How Product Management Can Double Customer LTV
Jeff Bordogna
@jeffthink / nighttrain.co
Meal Planning @ Relay Foods
Hello.
What is product management?
It's complicated.
Delivering value to customers.
Building useful artifacts.
Facilitating decisions.
Determining the "why" and "what".
Prioritizing work to be done.
Enabling collaboration.
Voice of the customer.
CEO of the product.
Writing user stories.
Product Mindset
Customer empathy
Curiosity
Humility
Adaptability
Intelligence
Data-driven decision-making
Continuous improvement
Scrappiness
- Seth Godin
"That voice in our head is a press secretary who is explaining to the media, without knowing exactly how, why what we just did was very smart."
Think
Like a
Storyteller
Act
Like a Scientist
Online Grocer founded in 2007
Series A in 2013 => Acquired in 2016
Focused on Mid-atlantic region
From 2007 => 2009, Relay was:
We'll deliver anything to your door
From 2010 => 2012, Relay was:
We'll deliver any food to your door
From 2013 => 2015, Relay was:
We're your online farmer's market for local / healthy food
+
Net Promoter Score (NPS)
81
That sounds good.
What's the problem?
after 1st Order
28%
after 8 weeks
17%
Retention
New Customer Economics
AOV
(Average Order Value)
$57
CAC
(Customer Acquisition Cost)
$92
New Customer CLV
$338
(Customer Livetime Value)
Avg. over 12 months
Excitement
>
Usage
Think like a storyteller
"Why are users recommending Relay to others, but not continuing themselves?"
We learned that the real problem was:
Act like a scientist
Hypothesis: By incorporating more elements of the full grocery lifecycle into the product, customers will become stickier.
Step 1) Create a low cost experiment
Add recipes content with focus on planning & cooking
Step 2) Measure engagement
New Customer Retention
Average Order Size (AOV)
Recipe Engagement
Step 3) Collect customer feedback
“This is great! I am more organized with shopping and am now managing to make meals for my family a lot more often.”
- Sienna
Step 4) Get leadership approval for a project
Enter the
"Meal Planning"
project
We did Product Discovery.
www.product-frameworks.com/
We talked to our customers
Attitudinal: "Tell me about your grocery shopping routine."
Behavioral: "Can I watch you you interact with this wireframe / prototype?"
We prototyped before we built
We collaborated and planned across departments
Product - What to prioritize & how to design it?
Marketing - How to talk about it & who to target?
Merchandising - Which recipes & ingredients?
Operations - How might this impact fulfillment?
Engineering - How to iteratively build it?
We iteratively rolled out improvements.
Oct 14'
Nov 14'
Dec 14'
Jan 15'
Feb 15'
Mar 15'
Public
Alpha
Research / Build
0
100
50
25
Beta
Meal Planning rollout
% of customers with access
75
drumroll please...
$338
New Customer CLV
?
Lesson One
The ability to measure an initiative's sucess is as important as any feature and can't "wait until later".
"According to our roadmap, it's time to work on X, Y, and Z"
Meal Planning
Project Y
Feature X
Partnership Z
Lesson Two
Companies must be ready to adapt - by having a framework for when to fold, call, or double down.
Lesson Three
A great product manager is always aware of the motivations of the people around them.
4 months later...
(August 2015)
Fast forward to
Existing Customers
AOV
5%
Order Frequency
20%
(27% of them tried it out)
Lapsed Customers
Their Previous
AOV
12%
Still Active
after 8 weeks
34%
(4X more winbacks than usual)
New Customers
1st Order AOV
(vs non-meal
planning)
49%
8 Week Retention
(vs. non-meal planning)
42%
(consistent findings across channels)
$338
New Customer CLV
$665
2X
Unfortunately,
we missed our window...
We spent the next ~6 months focused on fundraising / M&A
Acquired by Door to Door Organics
(May 2016)
Door to Door Organics Closes / Sells Tech
(Nov 2017)
3 Tips For Aspiring
Product Managers
1) Tailor *your* story
Think of how it maps to the story a given hiring manager is telling themselves.
I would love to be a product manager here.
I think my X experience would be relevant for Y reason.
For example:
2) Show customer empathy
For example: Show how you thought about their habits & pain points, how you mapped that to a solution that you then validated, etc.
How can you frame a project or deliverable you were a part of to focus on the customer to whom you were delivering?
3) Practice, practice.
Find ways to do PMing - in your existing job, on side projects, or even just in your reading/thinking.
For example: Think about what you don't like about products you use every day - why do you think the decision was made the way it was? What would you have done instead?
Thanks!
Appendices
How Product Management Can Double Customer LTV Jeff Bordogna @jeffthink / nighttrain.co Meal Planning @ Relay Foods Youtube Video
Relay Foods Meal Planning LTV Case
By Jeff Bordogna
Relay Foods Meal Planning LTV Case
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