend on a campaign, you get 10 customers then your CAC will be $100 for each customer. Understanding CAC is crucial if you want to focus on sustainability of your product or business in the long run.
Internet Users by Continent
Global: 3.2B North America: 320M Asia: 1.8B Europe: 636M Africa: 353M
In regards to content marketing metrics, "Consumption Metrics" answers which of the following questions:
How many people viewed, downloaded, or listened to this piece of content?
5 adoption profiles
Innovators, Early Adopters, Early Majority, Late Majority, Late Mass
Information collected from toolbars is a source of competitive intelligence data.
True
How do you Track Users Across Devices?
You have to turn on the user ID feature in analytics
Bookings to BS
"booking" goes onto the balance sheet in a liability line item called deferred revenue. (Because the balance sheet has to "balance," the corresponding entry on the assets side of the balance sheet is "cash" if the customer pre-paid for the service or "accounts receivable" if the company expects to bill for and receive it in the future)
David MArc
"segmentation causes identification w/ narrow group interests at the expense of oceanic feelings for humanity or citizenship"
What is the rule of thumb for GMPP metrics?
- GMPP under 12 months are great - GMPP is acceptable up to about 18 months
Story 12: Mentoring an employee
- Took mark in off street, mentored into programmer over three years
How to you calculate your gross margin in SaaS?
- Total Revenue - COGS = Gross Margin
activities of creators
- publishing a blog -creating their own web pages -filming original videos and uploading -writing articles/posting them
Customer Experience Gets Great Attention
- top priority across industries - Chief Experience Officers (CXO) - Qualtrics evolved from offering a survey tool to offering: experience management system - customer experience - brand experience - product experience - employee experience
Decision Matrix
-Benefits / Cost / Mitigations -Option A / B
Common Issues Facing PMs
-No direct authority; have to convince -No measurement -Rapid shuffling of teams / projects -Success theater -Infrequent acknowledge failures -No connection to core metrics -No PM retrospectives -No tweaking / iteration -Shiny objects
Market Entry Checklist -Competitive Environment
-Number of competitors -Competitors resources (human capital, $$) -Competitors unique competences (distribution channels)
Cohort Metrics
-Number of sessions per user (cohort of users), over time -Session duration for a cohort, over time. -Number of user actions per session, for cohort, over time. -Action completion rate & differences between different cohorts
strategic and organizational fit
-stage and gate 1 -managers determine if new product is good fit and averaged together -must be comparison point (gate) to determine if product is good or bad-usually middle of scale -info comes internally
P-Value
-used to determine statistical significance of scientific test -A/B testing validation -reflects risk tolerance and confidence in test -X < 0.05 -larger sample size the more confident in result -does not always mean its an accurate assumption
1/3
0.3333
CTR Google Display Ads
0.35%
Click-through-rate for Google Display Ads
0.35%
3/8
0.375
Customer Retention % Formula
1 - (Customers who Churned in Period / Total Customers at Beginning of Period)
The 3 Keys to Success in SaaS:
1) Acquiring Customers 2) Retaining Customers 3) Monetizing Customers
What are greatest strengths
1. Get shit done/tenacious, see trends (jellyfish tank, crowdfunding) when nobody else does 2. Have touched absolutely everything 3. Creative (jellyfish tanks, chargerito, figure drawing, web design) yet analytical always thinking about the funnel. 4. Great at sales: sold $25K tank when had nothing 5. Well-networked: put a lot of effort in that, can always ask for advice 6. Resourceful, err on moving fast, e.g. redesigning charerito last minute, selling other company's jellyfish tank retrofitted before my own
7 Key Metrics of a Product
1. Users/traffic 2. Conversion 3. Referral Rates 4. Engagement 5. Retention 6. Revenue 7. Costs
Some Example Questions to Ask
1. Where do you see company in 5 years? 2. What is the most important metric of X product? 3. Why did your company do this (without being negative, just curious)? 4. How is the role of PM evolving?
3 ways marketing can segment audiences using google analytics
1. audience (compare to brand persona) 2. acquisition (find most lucrative channel) 3. behavior (isolate people who didnt do an action [empty a shopping cart])
What are the 3 parameters of the CLV calculation?
1. constant margin 2. constant retention 3. discount rate
Facebook Number of Users
1.8B
11 x 12
132
12 x 14
168
13 x 13
169
Africa Social Network Users
170M
12 x 15
180
Instagram Number of Users
1B
Click-through-rate for Google Search Ads
2%
Working hours in a year
2,000
Typical conversion rate
2-5%
US Avg People per Household
2.5 people
US percentage under age 18
23%
Hulu Paid Subscriber Base
27M
US internet users
286 million
USA Number of Internet Users
286M
Pinterest Number of Users
291M
Person per household
3
Population of Chicago
3 million
love and hate model
3 questions to ask about every journey stage Love - what do customers love? what about different customers? Hate - what do they hate? What do different customers hate?
Los Angeles Population
3.9M
Total number of businesses in the United States
30 million
US Percent with Bachelor's Degree
30%
Households by income
30% High Income 50% Middle Income 20% Low Income
Population of US
320 Million
US Population
320 million
4P's of Marketing (Marketing Mix)
4 P's framework help product manager & marketers in putting the right product in the right place, at the right price, at the right time. Product Pricing Promotion Place
Generation Breakdown
4 bucks 25% each [Gen Z] 0-15 [Gen Y] 15-30 [Gen X] 30-45 [BB + Other] 45+
LA population
4 million
Population of LA
4 million
7*6
42
India Number of Internet Users
462M
8*6
48
7*8
56
Apple Music Paid Subscriber Base
56M
Population of the United Kingdom
70 M
Population of Thailand
70 million
US Smartphone Penetration
70%
US smartphone penetration
70%
NYC Population
8.4M
NYC population
8.5 million
Life expectancy U.S.
80
Life expectancy in U.S.
80
US life expectancy
80 years
Marketing Plan
A document used to gather information about the marketplace, competition, audience and other factors that is used to determine what channels and tactics should be used to best market a business or product.
MRR Churn Rate (a.k.a. Gross Revenue Churn)
A percentage of MRR (Monthly Recurring Revenue) lost from existing customers at the start of the period for which MRR churn is calculated. MRR churn rate is always positive (positive churn rate means the company loses money), because it does not include upsell and cross-sell.
Engagement Loop
A practice of using insightful in-product usage data, along with engagement tactics, to influence prospects and customers to re-engage with the product and experience more value.
When considering the frequency distribution of search keywords, the 'head' refers to:
A small number of keywords that each drive a large amount of traffic to your website
Improve Conversion Rates
AB Test elements of landing page: call to action, tag lines, hero images, button positioning, descriptions, etc. Personalize messaging. Be persistent with visitors who've shown interest. Offer customer support throughout sales process.
Which of the following are *not* features of a good landing page design?
All of these
Go-To-Market (GTM) Strategy
An action plan that describes repeatable and scalable processes for how a company acquires, retains, and grows customers.
initial Value Unit
An engagement or set of engagements that advance the customer through a core use case.
How many ideas should you shoot for when brainstorming solutions for a design question?
At least TEN. The good ones usually happen between 7-12...
Months up front
Average of months (or years) of payment received in-advance with new bookings. Getting paid in advance has a big positive impact on cash flow. This metric has been used at both HubSpot and NetSuite in the past as a way to incent sales people to get more paid up front when a new customer is signed. However asking for more money up front may turn off certain customers, and result in fewer new customers, so be careful how you balance these two conflicting goals.
Other Internet Facts
Avg. Mobile Screen Time per Day: 3.7 hours Mobile Share of Global Traffic: 50.3% # Youtube Videos / Day: 5B Total iOS Apps: 2.2M Total Android Apps: 2.6M
What are bookings? Is it GAAP? What is it used for in the context of SaaS?
Bookings represent any amount a customer has committed to spend contractually (usually measured on an annual basis); not GAAP; for SaaS businesses, bookings are useful for measuring the impact and growth of sales over time
Cohort
Definition: A group of customers. In the SaaS world, it is used typically to describe the group that joined in a particular month. So there would be the January, February, etc
Billings
Definition: Billings is the amount that you have invoiced that is due for payment shortly.
Bookings
Definition: The total dollar value of all new contracts signed. Usually taken as an annualized number even if the contract period is longer than one year.Since the bookings number might have a mix of different durations (e.g. month-to-month; 6 months; 12 months) this number is not very helpful for understanding the business.To really understand what is going on in your SaaS Business, you should look at the following components: a) What happened with new customers: - New MRR/ACV from new customer contracts b) What happened in your installed base: - Renewals - Churned MRR/ACV - Expansion bookings c) The sum of all of the above: - Net New MRR/ACV
CAC
Definition: There is a problem with using this formula in the early days, as you may several expensive people in the team that should scale to handle a far number of customers as you grow. In that case, your CAC will be too high. I suggest doing a very simple adjustment to the Sales & Marketing expenses to take only a portion of those salaries and expenses in the early days. That will give a better indication of how CAC will look in the future when you are at scale.
Steps in Which Google Analytics Processes Data
Determine new vs. returning users Categorize hits into sessions (or periods in which the user engaged with the site) Joins data from the tracking code with other data sources
Count of Sessions
Dimension ga:sessionCount UI Name: Count of Sessions The session index for a user. Each session from a unique user will get its own incremental index starting from 1 for the first session. Subsequent sessions do not change previous session indices. For example, if a user has 4 sessions to the website, sessionCount for that user will have 4 distinct values of '1' through '4'.
User Defined Value
Dimension ga:userDefinedValue UI Name: User Defined Value The value provided when defining custom user segments for the property.
_____ = The cost of capital for the organization (like interest rate on a loan) _____ = the percentage of customers who remain loyal over time. What is the customer lifetime value formula?
Discount rate Retention rate Margin (retention rate / 1+ discount rate - ret rate)
Types of Digital Ads
Display Ads (banner,social,video,mobile), Search (organic and PPC)
Examples of Usability metrics
Effectiveness - the accuracy and completeness with which users achieve specified goals Efficiency - the accuracy and completeness of goals achieved in relation to resources Satisfaction - freedom from discomfort, and positive attitudes towards the use of the system
Efficiency
Efficiency -Time to complete a task -Time to learn -Time spent on errors -Percent or number of errors -Frequency of help or documentation use -Number of repetition or failed commands
Accounting for Services portion of SaaS contract
Even though the set-up and customization would be delivered early on in the plan, as they are not a separate unit of accounting they would be recognized over the lifetime of the whole plan, along with the CRM software. If the company doesn't offer these as separate services and they are obligatory for any customer who is starting to use their CRM software, then they aren't separate units of accounting and are amortized over the lifetime of the contract. Say the SaaS company also offers a 6-month consulting service for $5,000. It is offered on a standalone basis, regardless of whether the customer is using the CRM. This would be a separate unit of accounting, even if it was sold along with the CRM software. The revenue would be recognized on its own straight-line basis.
New vs. Returning Users
Every time a new unique ID is detected, analytics counts it as a new user and sends it over with the hit When analytics detects an existing unique ID, it sends a returning user value with the hit
Captive Pricing
Ex. Keurig/ PW managers
List 5 customer personas for: [choose a product in the room]
Examples include: - Food Lovers - Soccer Moms - College Students - Small Business Owners
Unit Economics
Explanation: Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable. We need some tools to help us figure this out. A great way to understand any business model is to answer the following simple question: Can I make more profit from my customers than it costs me to acquire them? This is effectively a study of the unit economics of each customer. To answer the question, we need two metrics: 1) LTV - the Lifetime Value of a typical customer 2) CAC - the Cost to Acquire a typical Customer Entrepreneurs are usually overoptimistic about how much it costs to acquire a customer. This probably comes from a belief that customers will be so excited about what they have built, that they will beat a path to their doors to buy the product. The reality is often very different!
SaaS Bookings
Explanation: Every month in a SaaS business, there are three elements that contribute to how much MRR will change relative to the previous month: 1) What happened with new customers added in the month: New MRR (or ACV) 2) What happened in the installed base of customers: Churned MRR (or ACV) (from existing customers that cancelled their subscription. This will be a negative number.) 3) Expansion MRR (or ACV) (from existing customers who expanded their subscription) The sum all three of these makes up your Net MRR or ACV Bookings.
Months Up Front
Explanation: Getting paid in advance is really smart idea if you can do it without impacting bookings, as it can provide the cash flow that you need to cover the cash problem that we described earlier in the article. It is often worth providing good financial incentives in the form of discounts to encourage this behavior. The metric that we use to track how well your sales force is doing in this area is Months up Front. Getting paid more upfront usually also helps lower churn. This happens because the customer has made a greater commitment to your service, and is more likely to spend the time getting it up and running. You also have more time to overcome issues that might arise with the implementation in the early days. The Metric "Months up Front" has been used at both HubSpot and NetSuite in the past as a way to incent sales people to get more paid up front when a new customer is signed. However asking for more money up front may turn off certain customers, and result in fewer new customers, so be careful how you balance these two conflicting goals.
Cohort Analysis
Explanation: Since churn is such a critical element for success in a SaaS company, it is an area that requires deeper exploration to understand. Cohort Analysis is one of the important techniques that we use to gain insight. As mentioned earlier, a cohort is simply a fancy name for a group. In SaaS businesses, we use cohort analysis to observe what happens to the group of customers that joined in a particular month. So we will have a January cohort, a February cohort, etc. We would then be able to observe how our January cohort behaves over time (see illustration below). This can help answer questions such as: 1) Are we losing most of the customers in the first couple of months? 2) Does Churn stabilize after some period of time? Then if took some actions to try to fix churn in early months, (i.e with better product features, easier on-boarding, better training, etc.) we would want to know if those changes had been successful. The cohort analysis allows us to do this by comparing how more recent cohorts (e.g. July in the table above) compared against January. The table above shows that we made a big improvement in the first month churn going from 15% to 4%.
Kinds of SaaS Business
Explanation: There are two kinds of SaaS business: * Those with primarily monthly contracts, with some longer term contracts. In this business, the primary focus will be on MRR (Monthly Recurring Revenue) * Those with primarily annual contracts, with some contracts for multiple years. Here the primary focus is on ARR (Annual Recurring Revenue), and ACV (Annual Contract Value). Most of the time in this article, I will refer to MRR/ACV. This means use MRR if you are the first kind of business, or ACV if you are the second kind of business. The dashboard shown below assumes monthly contracts (MRR). However in the downloadable spreadsheet, there is a tab that shows the same dashboard for the second kind, focusing on ACV instead of MRR.
Why IMC?
Extend brand relationship, improve marketing effectiveness, relevance, manage resources, ROI
Total Cost of Ownership
Gartner defines total cost of ownership (TCO) a comprehensive assessment of information technology (IT) or other costs across enterprise boundaries over time. For IT, TCO includes hardware and software acquisition, management and support, communications, end-user expenses and the opportunity cost of downtime, training and other productivity losses.
Gross Margin
Gross Profit/Sales Revenue - COGS
Good design is __________. It does not attempt to manipulate the consumer with promises that cannot be kept.
Honest
What are Unique Events
How many users have triggered that event
Online Conversions Metric
How well does your online audience convert into paying customers? Formula: Conversion Rate (%) = (# of conversions / # of clicks) x 100 - New Customers: First time buyers - Returning Customers: Buyers that have made at least 1 previous purchase. - Average Revenue per Buyer: Total revenue for a period divided by total number of buyers. - Total Transactions: The total number of purchases made during a period regardless if the purchase was made by a new or a returning customer. - Total Revenue: The amount of revenue generated during a period from all customer types. Best Practices: - When looking at the conversion rate, don't just look at the volume of sales - look at the percentage of repeat visitors, login vs registration vs abandonment rates, etc. These identifiers will tell you which areas of your checkout and purpose process are over and underperforming. - Base your company's testing and optimization strategy on extensive historical data. - Your landing pages, homepage and key entry pages, are essential to increase your online conversions. Make sure these pages are focused, uncluttered and address your visitors main purpose.
Google Specialized Search Products (5)
Image Patents Trends Scholar Shopping
What is an example of an Onboarding Gross Profit Item?
Implementation Services
Flaws of LTV
It's a Tool, Not a Strategy: The LTV formula is a measurement tool to be used by marketing to test the effectiveness of their marketing spend - nothing more and nothing less. The Model is Confused and Misused. Frequently the same group that is arguing for more spending is the same one that "owns" the LTV calculation. (This is a mistake - finance should monitor LTV). As a result, it is not uncommon for one to see shortcuts taken that allow for greater freedom. Purchased Customers Underperform Organic on Almost Every Metric. Organic users typically have a higher NPV, a higher conversion rate, a lower churn, and more satisfied than customers acquired through marketing spend. LTV heavy companies are in denial about this point. In fact, many of them will argue until they are blue in the face that the customer dynamics are the same while this is rarely the case. A customer that "chooses" your firm's services will be much more satisfied than one that is persuaded to buy your product through spend.
M/K
K
context
Lemon and Verhoef, 2016 customers now interact with firms through numerous touch points in multiple channels and media, customer experiences more social in nature - firms need to integrate multiple business functions and external partners to create/deliver positive customer experiences • Address importance of experiences in today's society & opportunities to benefit from creating strong and enduring customer experiences
Customer Cons of SaaS
Less Control and Security of Data - While it is less of an issue now, some firms (especially large enterprises) are still reluctant to part with control of their data in some cases Limited Customization Available - Since all customers use the same application, there is limited customization relative to an on-premise solution
Measurement Protocol
Lets you send data from any web-connected device like point-of-sale systems or web-connected kiosks to google analytics If you want to collect data from a system outside of google, you must pass the data collection hits manually in a URL string
What does a cohort with a rapid GMPP but low LTV : CAC likely denote?
Little profit will be realized from customers because they churn soon after the breakeven point
End Action Rate
Measure how effective marketing campaigns are by monitoring the last action taken by your audience. Formula: # of users that start activity / # of users that complete activity - End action: The last interaction a campaign visitor has with your website. - Lead: New prospects generated by a marketing campaign. - Wins: New customers generated by a marketing campaign. Success Indicators: - Campaigns that result in a high number of leads or wins - Campaigns that generate positive events like social engagements or contact requests. - A reduction in negative events like bounces and exists.
Website Traffic Lead Ratio
Measure how many of your website visitors convert to leads. Formula: # of Website Visitors/# of Leads = % Traffic Conversion Benchmark: If the ratio is no less than 2-4%, then your content strategy is working to attract the potential customers instead of simply driving people to your website thanks to the viral content without any other perspectives. Best Practices: - What is important for the Website Traffic to Lead Ratio is to get a baseline, what is this ratio currently? And what can you do to improve it? Many times, focusing on improving the website's conversion rate is an easy way to improve this ratio. - Landing Pages. While the purpose of many content pages on websites is to provide information; landing pages are designed for collecting contact information. Very effective landing pages combined with targeted traffic can give a conversion ratio of as high as 50-60% and in some rare cases even more than that. - If your traffic is steady or increasing, but your traffic-to-lead ratio is low or decreasing, that's a surefire sign that something is missing on-page.
Low Cost Metrics
Measure the ability to deliver goods and services at a low cost
Cost per Action (CPA)
Measure the amount of money put towards driving conversions. Formula: Payments for conversions/Total number of conversion - Reporting Frequency: Monthly - Example of KPI Target: $28 per action - Audience: Marketing Manager - Variations: CPA
New Leads Generated
Measure the number of new leads that have been added to your system during a specified time period. Formula: Total leads generated during reporting period - Reporting Frequency: Weekly - Example of KPI Target: 650 leads - Audience: Marketing Manager - Variations: Leads Acquired, New Opportunities
Email Forwards
Measure the number of times a piece of content was forwarded on to another contact form one of your viewers. Formula: Total number of forwards Reporting Frequency: Monthly Example of KPI Target: 76 forwards Audience: Marketing Manager Variations: Forwards to a friend
Gross Retention
Measurement of annual revenue lost from a company's installed base of customers NOT accounting for cross-sells, up-sells, price increases, or organic account growth. Gross Revenue Retention will always be less than 100%. Gross Retention = total MRR from that same list of customers less any that are no longer active/customers from 12 months ago and sum of their MRR for that month This metric best isolates lost customer revenue without being obscured by a myriad of other important, but tangential factors. It allows businesses to be more accurately compared to each other, and it may also better identify business model issues that would otherwise be hard to isolate.
Trust Flow (TF)
Measures the trustworthiness and authority of the websites links.
14 Day Active Users
Metric ga:14dayUsers UI Name: 14 Day Active Users Total number of 14-day active users for each day in the requested time period. At least one of ga:nthDay, ga:date, or ga:day must be specified as a dimension to query this metric. For a given date, the returned value will be the total number of unique users for the 14-day period ending on the given date.
1 Day Active Users
Metric ga:1dayUsers UI Name: 1 Day Active Users Total number of 1-day active users for each day in the requested time period. At least one of ga:nthDay, ga:date, or ga:day must be specified as a dimension to query this metric. For a given date, the returned value will be the total number of unique users for the 1-day period ending on the given date.
7 Day Active Users
Metric ga:7dayUsers UI Name: 7 Day Active Users Total number of 7-day active users for each day in the requested time period. At least one of ga:nthDay, ga:date, or ga:day must be specified as a dimension to query this metric. For a given date, the returned value will be the total number of unique users for the 7-day period ending on the given date.
How would you track success after selecting your primary solution?
Metrics Identify key metrics (use AARM to brainstorm)
Retention by cohort
Month 1 = 100% of installed base Latest Month = % of original installed base that are still transacting
What is MRR?
Monthly Recurring Revenue - the average monthly recurring revenue per customer
RFM
One of the best customer segmentation technique based on user behaviour. It groups customers based on their history (how recently, how often and how much) and sends marketing communication accordingly. Recency Frequency Monetization
3 Ways to Pay for an Ad
Pay per click Pay per impression (CPM is cost per mille) Pay per conversion
Life Time Revenue (LTV)
Present value of the net profit from each customer. Calculate LTV by multiplying the contribution margin per customer by the average lifespan of a customer.
Consumer Marketing Channels
Producer -> Wholesaler -> Retailer -> Consumer
Why do retailers create brands?
Profit margin, slotting, unique offering, bargaining clout with brand suppliers
Grow CTR
Research target customer to understand messaging they respond to. Keyword research tool to find words customer likes/dislikes. Power words: provoke urgency, authority, performance, advanced tech, scarcity, social proof. Eye catching images. Clear call to action. Demographic targeting
SCRUM -Scrum Master duties -Product Owner duties
Scrum Master -establishes scrum practices / rules -ensures team is fully functional -sets up meetings -help with the backlog Product Owner -defines features of product; focus on ROI -track value and return -scope management / prioritize backlog -accept or reject work
Sessions by Device Type
See what devices your website traffic is using for the time period of your choice. Best Practices: - Take the time to view your landing pages from different devices to make sure that it always loads properly, contains all the key elements needed to prompt users to action and has a crisp layout that isn't impinged upon in any way by your site's responsive styling. - Online emulators can show you how your site will render on different devices; take advantage of them, but also test your site on the live environments of you Pierre DeBoiand your friends' devices to be sure the emulators are accurate. - The fact is that it is critical to add an analytics solutions to accurately capture that traffic.
Customer journey mapping
Technique for optimizing customer processes and developing innovative management concepts. Helps visualize the purchase process from the consumers perspective.
Gross Profit
Tells us how profitable a revenue stream is after subtracting COGS- all expenses involved in providing customers with product/service- from the topline.
Marketing Media Life Cycle
The Process of creating and running a campaign through several stages: -Design -Implementation -Evaluation
What is the Rule of 50 and why is it a good measure of performance for a SaaS company?
The Rule of 50 is when LTM revenue growth plus LTM EBITDA margin > 50%; it's a good measure of financial performance because it demonstrates that the company is growing fast but also maintaining profitability
Net MRR Churn rate
(SUM of Churn & Contraction MRR - SUM of Expansion & Reactivation MRR) / MRR at start of period.
Pirate Metrics (AARRR)
* Acquisition * Activation * Retention * Revenue * Referral
What are the three parts you should keep in mind when Comprehending a situation of a design question?
- Context - Goals & Metrics - Constraints
What questions can/should you ask when Comprehending the context of situation in a design question?
"5 W's and H" (* = "3 W's and H") - What is it? * - Who is it for? * - Why do they need it? * - When is it available? - Where is it available? - How does it work? *
Story 11: Failure of Chat Basket
- Was trying to capture X factor - Poor way to incubate an idea: Frankenstein idea
What are the four Event tracking parameters?
-Category -Action -Label -Value
Questions to Ask a Company
-How do all of the products fit together? -Who are the competitors? How does the company differentiate? -What is the revenue model? -What do customers love / hate about product? -What are the key metrics? How many users... conversion rate... growth rate? -What are your product weaknesses? -What are the product's competitive advantages? -What threats are there impending? -
GAME Framework
-How to establish metrics for a project G -> Goals (user and business) A -> Actions M -> Metrics (use ARM) E -> Evaluations
Customer Lifetime Value
-Informs companies about how much a customer is worth to them. -Especially important for companies like Netflix, where they want customers to continue to subscribe to its services. -These metrics focus on the LONG TERM value a single customer brings to the company.
Multi-Variate Testing
-Multivariate involves testing multiple differences. Instead of 2 versions of a page, create N variations with different version of elements on each page -Can show that a footer has no effect on conversion -Really good for redesign efforts -Requires a lot of traffic / data to run variations
Survey Checklist (best practices)
-My survey has a clear objective -My survey has a defined target audience -I know what I want to achieve with my survey -My survey questions are not ambiguous -I know where people will respond to my survey (at home, at work, on the bus...) -I know what I will do with the responses and how to action them -I know how I will distribute my survey (via email, social media...)
1/12
0.083
1/9
0.1111
Root Cause Analysis (5 Whys)
1) Ask why problem happens and write down answer below problem 2) Ask why again if it doesn't identify root cause 3) ... repeat E.g. Q: Why did your car stop? A: Because it ran out of gas Q: Why did it run out of gas? A: Because I was lazy ...
Amazon's Leadership Principles
1. Customer Obsession 2. Ownership (Long term view) 3. Invent and Simplify (innovate) 4. Are Right A Lot of the Time (Good business instinct) 5. Hire and Develop the Best 6. Insist on the Highest Standards 7. Think Big 8. Bias for Action 9. Frugality 10. Vocally Self Critical 11. Earn Trust of Others 12. Dive Deep (audit frequently, no task below you) 13. Have Backbone; Disagree 14. Deliver Results
Chicago Population
2.7M
_____ of customers provide _____ profitability
20%; 80%
People per Age group
4 million 0-10; 11-20; 21-30; 31-40; 41-50; 51-60; 61-70; 71-80
Global Mobile Share of Web Traffic
50.30%
Men/Women
50/50
Minutes in a year
500,000
US Percent Married Adults
52%
Americas Social Network Users
599M
Number of YouTube Videos Watched Every Day
5B
It is ____ times more expensive for companies to attract new customers than to keep existing customers.
6-7 times
Americas Social Network Users
600 million
GDP per capita in U.S.
60K
Median Household Income
60K
Android US Market Share
61.7%
UK Population
65M
World Population
7.4B
Life expectancy world
70
Formula: how long for something to double, doesn't work for extremely high growth
70 / % increase e.g. 70/10% per year equity growth of property = break even in 7 years
Europe Population
739M
Europe population
740 million
What is median Subscription Gross Margin in SaaS in 2018?
77%
Brazil Smartphone Install Base
79M
Population of NYC
8 million
People per Generation
80 Million 4 Generations: 0-20; 21-40; 41-60; 61-80
Life Expectancy of an American
80 years
US Life Expectancy
80 years
Population of Europe
800 million
Which of the following two hypotheses is constructed correctly? A: "I think a bold font for the 'Blog' button on my homepage will increase the number of visitors who click on it." B: "I want to test the best font for my website"
A
5Es Framework
A brainstorming checklist for various stages of the UX. Helps build customer journey maps. -Entice. What event triggers a user to enter into the UX funnel? -Enter. What are the first few steps in the UX funnel? -Engage. What task(s) is the user trying to accomplish? -Exit. How does the user complete the task? -Extend. What follow-up actions occur after the user completes the task?
What is the 'Why? Method'?
A brainstorming framework. Challenge the status quo.
Freemium
A customer acquisition strategy that provides access to part of a software product to prospects free of charge, without a time limit. A freemium product does not limit the amount of time a prospect can access the software, but often limits users in some way such as through stripped-back features or allowed amount of usage.
What is Median ARR per FTE range from companies less than 5M ARR up to 100M ARR?
According to KPCM survey research: Less than 5M ARR - 65K per employee median 122K between 10M - 25M ARR 183K above 50M ARR You get more efficient per head as you scale and get bigger.
Communications Mix
Advertising, Sales Promotion, Personal Selling, PR, Word of Mouth
World Population
7B
1/18
.055
1/20
0.05
AARRR: Startup Metrics for Pirates
A very helpful framework by Dave McClure, 500 Startups for a product manager to define success metrics for any product or feature. It'll also help you measure your funnel and enable you to optimize it for the better. Acquisition — where/what channels do users come from? Activation — what percent have a "happy" initial experience? Retention — do they come back and re-visit over time? Referral — do they like it enough to tell their friends? Revenue — can you monetize any of this behavior?
Conversion funnel
A visual model that illustrates the journey of how a potential customer flows through the process of becoming aware of a business or product and into more involved stages until they make a purchase. This model also indicates that there will be more people in the earlier stages and smaller number of people that continue into the later stages.
When does a Session End
After 30 minutes if no other hits are recorded If a user returns to a page after a session ends, a new session will begin
Avg. life span of customer (in months)
Avg. life span of customer (in months) = 1 / by your monthly churn.
Average Customer Lifespan
Avg. life span of customer = 1 / churn
______ testing is an experiment where two versions of a webpage are shown to users at random in an attempt to determine which one is more effective for reaching a defined goal.
A/B
What are cash collections? Is it GAAP? What is it used for in the context of SaaS?
Actual cash collected and deposited into the bank from the customer; not GAAP; useful for knowing how much a business can spend
E Marketing Media Campaign
Analyse, Planung, Steuerung, Gestaltung, Durchführung und das Controlling von Online Marketingaktivitäten innerhalb einer Kampagne über digitale Medien und Kanäle zu den Kunden, mit dem Ziel einen unternehmerischen Mehrwert zu generieren. Online Marketing Mix aus: Price Product Placement Promotion
Analytics Identifying Sessions
Analytics doesn't recognize users who visit your website from different devices by default and will count each device as a unique user
Joining Google Analytics Data With Other Sources
Analytics will join the data collected by the tracking code with other sources that you've specified
Long Tail Online
Anderson's research shows the demand overall for these less popular goods as a comprehensive whole could rival the demand for mainstream goods. While mainstream products achieve a greater number of hits through leading distribution channels and shelf space, their initial costs are high, which drags on their profitability. In comparison, long tail goods have remained in the market over long periods of time and are still sold through off-market channels. These goods have low distribution and production costs, yet are readily available for sale.
Discounted Cash Flow (Perpetuity)/Valuation/NPV
Annual Cash Flow / (Discount Rate - Growth Rate)
LTV / CAC Logic
As long as the sum of the discounted future cash flows are significantly higher than the CAC, then people will argue it is warranted to "push the accelerator," which typically means burning capital by aggressively spending on marketing. The best SaaS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8.
FB: 3 proactive ways to drive the interview
Ask clarifying questions State your assumptions Take time to gather thoughts
Definition E Pricing
Bewusstes Bilden / Einstellen und kontinuierliches Management von Preisen innerhalb ökonomischer Märkte Preismanagement innerhalb des Internets mit Aktualisierung und Beschleunigung
Web Design Patterns: Components (3)
Bookmark & Organization Data Management Scrolling
Bounce Rate
Bounce Rate is the percentage of visitors who land on a page but do nothing and leave. It is good for measuring the performance of specific landing pages.
Creative Brief Components
Background, Objectives, Target Audience, Competitive Position, Key Promise, Supporting Facts, Creative Considerations
Monthly Recurring Revenue
Be careful to note that multiplying monthly all-in bookings by 12 to get ARR overstates ARR as it includes non-recurring fees
Why is the churn rate metric important?
Because it is less costly to RETAIN customers than to acquire new customers.
What types of questions do you need to prepare for?
Behavioral, Product Design, Estimate, Metrics, Tech, and Product Strategy
Persona -what to include -what makes a good one?
Behaviors -degree of loyalty / usage Demographics -age, gender, income, education -country, climate, population Needs & Goals Include on Card... -Name / Title -Goals -Attributes (demographics) -Needs / Challenges -Skills / Behaviors Good Personas are... -reflect patterns from Research -focus on current state -are realistic -help understand users
Breakeven Market Share
Breakeven Volume / Market Size How much of the market would you need to capture to make it worth your investment?
What does the acronym CIRCLES stand for?
C - Comprehend the situation I - Identify the customer R - Report the customer's Needs C - Cut, through prioritization L - List solutions E - Evaluate trade-offs S - Summarize your recommendation
CIRCLES - C - Cut, through prioritization
C - Cut, through prioritization - Use a quick model/framework to prioritize which user story to go with. ROI - Use a table or RICE model
M/M
Cancels out
5 Cs Analysis of Environment for Product
Company Competitors Customers Collaborators, e.g. distributors Climate
Facebook Ads Impressions and Reach (last 7 days)
Compare your Facebook Ads impressions with reach over the past 7 days.
Vendor Cons of SaaS
Costs Associated with Providing the Service - SaaS vendors typically have lower gross margins because they have to operate the data center that provides the service to customers Lower Switching Costs for Customers - Consumers can relatively easily run test pilots of alternative solutions even if the original solution is widely deployed in the firm
Why paid CAC is important
Costs typically go up as you try and reach a larger audience. So it might cost you $1 to acquire your first 1,000 users, $2 to acquire your next 10,000, and $5 to $10 to acquire your next 100,000. That's why you can't afford to ignore the metrics about volume of users acquired via each channel.
CSAT
Customer Satisfaction -measures short term happiness (transactional) -does not address how user feels about company as a whole -typically use 1 to 5 scale -# of satisfied customers (4/5) / # of responses "How would you rate your overall satisfaction with the service [or product] you received?" Diff w/NPS -NPS is about long term happiness -NPS measures loyalty
Customer Metrics
Customer Satisfaction -renewal rates for services likeliness to recommend to friends -effectiveness of online customer service -customer ratings on sites such as Yelp or Amazon
AARM Framework
Defines metrics for a product: - Acquisition: tracking customer signups - Activation: getting lazy users to complete registration - Retention: getting users to use service more and behave in a way that helps the user or business - Monetization: collecting revenue from users
What are "COGS" for SaaS companies?
Data hosting and customer support
What matters more? Percentages or dollars?
DOLLARS because that is what you can spend (it's tangible)
MRR
Definition: The Monthly Recurring Revenue at the end of each month. Computed by taking the MRR from the previous month and adding Net New MRR.
Traditional Perpetual License
Delivered as a key ID license to a customer and sales is one time with recognition of revenue happening all at once. Paid and recognized upfront upon either the sale or the delivery of the license. Gross margin typically 95%+ due to customer taking ownership for computing the software. MTCE is component that is recurring. Attach rate: usually 100% in enterprise software (i.e. all customers are required to buy maintenance). Price: typically ~20% of license (can vary depending on tiers)
Incremental Sales
Demonstrate how your marketing campaigns are resulting in increased sales revenue. Formula: Incremental Sales ($) = Total Sales ($) - Baseline Sales ($) - Baseline Sales: What you expect to sell for a given time period without marketing. - Lead: An individual that has expressed interest in your product or service by completing a goal. - Wins: New customers generated by a marketing campaign. - Campaign: A marketing communication on a dedicated channel intended for a business' target audience.
Velocity Metrics
Describes how long it takes a company to achieve certain milestones. This includes the average number of days it takes a prospect to go from signup to becoming a PQL, and the average number of months it takes a company to break even (when CLV>CAC).
How do you evaluate tradeoffs between solutions when answering a design question? Is there a more rigorous way to do so?
Discuss the pros and cons. Bonus: Define tradeoff criteria. Such as customer satisfaction, implementation difficulty, and revenue potential.
Downloads
Downloads (or number of apps delivered by distribution deals) are really just a vanity metric. Investors want to see engagement, ideally expressed as cohort retention on metrics that matter for that business — for example, DAU (daily active users), MAU (monthly active users), photos shared, photos viewed, and so on.
Multi-axis Pricing
Explanation:
Unit Economics: Hubspot Example
Explanation: HubSpot's unit economics were recently published in an article in Forbes. You can see from the second row in this table how they have dramatically improved their unit economics (LTV:CAC ratio) over the five quarters shown. The big driver for this was lowering the MRR Churn rate from 3.5% to 1.5%. This drove up the lifetime value of the customer considerably. They were also able to drive up their AVG MRR per customer. Brad Coffey, HubSpot: "In 2011 and early 2012 we used this chart to guide many of our business decisions at HubSpot. By breaking LTV:CAC down into its components we could examine each metric and understand what levers we could pull to drive overall improvement. It turned out that the levers we could pull varied by segment. In the SMB market for instance we had the right sales process in place - but had an opportunity to improve LTV by improving the product to lower churn and increasing our average price in the segment. In the VSB (Very Small Business) segment, by contrast, there wasn't as much upside left on the LTV (VSB customers have less money and naturally higher churn) so we focused on lowering CAC by removing friction from our sales process and moving more of our sales to the channel."
Cohort Analysis (Revenue)
Explanation: There are two ways to run Cohort Analysis: the first looks at the number of customers, and the second looks at the Revenue. The example graph below looks at how MRR evolves over time for each cohort. This particular example illustrates how the graph would look if there is very strong negative churn. As you can see, the increase in revenue from the customers that are still using the service is easily outpacing the lost revenue from churned customers. It is pretty rare to see things look this good, but it is the ideal situation that we are looking for. For those wondering if this can be achieved, one company in our portfolio, Zendesk, that has numbers that are even better than those shown in the example below.
Bookmark & Organization
F.A.T. >*Favorites, Bookmarks, and Wish Lists:* Users forget or cant find content they particularly like >*Activity Feed:* Users want to stay updated on site activity. >*Tagging:* Content is so broad that users don't want to skim through it all.
Users by Platform
Facebook: 1.8B Snapchat: 300M WhatsApp: 1.5B WeChat: 1B Instagram: 1B Twitter: 321M Pinterest: 291M
The data you collect about your own website using a competitive intelligence tool should always match the data you collect using your site's analytical tool (such as Google Analytics). `
False
Google Home and Office Products (11)
Gmail Docs Sites Calendar Voice Wallet (card and phone syncs with online payments account) Translate Drive Analytics Chromecast (broadcast to multiple screens, you have to sync your app to an existing google video streaming app, which then sends the video to the chrome cast device and screen) Glass
Objectives
Goals set to help guide a marketing plan or elements of the plan.
FB in execution, what 4 things are they looking for + one bonus (PA)
How you set the right goals for a product and measure against them. How you identify, frame, and evaluate trade-offs How you analyze and debug problems. How you set your team up for success. + Focus on impact. Prioritize THE biggest goal.
Marketing analytics continuous function
Identify--> analyze--> improve
In what stage is it time to do everything possible to ensure the success of the campaign? In what stage is it important to determine how many resources, if any, should be spent on it in the future. In what stage are A/B tests important due to their nature? In what stage do you see whether a campaign has met its goals, and if not, how the campaign could be improved In what stage is important to regularly monitor the results of A/B Tests, perhaps creating new ones and making adjustments.
Implement Evaluate Implement Evaluate Implement
Services Aspect of Delivery for Both
Implementation, customization, configuration and other services performed by the company for the customer in relation to the software. Gross Margin: ~25-35% (headcount dependent revenue stream).
SaaS Model
In a SaaS model, the license, maintenance and hosting are bundled into one, recurring fee. Terms: Can vary but most commonly 1-year contracts, paid annually upfront or paid monthly or quarterly. Revenue is recognized ratably across the term. Due to the revenue model, growing SaaS businesses have less lumpy financials. Price: the traditional comparison for SaaS pricing is parity in total cost of ownership ("TCO") over 3 years, vs. the perpetual model. If a license costs $100, the TCO of the license + maint. under the perpetual model is $160 ($100 +$20*3). The SaaS product would be priced at ~$53/year (or$160 over 3 years).
What is the key to properly calculating Recurring COGS, and consequently RGP?
Include all month-to-month costs required to maintain a customer that is already live on the software, but to exclude the initial expenses necessary to light up the new customer
Strategische Faktoren der E Communication (3)
Integration - E Kommunikation lässt sich gut in bestehende Kommunikation eingliedern Industrie Restrukturierung - Neue Kommunikationswege durch veränderte Industriestrukturen Independenz - Unabhängigkeit von Ort und Zeit (Live Chat, GoTo Meeting..)
Types of Coverage
Intensive, Selective, Exclusive
Definition E Communication
Interaktive, multifunktionale Kommunikation unter Nutzung netzwerkbasierter und elektronischer Kommunikationsplattformen
What does Lumity do and why do you think it'd be a good investment?
Lumity provides a data-driven benefits platform for SMBs that helps employers and employees forecast and plan healthcare spending (employers save money by choosing the right health plan and employees gain more insight into their healthcare budgeting) Lumity is a good investment candidate because it's a recurring revenue business model and is poised to benefit from favorable industry trends (i.e. shift within HR technology from systems of record --> systems of engagement)
How do you calculate MRR?
MRR = the monthly recurring revenue at the end of each month and is computed by taking the MRR from the previous month and adding net new MRR
Major Events in the history of SaaS
Main frame to client server to web and now cloud computing which really in many regards enables SaaS
Organic Search Traffic
Make sure you are getting a steady stream of unique visitors from organic search. Organic Search Traffic vs Paid Traffic: - Organic search traffic is simply better for delivering relevant traffic - Combining organic search traffic and paid search outperforms either channel by itself - Walled gardens (social media platforms) have their own rules - Site "stickiness"
Facebook Ads Campaign Performance
Make sure your message is reaching the right audience by measuring your Facebook Ads campaign performance for the date range of your choice. - Facebook Ads Spend: the total spent on your campaign thus far. The term 'spent today' however means the amount spend on your ad set since 12am today. If you set a daily budget for an ad set, you'll see your progress towards the budget in the later term - Conversions: Conversions are customer-completed actions, like purchases or adding to a cart on a website
IMC
Marketing Plan -> Promotional Goals -> Promotional Strategy -> Commuciations Mix -> Execute and Evaluate (increase pleasure/eliminate pain points) (product benefits/customer exp)
Positioning Map
Map that shows multiple attributes on X and Y axis and shows different brands/products relative perception
Lifetime Value: Customer Acquisition Cost (LTV:CAC)
Measure the relationship between the lifetime value of a customer and the cost of acquiring that customer. Formula: Gross Margin % X ( 1 / Monthly Churn ) X Avg. Monthly Subscription Revenue per Customer : Sales and Marketing Costs / New Customers Won - Reporting Frequency: Monthly - Example of KPI Target: 3:1 - Audience: CEO, CMO, Marketing Manager, Sales Manager - Variations: CAC:LTV
Content Backlog
Measure the total amount of content pieces that are waiting to be pushed live. Formula: Total number of unpublished pieces of content - Reporting Frequency: Monthly - Example of KPI Target: 5 content pieces in backlog - Audience: Marketing Manager, Content Marketing Manager - Variations: Content waiting
Facebook Likes
Measure the total number of Facebook users that like your company page. Formula: Total number of Facebook accounts that like your page Reporting Frequency: Monthly Example of KPI Target: 12,000 likes Audience: Social Media Manager, Social Marketing Specialist Variations: Facebook Page Likes, Facebook Page Popularity
Citation Flow (CF)
Measures how powerful the links to the website are.
Days from Signup to Customer
Measures the average number of days it takes a prospect to become a customer.
LTV
NPV of net profit from customer over the duration of the relationship Includes: Revenue per customer per month (AOV * orders) Plus Contribution Margin (revenue minus variable costs associated with the customer (SG&A and operational costs) Avg life span of customer = 1/monthly churn LTV = contribution margin * average customer lifespan
Landing Page Performance Optimization
Optimize your landing pages to increase conversion rate, and decrease bounce rate. How can SEO contribute to Landing Page Performance Optimization? 1. Text headlines 2. Setting expectations 3. Pure optimized HTML 4. Provide a valuable resource to gain links 5. Reduced PPC costs - Landing Page Performance by Total Search Traffic (last 30 days): Your landing page is the backbone of your marketing campaign. Make sure people are seeing it by tracking views this month-to-date, and compare it to last month and your target. - Landing Page Performance for Organic Searches (last 30 days): Get a quick, at-a-glance reference on how your landing pages are performing against your total search traffic. - Landing Page Traffic by Source/Medium: Rank your top traffic sources based on engagement, conversion rate, bounce rate and more important metrics - Landing Page Views: Your landing page is the backbone of your marketing campaign. Make sure people are seeing it by tracking views this month-to-date, and compare it to last month and your target. - Leads (last 30 days): Track the number leads you have gained over the past 30 days and compare to the previous 30 days - Landing Page Optimization Stats: Use your key landing page metrics to discover the success of your lead generation efforts.
What is the PURPOSE of the Customer Profitability metric?
PURPOSE: to identify the profitability of individual customers (not all customers are equal)
____ drives increased customer engagement, customer retention, brand loyalty, and business growth.
Positive customer experience
Gross Dollar Renewal Rate ($'s)
Renewal Rate = $ from customers who renewed their contracts / total $ of contracts up for renewal instead of looking at the number of customers, it looks at the dollar value of the renewed contracts. It's important to look at both, as they each tell an useful part of the story. If you were losing a lot of customers, you'd want to know why. Similarly, if you were only losing a few customers, but they were your biggest $ value customers, you'd also want to know that as well.
__________ is an important aspect to consider when obtaining competitive intelligence data from web analytics vendors
Sample size
5 Forces of Industry Analysis
Rivalry Amongst Existing Competitors Buyer Power Supplier Power Threat of Substitutes Threat of New Entrants
Customer Satisfaction Metrics
Shows how engaged customers are, how much value they derive from your product, and whether they will recommend your solution to peers. Customer satisfaction reflects how a customer perceives the value and experience with your company, brand, and product. A few examples of metrics in this category include Net Promoter Score (NPS), Customer Behavior Index (CBI), and Customer Lifetime Value (CLV).
Market Entry Framework: Market Characteristics
Size, growth, profit margins, trends (regulatory, customer preference)
T or F: A firm runs marketing analytics to assess the success of its overall marketing strategy. T or F: Big data analytics has not allowed managers to keep up with their marketing campaigns in real-time. T or F: Marketing analytics is not a continuous function of measuring results of campaigns.
TRUE FALSE (it has!) FALSE ( it can be conceived as having a "rinse, lather, repeat" cycle.)
_____ = In this stage, the marketing analytics manager must implement changes to help the campaign perform better or continue good performance trends. 1 Identify the metrics 2 Analyze the metrics 3 Take improvement actions A/B testing can be useful during this stage since it allows marketers to make the related changes until the best performing marketing effort can be achieved. T or F: diminishing returns exist when optimizing a marketing campaign.
Take improvement actions Take improvement actions TRUE
What does it mean when you talk about distribution channel ALIGNMENT?
Talking about how you incentivize channel members (with money) to serve customers efficiently and effectively.
Signup-to-PQL Rate
The percentage of prospects that complete profile and in-product engagement requirements to become product qualified leads (PQLs). It is calculated by dividing the number of PQLs by the number of signups. The signup-to-PQL rate provides insights into how effectively your company engages prospects in the early stages of reaching initial value.
Signup-to-Customer Rate
The percentage of signups that become paying customers. It is calculated by dividing the number of customers by the number of signups. The signup-to-customer rate shows how your company, on average,
Visitor-to-Signup Rate
The percentage of visitors that visit your page and then sign up. It is calculated by dividing the number of product signups by the number of visitors to a signup page. The visitor-to-signup rate shows how effectively your company convinces visitors to sign up for free trials or a freemium.
Customer Onboarding
The process of getting a newly subscribed customer (or account) up and running effectively with your product, including training, account and team member setup and assistance with integrations. The goal here is to set up the customer to realize the full value of your product, thereby retaining customers while also expanding business within the account, or getting referrals from your happy customers.
What is Event Tracking Useful For?
To better understand user behavior specifically for your website and overall business
Customer Acquisition Cost (CAC)
Total marketing costs over a period of time/ Total amount of new customers in that same time period.
What are common costs of onboarding?
Training and data migration, as well as any upfront expense or capex outlay (net of what is billed back to the customer)
Cost of Goods (SaaS)
Unavoidable costs - hosting, customer support, third party license agreements, data fees, etc. Rainmaker gross margins averaged 77% - accounting for direct costs such as personnel, professional fees/support, software, travel, and marketing
Twitter Engagement Metrics
Understand which tweets are most effective in your campaigns. Formula: Twitter engagement = retweets + favorites + mentions + replies - Favorites: The number of people who click the favorite button under your tweet. - Retweets: The number of people who click the retweet button under your tweet. These are then visible on that user's timeline increasing the reach of your tweet. - Mention: When a user adds your Twitter handle in their tweets it will show on their timelines and you will be notified. You can communicate with users through mentions Success Indicators: - An increase in overall engagement - An increase in website visits from Twitter Best Practices: 1. Understand what your audience wants to see in their stream. 2. Select compelling imgaes to accompany your Tweet. GIFs also perform well, so it can be worth your while to work with your design team to create some GIFs to accompany Tweets. 3. Refine your copy over and over again. 4. Double down on content that works. Tweets and content that perform get published over and over again. 5. Show a little personality in your copy.
A design which is ____________ clarifies the product's structure. Better still, it can make the product talk. At best, it is self-explanatory.
Understandable
What Metrics will you see for Total Events
Unique events Event Average value
4 Decline Strategies
Withdraw/divest, harvest, niche, market leadership
Preisbündelung
Zusammenstellung von Produkten und die damit verbundene Preissetzung Arten: Reine Bündelung: Verkauf von Produkten in Bündeln (Kfz + Sonderaus.) Gemischte Bündelung: Auch einzelner Verkauf von Produkten (Smartphone und einzelner Vertrag) Entbündelung: Produkte nur einzeln angeboten
Nichtlineare Preisbildung
Zwischen Preis und Leistung gibt es keinen proportionalen Zusammenhang Nichtlineare Preisbildung basiert auf Absatzmenge und der Selbstselektion der Nachfrager. Anbieter gibt nur Tarifstruktur vor. Nachfrager verteilen sich auf Segmente. Ziel: Gewinnsteigerung durch Abschöpfen der unterschiedlichen Zahlungsbereitschaften Beispiele: Mengenrabatte, Buy three, get one free, Blocktarife, Pauschalpreise
Net burn
[revenues (including all incoming cash you have a high probability of receiving) - gross burn] is the true measure of amount of cash your company is burning every month. Investors tend to focus on net burn to understand how long the money you have left in the bank will last for you to run the company. They will also take into account the rate at which your revenues and expenses grow as monthly burn may not be a constant number.
evolve
vystytis
For market entry and exit:
Market size and marketing growth should be measured
Design the system for digital offer system for one channel then asked me what I will do to launch digital offers in another channel.
After identifying the data required for app, I would see if there were any available data stores that could be used and identify new stores that we'd need to build. Then I'd find out if any of existing data stores talk to one another (why?) Then I'd build a service layer that would orchestrate the data and do calculations required to present the right data to the user interface. This layer would be built with a service oriented architecture because that allows for faster enhancements and releases to a service. Would leverage a deployment automation tool like Artemis PAR to do 1 click deployments, reduce manual testing and enable deployments without days of lead time. Build UI in components such that each feature is independently modified and released Security? Entitlements engine and proxy service
What is the primary function of LTV?
After repaying the fully burdened cost to acquire a customer and any variable recurring costs required to support the customer, LTV goes towards paying off the remaining fixed costs in the business - where significant operating leverage can be found with scale
Which of the following are examples of "Conversions":
All of these
Which research method(s) can be used to measure the impact of your online presence on your offline channels?
All of these
Companies find it hard to measure the value of their social media marketing efforts because:
All of these options
Which of the following must be performed before you can actually analyze data?
All of these options
If you wanted to measure the number of re-shares or re-tweets on a post, you would be measuring the:
Amplification rate
Product/Market Fit
An experimentation process of finding customers in a target market with a problem that your product can address for a price (or total cost of ownership) well below the level of value that's provided in exchange. A broader but related concept, company/market fit, combines pain-product fit and customer-message fit ideas.
Lead
An individual or organization with an interest in what a business is selling. The interest is expressed by sharing contact information, like an email address, phone number or data that will enable the business to continue contacting them.
Personalized Customer Experience
An ongoing process of designing and delivering targeted messages and experiences that create meaningful customer engagements.
STEPPS
Analysis of things that go viral: Social Currency Triggers Emotion Public Practical Value Stories
Customer Lifetime Value (LTV)
As the name suggests, it is the estimated value generated by a customer over their lifetime, before they churn. It is the amount of net profit (revenue in some companies) that you can generate from a customer over his lifetime. You get this value by multiplying the average profit per month from a customer with the average lifetime of a customer in months.
What is the biggest challenge in measuring CUSTOMER PROFITABILITY?
Assigning costs to customers -- can use activity-based costing Easy to determine customers' revenue
TCP/IP Data Flow
Computer -> Application Layer (HTTP) -> Transport Layer (TCP) -> Network Layer (IP) -> Data Link Layer Ethernet
Acquisition cost per customer per channel
Cost per click divided by total conversion rate
Customer Success and Customer Care Metrics
Customer Churn and Churn Rate Customer Onboarding Costs Net Promoter Score (NPS) Advocacy (Viral Coefficient) connected to the NPS Customer Effort Score (CES) Net Easy Score Customer Engagement
% Renewal Rate (Customers)
Definition; It can be confusing to look at both your renewal rate (which should be just 1- Churn) in addition to churn. However in a model where you have yearly contracts being renewed, the two numbers can actually be different. For example, in the early days of a startup, you might have low churn because many of your customers have not yet reached the point where they could drop your service because of the length of their contract. In that situation, your churn number will not accurately predict what is really going to happen when you reach steady state. So a better number to look at is how many of your customers are renewing at the point where their contract expires. That is what this number measures. When you reach steady state, this number should be equal to 1 - % Customer Churn.
Trends
Disintermediation, Integration/Vertical brands, Retailers creating brands, Brands becoming retailers, Omni-Channel distribution, Online to offline (O2O)
United States Facts
Life Expectancy: 80 Years People/Household: 2.5 Median Household Income: 53K GDP: 16.8T % Smart Phone Penetration: 70% % Bachelors Degree: 30% % Married Adults: 52% % < 18: 23% % > 65: 13%
Funnel Metrics
Explanation: The metrics that matter for each sales funnel, vary from one company to the next depending on the steps involved in the funnel. However there is a common way to measure each step, and the overall funnel, regardless of your sales process. That involves measuring two things for each step: the number of leads that went into the top of that step, and the conversion rate to the next step in the funnel (see below). In the diagram above, (mirrored in the dashboard), we show a very simple three phase sales process, with visitors coming to a web site, and some portion of them signing up for a trial. Then some of the trials convert to purchases. As you can see in the dashboard, we will want to track the number of visitors, trials and closed deals. Our goal should be to increase those numbers over time. And we will also want to track the conversion rates, with the goal of improving those over time. Another key value of having these conversion rates is the ability to understand the implications of future forecasts. For example, lets say your company wants to do $4m in the next quarter. You can work backwards to figure out how many demos/trials that means, and given the sales productivity numbers - how many salespeople are required, and going back a stage earlier, how many leads are going to be required. These are crucial planning numbers that can change staffing levels, marketing program spend levels, etc.
Cohort Analysis (Customer)
Explanation: There are two ways to run Cohort Analysis: the first looks at the number of customers, and the second looks at the Revenue. Each teaches us something different and valuable. The example graph below simply looks at the number of customers in each cohort over time.
T or F: Innovation is just fixing mistakes and errors in products and services. T or F: Innovation Metrics should measure levels of breakthrough products, next-generation products, *major enhancements, minor enhancements* and corrections.
False TRUE
Big Picture Framework
For questions about marketing campaigns: - Goals: state overall business objectives and intermediate marketing objectives - Segmentation: group buyers by attributes to identify those who would benefit - Targeting: choose segments that would appreciate the product - Positioning: create a product image for the segment - Product: develop new product ideas using the CIRCLES method - Place: choose the distribution channel that best meets the business goals - Promotion: match promotional tactics with your strategies - Price: use breakeven analysis for existing products and the pricing meter for new products
Prospect (user) onboarding
How a prospect moves through initial signup, experiences initial value, and reaches PQL status. It is designed to help users become familiar with the product and realize initial value as soon as possible.
New Followers
How many social media followers are your campaigns attracting? Formula: # of new followers, # of referrals, # of mentions Best Practices: - Reacting to changes in follower growth in 3 different scenarios: 1. Your follower growth may repeat itself in the last few months, which is good. Your process only requires a change if you believe there is significant room for improvement 2. Your content follower growth may exceed your past follower growth. In this case, you need to analyze your social media posts carefully and figure out what went right. If you understand the reasons behind the growth improvement, you should be able to sustain it. 3. Finally, your follower growth may be very low or significantly worse than in previous months. 4. Guest blog. Not only can guest blogging be a great way to get your company exposure, but it can also increase your social media impact. 5. Add Facebook and Twitter Widgets to your website. This allows users to Like a page without ever having to access Facebook and search for you. There are also sharing functions available on many sites, with the option to Like or Tweet specific pages. 6. Follow and follow back. Following back adds a personal touch, no matter how popular you are on Twitter. It shows that you noticed someone followed you and took the time to follow them back.
HEART
How to choose right UX metrics for your product. You might want to consider the HEART framework designed by Kerry Rodden, Hilary Hutchinson and Xin Fu, from Google's research team. Happiness Engagement Adoption Retention Task Success
Under what condition would bookings equal the change in deferred revenue for a given period?
If all of the contract value was paid upfront; if only partial was paid upfront then bookings would exceed deferred revenue
Email Marketing Statistics
Metrics to gain insight into your email marketing campaigns. - Campaign Performance: This metric is a great way to evaluate the effectiveness of an email campaign and whether to improve on the email and landing pages related to it, to build similar email campaigns, or to discontinue the campaign all together. - Delivery and Engagement Statistics Metric: This metric gives digital marketers high level data on their email campaigns. The metric displays valuable campaign insight like the number of leads who received the email, the number of leads that opened the email, and how those who opened the email are interacting with the content. - Opens by Country: The Opens by Country metric helps you understand which countries bring in the highest open rates for your email campaigns.
Social Events
Monitor events on your social stream to nurture engagement and grow your audience. Formula: # of social events - Social Events: Interactions that indicate your audience is engaging with your brand on a specific platform - Referral Traffic: People that visit your site by clicking on a URL on another website, such as a social media post. - Conversions/goals: A marketing objective for your audience to complete, such as subscribing to a mailing list. Success Indicators: - A high number of quality interactions Best Practices: - Get everyone on the same page. - The number of followers or likes does not equal success. Formula: Landing Pages + Goals + Advanced Segments (Social Source) = Value - Leverage your referrals. Formula: Referrals + Goals = Opportunity - Pair social media with other channels
Monthly Recurring Revenue (MRR)
Monthly Recurring Revenue or MRR means the revenue your product gets from the customers every month. It should include both New MRR and Add-on MRR. New MRR helps you get an idea of the revenue generated through new customers every month and Add-on MRR measures the revenue generated through add-ons such as additional product purchases. Add-on MRR is a good indicator of whether your customers find your product useful or not and if they are willing to increase their engagement with the product by investing more in it.
Facebook Growth KPI
Social Followers vs Target Formula: # of current followers compared to target for month/year Best Practices: - Identify your goals and objectives. Know what you are going for before you start posting. Ensure you know how each platform works, what audiences you can reach where, and what your objectives are - Let them know you are human. - Include your icons on your website. Make sure your social media icons are on all your website pages. - Treat each social network as an individual one. - Make use of paid ads on Facebook, Twitter and other social networks. You can get pretty granular with the ad targeting to ensure you're reaching the right people. His advice is to experiment with paid ads and see what type of results you get, as this strategy works for some companies more than others, largely depending on the product/service offered
Deferred Revenue
The "booking" or revenue that has not yet been recognized (because the service has not yet been provided) on the balance sheet. As service is provided, deferred revenue decreases and revenue increases.
MRR (monthly recurring revenue)
The Monthly Recurring Revenue at the end of each month. Computed by taking the MRR from the previous month and adding Net New MRR. Common mistakes with this method include: (1) counting non-recurring fees such as hardware, setup, installation, professional services/ consulting agreements; (2) counting bookings
What is MRR? Is it GAAP? What is it used for in the context of SaaS?
The Monthly Recurring Revenue at the end of each month. Computed by taking the MRR from the previous month and adding Net New MRR; not GAAP; useful in identifying momentum as a subscription business
Social Visits and Leads
The effectiveness of social campaigns at driving visitors and leads to your website. - Leads: New prospects generated by a marketing campaign - Wins: New customers generated by a marketing campaign Success Indicators: - A high number of leads and visitors from a social media campaign - A high visit to lead conversion rate from social media visitors Best Practices: - While it's arguably the most important metric to use when measuring social media marketing ROI, it doesn't usually apply for many situations and brands. Review your social media goals, your business and customer acquisition process to see if this calculation makes sense for you. Then take another look at the traffic you're generating from social media sites. Of that traffic, how many of those website and blog visitors are converting into leads? Now take that leads data one step further. Are your social media leads actually turning into customers? How many? - Once customers landed on your site, the following questions come into a play: 1. Is your content helpful, relevant to why they clicked the social media link, and of high enough quality that the visitor might want to see more, either on that visit or in the future? 2. Do you have appropriate, well-tested and optimized opportunities for the visitor to convert in whatever way fits your goals? - You can track revenue in different ways, depending on your business model. For B2B companies, you may label a lead as a person who has downloaded an ebook and completed a form in exchange for content. With a B2C company, you may track users who have perused or purchased on your ecommerce website, or someone who signed up for your company newsletter, and label them customers.
Social Traffic and Conversions
The effectiveness of social media campaigns at generating website traffic and goal conversions. Formula: # of Referrals / # of Conversions - Referral Traffic: Visitors that visit your site by clicking on a URL on another website - Conversions/goals: A marketing objective for your audience to complete, such as subscribing to a mailing list - Conversion rate: The number of web visitors divided by the number of goals completed Success Indicators: - A high GCR coupled with high traffic from key social media platforms Best Practices: - A decrease or an increase in post activity - Use high conversion keywords - Use a social media friendly website structure: 1. Enable Twitter Cards 2. Use Facebook OpenGraph 3. Add Social Media Sharing Widget
Core User Properties
Top of Mind: come directly, not because of reminder or google search...etc Recurring: do they come back again and again? Referring: do they share with others?
What is ratio of a dedicated HR employee to regular employees as a company scales?
- 1-49 employees: you can probably make do with software and outsourcing (although I think an office manager who can also do HR is the key here) - 50-100 employees; you should have 1 HR person or at minimum the OM/HR person - 150+ - it's time to hire a 2nd HR person
Joseph Turrow
"Breaking up America;" lost shared consumer experience
Netflix Retention
"Netflix has now captured 52% of US broadband households, and in the last year, only 9% of its subscriber base has canceled."
Market Size Question Solving Steps
# of people in population * % target customers * purchase frequency * quantity purchased * price per unit
Click through rate (CTR)
# of users who clicked an ad divided by # of times the ad was delivered (the impressions). measures the percentage of people who clicked on an ad to arrive at a destination-site. Hey
Average Cost-per-thousand-impressions for iOS Banners
$0.20-$2.00
Global Average Annual E-Commerce Revenue per User
$1,189
CPM Video Ad
$12.80
Cloud Infrastructure Spending
$36B
Google's market cap
$380B
USA Total Online Sales
$390B
US median household income
$53,000
US Median Household Income
$53K
Traditional Data Center Infrastructure Spending
$60 billion
How does a SaaS company achieve negative churn?
(1) Expand revenue from your current product (i.e. charge more for more usage) (2) Cross-sell existing customers new products (3) Up-sell customers by convincing them to buy higher quality versions of products
What are the advantages of getting paid upfront in SaaS?
(1) Helps with the cash flow problem associated with heavy S&M investment required to drive bookings (2) Helps lower churn by requiring more upfront investment from customers, thus they'll more likely take the effort to get the product up and running
How to slice bookings to make the most sense of it?
(1) What happened with new customers (new MRR/ACV) (2) What happened with your installed base (renewals, churn, expansion)
San Francisco population
800,000
San Francisco Population
806K
QQ Number of Users
899M
HBO NOW Paid Subscriber Base
8M
NYC population
8M
Hours in a year
9,000
What is the 'Attribute Method'?
A brainstorming framework. List all the product attributes. Mix and match to get interesting new combinations.
What is the "Rule of 40"?
A formula for looking at viability of startups which is that your growth rate combined with your profit should add up to 40% For most startups that are burning capital, your growth rate needs to be high enough to compensate for that burn. If your profit margins are -10%, your growth rate should be at 50%.
billings
A good proxy to measure the growth — and ultimately the health — of a SaaS company calculated by taking the revenue in one quarter and adding the change in deferred revenue from the prior quarter to the current quarter If a SaaS company is growing its bookings (whether through new business or upsells/renewals to existing customers), billings will increase.
What is CAC multiple?
A measure of how much it costs to acquire a new customer, factoring in new customers acquired
Critical Path Method
A method used to estimate the minimum project duration and determine the amount of scheduling flexibility on the logical network paths within the schedule model.
Keyword Opportunity
Analyze how you can improve your search rankings.
Month on Month (MoM) Growth/Compounded Monthly Growth Rates (CMGR)
CMGR = (Latest Month/ First Month)^(1/# of Months)
BCG Matrix
Cash Cow -generates more cash than is needed to maintain market share so excess should be reinvested Dogs -are worthless, low market share and low growth - only value in liquidation Question Marks -are high growth, low market share -require far more cash than they can generate -become Dogs when the growth stops -liability Stars -are high market share, high growth -always generates profits -becomes Cash Cow all products become Cows or Dogs -all dependant on obtaining a leader share of market before growth slows Balanced Portfolio has: Stars - high share and high growth assure future Cash Cows - supply funds for growth Question Marks - can be converted to stars w/added funds
Cohort Analysis
Cohort analysis is not a specific churn metric, but is the measurement of the gross or net churn of a specific group or "cohort" of customers over time. Most often, the cohort is defined by the date the customer was acquired. For example there might be a "November 2012" cohort of customers, and a "June 2012" cohort of customers. The company can compare the attrition rates of the two groups at their respective 6, 12, and 18-month intervals and so on. Cohort analysis can provide insight into customer success and onboarding programs. It can also help the company understand if it is trending toward acquiring customers who are more, or less, likely to churn. Cohorts are also frequently refined based on customer size, or type, to add further clarity to their fundamental churn characteristics.
Customer Success Metrics: Customer churn rate MRR retention rate Customer retention rate Net MRR churn rate
Customer churn rate = Churned customers in period / Total customers at start of period MRR retention rate = MRR renewed subscriptions / MRR subscriptions up for renewal Customer retention rate = # of renewed customers / # of contracts up for renewal Net MRR churn rate = (Sum of churn & contraction MRR - Sum Expansion & Reactivation MRR) / MRR beginning of period
CUSTOMER METRICS What are the 2 important metrics for understanding the values of customers? _____ = measures the long-term value of each customer. _____ = emphasizes customers' contribution to overall company profits. ____ = informs companies about how much a customer is worth to them
Customer lifetime value Customer profit Customer lifetime value Customer profit Customer lifetime value
_____ is the amount of value a customer contributes to your business over their lifetime - which starts with a new customer's first purchase/contract and ends with the "moment of churn."
Customer lifetime value (CLV)
____ is the profit the firm makes from serving a customer or customer group over a specified period of time.
Customer profitability The difference between the revenues earned from and the cost associated with the customer relationship in a specified period.
Aspects of Effective Customer Experience
Customer: thoughts, feelings/emotions, psychological processes (memory, belief, attitude formation), senses (smell, sound, touch, taste), actions
If you were Google's CEO, would you be concerned about Microsoft?
Customers Company Competition The point is to understand purchase behavior as a cycle wherein the customer must first be aware of your product, then they have to evaluate it against their needs and competitors' offerings, and then they finally purchase it. After the purchase decision, the customer relationship continues and your company should likely work to foster a strong relationship."
% MRR Expansion
Definition: Defined as the expansion revenue from existing customers as a percentage of total revenue.
Human Centered Design
Design consistency in terms of font, images, buttons, links, etc is key in building and leveraging existing familiarity for the user Use buttons over links to persuade the user to take action Reduce the amount of text so that the user is not fatigued by text on screen; too much text could cause the user to leave the app Use images to quickly communicate context to the user Provide feedback to the user that the actions taken were successful or failed Visual hierarchy: present things in order of importance by color, placement, size, etc
Domain Authority (DA)
Determine the effectiveness of your link-building efforts by measuring the "trust" factor of the whole of your domain. Benchmark: - Sites with a lower DA than their competitors rank higher, averages can also be skewed by self hosted web 2.0's like wordpress blogs that have DAs of 100. - Minimum DA score for a blog to consider guest posting Best Practices: - At the basic level, the most important things to do to improve domain authority are: 1) get rid of bad links and 2) gain good links - Engage the services of an SEO agency that has relationships with websites and writers who can secure high-quality legitimate backlinks. This is a good option, but it is expensive and has risks. - Create a site with high value information that elicits links by virtue of its awesomeness. That, my friends, is content marketing. - The best way to influence this metric is to improve your overall SEO. In particular, you should focus on your link profile - which influences MozRank and MozTrust - by getting more links from other well-linked-to pages.
Facebook Ads Today's Summary
Drill down into today's campaign metrics and monitor your Facebook Ads objectives. - Spend: The total spent on your campaign thus far. The term 'spent today' however means the amount spend on your ad set since 12am today. If you set a daily budget for an ad set, you'll see your progress towards the budget in the later term - Cost per unique click: The total number of unique people who have clicked on your ad. Cost is calculated based on each unique person, not per click. Ex: if 3 people click on the same ad 5 times, it will count as 3 unique clicks. - CPM: Cost per 1,000 impressions. The average cost you've paid to have 1,000 impressions on your ad. - CTR: Click-through rate for all clicks. The total number of clicks you received (ex: offsite clicks, likes, event responses) divided by the number of impressions.
Dwell Time
Dwell Time is the amount of time a user spends in a single session on average. Dwell time can indicate how engaging your content or product is. Digging deeper into this metric can help find many anomalies.
Customer Pros of SaaS
Easier and Cheaper to Use the Software - No upfront license fees or infrastructure costs to house a datacenter on customer's premise Faster Time to Using 'Live' Software - Customer does not need to build or modify the software solution or supporting infrastructure and can go 'live' faster Free Up Resources While Getting Latest Software - Product updates are performed by the vendor, enabling customers
Why are you leaving current job
Got very good offer for acquisition, went traveling, have done side projects and learned a lot. But really want to sink my teeth into something long term. Want to have an impact, product manager position seems like way to be entrepreneurial, but have access to distribution.
What is the general response structure you should use for Product Design cases?
Here's how I would think about improving Google Maps. - First, I'd like to understand the goals and constraints. - Then, I'd explore the user and their use cases. - Next, I'd prioritize the use cases and focus on brainstorming solutions for the most urgent use case.
What is a more in-depth, and potentially more accurate way of looking at tCAC?
Including variable costs of customer acquisition, as well as the costs of onboarding
You run a blog about web analytics and you want to conduct a competitive intelligence analysis in which Avinash Kaushik's www.kaushik.net (Links to an external site.)Links to an external site. blog is one of your competitors. Based on the paragraph below, taken from Avinash Kaushik's blog post you read this week, why might the data describing the volume of traffic to www.kaushik.net (Links to an external site.)Links to an external site. not be a representative measurement? "As Edward Snowden and the NSA/CIA/MI6/GCHQ documents releases have shown, there are many kinds of competitive intelligence in the world. Our interest here is not that type of intelligence. [Note to NSA reviewer of this blog post: I'm a harmless digital marketer, totally not worth your attention.]"
Internet searches for "Edward Snowden" may have driven the wrong kind of traffic to www.kaushik.net.
Growth Metrics Timing Basis
Investors like to look at monthly GMV, monthly revenue, or new users/customers per month to assess the growth in early stage businesses. Quarterly charts can be used for later-stage businesses or businesses with a lot of month-to-month volatility in metrics.
Value
Is an optional numerical value like the amount of time it takes a video to load or how much a specific event action is worth You can use value to assign a specific dollar amount when a specific action occurs
Label
Is an optional value used to further describe the element you're tracking like the name of a video
ARR per customer
Is this flat or growing? If you are upselling or cross-selling your customers, then it should be growing, which is a positive indicator for a healthy business.
CAC Medians in SaaS in 2018... - New Customer, Cross-Sell, Expansion, and Blended...
New Customer - $1.32 Cross-Sell - .71 Expansion - .38 Blended - 1.11
LTV
Lifetime value is the present value of the future net profit from the customer over the duration of the relationship.
30 Day Active Users
Metric ga:30dayUsers UI Name: 30 Day Active Users Total number of 30-day active users for each day in the requested time period. At least one of ga:nthDay, ga:date, or ga:day must be specified as a dimension to query this metric. For a given date, the returned value will be the total number of unique users for the 30-day period ending on the given date.
Number of Sessions per User
Metric ga:sessionsPerUser UI Name: Number of Sessions per User The total number of sessions divided by the total number of users.
Users
Metric ga:users UI Name: Users The total number of users for the requested time period.
Burn Rate
Monthly cash burn = cash balance at the beginning of the year minus cash balance end of the year / 12
Revenue Metrics: MRR, ARR, ARPU, ASP
Monthly recurring revenue (MRR) Annual recurring revenue: MRR x 12 Avg revenue per account: MRR / Customer Count Avg selling price: New bus. MRR in period / # new customers in period
MOSCOW
Must Have Should Have Could Have Would Have
Total Contract Value (TCV)
Projection of booking revenue and DOES include one-time charges, service fees and recurring charges. Often implies a multi-year contract.
Annual Contract Value (ACV)
Projection that measures the value of a contract over one year. Consider the size of the ACV and whether it's growing (or shrinking). If it is growing, then product must be of higher value to customers (so they are willing to pay more for it).
Definition Customer Experience Management
Prozess des strategischen Managements alle Erlebnisse des Kunden mit einer Marke an sämtlichen Touchpoints des Unternehmens zum Kunden
What was the average Annual Contract Value for the fastest-growing enterprise software/SaaS companies in their first year or two of operations?
Rapidly growing SaaS companies have a bi-modal distribution of ACV, at $300-$400 (eg Zendesk) and $10K (eg Marketo). As far as the first year or two of operations -- the data above is mostly for current state (ie, later years). But if Year 2 = AFTER product/market fit, I would assume the ACV doesn't change dramatically in later years. This is because while you'll go up-market and maybe get bigger accounts, your CAC will go up as you plow marginally less fertile land.
When creating a digital dashboard, you should try to pack in as much data as possible.
false
Retention vs. Renwal Rates
Retention rates account for all customer contracts, whereas Renewal rates only account for contracts up for renewal
What is Return on Total Customer Acquisition Spending (rCAC - aka LTV : CAC)?
Return on Total Customer Acquisition Spending is the multiple of acquisition cost provided by a customer's lifetime gross profit
_____ = revenue from marketing multiplied by the contribution margin divided by marketing spending
Return on marketing investment
Monthly Recurring Revenue (MRR)
Revenue earned in one month. When calculating ARR from MRR, be sure not to 1) include one-time fees and 2) counting bookings rather than revenue although some prefer to include bookings in MRR/ARR
Revenue
Revenue is amount of money that can be recognized according to accounting policy. Even if it is paid for upfront, usually subscription revenue can only be recognized ratably over time as the service is delivered. If more money has been paid than can be recognized, the difference goes into a balance sheet item called Deferred Revenue.
Provide 5-7 examples of Monetization metrics
Revenue per customer Lapsed customers (inactive users) purchaes per (year, month, week) revenue per click cost of sale( ad spend/ revenue) Customer Lifetime value Cost of shipping % of paid users Deal size renewal rate monthly recurring revenue revenue per lead
Payback Period
Sales and Marketing Expenses for period Q2 / ([Gross Margin Q2 - Gross MarginQ1] - this is on quarterly basis, * 4 to get annual and / 12 to get months is basically inverted Inverted CAC Ratio (Payback Period) The inverted CAC ratio tells us how many years it will take to recover initial investment in sales and marketing for a given month. Best SaaS businesses are able to recover their CAC in 5-7 months (<12) or half a year
Myths of SaaS
The cost-advantage is only in the short-term; long-term, SaaS is more expensive - TCO analysis favors SaaS in the short term and people may argue benefits stop here - however, time value of money is important and SaaS keeps cash in the hands of the customer longer, freeing it to be used for other critical operations that can benefit them in the long run Security is a concern with a SaaS application - many customers worry that with all their data under one roof and commingled with other companies data it is at risk - this view is outdated, The top SaaS providers undergo regular security audits, have advanced biometric controls and have a security team monitoring 24x7. Security measures employed by mission-critical SaaS providers are usually for more advanced than those used by Fortune 100 companies.
Moment of Joy
The time when a prospect feels the value in the product. Similar to the Moment of Truth; especially popular in the gaming industry. Successful product-led conversion connects moments of joy with recognition and rewards when a user performs a desired action.
Valued (Golden) Features
These help companies understand which product capabilities deliver customer value and fill the Value Gap. The idea also provides a mechanism to know which customers receive value from product features, and which customers are not engaged at key stages in their lifecycle.
MRR Formula
Total MRR = MRR Per Customer x Number of New Customers
Gross Merchandise Volume (GMV)
Total sales dollar volume of product transacting within marketplace at a specific time. Useful in measuring the size of marketplace and provides a "current run rate" based off of last period of time measured.
What do in spare time
Triathlons, mtb, coding classes, freelance projects web design
M*M
Trillion
SCAMPER
Used to brainstorm ideas - Substitute - Combine - Adapt - Modify - Put to other uses - Eliminate - Rearrange
MOB
Used to rate product advertising effectiveness - Memorable - Oh, Product - Benefit
What is an effective way to describe a customer's wants/needs?
User Stories "As a <role/persona>, I want <goal/desire> so that <benefit>."
Preferred Timespan for LTV
if you have only few months of data, the conservative way to measure LTV is to look at historical value to date. Rather than predicting average life span and estimating how the retention curves might look, we prefer to measure 12 month and 24 month LTV.
When selecting an ISP-based competitive intelligence tool, you should look for the one that uses the _______ sample size because you want to avoid ______.
largest ; bias
determine
nustatyti
aligning marketing with journey
o from focusing brand advertising on the initial-consideration phase to developing Internet properties that help consumers gain a better understanding of the brand when they actively evaluate it o may need to retool their loyalty programs by focusing on active rather than passive loyalists or to spend money on in-store activities or word-of-mouth programs Four kinds of activities can help marketers address the new realities of the consumer decision journey: 1) Prioritize objectives and spending - to be more specific about touch points used 2) Tailor messaging - win part of the journey with greatest revenue oppt. 3) Invest in consumer-driven marketing - internet, buying properties attracting customers (websites, WOM programs, customized advertising) 4) Win the in-store battle - important selling factors of packaging, customers influenced by visual dimension (e.g. favourable shelf position)
Oscar Micheaux
one of the most successful early black filmmakers
loyalty
ongoing relationship starts here
Downgrade
opposite of the expansion metric which takes into account the effectiveness of renewals and upsell carried out by sales and customer success
Measuring hits has largely been abandoned because
pages composed of many small files generated numerous hits per pageview going an overly positive view of consumer activity
enough
pakankamai
abandoning
palikti, atsisakyti
Retention rate
percentage of customers who remain loyal over time
Site Time
the amount of time a customer spends on a site (e.g., important for media providers).
Big data information value chain
the information flow within a big data system as a series of steps needed to generate value and useful insights form data (Curry, 2016) - Used as a decisions support tool to model chain of activities to deliver a valuable g/s - Made up of a series of subsystems each with inputs, transformation processes and outputs 1) Data 2) Information 3) Knowledge 4) Decisions 5) Actions
exit page
the last page of a visit
Net Retention
this number includes cross-sells, up-sells, organic growth within a customer account, and price increases. This is an important and broader metric which tells the story of what would happen to a SaaS business over time if it did not acquire any new customers. Growth in the installed base that completely offsets losses (a.k.a. Negative Churn) is a very powerful financial driver. Some high-performing SaaS businesses have "Net Retention" numbers in the 150% to 300% range. It is these outliers that demonstrate the usefulness of reporting both Net and Gross Churn, as cross-selling, up-selling, or individual customer organic revenue growth completely obscures any meaningful erosion in the customer base.
TCV (total contract value)
total value of the contract, and can be shorter or longer in duration. Make sure TCV also includes the value from one-time charges, professional service fees, and recurring charges.
Product Conversion Rate
transaction for any given product / number of website visits of a specific product
It is possible for a data set to have high accuracy but low precision.
true
activities of collectors
use RSS feeds -add tags to the content they find online -provide links to other resources on their blogs
Rich media interaction rate
used to assess the effectiveness of a single rich media advertisement in generating engagement from its viewers Represents an important way of tracking the success of internet advertising in that it monitors the fraction of impressions that generate interaction on the part of the viewer
What is the Action Parameter?
user initiated event, may have a category "videos" asso. with play action
positioning
using marketing mix to influence consumers' perceptions of products or brands
One of the main differences between A/B testing and multivariate testing is the number of ________ being tested.
variables
business outcomes
verslo rezultatai
consumption metric
views, impressions, sessions(visits for Google analytics), downloads
Since there can be some confusion around the difference between bookings, billings and revenue, here is a simple example to help clarify them: Imagine you signed a new contract with a customer with a one year term, specifying that you provide your service to them for $1,000 per month, with an upfront payment of six months:
• Your bookings would be $12,000 (the entire contract value) • You would bill $6,000 in the first month, then $1,000 per month from the seventh month onwards. • You would recognized $1,000 in revenue for each month of the contract. (This is dictated by GAAP accounting policy.) For the example above, the balance sheet and income statement impact of these items is as follows: • Bookings do not affect either the balance sheet or the income statement. • When you bill $6,000 in the first month, but can only recognize $1,000 in revenue (income statement), and the other $5,000 goes into deferred revenue on the balance sheet (a liability). • Each month thereafter until another $1,000 can be recognized as revenue (income statement), and that reduces the deferred revenue liability on the balance sheet.
