If you want to generate more raving fans for your business build a machine to understand what drives some of your users from awareness to white-hot enthusiasm. That is the theme of this week’s Growth Snack: The Breakout Growth Podcast Short with Sean Ellis and Ethan Garr.
The ”Perfect Customer Loop” is a way to visualize the journey that evangelizer-customers follow as they try, use, and fall in love with your product.
In our last Growth Snack, we talked about the trap companies often fall into when they achieve product/market fit but fail to understand it deeply enough to operationalize growth effectively. This conversation builds on that and will help you avoid that mistake while tapping into the emotions that drive users to your product’s must-have experience.
So jump in with us, and in less than 10 minutes you will learn how The Perfect Customer Loop can help you accelerate growth.
We discussed:
* “The Perfect Customer Loop”, a tool for dialing-in product/market fit (00:34)
* The value of visualizing retention and referral in action (02:56)
* How teams win with this exercise (04:03)
* Leveraging the learnings to improve speed-to-value (05:23)
* Warning; don’t fall into this trap (05:41)
Transcript:
00:00.00 Sean Ellis
If you are leading growth building a startup or looking to ladder up your skills then you’re probably really busy. So every other week tune into Growth Snack the breakout growth podcast short where ethan gar and I share one key growth learning to help you on your journey to breakout growth success. It’s food for thought for anyone hungry for growth all right Ethan you called me a couple ofweeks ago. Excited about this perfect customer loop concept and I think it’s something our audience can really benefit from especially in the context of our last discussion where we discuss key mistakes companies make when transitioning to growth.
00:34.59 Ethan Garr
Sure you know you’ve always told me that companies fail for 1 of 2 reasons either they fail to find product/market fit or they find product/market fit but then they never really understand it so they never were able to use it as a lever for growth that always surprised me because you’d think if you found product/market fit you really understand every bit of your product market.
00:34.79 Sean Ellis
So explain the idea.
00:54.00 Ethan Garr
But it’s actually much more nuanced in then especially at that transition when now you have to use work cross-functionally to amplify that value to ah you know in multiple ways can be a real challenge and I think a lot of companies stumble there. So as I’ve been coaching a couple of CEOs recently I really wanted to help them focus on building that understanding and certainly that starts with. Understanding your data and asking lots of questions. But this exercise came into focus and it really proved to be valuable. So It’s a pretty simple concept. You start with this idea of imagining your customer telling someone colleague a friend about your product and they’re just just super amped up and love your product. So I always use My Robo Killer example So imagine somebody sending in a bar. They get a phone call and they throw their phone down and they say damn I hate those robocalls they’re so annoying and the person next to them goes. Oh you’ve got to try this Product. You’ got to try Robo Killller. Not only does it block those calls but it answers them and and talks back to those spammers and wastes their time so you can get revenge. And they’re raving about your product and they just love it and they’re evangelizing who you are and the idea is to work back from that moment step by step all the way to where that person became aware sitting at a bar about your product from someone else. So think about what happened right? before.
02:06.37 Ethan Garr
They had that conversation. Maybe they got a phone call themselves or something happened where the job to be done came into focus and the product elegantly solved their problem. What happened before that maybe they added a new feature that you that you presented to them and they said Wow, That’s even more value that I didn’t even expect. Maybe they had an interaction with customer support or they finished an onboarding process. Ah, they just visited your app or your so you know somehow they were delighted. You think back through each step whether it’s an email a text whatever happened all the way back and you just keep thinking about these loops that create this perfect customer.
02:43.33 Ethan Garr
And the idea is this perfect customer telling another customer a potential customer about your product. That’s the perfect. Um, you know example of a white hot fan. So you just want to keep digging in and understanding the emotions that that are behind that experience.
02:56.27 Sean Ellis
Awesome I love it. It’s ah it just it’s ah it builds so much more on some of these other concepts. So it’s it’s like taking the net promoter score and just really like okay, what is the action. That is is driving that it’s like looking at it in action but not just that it’s it’s it’s working all the way back. Another thing that it kind of taps into one of my favorite questions on http://thepmfsurve.com that the template that I’ve I’ve put out there for for several years that a lot of people have used now is have you recommended this product if so.
03:29.16 Sean Ellis
How did you describe it I love that question because it gives me really rich language that people use to describe the product. But I think this is taking it so much further where it’s it’s not just the language they used or the the moment that they recommended it. It’s everything that led up to that moment. So so kind of beginning with the end in mind. 1 of the the 7 habits of highly effective people. One of those habits begin with the end in mind and so the the end goal is this white hot referral customer that loves your product. You’re thinking about what drives that referral.
04:03.16 Sean Ellis
And then just yeah, every single thing that leads up to that and and of course that doesn’t happen if you don’t have strong product Market Fit. It doesn’t happen if you can’t retain that customer but most most companies kind of feel like okay if we can retain the customer. We have product Market fit. Okay, we’re done. No, it’s it’s it’s like actually adding another goal to that to get them to the point where they’re now actually referring the product. So what? What do you think Teams can can really get from this exercise Why is it so valuable.
04:33.84 Ethan Garr
Yeah I Think like you said I think you’re building this machine to really understand the whitehot customer and it just gives you a great way to focus on making more of them and thinking thinking through how can you attract and retain more people who have that experience So you know it. Like it because you can start looking at each of these moments in that journey as opportunities to experiment and learn and to drive that more frictionless you know loop through this but also and maybe more importantly is you can think about the emotions driving their actions at each point and think about which channels may be best suited to appealing to those emotions.
05:11.58 Ethan Garr
In your marketing and in all of your efforts I think Ultimately what you’re trying to do is you’re trying to understand product Market fit in a more actionable way we’re trying to turn product market fit into a verb that you can then use to focus in on your objectives.
05:23.88 Sean Ellis
Yeah, and and I see why you call it a loop too because it is really, you’re not just thinking about what led up to the point where someone refers the product but you’re also then thinking about the next person’s experience and so clearly.
05:41.62 Sean Ellis
When that referral happens it creates a set of expectations and how quickly can you get that new person to a valuable experience where you now get that lock-in and ultimately get them to make the referral and so I really just breaking down these components of. Authentically what drives a strong word of mouth growth. Engine is is super powerful. But of course we need to we need to be aware that anytime you talk about referral. It brings out the crazy and growth people and so you’re going to get a lot of people that are just like.
06:12.42 Sean Ellis
It’s all that last mile and and how do I spam the heck out of my existing users to prompt them to tell more customers and and you know what?? What’s the right incentive to give and I think what’s really great here is that you’re you’re literally saying think through the entire experience and. How does that entire experience lead up to the referral and and and ultimately build that engine and so we we just have to avoid making this about a single tactic and more about just authentically how to how to all of these pieces fit together to drive referrals.
06:41.20 Ethan Garr
Um, yeah. Yeah I mean some companies are more referral. Yeah oriented than others. It’s not so much about the actual referral. It’s about thinking through the flywheel that would drive the creation of white hot fans who are excited about what you do? Yeah I mean at the end of this exercise if you’re thinking like.
06:51.64 Sean Ellis
Right.
07:05.26 Ethan Garr
Hey we have to come up with an you know here’s our incentivized referral program. You’re probably missing the point I mean this is not this isn’t designed to get you to a Dropbox moment. Although I hope every company can find 1 this exercise really about focusing on how value is created and delivered to end users and using that to really guide big picture thinking and strategy for your.
07:24.84 Sean Ellis
Yeah, and you know when when I look back I’ve I’ve I’ve worked on a lot of companies from the early days that that became that you know that reached that that unicorn status that that we all hope to get to and when I really think about you know what? what was that? biggest growth driver in each of those companies it was referral.
07:24.94 Ethan Garr
Your organization.
07:44.33 Sean Ellis
There’s not a single exception to that of of the you know 5 or 6 companies that reach billion dollar valuations that I’ve worked on and it’s just it’s so interesting because it is not. It is not something that we. Necessarily did drive the referrals even Dropbox the the super famous case of of an incentivized referral program it it was really about getting all parts of that experience right? and then the referrals were a natural outcome of. That but we were never as intentional as what you’re talking about and so that’s what I really like about this that if you’re if you’re super intentional about what that the that the white hot raving fan is what you’re trying to create and and you think through. From from day 1 of that journey. How do you How do you get them to that point and then building on that loop how you get the next one and the next one I think it’s super powerful for for building. Ah an engine that becomes unstoppable, but obviously we could talk a lot more on this referrals. Ah a huge topic.
08:45.62 Sean Ellis
But I think it’s important for us to honor our promise of keeping these under 10 minutes so thank you for for sharing this. This is great.
08:53.57 Ethan Garr
Yeah, thanks everyone for tuning into this week’s growth snack. It’s one one growth insight to help you power your team’s breakout growth success next week we’re back with a full breakout growth podcast episode with an interview with one of the world’s with a leader from one of the world’s fastest-growing companies if you’re hungry for growth. Keep tuning in.