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CH 21 - Am I Good Enough? (Case Study (knowing cancellation number isn'…
CH 21 - Am I Good Enough?
Intro: find a baseline for the conversion rate. It's changeable based on times.
Case Study
knowing cancellation number isn't enough; you need to understand why people are abandoning your product or service.
Went out and found a benchmark for cancellation rate.
For established hosting companies, 2% is a best case scenario benchmark for cancellation rate per month.
This changes your perspective.
WP Engine built a healthy WordPress hosting business, but losing 24% of customers every year concerned its founders.
By asking around, the founder discovered that a 2% per month churn rate was normal - even good - for that industry
Knowing a good line in the sand allowed him to focus on other more important business objectives instead of trying to over optimize churn.
Pricing Metrics
當你收費的越貴，你賣得越少
找到利潤的最大值
注意！利潤不代表一切
出價越高，可能會失去市場
出價越低，消費者會對產品產生懷疑
Price is related to what your customers are prepared to pay!
Average Isn't Good Enough
What Is Good Enough?
Growth Rate
Focus on growth too soon is bad. We have seen how inherent virality - that's built into your product's use - is better than artificial virality you have added as an afterthought.
Premature scaling, such as firing up the paid engine before your are sticky, can exacerbate issues with product quality, cash flow, and user satisfaction.
While rapid growth can accelerate the discovery of product/market fit, it can just as easily destroy the startup if the timing isn't right.
Technology lifecycle adoption model: it takes a lot of work to move from early adopters to laggards as the product becomes more mainstream and the barriers to adoption fall.
Start-up goes through three distinct growth phases:
slow: where the organization is searching for a product and market to tackle
fast: where it has figured out how to make and sell it at scale
Slow again: it becomes a big company and encounters internal constraints or market saturation, and tries to overcome Porter's hole in the middle.
Number of Engaged Visitors
Engaged user的基準是什麼？
30% - 10% - 10%
每個月至少使用一次產品的使用者佔註冊的使用者的30%
每天使用產品的使用者佔註冊的使用者的10%
線上的活躍使用者的最大值為每天活躍使用者的10%
當滿足30% 10% 10%表示可以邁向下一個階段：Virality
Case Study
Socialight: Social platform
B2C -> B2B
有時候定價高是為了嚇阻客戶使用這個方案，用其他可能可以獲取更多利潤的方案
利潤不只是包含金錢，還有人事成本、服務成本等
制定產品價格應該是團隊的共同工作，不只是要參考競品，也需要測試顧客反應
Customer Acqusition Cost
Metrics
獲取客戶的成本 < 1/3客戶終身價值
Reason
CLV 可能算錯
Acqusition cost 可能算錯
借貸現金流
可即早驗證預設的 CAC 是否合理
Decide with your business model, target margin, investment to drive the margin
Virality
Metrics
新客戶數/既有客戶數 >1
Time
Segment
Artificial Viral(Dropbox) v.s. Inherent viral(Skype)
Mailing List Effectiveness
Metrics
Open rate 20-30%
Click through rate 5%
Tips
3pm
Few people check mail on weekends
new subscribers are more likely to click
Open rate are mainly useful for testing subject lines/different contact list for a single campaign
Uptime and Reliability (計算機或通信系統正常工作的總時長)
Metrics
Uptime 99.5%
Must keep user updated about outage
Site Engagement
Metrics
1 min per page (Landing < Non-landing)
Web Performance
Metrics
First-time visitor: < 5s
People will leave if loading time > 10s
Update!
2s