Your first million users: how to rock the cold start, with Hannah Parvaz
How do you get your first million users? Money is definitely part of that equation, but it’s not where you need to start.
The cold start is a major challenge. Not everyone has multiple billion-user networks to kickstart your new Twitter competitor, after all. And while most have some funding, few have the ability to blow millions of dollars on massive ad campaigns. As an extra challenge, early in your app’s lifespan your product is also young, probably incomplete, and likely not as mature and polished as it will be in a year or two.
As all startup founders know, building the plane while flying the plane while also advertising for tickets on the plane is a significant challenge.
Your first million users: start with the real problem
I recently spent the better part of an hour with Hannah Parvaz, a former growth mentor at Google and Business of Apps app marketer of the year. She’s helped dozens of mobile app publishers grow and runs her own agency, Aperture.
It starts with something that sounds very simple and obvious — and it is — but that most of us impatient builders and founders brush past because we assume we know:
“The very first thing that’s important for us to pin down together is understanding our customer and understanding really what the problem is,” says Parvaz.
The challenge is not only that we assume we know (which is always a perfect barrier to learning) but also that there’s so much to build, so much to make, so much to market, so much to manage. The result of all the busy-ness is that some founders refuse to come to grips with actual customer need. But the ones who get “stuck in” to understanding their users, customers, and players are the ones she’s seen win.
Don’t forget the recursive why
Parvaz is a fan of the recursive why.
Except she doesn’t like to use the word “why.”
The recursive why is important because, as one theory says, all of your answers are 5 why’s deep. Our real reasons — and our app users’ real reasons — are often buried under justifications, pat answers, rationalizations, publicly acceptable reasons, or other misleading answers.
That’s one of the lessons of The Mom Test.
“Everyone is accidentally lying to you without them knowing it,” Parvaz says. “It’s an accident; they don’t realize.”
One example: users of the Curio audio journalist app said they used the app because they wanted to learn. A few why’s later, it emerged that what they actually wanted was to be socially interesting and to appear smart. Multiple conversations over months of customer interviews yielded the same finding, resulting in a change of the app’s tagline from “intelligent audio for busy people” to “becoming the most interesting person in the room.”
Keep reading: more in the full transcript about finding your first million users
See the full transcript below with much more insight and more details on key app growth topics to help you find your first million users:
- 2 forces that increase demand generation
- 2 forces that reduce conversion
- Digital drug dealers and little hits of dopamine
- When to use awareness and when to use direct response ads
- Starting at the bottom of the funnel
- Experiments and why even the failed theories are useful
- When to add an MMP
- Boosting retention from 20% to 52%
- When to not advertise (!!)
- When to start advertising
- Doing the work that others won’t do
- Why many app publishers spend 80% of their time on the first 2 minutes of app use … and why you should not
- North Star metrics
- The subscription app formula:
- cadence
- action
- revenue
- Avoiding the churn cycle so many apps are in
- What to build a brand around
- The 3 key drivers
- Acquisition
- Activation
- Retention
- One campaign that went insanely viral
- One campaign that completely flopped
- And … how to find your David under the block of marble
But first, subscribe to Growth Masterminds!
Don’t miss this Growth Masterminds episode, or any of the others …
Subscribe to Singular’s YouTube and to the audio podcasts to never miss a show. Recent guests have shared insights on topics like:
- E-commerce and in-game fraud
- Alt-UA with Fluent co-founder Matt Conlin
- Power shifts in the ecosystem with guests like InMobi’s chief business officer Kunal Nagpal
- Generative AI in games with Unity CEO John Riccitiello
- Massive games growth with Dive’s Elad Levy (who sold his games company to Playtika)
- Privacy Sandbox on Android
- Targeting in the era of privacy
- Reducing app subscription cancellations
- And … so … much … more!
And now, the full transcript: Hannah Parvaz on getting your first million users.
John Koetsier: How do you rock the cold start?
Hello and welcome to Growth Masterminds. My name is John Koetsier.
I’m starting a new series in Growth Masterminds and the Singular blog, it’s Zero to Hero. It’s a startup story. It’s about getting early growth, not just your first hundred or first thousand, but maybe your first million, maybe your first hundred thousand, first 500,000 users.
There are huge challenges, we all know, for really big apps and real big brands to continue to grow, right? But they’re different. They have some resources, they have some brand, they’ve got users or players or customers or whatever they’ve got starting from zero or very small is a different challenge.
I actually think there’s a lot to learn on both sides of that for the other side, but this series will focus on early stage growth to kick it off. We’ve got an all star. She’s literally an app marketer of the year. Also biz strategy consultant of the year. She’s worked in tons of growth roles and now runs her own growth agency called Aperture.
She’s helping apps grow, helping mobile businesses work. And I noticed speaking all over the world. Her name is Hannah Parvez.
Welcome to Growth Masterminds, Hannah.
Hannah Parvaz: Thank you so much, John. It’s really nice to be here and I’m really excited to have this conversation with you today. So thank you.
John Koetsier: Awesome.
I love it when people say that … it’s often true too, but it’s late, you’re in London, it’s Thursday night and you’re hanging around in the office to chat. I really do appreciate it.
I wanted to start with a little bit of personal stuff because you’re one of the UA consultants that runs your own agency. That’s an exclusive group, right? We talked earlier. You got Thomas Petit. You’ve got Felix Braberg. You got 5, 20 others. There’s not hundreds or thousands of people like you.
What’s your life like?
Hannah Parvaz: Actually, last year, my life took a big change. I have been living in London for the last 11 years, since 2011.
And last year, actually, I ended up going completely remote for the year. So my life has been a bit atypical over the last year. So I went to a lot of different places. I’ve met a lot of different kinds of interesting people from interesting companies. I was speaking in many different places and countries and cities all over America and Europe.
And at the moment I’ve come back to London just for a couple of months, just to, I mean … the idea was to capture some of the summer, but in a true kind of British style, it’s not been exactly what we were expecting.
John Koetsier: Your summers are probably like San Francisco summers.
Not very good.
Hannah Parvaz: Ah, yes, I saw a heat map of the US recently where it was like 100, 100 and San Francisco was 62.
John Koetsier: Yes, exactly. SF summer is not so great. It’s great in the spring, great in the fall. So working as you have with companies in a head of growth or head of UA role, those sorts of things, and then transitioning to working with 10, 15, 20 companies, maybe at a time, what’s that like?
Hannah Parvaz: Whenever I was working full time in house for my last kind of three or four companies, I had been doing a bunch of coaching and consulting and freelancing on the side. And that was always something that I’ve been doing a lot of. And it was also something that kind of comes with the package.
I wouldn’t have been able to work with a company unless I was also able to do that and had the freedom to do that because. For me, having those additional challenges on the side and being able to work on all of these different problems at the same time was really beneficial for my personal growth.
And so transitioning over to having Aperture and working on this full time, I left my last full time in house company. I disappeared off the face of the earth for a month. And then I came back better and faster and stronger than ever, like ready to go ahead with Aperture. But it did feel very seamless and it did feel like the only possible next step for me after being at my last company.
So it was good. It’s been great.
John Koetsier: I’m always so tempted to take the month off or the three months off or something like that, but I don’t trust myself. I’m not sure if I’ve ever come back. So that’s why I haven’t done that.
Okay. So somebody comes to you, they’ve got a new app, they’ve got some budget, they have big plans, they want to grow.
What do you do? Where do you start?
What is the core problem you are solving?
Hannah Parvaz: If they’re right at the beginning of their journey versus, even a bit farther in, I’ve worked with companies at all kinds of stages from being, the second higher and a company’s not even launched yet to joining later or working with kind of larger kind of commercial companies and so on, more corporate styles.
But really the very first thing that’s important for us to pin down together is understanding our customer and understanding really what the problem is.
Because a lot of the time we’re doing this supply side thinking, we’re thinking about what we want and what we think is the problem and what is so important and what I spend a lot of time talking publicly and also with founders and with other people is just centering the customer and centering what their needs are, as opposed to what you think their needs are. And that’s something this is just the bread and butter for every company, it’s not just for mobile apps, it’s not just for a specific kind of subscription, this is for every business. You should truly understand exactly what your customer wants and needs. And this is my favorite topic, so I’m happy to spend all day on this if you like.
John Koetsier: Nobody wants to do that really. I mean, everybody wants to …
I got to build something.
I got to make something.
I have to market something.
I have to buy a campaign.
I have to … all that stuff. I’m talking for myself right here, just myself. I mean, this is the sort of thing that you just … it’s hard.
Hannah Parvaz: It really is hard. And a lot of people are very resistant to doing it as well, because it’s really facing what the problem is head on and potentially, you’re potentially …
John Koetsier: Wrong solution.
Hannah Parvaz: Yeah, maybe what I think isn’t correct, I don’t want to have to face that and what I do see time and time again is that it’s the founders that are happy to get stuck in that are the ones that succeed.
And I’ve worked with some founders who are: I’m not going to join these customer conversations … I don’t want to. (I always call these customer conversations, by the way, rather than user interviews, because “user” … it’s obvious we can use this term sometimes internally, but we need to start thinking about them as customers. They’re buying something from us.)
And obviously you can have a really great interview, but what we want to do as well is just have a proper conversation and get to the bottom of who they are, what they are.
There’s a theory called the four forces which I’m sure you’re familiar with, but …
The four forces of demand generation
John Koetsier: Tell me about the four forces. I want to know.
Hannah Parvaz: There are these two demand generation forces, which are pushes and pulls. So what’s pushing you towards the solution and how is the solution pulling you towards it?
And then there are these two forces which are reducing demand, which are habit. So what am I already doing? And anxiety, what is my fear of what is this product?
And a lot of the time companies focus a lot on the demand generation, what, how are we pulling people in? How are we marketing ourselves? But they don’t focus enough on those other two.
And the customer is inside all of these four forces, these, all of these anxieties trying to work out what’s the best solution for them. Where are they? And they’re experiencing all of these. I mean, we’re people, right?
We’re constantly experiencing emotion. So they’re experiencing all of these forces and emotions at every point of their customer journey. So from being problem unaware to problem aware to, they’re actually now buying and now they’re using it. They’re experiencing and thinking about these things the whole time.
So for us, it’s our job to understand how they’re thinking and how they’re feeling at these different stages of their life cycle.
John Koetsier: You’ve seen hundreds of apps and hundreds of businesses, and you said, this is your favorite thing.
So I want to ask you a question about it, because I know that in some of the startups that I’ve done, I’m somewhat resistant to that. Maybe somewhat I’m being kind to myself, and I’ve seen that elsewhere and companies that I have advised and consulted with or that worked in.
Speak to that person who wants to go do something, build something, create something and not spend their time on all this kind of squishy stuff that is hard and is not the way they typically think because they’re a creator, they’re a doer, they’re a builder, not this philosophy and all this stuff.
Speak to them of the apps that you’ve worked with, the ones that have been successful. Is there a correlation between their success and their willingness to do this upfront work?
The Mom Test: everyone is lying to you
Hannah Parvaz: I would say absolutely there is unless somehow you are wise beyond human realms and you can predict all of these things. I speak to a lot of companies, for example, and they, and I ask them, do you talk to your customers?
And the first thing they say is, yeah, I send out surveys, all, I send out a lot of surveys.
We do this, we send out quarterly surveys and don’t get me wrong. I think surveys are fantastic for some purposes, but if you’re trying to get to the bottom and to get to the real truth, then you’re not going to be able to get that in the survey.
So there’s this really great book called The Mom Test. You might’ve heard of it. It’s about a hundred pages long, so you can read it very quickly or get an audio book and listen to it while you’re on a walk. But the kind of theory behind this book is that everyone is accidentally lying to you without them knowing it.
It’s an accident; they don’t realize.
For example, I was working with one company. I’ll tell you a story if that’s all right.
I was working with one company called Curio and this is an audio journalism product. And I was working with them five, six years ago, and whenever we started, they had a tagline, which was “intelligent audio for busy people.”
This was on all of the ads, very kind of functional, great. It’s audio journalism, you’re listening to it. So great. And when I started to talk to people and talk to the customers, I was asking them, how come you’re using this product? And they would say I’m really busy and I want to learn.
And that makes sense: intelligent audio for busy people.
So then I would ask them. Okay, if you’re so busy, why do you want to learn so much, and if you’re learning … how have you ended up using this? And they say I’m commuting. And so I want to listen, in case I’m standing up, or I want to be walking.
There was a huge kind of commuting use case here. And I want to feel like I’m using my time wisely.
And I would say, why, but why is that? Why do you not want to just sit on the tube and pick your nose and play Candy Crush? You could be doing anything.
John Koetsier: I’ve always wanted to do that.
Hannah Parvaz: Easy, the path of least resistance.
And they would tell me then, but I want to understand the world better. Okay, so now we’re getting somewhere. And so then I would say, why do you want to understand the world better? This is where the gold comes. And so then they would start to tell me stories about … I go around to my mom’s house and she’s married to a new man and he’s a professor and he’s always talking about all this stuff and I have no idea what to talk to him about, so I always seem, I always feel like I’m not very clever.
I want to seem more interesting.
And again and again, this phrase, I want to seem more interesting.
And so this is the power of simply talking to customers. And it’s not like I pulled out this theme out of two conversations. It was, I spent, as soon as I joined that company, I spent the first three months with one of my main focuses on talking to customers.
And so then we started experimenting around this messaging, see more interesting, does this seem smarter? Does it seem interesting? Is it interesting? Is it, and we tested out a lot of different messages and we ended up landing, after hundreds of iterations, on “becoming the most interesting person in the room.”
Which is a line of copy you might have seen around, like some of the biggest apps in the industry now are using this same headline after we used it at Curio.
Because it’s something that really taps into your ego and it’s something that again and again performed, not just in the UK and the US, but in every country that we tried it in, this was effective, and this is why now you’ll see this line which came out of a bunch of different conversations being used all over the place, because it’s just effective, it taps into something in turn in deep inside you.
The 5 whys and the recursive why
John Koetsier: Love it. I absolutely love it.
Who doesn’t want to be interesting and have people interested in you … it makes a ton of sense.
One of the things I took from what you said was you’re a recursive why person. You keep asking why. You get an answer and you ask why.
That can get you punched in the nose sometimes.
Hannah Parvaz: It can, but you just need to do it with a smile. And also I did, I know I said why a few times there, but I actually tried to keep away from the word why itself too. And so I usually would say something like, how come, how come you ended up doing this?
And this is because the word why actually upsets a lot of people because deep down they feel like they’re a kid being told off. Like, why did you do that?
And this is something I spent a lot of time looking into as well, just to make sure I was able to have the best and most effective conversations possible. And so I usually keep away from why, even though there’s a theory called the five whys, so all of your answers are five whys deep it’s still good to use some different words instead of being that kid, which is fun as well. And you have to come at these things by building a sense of rapport with the person.
I always say at the very beginning of any of these conversations, get to know them a little bit first. Don’t just jump in with kind of very extreme technical or personal questions, share something about yourself, if you can, how are you relating to them and making them feel your customers feel human and safe in this conversation.
John Koetsier: Love it. Love it. I’m glad we had a chat before we started recording.
Hannah Parvaz: Yes, we built some rapport.
John Koetsier: Exactly. No, that’s awesome.
So we’re going to get to all the hardcore growth stuff. So for everybody who’s listening and saying, okay, I got to ask why, I got to talk to my users, got my customers, my subscribers, all that stuff … we’re going to get to the hardcore questions about what tech and how I start campaigns and do I need an MMP right away and my metrics and all that stuff …
But I got to dive just a little deeper here on this, knowing your customer, knowing your user, is this even the case?
Let’s say somebody says, I’m building a game, it’s just about fun that is common to 97. 83% of humanity. I don’t need to have these conversations. Are they right? Or are they wrong?
Games and little hits of dopamine
Hannah Parvaz: I would say that it’s still valid and relevant because with your game someone is still trying to do something and trying to achieve something and that might be just feeling dopamine hits.
That might just be feeling again and again I’m completing these levels but that’s why there are so many kind of tricks of the trade that work so well for games, and I think a lot of the time we can learn a lot from how games are produced and how games operate, letting someone experience a win very quickly even though it’s a very easy level, how can we transfer that learning to our apps and to our kind of other products as well?
What are we doing to get people to that kind of activation threshold as quickly as possible, because that’s what games are mastering. And I see a lot of people going from games to out of games now or gambling to out of gambling, because they’ve got so, so good at this. And now they know how to translate for and translate this knowledge across.
John Koetsier: I like those little hits of dopamine. We’re all digital drug dealers, right? Absolutely. Okay, here we go. Let’s dive in.
That same person comes to you, this new app, some budget, big plans, right? They want to grow. You’ve gone through this process. They’ve identified, okay, this particular person, this segment, that’s who we’re aiming for.
Here’s their challenges, here’s their problems, here’s what we can solve. Here’s what we’re gonna do and here’s how we’re gonna approach it. Okay?
So now they want to actually. Grow and they’re going to start investing some budget. Where do you kick off? Where do you start?
Levers and metrics
Hannah Parvaz: So once we’ve understood our customers, the problems that we’re solving, what are our levers as well? So what are the key areas that we can focus on? And usually these are going to be something aligned with acquisitions.
So something like installs, something aligned with activation, something aligned with retention. So we want to be able to establish these and then figure out what’s the first area that we want to impact, really.
And so for a lot of companies to begin with, that might be acquisition. And so we will think about how does your product work? What are the kind of natural acquisition lanes that you have. And so a lot of the time it’s a bit like sorting, you don’t get to choose your lanes, they choose you in a way.
And so if you’re a kind of D2C subscription app, probably you’re going to want to start with doing some advertising. But if you’re a super social viral network effect product, then probably you don’t need to do any advertising to begin with … what we’re going to do is work out how we’re getting people activated as quickly as possible and how we’re making it as shareable as possible.
And of course, we always need to bring in all of these elements into our product.
It’s just about if you’re a small team, where do you focus first? And it’s about how are we aligning everyone in the business around this main focus? So whether that is activation or acquisition or retention or whichever awareness to begin with.
I would normally probably not be starting with awareness for a very small product because we still want people to come through with my companies. We’re spending 1% of our budget roughly on awareness ads. We’re spending everything else on direct response because we need to get the people in, we need to be able to monetize.
Experimenting, theories, hypotheses
And so after we’ve decided our lanes, then we would start experimenting. Let’s say we’re going to go after a paid ads channel. This is where things start to get a little bit hairy. And so what we want to do is go back to this kind of … what are people trying to achieve and start testing our messaging?
So we’re always going to have some hypotheses. We’re going to have some rough theories about, I think this message will resonate with these people, but also in this kind of post May 2021 world where we’ve got a bit less visibility we want to make sure that what we’re doing and what we’re bidding on is right.
And yes if that’s the route that we’re going down and we’re thinking that we want to have visibility on any of our ads, for example, then we should be implementing an MMP, a mobile measurement partner so that we can see that traffic so that we can post it back and so that we can keep our app a little bit lighter so we don’t have to keep bothering our developers about every new SDK that we want to add in.
Yeah, you want me to continue?
Start at the bottom of the funnel
John Koetsier: Yes, absolutely. But I’m going to interject for half a moment.
Because what I love about what you said is you didn’t start with, okay, we’re going to buy ads on Meta. We’re going to buy, we’re going to invest in TikTok. We’re going to go and do some programmatic and stuff like that.
It reminds me of when I was chatting with Rory Sutherland, it’s got to be a year ago or so.
Famous … infamous Ogilvy marketing guru, if we want to call it that way. And he said, start at the bottom of the funnel, start at the bottom of the funnel. What’s happening there? What’s happening there?
Work your way back up and you just follow that exact path.
Hannah Parvaz: Exactly, and I, there’s a lot of companies and some of the ones with the fastest growth that I’ve seen are ones that aren’t caving to this, sometimes if you see pressure to just turn the tap on, turn the tap on and see what happens.
It’s companies that are, maybe they’re spending a little bit of money at the top of the funnel just to get a few people trickling through if they need to, but not spending a lot of time optimizing on it, but then seeing how these people are performing.
3 months on retention: from 20% to 52%
One company that I’ve been working with for the last year, we had started with some acquisition work. We were getting people in, it was performing, but what we were seeing was that our day 30, for example, was like 20%. So we knew that, but with a free product, a free social product, we can increase this.
So what we did was we spent the next kind of three months focusing on retention. How are we increasing our day 30 retention?
And by the end of that, we got up to 52% day 30 retention, which is very high.
And then we moved to activation. So we were like, how can we make sure people are going to go do this action, these actions that we need them to do.
And then we fixed this, we did a really great job with that. And then we were in a good place to be able to turn on our paid ads properly and really start putting a lot of people through this funnel. And yeah, it’s been going very well ever since with obviously as a free app as well, you can build in a lot of virtual currency, social viral features, yeah …
John Koetsier: I’m a trillionaire in multiple currencies that don’t matter.
Slower and harder and longer than you think or want
But I want to draw out something that I’ve heard now twice that you’ve said, and I want to highlight it because I think it’s really important. I’ve worked in Silicon Valley. I spent 3 years commuting into San Francisco every other week.
I’ve worked in startups or assisted or advised or consulted with startups for the better part of, I want to say a decade and a half, maybe two decades. And everybody wants instant, everybody wants results now or tomorrow or this week. And now three times, maybe twice, you’ve said: “I took three months,” right?
And here you just said, I took three months to examine what was happening to users who were in the app and what they were doing and how, and you increased the retention there.
And earlier you said you took three months largely talking to customers.
And I just want to bring that out because … yeah, you might have a Threads story and go to 100 million users instantly, (but there’s more to that story because the engagement is dropping, obviously) and you might have a Pokemon Go and you get a billion users, and it just keeps going and going and going, but for most people, the real story, the actual story is slower and harder and more involved and more effort and more knowledge and processing.
That’s a really strong insight for people who are super impatient, like me. To have sink in.
Hannah Parvaz: Yeah, there are 160,000 apps released every month. So there are always these anomalies like Threads, Pokemon Go, which have of course come from these giant companies where there’s been a lot of kind of brand awareness, let’s say, up front, but with companies that are potentially category creating.
I was having a call yesterday with someone who’s doing a product, which is absolutely category creating, no one is doing this yet, there isn’t awareness for these solutions.
Problem unaware vs solution unaware
People are often probably “problem unaware,” but they’re 100% solution unaware because there hasn’t been a solution like this before.
And so whenever you’re exploring these areas, you need to understand the landscape and actually with the companies where I’ve spent, when I’ve been working internally with them and we’ve spent two, three months working on something … it’s by that kind of time that the founder is like, why is nothing happening?
But it’s by that time that you’ve understood everything and then you can turn things on and then it works. And so I was working with one company which had been around for two years when I joined. And whenever I joined, they were doing about seven actions, like seven redemptions per week … seven uses per week.
A year and a half later, we were doing 7,000 per week, which is a fairly big increase.
And this is the process.
You understand your customers, you understand how they operate, what is on their mind, what are they actually trying to achieve? There’s a theory called Jobs To Be Done which is an amazing theory about just what people are actually trying to achieve. So like with the audio journalism company I mentioned before, the functional jobs to be done are, keeping my brain occupied while I’m commuting, making my commute a bit more entertaining.
But an emotional job to be done is I want to seem more interesting.
And we need to understand the landscape of our users’ mindsets as well as the market and so on. The market’s very important too, but our customers and what they need is really the most important part for our business.
Your superpower: do the work that others won’t do
John Koetsier: And I just wonder that maybe for some of the people who are founders or early stage employees at smaller apps right now, who are listening right now, maybe that can be your superpower.
Maybe this can be your superpower.
Do the work that others aren’t willing to do. Do the work that others don’t don’t even know to do.
Do that work before you spend the $500,000 that you raised in seed funding or the $7 million you got in, Series A or something like that, and do that work and get that kind of growth. After you’ve slogged for some time, okay, let’s talk a little bit about metrics.
What are the metrics that tell you something’s working here?
Metrics madness: Don’t spend 80% of your time optimizing the first 2 minutes of app use
Hannah Parvaz: That, I mean, ultimately at the end of the day, the kind of main metric is how many people are purchasing my product. So that everything starts from there. What’s the lifetime value of someone that’s coming in?
And I’ve had lots of discussions, especially with developers and data people around … at one company I worked, we were running a lot of experiments and they were saying the success of every experiment should be measured based on lifetime value …maybe an estimated lifetime value. You can’t necessarily look at that when it’s a week-long experiment, for example. And so ultimately lifetime value is a lifetime value over customer acquisition cost is key.
But also what we want to do is look at our North star metrics. So for the majority of subscription app businesses, I have a handy little formula that everyone can jot down, but it’s for a subscription app business, for example, we want to have a cadence, then an action, and then a revenue associated metric.
And so this looks like something like:
- Weekly listening
- Subscribers
- Journaling
Subscribers, or purchasers or, and so on. And this helps represent you as a business and your needs. So that has the subscriber side. And then you also are representing the customer. So they are coming back. They are getting value from using your product.
That’s why they keep returning.
And a lot of the time I’ve worked with companies and they’ve said, subscribers is our North star metric. And adding subscribers at all costs means that within those companies, they spend 90% of their time optimizing the first two minutes of the product because 80% to 90% of trials come up within the first two minutes of someone downloading your app.
And then the rest come up later and they long tail out over forever, but the majority of these will come from the first two minutes of someone downloading your app and signing up.
And time again, I’ve seen companies who are revenue, subscribers at all costs just spending time on there and getting great numbers of trials through but then everyone’s just churning out. People aren’t renewing, people aren’t sticking around because the product itself hasn’t been worked on because they’ve just been … I’m spending money on ads, so I need to get subscribers to pay for my ads to get more subscribers to pay for my ads and they forget about everything else, which is how are the customers feeling and how are they being retained?
Like, how are they receiving value from you?
You can’t build a brand around building the best funnel
John Koetsier: It’s so interesting because if you take that insight and you bring it back to the very beginning of our conversation, who am I serving? What are their needs? What do they want? What are they trying to avoid? All that stuff.
If you get that right, then you’re more likely to get this end part right as well and optimize your product and your product experience and your user experience rather than like … your job … your goal in life is not to be the best at getting people through a funnel.
I mean, that would suck. That would really suck.
I mean, hey, you’d make a lot of money probably, but would you really be fulfilled? “I make the best funnels.” Okay. Maybe some people think that’s their gig, but maybe you want to make somebody’s life better.
Maybe you want to make them have a little bit of fun.
Maybe you want to help somebody create better habits or be the most interesting person in the room or something like that.
Those are things that you can build a brand around. Those are things that you can build a team around. Those are things that people can sign up for as a mission to join your company and maybe stay with your company because it’s meaningful.
It has something to it.
So if people get that first part they’re more likely to get this part, right?
Talk to me about when you start knowing that the snowball is rolling downhill. You’ve talked a couple of times about, I took three months to do this, I took three months to do that. We’re doing seven activations a month and now it’s 7,000 …
When do you know that the snowball, which is just sitting there and then maybe moving a tiny little bits in the beginning, is actually starting to go downhill?
Hannah Parvaz: We look at the numbers … so you can’t grow what you don’t measure, so we track everything
John Koetsier: You can’t grow by accident?
Three key drivers: acquisition, activation, retention
Hannah Parvaz: You can, but you don’t know, and so what I would say is obviously we’ve got our North star metrics.
We also have these three little things called key drivers, usually. So these are the metrics I was referring to before, usually acquisition, activation, retention, but there’s usually a real kind of solid metric associated with them.
So once we start to see that these metrics are reaching our targets then, we can move to another metric or lever to impact. And then, and then hopefully, we started right at the bottom, we’re moving up to the top of the funnel. Once we start seeing that we can put money in and we can start getting that sweet money back, then it’s time to turn that tap on, so with some of the companies I’ve been working with, it has taken six months or so to get them to be able to reach kind of day zero payback with their monetization.
You’re not going to get a positive ROAS on day one instantly
But we say to everyone at the beginning and most people know, for example, with performance, you’re not going to get a positive ROAS on day one straight away.
It takes a bit of time. It takes learning. It takes experimentation. And so I’ll say the time at which we know that the snowball’s going is when we hear people talking about it, when we don’t understand where the people are coming from as well. I ran one campaign, which you can talk about later last year, which went viral five times.
And it ran for two weeks and by the end of the two weeks, I was walking down the street and I heard someone cycling past talking about the campaign and I was like this is success …
John Koetsier: Wow. Wow. That’s awesome. Let’s transition that because this has been great. I could chat for another half an hour. We have limited time, it’s late for you. And there’s other things on my calendar. I mean, as much as I like to spend all day here, can’t do it, but might have to have you back, there’s so much more we can chat about.
I wanted to end with just a couple of more lighthearted things.
One campaign that rocked
One campaign that totally blew it out of the water … absolutely went nuts. Completely rocked in and you already hinted that we’ll hear more hopefully. And then one campaign that you thought would be so awesome, but completely cratered. Go for it.
Hannah Parvaz: Absolutely. So the one that blew us all away was last year, with a company called Uptime, we launched this campaign called Quit Social Media.
And it was a campaign around a study to get people to quit social media for two months, and we would pay them £2,000 pounds to quit social media for two months. And so we promoted this and sent it out as a PR story. We were accepting one person.
And so we sent this out, it got picked up by all kinds of British national press.
Great. we thought, we’ll get a couple thousand applicants. That’ll be enough, it will give us some backlinks.
So then I had some, an amazing lady on my team. We scripted out a video for her. She read it, and we posted it on TikTok. We put about £10 pounds behind it, very minor amounts. And this was a couple of days in, and we had a kind of Google form, I think, that people were submitting.
And, by this point we had a couple thousand applicants. I was like, sweet. We’ve hit our goals. So we boosted this post and just as I was about to go to bed, I decided to check the applicants and all of a sudden there were about 50,000 applicants and I was like, huh, like Scooby Doo. And I immediately added a question, which was, how did you hear about this … so that we could try and understand.
And we started to get people coming in and saying, this campaign has caused a controversy in my country. And we started seeing Twitter accounts with millions of followers were posting about it. It was on Sky News Arabia. It was on Newsweek. Anyway, an Instagram page called Puberty posted about it as well, which has … maybe they’ve got 30 million followers, quite a few followers.
We ended the campaign anyway, with a quarter of a million, 250,000 ish applications to take part in the study. And we spent about two grand on the cost of the study, and then a hundred pounds or so on boosting because we did a small boost on TikTok, a small boost on Facebook and a small boost on Instagram.
It was to the extent that with a company called Uptime it was uptime.app, there was another company called uptime.com … Uptime.com were writing to us saying, we’re getting hundreds, we’re getting thousands of support tickets asking how to apply and how do we … we don’t know what to do.
And we were like we didn’t tell them to go, we can’t really do anything about that. And then on one of the last days of the campaign, someone was cycling past me talking about, did you hear about this campaign? You can get paid £2,000 pounds to quit social media. And I was like, this is so funny, it just started out as something small and it just kept growing and growing.
We then managed to, trying, working very closely with the product team the whole time, it’s very important to keep aligned there … we were able to build out specific flows in the app. We built collections around social media. We sent offers to people who were applying, we got tens of thousands of downloads and subscriptions and so on from this campaign as well.
So they really transferred from what was, I hope we get a few backlinks to this is a substantial marker on the company overall from a very kind of silly, small, expectedly small campaign. So that one I’d say really blew up.
John Koetsier: Amazing. Amazing. Amazing. It’s so incredible when something that you do becomes part of the zeitgeist, becomes big like that.
And it probably only happens a few times in most people’s careers. So we love chatting about our children that grew up to be millionaire models, sports heroes, titans of industry, all this stuff. Have you had any redheaded stepchild?
One campaign that flopped
Hannah Parvaz: You’ll know that every person in growth’s whole career is built on things not working, really.
That’s the first thing to know. I’m constantly running, I mean, with one of my companies on my own, I ran over a hundred experiments in one year by myself without thinking about all of the other people in there and all the experiments that they were doing.
And within that, we had about 45ish percent of them were successful, which means that more than half of them weren’t successful.
But that’s still a great success rate for an experiment. And, one thing that I actually sent out an email to the company about this and said, 55% of these were failures. And someone replied to me this was about five years ago and it changed my mindset a little bit saying, none of these were failures because we learned something from all of them.
So they weren’t failures. Your hypothesis was just not right. And that really helped me reframe things. Even when things aren’t completely right, that’s fine. We learned from it. And so we did recently.
John Koetsier: That’s what you tell the CFO when you spend a million dollars on an ad campaign and it gets you nothing.
“We learned a lot from this.”
Hannah Parvaz: But you know what? If you do accidentally spend a million dollars or you accidentally send out an email to a hundred thousand people, like what do you learn from that? I remember one company where a CRM person accidentally sent out a push notification to the entire user base that just said “dot.”
John Koetsier: Could have been worse, could have been worse, could have said something nasty!
Hannah Parvaz: This was the best open push notification that was ever sent.
And people, we learned like people probably clicked on this ‘cause they had no idea what was going on. They were like, I’m intrigued. And so we had our most kind of active user day ever and things like that.
But I’d say, a recent one was we spent … with one of our companies we had tried out something with one kind of famous influencer for one product that the company has.
And we were like, cool, it’s working with this one product. So it will work with the other products. So we then sprung for an expensive deal with this creator for the other product … that didn’t work. But you know, we learned that … align this creator with this product, not this one.
And, at the end of the day, everything’s an experiment, so as long as you’re learning from it, I think, and you’re owning it, that’s very important, taking ownership of these things too, and saying, this is why something worked, or why something didn’t work and documenting it, then, I think it’s all good.
John Koetsier: I one hundred percent agree and we can joke about it and I’ve joked about it a little bit here, obviously, but realistically, the biggest failure is always being so scared to try something that you don’t do anything or you don’t try enough because guess what: that one campaign years that blew up, it was probably one of 50 or one of a hundred or something like that.
99 didn’t blow up.
But if you stopped at 98 and you didn’t do the 99th or the 100th, you wouldn’t have had the massive success.
You can’t really account for virality. Sometimes you just have an ad that just beats everything else for a year. I’ve heard about that. That’s your hero. That’s your champion ad and you can’t beat it for a year and you get really pissed off about that, but you should also be happy about it because you made something great.
And sometimes you do 50 campaigns that don’t work, but you keep trying and somehow the magic pixie dust of the internet just spreads on it and good things happen.
Hannah Parvaz: Absolutely. You need to just keep to the process. There’s a process there for a reason, like around experimentation, around validation.
And it’s so important to just keep to that process because once you do, and that’s your muscle memory, then that’s where you find the gold, if you want to be chipping away at that block, trying to find your David underneath. Because it is there. You just need to keep on trying …
John Koetsier: love it. Hannah, this has been such a fun 40 minutes longer than I anticipated. Sorry for keeping you longer. I’ve really enjoyed it. I think I’ve learned a ton. I’m really impressed.
Thank you so much for your time.
Hannah Parvaz: It’s been such a pleasure, John. Thanks for having me. And thanks everybody for watching and listening.
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