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How to build a product with customer retention at the core

Hiten Shah | Founder and CEO of FYI

  • | Acquisition | Activation | Customer Success | Engagement | Growth | Onboarding | Product Strategy | Retention
  • October 2019
  • EP33

Retention is the core

Build your product with retention as the focus

Today on Churn.FM, we have Hiten Shah, the founder and CEO of FYI, and other startups such as Kissmetrics, Crazy Egg, and Quick Sprout 

We talked about the biggest shift in the product development landscape over the years, why it’s harder than ever to build and grow a business today, and why Hiten still launched FYI despite it all.

We also talked about how Hiten categorizes customer retention into different buckets, why products should focus on targeting an already existing behavior instead of trying to invent a new one, and how Hiten goes about customer development.

Hiten also shared his biggest learning about churn and retention after years of product development experience, the top 3 things that companies should focus on to improve customer retention, and his #1 piece of advice for anyone who wants to build a new product today.

As usual, I’m excited to hear what you think of this episode, and if you have any feedback, I would love to hear from you. You can email me directly on Andrew@churn.fm. Don’t forget to follow us on Twitter.

Mentioned Resources

Highlights

Time

The most significant shift in product development space over Hiten sees over the years 00:01:44
Things Hiten looks at when measuring retention and how he bucket various segments 00:08:30
Hiten’s definition of short-term, mid-term, and long-term retention 00:09:23
How Hiten determine the natural frequency of product usage, and why products should focus on finding out already existing behavior 00:10:28
Hiten’s biggest learning when it comes to churn and retention after years of product development 00:16:53
How Hiten measure the impacts of product changes to churn and retention 00:22:37
How Hiten prioritizes product decision 00:28:30
Who Hiten thinks should own retention within a company 00:33:45
Top 3 things that Hiten think companies should focus on when it comes to improving retention 00:35:09
One piece of advice for people starting out building a product 00:39:19

 

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Hiten Shah

Founder and CEO of FYI

Hiten’s recommended resources on churn
What Hiten is reading right now

About the podcast

My name is Andrew Michael and I started CHURN.FM, as I was tired of hearing stories about some magical silver bullet that solved churn for company X.

In the real world tackling churn and increasing retention is one of the hardest problems a subscription business faces.

In this podcast, you will hear from founders and subscription economy pros who are taking a systematic approach to increase retention and engagement within their organizations.

Transcription

Andrew Michael
Hey Hiten, welcome to the show.

Hiten Shah
Happy to be here, one of my favorite topics.

Andrew Michael
Awesome. It’s great to have you. So for the listeners out there, Hiten is probably one of those it needs no introduction. But if you do, he’s the founder and CEO of FYI, if I as a service that helps you organize all your documents in one place and find what you’re looking for in three clicks or less. Prior to FYI, Hiten also built five multimillion dollar products and co founded Crazy Egg, Quick Sprout and Kissmetrics. He’s also the co host of The Startup Chat with our previous guests Steli Efti, and invest in advising over 120 plus companies. So to say he knows a thing or two about building products is an understatement. So my first question for you Hiten is you’ve been building products for a long time, like what has been some of the biggest shifts you’ve seen in the product development space over the years?

Hiten Shah
Yeah, the number one biggest shift is, is the statement that some people have said and I’ve said a bunch of times, which is it’s easier than ever to start building, start creating a product, even launch product, it’s harder than ever to grow a business off of that product.

Andrew Michael
Absolutely. And what do you think some of the reasons offer that?

Hiten Shah
I think the number one reason for that is the fact that today, there are more opportunities than ever to basically build really fast you can build with no code, you can build really easily with her Roku and AWS, and let’s not forget Google Cloud and Microsoft Azure, and then all these other tools like even Shopify, and you know, the knowledge is there. There are so many more programmers, there’s things like lambda school, right? So this whole, like, undercurrent to me is the fact that there is a lot of tooling. There are a lot of people and there’s a lot of infrastructure that makes it really easy to build something that’s a website basically that is more of like a web app. that people can sign up for and do something with. There’s also now that we’ve had so many different hardware companies come out. It’s also easier than ever to start a hardware company. Yeah, all of this stuff has its challenges. But these things are not very hard to do compared to 510 15 years ago, especially, definitely not 15 plus years ago, when I started, this stuff was unknown. Like we were we had Ruby on Rails, it was point one, when we started it crazy. I back in the day, I don’t even know where they’re at now in terms of how far along but it’s been a solid 1615 years, you know, since that thing came out, and things are different. It’s just easier. And I think that I can’t highlight that enough. It’s just easier. There’s even companies like Zapier that make it easy to connect a bunch of apps together and build some kind of back end for yourself, and not even getting into some like more niche products like Firebase by Google. And, you know, all these other things are the fact that you can pretty much run a whole website or even an app using Aereo cable. So it’s like the tooling is ubiquitous. The amount of tooling is ubiquitous. And it’s not hard to start something.

Andrew Michael
Yeah, seven stock, you just didn’t really need to know how to Google and you can get started. I think. So but then I know that’s, I mean, you said as well, that it’s becoming harder to actually build a business around. So what are some of the reasons you think, like, it’s becoming more and more difficult to actually build a business as opposed to just building the software like you need to in the past?

Hiten Shah
So there are a lot of customers out there. There are a lot of customers out there. And that is a positive, that’s a plus. And what I mean by that is, there’s just more people on the internet than ever before. I mean, this is just like a sort of obvious statement, right? And with that comes like something that you think would be easy, which is, you can easily go and basically get these customers. I don’t think that’s exactly the case. Because everyone has that idea of we can go get these customers. So everyone’s going after essentially a similar customer base. And that’s for almost any market, you can be in a niche market and probably find customers and find a way to them. That’s a little bit different than other folks that are out there. But at the end of the day, we’re all going after the same pool of customers. There are a lot of marketing channels out there and a lot of marketing tactics, but there’s only a few that actually have scale, such as Facebook, for example, or Google search is still a really big deal for most companies. And so this makes it so that you have tons of customers you can get. Absolutely. And then on top of that you have everyone going after those customers, and then you have a limited number of channels that have really scaled. So it’s harder than ever to make it so that you’re actually able to grow a business and we’re not even talking about your product itself. In Sort of the reason we’re talking today, which is turn, we haven’t even gotten into turn, which I would actually more referred to as retention. Yeah, than churn because I like the positive, not the negative. But, you know, whatever, whatever way you look at a term usually implies, it normally usually implies a paid paid products, Software as a Service product. Well, I think retention is a little little broader.

Andrew Michael
Absolutely. And I think as well like what you’re saying now as well, in terms of competition and the different channels, being able to scale like one of the issues then becomes is that the customer acquisition costs, trying to acquire customers today. And I think there’s been a few different studies I know like from price intelligently profitable, they came out and showed the chin the trends in customer acquisition costs growing. And one of those ways like you say, obviously to combat embeds and be able to compete in channels is to have really, really strong retention. So you’re going at it again now and starting out another product if I with this in mind. So you already know that things are a lot easier now anybody can spend anything up inside competing. channels are becoming more and more saturated we fighting even though there’s more customers, there’s more of us fighting for those customers. So what are some of the things you thinking about going into this time that you’re going to be different between different from the companies that you’ve previously founded and built?

Hiten Shah
Yeah, I mean, I’m not even just saying this because we’re on this call, but turn. We’re focused on churn, we’re focused on retention, we’re focused on making sure that companies get the value that that they should. And we actually are very deliberate about this. We started out with a product that individuals loved, and wanted to make sure we built that we built that individuals can sign up for FY, get a ton of value out of it. That’s our single player mode. Right now, the number one thing we’re working on is what we call FYI for teams, which is our version of multiplayer mode. And that mode is really all about making sure our teams love our product. And teams won’t love our product. They’re not retained, right. Yeah, makes any sense. It’s like anti anti retention is the is the lack of customer love.

Andrew Michael
Exactly. And if you’re not giving love, if they’re not giving you love and you’re not delivering value, they’re going to be turning and leaving your service. So what are some of the things then when you’re thinking about this, and I like it that you’ve taken the approach. So first of all thinking about that single player mode, and really focusing on that end user of the product, because more often than not, maybe we overcomplicate things in the beginning, but I think given the context of a team, and our companies will be using it, but really, it’s the individual users. How are you thinking about like retention in the context of individual users? What are some of the things you’re looking to measure and track and maybe give us one or two things you’ve looked into and ways of improving it?

Hiten Shah
Yeah, the number one thing we look at is literally our daily retention rate, which is what you know, and it’s courted. So of the people who signed up last week. Let’s see specifically on Monday, what percentage of those people are still around and more importantly, we care about What percentage of those people come back the next day? And so I basically break break down retention into into basically buckets. And then and then I use those buckets to essentially align, like our thinking as a company around retention. So I’ll, I’ll sort of explain how we think about it. Right now. Basically, what we do is we take retention, and then we basically split it into short term retention, medium term retention and long term retention. So for us, and we’re not a game, we’re a SAS product, right? We’re software product. If you’re a game, your short term retention is measured in in like, one to one one day, basically day one. midterm is like day three to seven, and long term is day seven plus, right? That’s not how we do what we do is short term is week one. midterm is weeks, two to four and long term is weeks five plus. So for us Short term retention, we’re trying to answer two questions. Do people use a product after their first session? How many times do people use the product in the first week? midterm retention, which is essentially two to four weeks, we’re looking at does a product solve a painful enough problem for people? And is the problem a frequent one that people have? And then long term retention is really is the product of part of people’s daily lives? And or workflow?

Andrew Michael
Okay, I like how you’ve broken that up into the three different phases and having sort of key actions that you’re looking to measure on the term of frequency because I think it is quite an important one. When you look at churn and retention, you mentioned like sort of gaming companies and a lot of comes down to those sort of areas where they’re measuring churn and short medium and long term is comes down to the frequency in which they use the product. How do you go about measuring and looking at sort of what the natural use case and the natural frequency of a product like if I is

Hiten Shah
Yeah,

Think frequency is something you measure, but but it’s not necessarily something you can manipulate. And what I mean by that is a lot of people will try to send emails and push notifications and things like that, in order to get people back, right, and get that engagement, get that repeat usage. I don’t really believe in that being the first place you go, what I believe in, is spending a ton of time, almost like an ungodly amount of time, understanding people’s behaviors. And the reason is, there are really no new behaviors you get to improve. Yeah, you only get to improve existing behaviors. A lot of this like some people would say, oh, jobs to be done. And all this stuff. I like to get a lot of the craft out of it and not talk too much about frameworks that not everyone understands. Simply put, there are things that people on the planet, not off the planet are doing. And of those things. You want to understand which of those Can your software provide a better experience for? So for us, we realized that people have a big problem. First, we identify the problem, which is people have a number one problem with documents is finding them across all the different apps they use, which is obvious from our value prop that you mentioned. What’s not obvious is the behavior that we discovered after literally hundreds of interviews now, and different serving methodologies and studying the market is that people aren’t looking to use a search box to solve this problem. They’re actually looking to just find documents period, and they want to do it in ways that align with their behavior. So the behaviors we learned, after all that interviewing is basically they find the documents by going in the tools that that they think it’s in the tool it’s in usually it’s tools because they don’t remember where it is a lot of the time. Then they look at what recently been modified, shared with them what’s recently been happening, because a lot of times they’re looking for documents that are reading Or they’re looking for documents based on the fact that someone shared it with them, or someone also has access to it. And they want to find it that way. And so we built an interface that aligns with those three things, and those behaviors. And then the other thing we learned is that the last ditch effort is people doing a search. And so we have a search as well. So when you think about it like that, it’s literally all about interviewing, and all about figuring out exactly how people want to find their documents, not how people want to search for their documents, because that’s two different ways to think about it. And what we learned is that people don’t use search, even though it sounds like the obvious solution for finding stuff.

Andrew Michael
Yeah, and I think is what you mentioned is that really critical is starting with that problem. And then going through the research psychologist speaking to customers. interested to hear your process in this? Because obviously, you’ve gone through this customer development process quite a lot over the years building the various products like, what are some of the questions you’re looking to try and answer in a survey or in a customer interview? And what is does your typical process look like because I think more often than not, as well as that, when we get stuck into customer research and customer development, often our own cognitive biases can like artist down the wrong path and be sort of like a self fulfilling prophecy. Like if we believe there’s a problem, we will find the problem. How do you go about ensuring that when you’re doing these interviews, one, like you eliminate your own cognitive biases, but then to also you’re able to have information that’s easily sort of quantifiable and measurable at the end that can actually action on

Hiten Shah
I’m looking to get stories out of people. I want people’s stories, because those behaviors are those are the ways that we learned the behaviors. So we asked people stories of like, when was the last time you were looking for a document and what happened? And they just went off and explained exactly everything they did. They explained things like we, I was I was in a meeting, and I couldn’t find the document. And at first, I just thought it was in Google Drive. And so I started looking around, I couldn’t find it. And then I realized that like, my coworker, john, shared it with me in slack. So I just went straight to john, I couldn’t find it in the message thread. So I went to john and asked john, where’s that document. And this is all while I’m in a meeting, and everyone’s waiting for me, while I’m looking for that document. That is a scenario. It’s actually a common scenario. And so that’s one behavior that we found. And you notice, like people went through a few of the behaviors already described. So to me, it’s about getting stories, whatever you’re doing, if you want to figure out the behaviors that people have, go get stories from them when you interview them, and ask them about the last time they had this problem, basically, especially once you’ve identified that this is the problem. What’s Solving for your business. And that’ll help you really even think through things like frequency, and how often does it happen? But really, for me, it starts with behavior. Because I can’t determine frequency without knowing behavior, because it’s the frequency of the behavior that you’re really trying to figure out. And we figured out that this behavior of needing to find your documents happens literally on a daily basis.

Andrew Michael
And I love that you taking it from the story angle, it’s really like allowing them to be quite a lot more descriptive in the nature of the usage of a tool or a problem, as opposed to maybe a little bit more rigid Question and Answer style interview. This for customer development stage, I think it sounds like an interesting way to go. So let’s fast forward a little bit now as well into churn and retention itself. So we talked a little bit about how you go about measuring it and how you’re looking at it in the being there. What is maybe one of your biggest learnings from maybe the biggest surprises you found throughout your time building products that had a big impact on shown by You never may be expected to have

Hiten Shah
early on, I didn’t realize how how great of an impact onboarding has on turn. Yeah, I know that sounds obvious now maybe. But the experience people have during the first session greatly will determine how likely they are to come back. And so in the case of FYI, what we do is, and anyone can check it out us fyi.com. It’s a free product, and we have paid plans as well. And but the reason I say that is what I’m about to say, we have something called Quick onboarding. By the time you hit our interface, no matter how many different apps you’ve connected, our interface should give you a solid understanding of what the product can do for you right away. You should be able to see as many of your documents as we can show you right within that first experience, which really happens between two to five minutes. And so we spent a lot of our energy, making that a great experience because that’s the aha moment. all my stuff is here. When we say find your documents in three clicks or less, all your stuff has to be there. That takes a while we have to ingest the metadata about all your documents, regardless of how many tools you use, and how many you’ve connected to takes up. So we needed to build something that made it feel like your stuff was there, and it was your stuff. And so that’s where we spent a lot of our energy. And so to me, that’s onboarding. That’s the first experience. And in the past, I kind of got lucky, like with Crazy Egg, we built an experience where you had to create your first snapshot we called it, which is really like, pick a page, pick a set amount of time and get your first sort of heat map, basically, for a page that you want. And that was our onboarding. It was basically built into the one experience you’re going to repeatedly get with the product, one that you’re repeatedly going to have to do, which is create the snapshot. The The world is evolved and that model of people having to create snapshots might not be the right one anymore. We’ve done some things around that. But back then, back in 2005 2006, it was like revolutionary to be able to pick paid you want to track and get this sort of visual representation of it. Right. And it wasn’t immediate. That was one of the problems. But the fact that you created it, and now you’re in anticipation of waiting, and you to come back tomorrow and look at it was a key driver. And so for us like back then we just made onboarding, the thing we felt like you would have to do to get get value from the product, and you would have to do repeatedly. And that’s what made it work. And so this is the way I think about it, which is like that. Not that that thing that’s now intuitive. And a lot of people have shared talked about done, test on growth experiments on etc, which is the fact that onboarding has a tremendous impact on on retention. In fact, it’s probably the number one thing I would be working on. If I want to improve retention, which is onboarding, it would work on anything else, frankly speaking.

Andrew Michael
Yeah, I think this has come up time and time again on the show and it’s like you said there’s almost one of those camp counterintuitive, but when you first getting started thinking about the problem, I think the The more obvious source is going to speak to customers that have turned and trying to understand what they’re doing and then trying to fix the reason. But then when it comes down to it, it’s really like, like you said, it’s not, they haven’t been able to get to the point where they actually understood the value. So really investing the time and effort in onboarding is is critical. I think one of the things I’ve also noticed about your products and maybe you can let us know why as well, a little bit but looking at us FI I mean, if you go to user fi.com, all you really have is a button to sign up. And similarly, I think, I don’t know if it’s changed, but I remember in the past Crazy Egg had a similar approach where like, there was just really the on the signup button and then it was a little bit difficult to find like the rest of the site yet to like, click another button to actually scroll down the page, whatever. Like, is there a specific reason is anything that you found in experimenting with your homepage of your site when it comes to sort of maybe onboarding or signup?

Hiten Shah
Yeah.

The way we think about that is that people are there to take the next step. And either they’re going to take the next step or they’re not. So all we really care about is I’m taking that next step. I mean, it’s that simple. And then the next step for FYI sign in with Google, go go after it, like get get your document here.

Andrew Michael
Yeah. And then from, like you say, you pulling that information. The next thing you said as well then was that in terms of the aha moment, and getting them there, like really wanting to get them there as fast as possible. You also mentioned that like, there’s a lot of work that’s happening in the background. And for a lot of companies as well, it’s not always that easy to get to that aha moment immediately. And for some, it may take quite a bit of time until somebody actually sees the value and the reason for signing up. So in your case of what of some of the things that you’ve tried to do or look at, in the interim, black while you building up people to this aha moment. When you thinking about the context of onboarding.

Hiten Shah
We think about the steps we make them take the order of those steps, like Like, when should we make them integrate? All those kind of things? I think those things are really important to us too. So, you know, like, do we do we show them? Do we make them enter in their workspace name? Do we make them make them upload, upload a profile? Like picture? What do we make them do? So we think a lot about what do we make them do? And what kind of value is that going to give them immediately? And in the long run, more importantly, every step is scrutinized around does it help retention? Or is it information that we really, really need? It has to be one of those to either help for attention or it’s information we really, really need.

Andrew Michael
All right, and when you said that, like it either helps retention, no doesn’t. What are some of the ways that you actually measuring So you mentioned earlier you your packaging, and you’re putting together cohorts and then you’re taking a look at how retention changes and impacted over time, but how are you measuring like the product changes you’re making and the impact that they have on trends? I think like, a lot of the time it’s quite difficult to correlate specific changes but I’m interested to hear like because obviously electric As an output metric, and retention can be impacting so many different factors. But I think the biggest impact really when it comes down to these changes in product, so how are you thinking about like the measurements and understanding the impact on retention when it comes to product changes?

Hiten Shah
Typically, it’s covert. It’s who’s been exposed to what features. And so if we can make improvements, and actually not let them out to everybody, that’s the key. Because the improvements that we make if they’re, if everyone has access to them, then they don’t matter as much as like, we can’t measure them as easily. And so some people will look at it like we made these updates, and they started on this date. So everybody after that date is exposed to that, and is our retention going up as a result. We tend to look at it like well, either we can have a holdout group, which is a small percentage of users that don’t get the new features or we can split test it which give half the half the people one feature the other Half the other. Or we can even do the opposite of a hold up hold out group, which is almost like a hold on group, which is basically give only a small population of their customers those features and see if their behavior is different because retention is really about behavior, are they coming back. And so it’s all behavioral to me. And so the real right way to do it is not just court by time, but court by what they’re exposed to. That would be the most scientific way to do it. And I kind of prefer that when possible,

Andrew Michael
and possible. And then also, like in the context of that, I think one of the challenge when like running tests are looking at cohorts and seeing what they’re exposed to is the time it takes in order to be able to understand and measure the impact. Specifically, when you’re thinking about something like retention. Maybe for like a regular SAS business monthly subscription, like you at least need to commit to 30 days minimum to understand like, really, what the impact is going to be in 30 days is even too little in this case. Like What are some of the early things that you then try to understand when it comes to like the indicators? Is there any specific ways when you look at an experiment design that you start sending out some early indicators to get a signals of the impact it’s having?

Hiten Shah
Yeah, I mean, early indicators for me are more about do they come back, or more of them coming back the next day? I don’t try to make it too complicated. I measure it on a very granular basis. Sometimes we’ll look at it and be like, you know, if this product is something they can use multiple times a day, or they can be back to it. Are they engaging? Another aspect of this is depth of engagement versus breath. So when they come back, are they spending a lot of time in the product? What are they doing? Or is it a product like FYI, we’re spending a lot of time in it today isn’t necessarily what we want. We want people to come to it, and then leave it because they found what they’re looking for. Right? So being able to know what the natural engagement cadence and depth and breath is for your product once people come back is really important. So we’re We’re scrutinizing engagement in that way, which is when people come back, what are they doing? And unfortunately, like most products, don’t let you do that very easily. Because it’s really about granularity of each customer, each user, even the analytics products that are out there are not necessarily the best at letting you see an individual user, everything they’ve done. And the fact that this user is constantly coming back or not. Right? So there’s a bunch of aspects about that we usually just use our database for

Andrew Michael
Yeah, and like he says, We’re like, I mean, this changes depending drastically on the product. But more often than not, sometimes like people are spending more time and your product is not what you want to actually be achieving. Like you actually want them to be spending less time and achieving the results faster. So it’s important to make sure you’re aligning sort of how you’re measuring engagement, like the breadth and depth of it in relation to the natural usage of your products as well. Exactly.

Andrew Michael
So we have a questions first time trying it out as well and sent out a tweet earlier. Just ask any questions if anyone had for you eat and so we’ve had a question that somebody He asked as well, I’m kids. And he’s asked, How do you calculate churn and retention for a seasonal business? So for example, fantasy sports is given. And I know from your time I’ve said kiss metrics, and you’ve thought about these challenges quite a lot in terms of measurement and how to help your customers. So do you have any advice for young kids? I like how he could go about calculating channel retention for a seasonal business.

Hiten Shah
Yeah, I mean, look,

I have two thoughts on that one. If it’s seasonal, make sure that when they do when it is that season that they’re engaged and retake, right, like that’s one way to think about it. Another way to think about it is a lot of seasonal businesses don’t think about this, but to me, it’s like what can you do offseason? Can you get them ready? Can you give them a summary of what happened last time? Can you help them do research? Can you just keep them in the game so to speak during that time, and what would it take to keep them in the game because these folks are passionate, typically when the seasons on so if it’s something seasonal I would be I would be hard pressed and it would be focused on Thinking about exactly what people can do and what they will do with my product during the offseason. And it’d be building those things that

Andrew Michael
say be looking at additional use cases for the product and for the tool over and above what they naturally coming to you for as well.

Hiten Shah
Yeah. And that’s all based on understanding behavior. What are they doing offseason basically?

Andrew Michael
Cool. So next thing like, I’m interested to hear is understanding your, like product development process when it comes to. So in the beginning, we’ve chatted like you said, it’s all about your now and you’re really focused on like increasing retention when it comes to like product development, when it goes about prioritization and understanding what to build and how to build it like, what framework do you typically use when it comes to making these product decisions?

Hiten Shah

Around retention?

Andrew Michael
around sort of like you deciding on what to build next, and how do you go about prioritizing the long list of feature requests that come in So is it Do you ever thinking the lens through retention? And like, what impact is this going to have? And then how are you prioritizing around that?

Hiten Shah
Yeah, the number one factor we think through is actually retention. When we think about features, we think about whether it’s going to get retention or not. There are a lot of other reasons to think about features like is it going to get acquisition or not? Right? Are we going to acquire people because of this feature? Or not? So

Andrew Michael
I think we use that filter on everything like what what is this feature going to help us accomplish? Is it going to help us get more customers? Or is it going to help us keep customers and keep customers it’s really about retention for us. It’s not just like, keep customers so they don’t turn and they keep paying it’s literally about retention. And then at the moment as well so when you looking at retention, we talked about like in the customer context, but when you measuring it up what level are you measuring, when you’re looking at a user level retention, you looking at customer level attention? What are some like where’s the main focus for FYI,

Hiten Shah
we are purely focused on building A product that teams love right now. And prior to that it was about individual people in a company. So we care about that sort of person level, individual person level, more than we care about a company and then paying right now. And over time, obviously, that’ll change. But we’re always going to care about individual person level, in addition to the company and company turn.

Andrew Michael
Cool. Excellent a sense and I think definitely, I mean, if you think about it from a holistic level is if you’re really focusing on that individual. Like everything else just scales up with it. So if you managing to achieve really good and strong retention, the individual level, it impacts all other levels as well as the company and it’s the MR or customer level. So next thing I want to ask you is one of the three and a hypothetical scenario hypothetical thing is now let’s say, for some odd reason, you decided to take a new job at a new company and you Welcome to this company. It’s not doing so great when it comes to churn and retention. And you’ve been tasked now to try to help turn things around. You’ve been given three months to try and make an impact. What are some of the things that you would look to do within those first three months to turn things around at this company?

Hiten Shah
Yeah, if I’m given three months to make an impact, and it’s a new company, number one thing to do, for me would be assess the situation. So what’s going on with the in and out of users and customers with the product? And how much can I find out? So within the first week, I’m going around finding all the data I possibly can. And I’m answering a bunch of questions about the business. And those those questions. I actually haven’t shared them before, but actually call them I have a framework for this, that my co founder, Marie and I came up with. So what we’re trying to answer is, Who are your customers? What do they think about your product? Where are they coming from, and why are they leaving you? And I’m looking to get that answer from basically anything that already exists in the company. What that helps me do is determine mean, what gaps there are in those questions? And so if you’re a marketplace and you have two types of customers, we answer those five questions for each type of customer. And then that that helps us have a basis of being data informed about the business. And once we do that, then we can figure out, Okay, what are the gaps in the data? And then we start filling those gaps with new methodologies, new things, whether it’s more analytics, or more qualitative data, user testing, whatever it is that makes sure that we have really solid answers for all those questions. So step one, figure out how to answer those five guiding questions, and what the answers are already. So who are your customers? What do they think about your product? Where are they coming from? When did they leave you? And why are they leaving you? As you can see, two of those questions are about churn. Why do they leave you Why are they leaving you to have five so we’re really 40% indexed on churn which I think is great. And then we basically figure out the answers we have, figure out what we don’t know. Go figure out what we Don’t know and get the answers to that. And that establishes the basis of picking what we should focus on. One of those five is typically where we focus on under not even one of those five, it’s actually just being able to pick a metric that we need to focus on. Typically, when you go into business these days, you’ll you can hack the process, although I don’t suggest it because having a full picture helps get everyone on the same page, and things like that. You can hack it by basically saying, Oh, it’s retention, for sure. But then you might have got it wrong,

Andrew Michael
for sure. But and like you say, it sounds like you definitely fall in at 40% of the questions being asked all around retention and churn when they’re leaving. So that’s another thing then those who are like you’re coming into this company, and I’m always interested to ask your opinion of the guests because I think it is, it varies from company to company and individual to individual but in the context of retention as a metric, like Who do you believe should own this metric within a company? If anyone,

Hiten Shah
product managers, all the product managers, I actually did a recent you might want to link to this, I did a recent whole study on 51. job descriptions. And the Honorable Mention none of them mentioned retention. And the emphasis on metrics is very light. So to me, it literally is all about product, PM product managers owning it. If you have growth, folks, growth, folks are definitely going to own it. So it’s one of the other both, I don’t I don’t think I know, there’s companies that like, you know, if you’re a SAS company, you’ve got customer success that owns it and things like that, which is all great. They can own aspect of it, but they can’t necessarily move the needle on it as much as product improvements that you can make.

Andrew Michael
Why do you like what is the main reason that you believe that product should be earning and is it just purely because of the impact that the product has

Hiten Shah
influence impact and making sure that the features you add are our, our accounting for retention? Because otherwise or not?

Andrew Michael
Yeah. Cool. Alright, so Interesting like, yeah, I want to just get your maybe last question. And then we can wrap up because I see as well running up on time. But from your all your experience now in building products, and you mentioned earlier, like onboarding, being one of the biggest years that you’d focus and you’re double down on, if you had to maybe pick two other two or three other areas where you think company should take a look and try and understand a little bit better, or would be a good area to start tech in general attention. What would those next two areas be?

Hiten Shah
Yeah, so onboarding was one of them. The next area for me is the experience when people come back. So onboarding is about first session. Well, what happens when they come back? What do they see right away? If they’re coming back organically, and organically means they’re just logging back in? If it’s a SAS product, or if it’s an e commerce site, they’re just coming back to the site. Or if it’s a mobile app, they’re just opening the mobile app. What do they see? And this is the unprompted, they just came back, we didn’t tell them to come back. We didn’t do anything. Right, then so that’s number two. And in That’s just like the people were just coming back. And where do they go to? And what do you show them. So if you if you just log them into a dashboard, you don’t actually know why they’re coming back. So understanding all of that can help you design that experience for what I call those organic customers that just come back without you doing anything. Then there’s the third one, which is I would go scrutinize all the things that you’re doing. That’s getting people back. All the messaging you have if people if it’s a social product, people are commenting on things, or they’re doing things, and it’s causing people to come back. Well, what are those things that are causing people to come back? Why are they coming back? What are they looking at accomplish? what’s motivating them to come back in what’s experience when they come back? The reason is, like if these experiences are good, just like if your onboarding experience is good, and I don’t mean good, I mean, great, then basically, people will keep coming back naturally, because they want that experience again, we spent too much time focused on features, and you know, not worrying about the utilization of these features. And instead we should be really focused on is it a great experience every time people come and if it isn’t How do you make it a great experience? And a lot of that has to do with wire? They’re coming back? What are you doing to cause them to come back? Also, what are you not doing that that makes them come back anyway, there’s a bunch of these concepts that I would really study. And so it’s onboarding, then when they come back organically without you doing anything, what’s happening, where they’re getting to, and then when they come back because of a reason that you’re prompting them for? What’s what are the reasons? And what are they doing when they come back? And what’s the experience like and is it a great experience or not?

And if not make it better?

Andrew Michael
Yeah, I love it. How like your answers come direct from the product lens. And it is an interesting concept as well. It like hasn’t come up in the sense that we talk about onboarding so much like being the main area but then like that immediate experience after onboarding is like, Okay, you’ve managed to successfully onboard them they understand the value but looking into that experience, the next time they come back, is almost as critical as well as ensuring that you keeping them around and keeping them engaged. What are some of the things in that stage, you would work through with a company typically like to improve that experience. And like what are some of the things that you see companies doing really wrong in that second and repeat experience They’re not thinking about it,

Hiten Shah
frankly speaking. I don’t see enough companies thinking about those buckets and those people and really scrutinizing, like, what’s going on there, and figuring out how to make the experience great. I mean, in short, companies don’t look at that. They don’t look at that second experience, that organic experience, all the prompts, they just end up setting up these things, and letting them go these emails, these notifications, and not realizing how much impact they have not measuring them. So number one pitfalls, they don’t measure them. Because they don’t, they’re on to the next feature. They’re onto whatever they’re thinking about in their heads that they need to do, instead of focused on basically the experience. So companies are not really spending enough time on the experiences and the different touch points that they have with the customer. And so the things that I would do are really make it very easy for people to do They’re coming back to do. And that can be a lot of different things that people are coming back to do. So it gets a little tricky, but at the end of the day, create customized, like experiences for each type of path you have that causes people to come back. That’s That’s what I’d really be focused on.

Andrew Michael
Yeah, I think this is one of those biggest product development dilemmas that ends up happening is that the pressures that are get put on you for additional features, often, like, always end up taking priority, like if we if I look at all the different companies that have been following and look at, and we often like completely forget about this experience. But more often than not, it’s probably the most valuable aspect that you can be focusing on, like you say, like we talked about is this continuous onboarding, as well as if like, we end up putting someone through an onboarding experience, and then we might develop a few new features, but we’ll let them know once, whatever but then we never really update and keep people who don’t bring them along with us. We don’t keep on thinking about what the next time experiences. I can Just becomes this feature factory as opposed to really helping and educate your customers get to what they want in terms of value Foster. It’s definitely under utilizing under rated. Cool. So, like I said your last question, but I think this will be the absolute last question. If you had, if you had to give advice, just just the one piece of advice to anyone starting out building a product, what would you say to them being the number one thing they should think about now, if they were starting out a new business and a new product,

Hiten Shah
Use other products and start writing down why you’re frustrated by them and what they’re doing right and what they’re doing wrong in your opinion. And just start building your own spidey sense for product. And the only way to do that is use a lot of other products in your category outside your category. start paying attention to the details. It’s the details that matter. And so I would tell somebody who’s getting into it to like start studying products,

like any kind of products.

Andrew Michael
I love that 10 become a product text but also looking outside industries as well as often not thought of but you’ll often get really great inspiration from it. Yeah, thanks very much for joining the show today like I really appreciate it’s been fantastic having you and wish you best of luck now going forward with if I and hope to hear some great success stories coming soon.

Hiten Shah

Yeah, thanks