Growth Newsletter #081

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Founders dream of product-market fit (PMF).

But most of the advice you’ll find online reads something like, “You’ll know it when it happens”—a lagging indicator. This doesn’t help you understand what PMF really is or how to get there.

Sean Ellis, who ran growth in the early days of Dropbox and coined the term “growth hacking,” found that a simple survey can help you quantify PMF. Use it as an actionable, leading indicator.

Ellis’s survey technique has been used by companies like Slack and Superhuman to reach—and accelerate—PMF.

Here’s how:

1. Survey users (ideally 100+) who have experienced the core product benefit.

Ask: “How would you feel if you could no longer use [product]?”

Group responses into three buckets:

• Very disappointed
• Somewhat disappointed
• Not disappointed

2. Measure the percent who answer “very disappointed.”

If your “very disappointed” segment is at least 40% of the total sample size, that’s a strong sign that you’ve found PMF. That percentage is based on Ellis’s research benchmarking nearly 100 startups.

If your “very disappointed” bucket is under 40%, there are a few additional questions you can ask to iterate toward PMF. Check out Superhuman's in-depth post for the full framework.

Free trials are often touted as one of the best ways to get more SaaS leads. But if your trial users aren’t turning into paying customers, your acquisition model is broken.

To convert more users, try one (or more) of these strategies:

• Personalize onboarding. Send a welcome email when users sign up. Ask what they need help with. Or offer a one-on-one demo to show the full potential of your software—Funnel CRM shared that doing so increased conversions from 5% to 9%.
• Trigger support emails based on user activity. Adobe offers a 7-day trial for all its Creative Cloud apps. If users spend more time on a particular app, they’re automatically enrolled in a sequence focused on that app’s features.
• Offer a short feedback session halfway through the free trial. Resolve issues that users encounter. Communication platform Nextiva uses a 15-minute feedback session to uncover issues and offer support. The short time frame makes the ask feel like a small commitment—and gives Nextiva the chance to schedule another call at the end of the trial.
• Limit the features available during a free trial. Your product’s best feature should be easy to find and use during the trial. But to add intrigue, make secondary features visible but not accessible. This will entice users to upgrade to a paid account.
• Offer a discount at the end of the trial. Some users may not be fully convinced to sign up once their trial ends. In this case, you could try offering a generous discount off the first few months of your paid tier. Payment platform Dunnly offers as much as 60% off for 3-6 months after its free trial ends. It’s seen more fully paid conversions this way than by simply extending free trials—the discount weeds out leads who are reluctant to pay anything. And if users are continuously experiencing value in the discount months, they’re less likely to churn once they start paying full price.

Here’s a quick change that could increase Facebook retargeting conversions:

Shorten your ad copy.

Sounds ridiculously simple, and it is. But many marketers retarget with long-form ad copy—and it might be bringing down conversion.

‍Brainlabs ran a series of ad copy split tests for a fashion retailer. Short ad copy—copy that fit on one line on Facebook—consistently drove more clicks for retargeted users than long-form copy (64% vs. 36%).

Compare that to prospecting campaigns, where clicks from short-form and long-form copy were equally split.

The theory behind this difference:

• Retargeted users are often already aware of your brand and product. They’re higher intent and don’t need as much education, so they react better to shorter messages.
• New prospects need more education—so longer ad copy might be necessary.

Consider testing short- vs. long-form copy in a retargeting campaign to see if you get a similar conversion improvement.