Starting with your questions from last time

In my previous newsletter, I talked about the “secret” weapon I’ve been using to improve my life continuously: a weekly Mastermind session with three very good friends of mine, where we learn and advise each other on various topics.

I’ve got a few replies with general comments about it, alongside some interesting questions from you (thanks for not allowing this edition to flop completely).

1) How did your group start, and how can I find the right people to create my own?

It all started with an invitation for my friend and ex-business partner, Yuri Moreno. He shared this article about “The Elephants,” a modern Mastermind group (an idea introduced by Napoleon Hill, the author of one of the most-sold books ever).

What’s important to say here, though, is that I already knew everyone from the group: Caio Mattos and Denis Andrade. I already respected them and had a good idea about what it was like being around them. So when Yuri told me they were on board, I already knew it’d be foolish of me not to give it a try.

If I were to create a new Mastermind today, I’ll sit down with myself and think of people that:

• I could learn a lot from more than one area
• Have at least one area of their life where they’re “ahead” of me: fitness, relationships, finances, work, or mindset-wise.
• Someone I’d trust with my money and my wife
• Someone I’d enjoy being around

After I put that list on paper, I’d ask those people if they’d like to create a Mastermind with you. If they say yes, then use the answer to the following question as a map to decide what to talk about.

2) How do you decide what to talk about? Do the meetings always have the same format?

We have two types of sessions: fixed commitments and discussions.

The fixed ones currently are:

• Reset reviews: every month, we share updates on goals and progress around: health, relationships, work, finances, and hobbies
• Book/Documentary Club: every ±6 weeks, we sit down to discuss what we just read or watched. Then every ±3 months, we vote on what we want to read or watch. From documentaries on plant-based diets and e-sports to the most interesting authors I got to know – like Seneca, Victor Frankl, and Franz Kafka – we try to pick reads that will open our minds to something new.
• Game nights: we fill the gaps with simple multiplayer games to wind off and talk shit. We started with Poker, and last week we played Unrailed for the first time (this game is really fun, btw!).

Then we have sessions where it’s all about learning new stuff. It can be something that one of us knows more than the others (I talked about Freud and Phenomenology once, for example), or we bring a guest to teach us something cool and different (let me know if you want to be one of them), or if one of us needs to share a deeply personal problem, then we also have a safe space to talk it through and help. Those are the sessions we bond, I think.

3) What about the other things? Like, are there any downsides to having such a group?

Great question. There are also problems involved, of course, although I wouldn’t necessarily label them as bad.

The hardest thing is keeping accountability and having everybody aligned as much as possible. To keep it simple, we created a spreadsheet with all the dates and the theme of each day – and then we put it on paper if someone misses a meeting.

We also created the rule that if just one of us can’t attend, the others will go on without that person. That’s to avoid a situation where one person spoils the commitment of the rest.

Then the other thing is that it’s natural that everybody will not be 100% committed all the time. Only some people will think that the topic for discussion is super interesting. So I guess it’s also about being thoughtful and transparent to each other and enduring when things aren’t going well.

—

So, that was it. I hope that is enough information for those who are considering creating something similar and inspiring others who miss being part of a group with like-minded people. If you have more questions, hit reply 🙂

This meme from Anna R. made me spill my coffee:

A brutal “sad but true” moment.

Btw: I plan to bring AI to Easy App Reports later this year. The idea is to provide actionable insights and optimization suggestions based on the data we bring from the app stores and other sources. The thing is that most companies don’t have the fundamentals in place to leverage AI for data analysis. So I see this as a big, juicy, business opportunity if you ask me.

A dope growth hack from a Portuguese fintech

When my partner and I incorporated Easy App Reports as RC5 Lda in Portugal, we got this remarkable letter from Coverflex just a few weeks after we started operating.

I’ve been following these guys on LinkedIn for a while now, as they seem to have a pretty exciting way to run Growth there. I found this letter a perfect example of how startups need to think outside the box and go offline (why not?) to get their customers:

A few components that I found interesting about it:

• Using bold text to highlight business problems and tease the customer
• A calculation of how much value they can create (who on earth wouldn’t want to save 1k euros per year per employee?)
• Clear call to action via the QR code and other links
• Social proof at the bottom

Way to go, guys 😉

How to Google Ads your app

Thomas Petit has the best Twitter account for app marketers out there. This week he went beyond and wrote this guide on how to run Google Ads campaigns for apps. A must-read if you’re getting into the weeds of UA.

📕 Books I’m reading

Love: How to rethink Marketing for Digital Products: I got this book as a gift from Patrick Goldsteen and I have already recommended it to at least five people since I started reading it. This is an excellent book for anyone considering moving into Product Marketing or if you’re a Product Manager who wants to know how to market your product better.

🛠️ Tools I’ve been using

My prayers were listened to: finally, someone solved the problem of dealing with multiple calendars and project management tools. Let me introduce you to Akiflow.

As an independent consultant and entrepreneur who struggles with focusing, it’s easy to get lost in all the different commitments I’m making with multiple people. With Akiflow, that’s no longer a problem. I’ve been using them for about two weeks now, and it’s been a total game-changer. Now I finally have clarity on what should I prioritize my tasks during the day, even if they’re spread in Jira, Notion projects, Trello, and email.

Use my referral link to get $10 in credits (I’ll also get $10). Akiflow is not sponsoring this newsletter, by the way.

💡 Quote I’m pondering

Someone power-hungry makes a new rule at your workplace. It’s unnecessary. It’s counterproductive. It’s an irritant. It removes some of the pleasure and meaning from your work. But you tell yourself it’s all right. It’s not worth complaining about. 

Then it happens again.

You’ve already trained yourself to allow such things by failing to react the first time. You’re a little less courageous. Your opponent, unopposed, is a little bit stronger. The institution is a little bit more corrupt. The process of bureaucratic stagnation and oppression is underway, and you’ve contributed by pretending that it was OK. Why not complain? Why not take a stand? If you do, other people, equally afraid to speak up, may come to your defence. And if not—maybe it’s time for a revolution. Maybe you should find a job somewhere else, where your soul is less in danger from corruption.

12 Rules for Life, Jordan B. Peterson

Taking contextual ads to the next level

I recently stayed at Novotel, and I noticed these ads from Calm at the front desk and elevators:

A few thoughts crossed my mind when I saw these:

“This is pretty cool! Looks like a win-win deal for everybody: the guests, Calm, and Novotel.”

“Is this an ad, or is this a partnership?”

“I wonder what the results are, though. Are they being able to measure this properly?”

Later at night, I found this article that explains the whole partnership.

In a world where everybody seems to be pushing for short-term results and cheap conversions, this felt like a breath of fresh air to me.

A Shortcut to Measuring Engagement

How to measure your product’s stickiness today without going hardcore on data crunching by using GA4 or Firebase:

Write down how often your customers need your product to do their thing: daily, weekly, monthly (quarterly or annually could also be an option, but it’s not covered on GA4). That’s your product’s “natural usage frequency”. There are fancy ways to calculate this. But, honestly? If you know your customer, you don’t need any of that (you can always ask your founder or customer support person – they’ll know for sure).

If it’s daily, then DAU (Daily Active Users) is your main metric. But, you can compare it to weekly to make it more insightful.

So, in this example, you should be looking at DAU/WAU.

The question it answers: from all the users we’ve had in the past week, how many interacted with our product in a single-day window? That’s it. That’s how you instantly know your product stickiness.

Here’s how to find that info: open your Google Analytics 4, click on Engagement, and scroll down. You’ll see your “User Stickiness” there. That’s what you’re looking for.

Now, look at the trend. You can instantly know if your engagement is flat, rising, or dropping. Cool, right? It could be better, but it’s better than just looking at daily visitors or MAU.

“I don’t get it. Looking at Monthly Active Users (MAU) is just as useful”

Not true. If your customers use your product daily or weekly, it’ll take 3-4 weeks to realize what’s going on, which can be quite dangerous for your business.

“What if my product has a quarterly/yearly usage?”

GA4/Firebase doesn’t offer this, primarily because the more inaccurate it gets as you stretch the time window. In this case, an in-house solution would be better, or you’d have to upgrade to a tool like amplitude.

“But on GA4, there’s a lot of visitors, not real customers. Their dashboard isn’t reliable.”

It’s a matter of configuring your GA properly. You can then filter for logged-in users only if that makes sense. There are better solutions. But, the reality is that most teams don’t have the BI support to extract this information, so it does come in handy.

Another option is always to learn a bit of SQL, but that’s a story for another day.

🛠 Tools I’m using
I’ve been playing around with Descript for a while now, and the more I use it, the more I want to use it. This shit is magic. It even works in Portuguese (it’s not as good, but it gets 85%+ of the words right).

At the moment, I’m using it to prepare a few shorts and interview drops for my YouTube channel:

📕 Books I’m reading

Anything you Want by Derek Sivers: If you want to hear a story of a guy who built a multi-million dollar business trying to make his business smaller, not bigger, and delivering value above everything else, this book is for you.

Derek is in my top 5 favorite non-fiction authors, and he once again crushed it with this book (I have no idea how I forgot to read it sooner). Just like the Calm ad, this book feels extremely refreshing, especially compared to all tales we’re bombarded with about trying to get rich fast and growing companies like crazy.

Here’s one of my favorite parts (Portuguese):

Quote of the week

Understand ethical wealth creation is possible. If you secretly despise wealth, it will elude you – The Almanack of Naval Ravikant: A Guide to Wealth and Happiness, by Eric Jorgenson

Resurfaced using Readwise

Extras

I usually don’t brag, but the content we’ve been putting out in the App Bakers newsletter is just lit. If you work with apps and you’re thirsty for high-quality content on how to grow an app, then I really recommend you subscribe now.

PT-BR: recentemente eu liberei as entrevistas todas do meu curso de App Store Optimization de graça no YouTube.

Commitment = Exposure

In Steven Pressfield’s book, “Put your ass where your heart wants to be,” he defines commitment as exposing yourself.

Funnily enough, sooner, on the same day, my wife and I were looking at our yearly income since 2012, and we noticed something.

During our first seven years together, we just “ate bush” – as we say in Brazil. But since 2020, our lives have gotten significantly better. So, looking at that, we did what any human being would do: we started to look for that critical moment that unlocked all of this. We were looking for the silver bullet.

Instead, we found that there wasn’t a single heroic act that changed everything. It was more like the seeds we planted suddenly started to blossom “out of the blue” after a few years of grinding.

And then, looking closely at how those seeds were planted, we noticed that it came with lots of exposure and real-life consequences. So, yes, Mr. Steven, I agree with you.

To make it tangible, I’m talking about things like going bankrupt twice in the same year. Or having to sleep in your aunt’s living room for a few months when you’re expecting your second kid. Having no vacation whatsoever for eight years straight. Happily accepting a demotion. Developing a chronic illness from overworking and living a sedentary lifestyle for years. Being crazy enough to quit a well-paying dream job with a fancy title for the uncertainty of being an independent consultant.

But each and every one of those things also provided a stepping stone or forced me to find a new path – and those would always be much better than the one I was in before.

Then, sometimes someone will come and ask how did I make it “Head of” in my twenties or how I’m able to ship so much stuff and grow my career so fast (by the way, I don’t feel like I’m successful yet or that productive. But I understand why it might look like that from other people’s point of view).

My usual response is that it is as much about the sacrifices you choose to make as it is about dedicating yourself to your life’s work. I’m talking about things like:

Investing in courses and training over traveling and leisure.

Working 60+ hour weeks over having a balanced life during a few months.

Attending work events over eating out with friends or simply being at home.

Embracing financial risk with the possibility of a jackpot over a nice stable job.

Commitment to your life’s work over commitment to building someone else’s dream.

So my follow-up question usually is: if you’re really committed to turning things around, what would you be willing to sacrifice?

And let me be clear here: I’m not advocating for anyone to follow in my footsteps. They were often reckless and unhealthy (I guess the word dumb could also be used to describe certain decisions I’ve made). I could’ve taken things slower. Likely there was an easier path, and now I see I didn’t have to sacrifice my health so much. Still, Amor Fati.

Measuring Growth on a B2B SaaS

In my head, I see Growth from the perspective of filling a leaky bucket:

• There’s how much water you put in
• There’s how much water you lose to leaks

The ratio between the two will determine how fast your bucket fills.

At Easy App Reports, we measure Growth by looking at the following:

• How many new subscribers weekly subscribers we get
• How many do we lose

Below is the graph I stare at during our weekly reviews. In one image, it tells me how are our acquisition and retention going and how fast the business is growing:

I also have a small table with Milestones right beside it. That’s because data without context is just not as helpful or actionable. Having our most significant wins and losses side-by-side with our main KPIs clarifies the things that move the needle.

Then, I use input metrics to visualize how much water is coming on the hose – and how much of that water is staying.

From the acquisition perspective, in our case, that’s traffic and product-led leads.

From the retention perspective, it’s all about activation rates (the percentage of new users who manage to set up and use the product for the first time within their first week). We know that because we were able to establish a correlation between users not being able to activate their connectors with their likeliness to churn within the first days after subscribing.

To wrap up:

• Overview (weekly)
  • New vs. Canceled Subscribers + Active Subscribers
  • Milestones and MRR (Monthly Recurring Revenue)
• Input Metrics (daily)
  • Acquisition: Traffic, Leads, and Conversion Rates
  • Retention: D7 Activation Rate

Having a look at these takes just a few seconds, and it provides me with everything I need to know about how the product is performing.

📕 Books I’m reading

1. My favorite quotes from one of the best books that most people won’t read, “Put your ass where your heart wants to be” by Steven Pressfield (BR):
   1. When I sit down to write in the morning, I literally have no expectations for myself or for the day’s work. My only goal is to put in three or four hours with my fingers punching the keys. I don’t judge myself on quality. I don’t hold myself accountable for quantity. The only questions I ask are: did I show up? Did I try my best?
   2. Are you “there”? Or are you somewhere else?
   3. Only when the pain of not doing it got greater than the imagined pain of doing it did I somehow find the balls to pursue what I really wanted and had been obsessed by.
   4. You can be a full-time writer, one hour a day.
   5. The ability to self-reinforce is more important than talent.
      
2. The Consulting Bible (PT-BR): let’s see what ChatGPT has to say about it:
   Yeap. That’s accurate.

🛠 Tools I’m using

Numi: the most beautiful and useful calculator you have ever used (probably). What I love about it is that I can label my numbers, making it super easy to share formulas and calculations with the people I work with. 10/10.

Using “show, don’t tell” for better reporting.

This has to be one of my favorite principles of all time because it’s so versatile.

Despite being useful when creating ads, writing content, and designing landing pages, I also discovered how powerful it could be when reporting to executives.

Here are a few examples of reports that raises more questions than answers:

• This year’s Cyber Monday campaign was a success, the best one we’ve ever had!
• Our open rate was 21%, which could be better. We’ll see what we can do to improve it, but it might be just seasonality, so I’m not that worried.
• We’ve got thousands of new TikTok followers this week because of the new video scripts we have been using this month.

Can you spot what’s wrong or missing in the above? They share one thing in common: they’re all based on telling people your opinion on what happened rather than showing the evidence behind it.

Here’s how it could be improved:

• Our Cyber Monday sales were 12% higher this year, leading to $3.2M in revenue (9% against last year). This was due to a higher conversion rate on our checkout page details on this report. Kudos to the team on this one!
• Our open rate last week was 21%, but our average is 25%. I have a couple of hypotheses on why this is happening and will get back to you by Friday with more details.
• Our new TikToks went from 5% to 11% engagement rate. In this analysis, you can see the spikes in followers within 36 hours of each post. Overall, we attracted 42,173 new followers, a 3x increase compared to last month’s period.

The formula is as follows: show numbers, not your judgment on the numbers; link additional studies if you have them; be ok with not having the answer; ask for more time or additional help.

The new kid on the block: Lensa

This week, we saw the rise of Lensa, a 4-year-old app that is now breaking the internet (and flooding everybody’s Instagram feeds) with its AI-generated “Magic Avatars.”

To this day, there are over 362,000 posts with the hashtag #lensa on Instagram:

But there’s something special and unique about this: unlike other growth loops we see out there, this one drives revenue directly, not just acquisition.

That’s because you must pay at least 3,49€ to get your avatars. Yeap, that’s right. People are actually paying to get on this trend. I don’t remember the last time I’ve seen anything like this.

I quickly drew what I believe is their main growth loop at the moment:

Lensa Growth Model

On top of that, their App Store rankings are also snowballing (driven by their number of downloads in a short period) – making their distribution even more powerful. Pretty cool stuff.

📕 Books I’m reading & Tools I’m using

The 48 Laws of Power (PT-BR): The author, Robert Greene, has studied power and its effects for many years and compiled all his knowledge into this book. The 48 Laws of Power is not just a dry, academic treatise on the nature of power. It is written in an easy-to-read style and full of examples from history, biography, and pop culture. Oh, and if you’re bothered by the idea of participating in games for power (or the simple idea of learning about it), maybe you’re exactly the kind of person who should read this book.

Synthesia – AI Video Creation Platform: I’m playing around with it, and I must say I’m impressed. I’m probably bringing an example to this newsletter once I have one to share. For now, I’d recommend exploring it by yourself.

Maybe you noticed I’ve been absent for the past couple of weeks. Sorry for that and thank you for sticking around. I’m a big advocate of consistency though so, naturally, I’m frustrated that stuff like this happens.

Anyway, I’m also thinking of solutions already because I know I’ll probably have more weeks like these. So soon you might notice I’ll change the format sometimes, making it more concise and powerful rather than long and detailed.

On a more positive note, it’s been a great couple of weeks with my speaking gig at App Growth Week, a work trip to the Netherlands, some traveling with the fam, and exciting plans for Easy App Reports.

But without further ado, let’s get into this week’s newsletter:

3 metrics to master your app’s subscriptions

If you’re used to looking at new subscriptions to measure your growth but can’t seem to understand the forces at play around it, this article is for you. Hell, I guess it’s probably even more helpful if you don’t have access to fancy dashboards or a data team to help you out every step of the way. All tips I’m giving here can be retrieved directly from Google Play or the App Store.

Anyway, I’ve worked with multiple app subscription businesses in the past eight years, and if there’s one thing I learned, it is how to take a holistic approach when diagnosing growth problems.

When understanding how to grow a product, you must look up and down the funnel to understand all variables to identify problems and opportunities. In the article below, I’ll go through some of the shortcuts to understand the levers involved – and maybe it’ll help you get a feeling of where your opportunities are.

Moving beyond Sales Conversions

The first thing you can do is have your cancelations alongside your new subscriptions: that’s the easiest way to level up your analytical game. By doing so, you can have a more holistic view of your subscription growth and understand if you should focus more on acquiring subscribers or on retaining them.

Extra tip: look at your install-to-subscription conversion rate to get a sense of how well your product can convert free customers into paying customers.

Ideally, we want it all, of course, but it’s crucial to have in mind where’s the biggest problem so we can put our eggs in the right basket.

Think about it: you’re building a recurring revenue business. Therefore, increasing the total amount of active subscribers is what you want – not only acquiring new paying customers.

The longer your customers stay subscribed, the more your revenue will grow. That revenue can then be reinvested in expanding your acquisition channels and improving your product.

So creating the habit of looking into cancelations as frequently as you look into acquisition is the easiest way to get used to looking at the whole picture.

If you’ve never seen this information before, here’s how to find it:

App Store: Apple makes it hard to extract this Information as it’s only available through their API. Luckily, Easy App Reports provides a connector so you can pull that information to Google Data Studio.

Google Play: Go to Monetize > Subscriptions > Overview – also available on Easy App Reports

Net Subscriptions

Building on cancelations, I see it’s helpful to look at “Net Subscriptions” too:

New Subscriptions – Canceled Subscriptions = Net Subscriptions

This will give you the ratio between your acquisition and churn, providing a shortcut to measure your Marketing and Product efficiency throughout your funnel. Cool, right? I look at this metric daily as it contains the most crucial information I need to know sales-wise.

One thing to watch out though: today’s subscriptions don’t drive the cancelations of today. It’s more likely that the cancelations you see today are actually caused by customers who subscribed weeks or months ago. So some people might say that it’d be unfair to run such a calculation. I admit they’re not entirely wrong.

If you’re an Excel pro, though, you can adjust that calculation based on the time lag between a subscription and a cancelation to get a better proxy.

For example: let’s say your users stay subscribed for nine weeks on average. What you could do to incorporate that into your formula is:

New Subscriptions (9 weeks ago) – Canceled Subscriptions (9 weeks ago) = Net Subscriptions

The disadvantage of this model is that it can take weeks or months to have this overview, making it a lagging metric. And we know what happens to lagging metrics: they’re ignored.

So I’d still advise you to run it the way I initially proposed and keep this shortcoming in mind.

Voluntary vs Involuntary Cancelations

I can’t emphasize enough how important it is to differentiate these two. Your reactivation tactics must be utterly different when approaching voluntary or involuntary churn.

Voluntary: your user made the decision to cancel and proactively did it.

Involuntary: the subscription was canceled automatically due to multiple failed payment attempts, or the payment method is now invalid.

80% of the results I get for my clients are driven by involuntary churn recovery. Here’s how to find that information:

App Store: Same problem: This information is only available through their API, which you can extract without coding using Easy App Reports.

Google Play: Go to Monetize > Subscriptions > Overview (also available on Easy App Reports)

How to approach it

Involuntary: follow up with your customers, offer help and provide simple instructions on how to reactivate their subscription. It’s a good idea to gently remind them of what they’re missing as well to increase the likelihood of getting that customer back.

Voluntary: These are people who made a conscious decision to walk away from your product. As a consequence, the chances of recovering such customers are tiny. Brian Balfour (ex VP of Growth from Hubspot and the founder of the world’s leading Growth program, Reforge) has a pretty solid case against trying to regain such customers – he even calls this a “Hail Mary resurrection.”, and it’s an opinion I share.

The best thing you can do here is to work backward from the reasons why your customer churned in the first place and improve your product to prevent it from happening again in the future. This leads us to our final metric:

Explore your “Cancelation Reasons” often.

I’m blown away by how many people don’t know this one. Marketers, Developers, Product Managers, and even Founders miss it. But not us. Right?

Google Play and the App Store provide high-level information on why your customers unsubscribe by running a survey. Yes, you heard me: you already know why your customers are churning. Now, you just have to take that information and act on it.

App Store: You know the drill: use Easy App Reports to extract your cancelation reasons.

Google Play: Go to Monetise > Subscriptions > Cancelations > Cancelations with written responses  – also available on Easy App Reports

Ok, now what?

Now that you have a better picture of what your app’s growth looks like, you can work backward to figure out what are the best initiatives you might want to do to grow your sales and revenue.

Is your churn growing? Maybe it’s time to invest in product development or tweak your traffic sources.

Is your acquisition going down? Time to do your best User Acquisition work out there.

Acquisition and Churn are the same? Pull one up and push down the other.

It’s a simple thing, and it’s underestimated at the same time. Often we get trapped in optimizing for something that we don’t understand why is behaving in that way. Hopefully, during this article, I was able to provide you with a few tools to crack the problem so you can be more successful with your app.

📕 What I’ve been reading

The S.W.I.P.E.S. Email: this newsletter is super fun to read and I always learn something new, even if I just scroll through it for half a minute. For me, it serves as a constant reminder that building visually appealing content is not always necessary.

The Manual: A Philosopher’s Guide to Life: I have a book club with a few friends and this is the one we’re currently reading. Lots of people make jokes that life doesn’t come with a manual, but maybe it’s because they didn’t read this book yet. I already read it a couple of times but I’m planning to read another one because there’s just so much powerful stuff in every line of this book.

How to write a one-pager: “Your colleagues are most likely building decks of 50-80 slides to present a strategic recommendation for executive approval. Decks of this size take the better part of a week to build, over an hour to present, and at least an hour for an executive to review before and after a presentation. Slides tend to be crammed with data and hard to understand without live voiceover. A one-page memo, on the other hand, is a simple, disciplined approach to getting alignment and buy-in for strategic initiatives that will move the needle for your business“. I rest my case.

If you’re new here, maybe you don’t know that I bought an app a couple of months ago.

Then I recorded myself creating its new text metadata (title, subtitle, keywords, promotional text, and description) in Brazilian Portuguese – obviously.

The video below was recorded at 5 am, and I wasn’t at home, so the quality isn’t great. Still, I think it’s a nice example of a non-scripted “quick and dirty” kind of optimization:

So on the 23rd of September, our first app release was approved by Apple.

The results were instant:

🔥 8.7x more impressions: 107 to 939 (per week)

🔥 8.2x more downloads: 5 to 41 (per week)

Not a lot, but, hey, we’re going places!

Then it was time to understand why exactly this happened.

I was able to track down a couple of keywords that are responsible for this result: “tela de carregamento” (charging screen), and “papel parede natureza” (nature wallpaper).

We’re not ranking well in the other search terms to make any difference, so I’m just ignoring those.

“Well, but it’s just 45 downloads a week”

Yes. And here’s how I see it:

• Brazil went from being our market #20 to being our market #2, right behind the US. That with just one round. Mind-blowing. What else can we do in other markets, then?
• We know we can rank in the top 25 for queries with a search score of 30 or lower now, a crucial piece of information for our next round;
• We got results right off the bat.

“What about keywords added to the Promotional Text field?”

Yeah, we’re not ranking for any of those. Apple is still not indexing it.

It’s on the roadmap

We plan to decrease our pricing now. $5,99/week for a charging animation app is borderline insane.

Once we do that, we’ll have another chance to tweak our keywords, as well as maybe launch a new in-app event.

If you have any ideas or suggestions for what we should do next, feel free to reach out.

📕 What I’ve been reading

New Ad Placement Options – Apple Search Ads: Apple continues to push its ad game aggressively. Now they added placements on the Today Tab and… The Product Page tab. That means developers can finally buy their space on a competitor’s page. Interesting.

Creating an email lifecycle “welcome/onboarding series” that actually drives results: I love every single part of this post by Elena Verna. Idk who said that onboarding emails always drive results. Most of the time it actually doesn’t. So she shares four pillars on how to create welcome series your users will actually want to click.

One-year challenge: Turn a $20k Investment into $500k: I’ve been following this challenge since day 1. He’s using Facebook to grow and it turns out it’s working pretty well. There are many mud-throwers at Meta right now and companies are pulling investments from there. My take? That might be a great reason to consider Meta if the traffic costs are going down there. Why not?

Retention is the new Acquisition

There’s a misconception in our market where Acquisition is mistaken for Growth.

That couldn’t be further from the truth.

I understand that there are at least three different types Growth:

– User Growth

– Revenue Growth

– Usage Growth

If we’re talking about Revenue Growth, you could massively increase it just by doubling down on monetization. I believe this angle by itself makes it clear why Acquisition (meaning user acquisition) doesn’t necessarily lead to Growth.

Still, I don’t think this holds true only from a revenue perspective. It seems that when we talk about Growth, we’re talking about Acquisition instead. And whereas it isn’t completely off to think like that, I do believe that it’s a narrow view that can severely limit our approach to Growth.

We can even see it reflected in the roles we have now. SEM positions disguised as Growth Marketing roles. Or Lifecycle, Content Marketing, SEO, or Performance Marketing. It’s all Growth Marketing now. So it must mean that it’s all Growth, right?

Not really.

We could agree that Growth Marketing is about all Acquisition-driven stuff done at scale. But now Growth as a whole.

In order to grow, a product or service needs to be able to accumulate customers – with a big emphasis on the accumulation part.

If not, they’ll grow and fall as fast as the Clubhouse hype – or Google+, Periscope, and so many others who snowballed only to fail as fast as they acquired new users. They failed due to not delivering enough value, which is one of the leading causes of poor retention.

ps: remember, last week we discussed why engagement leads to retention – not the other way around.

Retention dictates how fast your acquisition can be translated into Growth. Not any kind of Growth, but the one we like to see: consistent, steady, and ready to compound.

But sometimes I guess we forget that.

How retention drives acquisition

Even in a bullish scenario where a company manages to acquire new customers every month, it’ll run out of people to sell its products. At some point, they’ll need as many repeat customers as possible to continue growing. And they’ll need those customers to spread the word to keep their customer acquisition cost (CAC) under control.

And it goes beyond the leaky bucket problem. This is actually about customer centricity and delivering value. That’s because:

Retention signals product-market-fit – especially for paid products.

Product-market-fit signals customer happiness.

Customer happiness signals positive word of mouth.

Positive Word of Mouth drives referrals.

Which drives Compounding Growth.

I’d even say that Acquisition is nearly useless if you can’t deliver what has been promised to your customers.

Growth is so much about Retention as it is about Acquisition. Heck, I’d even argue that it’s actually more important.

Because retention is what you want, it’s the thing you can’t fake. There’s just no way around it: your product either stands up to its promise to customers or doesn’t.

Like I posted yesterday: Acquisition can be bought; Retention must be earned.

“What about e-commerce?” you ask. “They can rely 100% on Acquisition and still be fine”

I believe the same logic holds for them. They still rely on repeat sales to grow and positive word of mouth to attract new customers. Otherwise, they’d be forced to acquire new users indefinitely. This would be a problem because they rely primarily on paid acquisition, which ramps up over time. Even in the rare case that you manage to outsmart your customers and push junk to them, they’d eventually accumulate too many detractors. This generates massive negative word of mouth to the point where acquiring new users becomes virtually impossible. That’s why lots of scammy products never really take off: although they’re able to drive decent sales, at some point, it all stops: angry customers will start complaining and denouncing it all over the internet. This also explains why such products or services usually rely on distribution channels where customer feedback is poor or inexistent (think about scammy products advertised for older adults on TV shows, for example).

Closing

There’s a lot of confusion about Growth and Growth Marketing, Retention and Engagement, Product Growth and Growth, etc. People may say that there are different interpretations of it, but I disagree. I see that these multiple interpretations sometimes even hold us back from doing our best work.

I believe the best collaboration happens when our communication can be clear and assertive. That can only occur when we have the same understanding of what we mean when we say things. So I’ll continue discussing these definitions with people until we achieve common ground.

I’m also aware this topic bothers me more than usual because of my idiosyncrasy, but I don’t mind.

If you don’t agree with something I wrote here, do write me back: I’d love to explore other possibilities with you and write a new version of this article.

Oh, and I remember last week I promised an article on Activation, but as I was writing it, I realized that it was more important to go through this thought exercise first. We’ll get there, don’t worry.

📕What I’ve been reading

How to design a referral program by Andrew Chen: great timing from Andrew to release this article in the same period we start to dig into Growth 😉

New App Store ads: Apple continues to ramp up its ad game by adding a new ad unit to the App Store.

Retention is breadth. Engagement is depth.
– Brian Balfour

Retention is how long the user stays in your product.
Engagement is how frequently and intensively your customers use your product.

If Retention can be measured in lifetime, Engagement would be the measure of the quality of that lifetime.

Let’s put it in an example:

Louis and Paul have been using Miro for a year in their company. They have the same retention.

Louis is a Marketing Manager. She uses Miro to facilitate brainstorm sessions, run online workshops, or simply put [her thoughts on paper]. She’s Miro’s cheerleader inside the company, being the main reason why they started paying for it in the first place.

Louis uses Miro every day.

Paul loves Miro too. It’s the first time he interacts with it. He’s a Lifecycle intern so he uses Miro when his manager, Louis, invites him to brainstorm sessions and team-building activities. Paul doesn’t yet dominate Miro’s functionality and never created a board for himself.

Paul uses Miro once every two weeks or so.

Louis is significantly more engaged than Paul.

I guess we wouldn’t have to go dive deep into our data to bet that Louis is much more likely to continue using Miro for a very long time – even if she moves to another company.

Paul does enjoy using Miro too, but he never invited a colleague there or played around with his own boards. The chance of Paul continuing to use Miro if he moves to another company probably isn’t that high.

Now that we cleared out the difference between engagement and retention, let’s look at how we should think about it in practical terms.

The problem with “optimizing for retention.”

When we’re at work, we often hear about “improving our retention.”

Watch out for this one, as it’s a conceptual red flag.

It means that your company probably doesn’t understand that retention is the result of activation and engagement – and not the other way around.

> Retention = Activation + Engagement

Retention is what we call an output metric. It is the result of activation (we’ll discuss it next week) and engagement. So, to increase your overall retention rate, the only way to do it is by actually improve your input metrics (engagement and activation).

And it’s easy to see that if we reflect on real customer stories. Let’s continue on our example from Louis and Paul.

If we want to increase our chances of staying with Paul for the long run, what would we have to do? I don’t work at Miro, but I can guess what I’d like to see Paul doing more so it becomes more engaged. Things like:

– Creating his first board
– Spending X minutes playing around with his board (activation)
– Sharing his board with at least one person
– Creating a second board after X days (habit formation)

But how?

Not by sending a blunt 7-day email series on how to create a board. Right?

Instead, we can do our best to understand Paul’s jobs to be done and think backward to hypothesize how could we help him by using Miro.

Then, we could look at our Marketing Channels and Product Real Estate – banners, in-app messaging, tours, etc – to figure out what would be the best way to take that message to him. A message that would aim to connect Paul to experiment more with Miro’s core product value.

The whole idea here is that, If we do our job well, we’ll actually manage to help our customers. This will deepen their engagement, which will then be reflected not only in retention rates but also on the positive network effects it may unlock.

As far as I can tell, that’s the proper way to look at it.

What usually happens when we optimize for retention instead
This is not only not optimal but also potentially harmful to your branding and product positioning. I’ll explain.

From experience, I can see that this train of thought usually leads to artificial tactics such as:

– Forced onboarding experiences
– Unsolicited trial extensions
– Dull drip campaigns
– Random discounts
– etc

Those are all classic desperate moves – usually taken when teams don’t understand the forces at play when we talk about retention and engagement.

I call it desperate because although they might make the numbers look better in the short term, they fail to address to solve the root causes of engagement problems. It can also deplete your brand’s value and contribute negatively to word of mouth – which is easy to cover up.

If I look back at all failed retention strategies I’ve seen in the past years, they all have a flavor of these artificial strategies.

Summary
– Retention is about how long the user stays in your product. Engagement is all about usage frequency and intensity
– Retention is an output of your Activation and Engagement
– Proper engagement strategies are rooted in customer centricity and great analytics
– Poor retention strategies use artificial leverages to force the user through the product journey

 Podcasts I’ve been listening

This podcast episode with Elena Verna on how B2B Growth is Changing is incredible. I started to follow her on LinkedIn a few weeks back and the only regret I have is not finding out about her sooner.
In this episode, she talks about Product-Led and Sales-Led models in a complementary way instead of the usual one-over-the-other kind of approach. Highly recommend.

 Tools I’m using

I started using Ulysses this week to write these newsletters and I’m absolutely loving it. This is a spontaneous shootout, by the way, they’re not sponsoring this newsletter.

I love that I can write with markdown and that I can now write without being distracted by the internet. This also makes posting on WordPress dead easy. Check, check, check.

Ulysses is included in my Setapp subscription. You can get your first month for free on this link.