Chapter 33: Designing Apps to Boost Retention & Increase Virality

In this chapter we'll explore a fundamental formula for retention and virality.


What you will learn

  • Key components for optimizing a users initial experience with your app, which increases the likelihood of virality
  • The Viral Coefficient
  • How to trigger behaviors within your app

Three step process

There are three main elements that a user will go through when they experience your app, and it's your job to maximize each one of them. If your product can achieve this, not only will your users have a great experience, but retention will likely increase. This will also increase the likelihood of organic growth. (Figure 4.9.1)

Figure 4.9.1

4.7.1 - Diagram.png

Understanding

Users need to understand why they are there, and what they need to do. At the very least, the user will have some context of what your app is, or what it does. Whether it is by keyword search in the App Store, or word of mouth from a friend, we need to assume their context with your app is as minimal as possible. Therefore it's essential that the second your user opens your app, they understand exactly what they need to do to start using it. If you want the user to post something, this should be clear and not be buried and bogged down with secondary features.

Journey

The next component is the Journey. The journey begins the second your user interacts with your app, and ends when they have gone through the actions you've set forth. For example, the journey through experiencing Instagram for the first time would be tapping the post icon, choosing your favorite filter, writing a description, and finally posting it to your feed.

The journey should be taken very seriously. It is as if you are meeting someone for the first time. A first impression is generally an accumulation of how they present themselves (both physically and emotionally), how they speak, what they speak about, the common ground you establish, and a variety of other factors. This can be directly translated to the first journey your user goes through with your app.

I encourage you to be very deliberate through this process. Focus on a few key actions you want your user to engage in, and cut out all the unnecessary fat. The user is in discovery mode, and excited to try out a new experience. Having too many options forces the user to think instead of enjoying the ride. Imagine if you went on a roller coaster, but at every turn it comes to a jolting stop, and asks if you want to go left or right? Sure it might be fun to "customize" the ride, but it becomes less of an experience, and more of a duty. Your users owe you nothing. Give them a great roller coaster ride.

I cannot stress enough the importance of remembering your target audience through this process. Because this is a first impression, you want to make sure your app personality shines strong here. If your building a business or enterprise application, you might want to cut straight to the point and make it easy for a wide range of ages to use. Whereas an app focused on music for millennial's might call for a greater finessed experience, filled with more bells and whistles. This will vary immensely for every single app, and should be carefully crafted and tested throughout the entire lifetime of your app.

Delight

This is your moment. Your user has found your app, downloaded it, experienced a magnificent journey through their first interaction, and now it's time for you to close them. This can be tied into creating user habits with micro-interactions, elevating the experience to a new level after completing an action.

Let's go back to our Instagram example. Once a user goes through the journey of posting their first picture, the highlight of it all is when users like your picture! Displaying users liking your content is a micro-interaction that loops you back into the journey process.

Another example is finding a freelancer on a platform like Upwork. The journey could have been setting up your profile and posting your first job listing, and when a freelancer reaches out to fill the position, the loop has been closed. That's the crucial moment when Upwork will let you know you've succeeded in your post, and as a user.

Gratifying your users in this aspect can also have some great compounding effects. This is the moment where the value proposition of your app is being fully defined, and when the user has experienced the value firsthand. They might tell their friends about it!

This is arguably the most powerful form of marketing, it's what makes products go viral. All products strive for this, and dialing in on gratifying your users after they have gone through the first two steps is crucial for success.

Virality Coefficient

The virality coefficient is a way to quantify virality. Frankly put, it's the average invites each existing user sends out, multiplied by the conversion rate of those invites. Invites can come in many ways. They can be emails, share systems, and even word of mouth. For the sake of illustrating this concept, invites are - how many people your current users talk about your awesome app to others.

So if we were to rephrase the definition in our context, it would basically be how many people your current user base talked about your awesome app, multiplied by the percentage of people who actually downloaded it. (Figure 4.9.2)

Figure 4.9.2 4.7.1 - Viral Coefficient.png

Great, so now let's see this in action! Imagine we just finished building our awesome app that already has 100 committed users. Let's say that on average, each user tells 5 of their friends about it, and 25% of those people actually download it and do the same. Look at how this affects our users over time. (Figure 4.9.3)

Figure 4.9.3

4.7.2 - 1.25.png

As you can see, we have a healthy growth curve. At the end of the first cycle, we have already converted 125 new users! Those in turn get re-entered into the viral coefficient formula. Be careful not to include your full user base when calculating future cycles. It's a dangerous and false assumption that your current users will share your app at the same rate indefinitely.

A cycle is most commonly a campaign that is ran to share or spread virality within your product. This could be in weeks, months, or days. It really depends on the time frame that fits well with your specific situation, and will likely vary case by case.

Now let's adjust a few of the parameters and watch what happens. We'll have the same 100 users, but on average they'll only tell 3 friends. That makes a 20% conversion rate. (Figure 4.9.4)

Figure 4.9.4

4.7.3 - Diminish.png

You will notice three things right off the bat. Our viral coefficient falls below 1, and eventually our converted users diminish to 0, which means our growth came to a screeching halt. Bummer.

So we can safely conclude that we need to keep our viral coefficient above 1 to maintain steady growth. (Figure 4.9.5)

Figure 4.9.5

4.7.4 - Flatline.png

So how do we increase our viral coefficient?

  1. Increasing how many friends your app is shared to by your current user base
  2. Increasing the conversion rate
  3. Do both because you're a ROCKSTAR

Increasing invites is a great way to increase your viral coefficient. Getting your current user base to share your awesome app with their friends becomes increasingly easier with technology. A common technique is giving discount or coupon codes for sharing. (ie Get 15% off your purchase by sharing to Facebook or Twitter).

Increasing conversion rates are also extremely efficient. If you know your app is being shared by friends who trust each other, increasing the conversion rate could result in tremendous returns.

Often, techniques will be used hand in hand with increasing invites. For example, when you share Uber with a friend, Uber rewards both you and your friend with 20% off your next ride (if your friend signs up). We've just killed two birds with one stone. We have incentivized sharing, usage, and new user adoption.

There are many more ways to use the viral coefficient and a number of hybrid formulas for specific use cases. If you are interested, I encourage you to look further into them. It can significantly impact the driving forces for better decision making.

User Behavior

In the last part of this Chapter, I'd like to touch on behavior. What makes a user take action? What are the driving forces behind these actions? B.J. Fogg, a behavioral scientist from Stanford University, breaks it down into the following:

Behavior = Motivation + Ability + Trigger

Motivation for all intent and purposes refers to how motivated the user is to complete an action. For example, a scenario in which someone might have a high motivation to act, would be paying an electricity bill. By paying an electricity bill, one can avoid late dues, and maintain power in their home. Motivation can vary case by case. For our next example, a 10 year old child might have less motivation to do his or her household chores than adult keeping up with their bills (As much as we'd like to go back to being a kid doing chores).

Ability refers to how capable one is to complete an action. In our electricity bill example, if one is struggling to make ends meet, they might have less ability to pay their bills vs their next door millionaire neighbor. Ability becomes extremely important because if your user does not have the ability to complete an action, the behavioral model is lost. Conversely, if someone is easily able to complete an action it makes all the other levers involved easier to pull.

A Trigger refers to something that prompts you to take action. For example, your bill sent to your mailbox, or a push notification on your phone would be a prompt for you to take action.

So how does this all piece together?

If you want your users to do something, it will depend on their level of motivation and ability, which will be prompted by a trigger. Prompting triggers with low motivation and difficult ability, have an extremely low success rate. Where as aiming to combine high motivation with ease of execution, results in higher success rate with your trigger.

Furthermore, you can have success with a highly motivating action and a mediocre ability level, and conversely, a lower motivating action with a higher ability level.

Imagine a trigger for a 15% discount coupon upon emailing 5 of your friends about the app. I would imagine motivation would be relatively low depending on the original price, and the ability might be difficult if you have to manually email 5 people, and carefully select those you send it to. Now imagine if the trigger prompted a free item (high motivation), with a mid to high ability level. Now you might start seeing some results!

Wrapping up

You might be thinking, "Okay this is great, but what is the point of all this?"

These principles are imperative from the moment you start brainstorming your minimum viable product, and will continue as long as your app is still alive and kicking. These principles are intertwined into the fabric of all great products in some capacity, and are not merely a check mark on the path to success. I encourage you to incorporate all these in your future applications, and I'm excited to see what amazing products you crank out because of it. :)

Exercise

Use a current app you have built, or one that you are planning on building, and create a model for your viral coefficient. Think about how many of your friends and family can get to use your product from the jump, and what tactics you could use to increase your viral coefficient. I encourage you to actually implement your ideas and quantify the results so you know where you can improve, and what tactics performed the best.