Emily Grossman - How to Grow

Transcript

1. Real Talk: I’m worried about the discourse on Growth
2. We need to go viral on TikTok. You don’t have a Podcast!? What’s your Chat GPT strategy? We need a Calendly-style invite link. Acronyms. So. Many. Acronyms. Thought pieces about acronyms.
3. When we are desperate, we look for hacks. Quick wins. Copy-paste solutions.
4. That’s not the growth I know.
5. The growth I know is business strategy. It’s focused, planned work.
6. Back to basics.
7. Growth is a financial objective Achieved through product, sales, and marketing strategies What is growth?
8. Growth is concerned with two (simple) things: As much and quickly as possible (or desired) Less than you’re making Making money Spending money 1. 2.
9. MAKING MONEY = People Conversion Rate Frequency Length of Time Size of transaction Cut of transaction (take rate / margin)
10. MAKING MONEY = People Conversion Rate Frequency Length of Time Size of transaction Cut of transaction (take rate / margin) Acquisition & Monetisation Engagement & Retention Pricing
11. A note on north stars, Only Metric That Matters, Core Actions… Ideal product use Leading indicator of ideal product usage Correlated action(s) w/ leading indicator
12. Monthly Buyers 4x/Month Browsers 3x searches in first week A note on north stars, Only Metric That Matters, Core Actions…
13. “Monthly Buyers” = People Conversion Rate Frequency Length of Time Size of transaction Cut of transaction (take rate / margin) Buying ≥ 1x Month People
14. If you’re measuring “growth” in a way that doesn’t align to how your business makes money, you’re doing it wrong.
15. Growth is concerned with two (simple) things: As much and As quickly as possible Less than you’re making Making money Spending money 1. 2.
16. MAKING PROFIT = REVENUES minus COSTS
17. (no sh*t sherlock)
18. Managing upfront costs vs. later returns Compares projected value to cost paid for that value Speed of CAC repayment Manages cash flow / burn LTV:CAC ratio Payback Period 1. 2. How fast you make your money back to reinvest Good or bad investment?
19. Calculating payback CAC Payback = CAC (Monthly) Revenue * Profit Margin % * * deduct your cost of goods!
20. Setting your payback goals Instant 6 months 18+ months 12 months Tried & True Tactics Unknown Tactics Less Risk More Risk Less Reach Broader Reach Monthly revenue & margin steady Expecting increases to monthly rev & margin
21. Set at a company level (blended). Set for each channel or tactic. Don’t change too much or too drastically.
22. Should you prioritise Profitability or Growth?
23. Recap: 1. Growth goals are financial 2. Know your revenue drivers 3. Manage investments
24. How to Goal Reality Options Will
25. Reality
26. There is no one right way to grow.
27. Commerce Model …increasing purchase events and purchase value People & Conversion Rate Frequency & Size of Transactions Cut of Transactions Grows primarily by… Key revenue drivers…
28. Commerce Model Subscription Model …increasing purchase events and purchase value People & Conversion Rate Frequency & Size of Transactions Cut of Transactions …elongating customer lifetime & increasing purchase value People & Conversion Rate Length of Time & Size of Transactions Cut of Transactions Grows primarily by… Key revenue drivers…
29. Commerce Model Subscription Model Marketplace Model …increasing purchase events and purchase value People & Conversion Rate Frequency & Size of Transactions Cut of Transactions …elongating customer lifetime & increasing purchase value People & Conversion Rate Length of Time & Size of Transactions Cut of Transactions …increasing matches of supply & demand, to drive transaction People & ‘Buy’ Rate Frequency & Lifetime Size & Cut of Transactions People/ Biz & ‘Sell’ Rate Frequency & Lifetime Grows primarily by… Key revenue drivers…
30. Commerce Model Subscription Model Marketplace Model Advertising Model …increasing purchase events and purchase value People & Conversion Rate Frequency & Size of Transactions Cut of Transactions …elongating customer lifetime & increasing purchase value People & Conversion Rate Length of Time & Size of Transactions Cut of Transactions …increasing matches of supply & demand, to drive transaction …creating an active & targetable audience, to increase ad sales People & ‘Buy’ Rate Frequency & Lifetime Size & Cut of Transactions People/ Biz & ‘Sell’ Rate People & Ad Conversion Frequency & Lifetime Businesses & Spend CVR Size of Transaction Frequency & Lifetime Grows primarily by… Key revenue drivers…
31. Businesses think about growth differently at different stages 2 3 Build Scale Evolve 1
32. BUILD: seed to sapling 1 2 3 Build Scale Evolve Focused on learning what works: - Finding PMF - Which business model works best for the product and audience - The power of your revenue levers - The relationship between your spend, revenue levers, & profit Common pitfalls: - Ignoring profitability - Jumping to ‘scale’ goals too quickly
33. SCALE: sapling to plant 1 3 Build Evolve Focused on exploiting what works: - Building scale or automation around strategies that can move revenue levers (and/ or drive cost efficiencies) Common pitfalls: - No focus - Trying to Scale and Evolve at the same time 2 Scale
34. EVOLVE: planting the garden 3 Evolve 2 Scale 1 Build Focused on diversifying: - Discovering adjacent markets/ audiences, products, or business models that play to your strengths Common pitfalls: - Jumping from Build → Evolve (skipping scale) - Assuming the same revenue levers and costs will apply to the new business - Divesting too aggressively from the scaling business
35. Growth strategy should adjust to suit your business model, not the other way around.
36. 1. Every company is different 2. Understand your business model 3. Understand your company stage to set the right goals & strategies Recap:
37. Goal
38. Growth is concerned with two (simple) things: As much and As quickly as possible Less than you’re making Making money Spending money 1. 2.
39. Two methodologies for setting growth goals: BOTTOM TOP
40. Bottom-Up Goal Setting • Analytical exercise • Forecasting a baseline & forecasting growth from planned changes • Typically led by function owners • Best when input/output relationships are known
41. This is my friend Ed. Top-Down Goal Setting
42. This is my friend Ed. “What do I need to believe?” Top-Down Goal Setting
43. 2024 Revenue : 50 Million 30 Million UK Revenue 20 Million EU Revenue Launch in France in April May - Dec Growth Rate same as UK Top-Down Goal Setting
44. 2024 Revenue : 50 Million 30 Million UK Revenue 20 Million EU Revenue Launch in France in April May - Dec Growth Rate same as UK 🤨 Can I believe that a new market will instantly drive as much revenue as a mature one? Top-Down Goal Setting
45. 2024 Revenue : 50 Million 40 Million UK Revenue 10 Million EU Revenue Launch in France by March 9 months EU = 3 months UK Top-Down Goal Setting
46. 2024 Revenue : 50 Million 40 Million UK Revenue 10 Million EU Revenue Launch in France by March 9 months EU = 3 months UK Top-Down Goal Setting
47. Top-down & bottom-up goals work together.
48. Options
49. Assess your options Strategy x Revenue Driver People Conversion Rate Frequency Length of Time Size of transaction Cut of transaction (take rate / margin) Product Marketing Sales
50. Some of the best growth strategies hit on multiple drivers.
51. Remember actions often have reactions People Conversion Rate Frequency Length of Time Size of transaction Cut of transaction (take rate / margin) Product Marketing Sales
52. Will
53. Ruthless filtering.
54. Back to the all the questions floating around Should you be on tiktok / What’s your ChatGPT strategy / Should you do Product Led Sales You can answer it now. Is it the best way for you drive revenue? Could it have an acceptable payback period? Does it align to your business model?
55. Growth is a financial objective achieved through product, sales, and marketing strategies. Break it down into revenue drivers. Don’t forget to manage your cash flow. Set your goals from the top-down and bottom-up. Evaluate best options for your business model & stage. Focus. Recap:
56. Back to basics.
57. Thank you. Let’s talk about growth linkedin.com/in/emilygrossman/ emily.grossman@dojo.tech
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