Four years ago when I joined Truecaller, our founders, Alan and Nami, had already built one of the fastest growing tech companies in the world. Starting out as a caller ID and spam blocking app, we’ve now broadened the product to a communications platform to make your conversations safe and efficient. Since then, we have reached many more milestones together and I’m glad they trusted me to be part of their journey.
Among other things, we have grown from:
- 30 to 300 million users
- 30 to close to 200 employees
- 3 to 35 partnerships with companies like Google, Samsung and Huawei
- And as I’m writing this, we’re adding more than 400,000 new users every day
I’ve been asked by friends and founders what has been our secret recipe for growth. Although there is no silver bullet that works for all, I hope that sharing some of our experiences can help other startups apply our learnings in their daily operations.
Growth is a Team Effort
Growth requires a combination of Product, Marketing, Analytics and Business Development and to grow a product effectively you need competences to take ownership of both internal and external factors. Internal in terms of product and user experience and external in the sense of having a consumer-focused approach that understands the market.
In the end, it’s all about:
- How to get people to discover your product
- How to get to an AHA moment as quickly as possible
- How to deliver core product value as often as possible
The Growth Funnel
The major difference between traditional marketing teams and the new way of structuring growth teams is that a growth team takes ownership of the complete funnel from start to finish and therefore has a holistic view of what improvements will impact conversion the most.
Truecaller’s Growth Model
As a mobile app that provides a full suite of communication our North Star Metric is Daily Active Users (DAU). We’ve chosen daily usage, compared to weekly or monthly, since our services include a dialer, SMS inbox and instant messaging which are features you’d be likely to use on a daily basis.
Linear Channels
Some growth practitioners consider linear channels less valuable since they are not always repeatable and scalable like other growth loops. In our case, a combination of partnerships, PR and marketing has proven to be a key part of our strategy to break through in new markets.
Partnerships with Industry Leaders
Since our Business Development team was formed, we have worked with mobile operators, device manufacturers and strategic partnerships to make Truecaller an integrated part of phones around the world that has brought Truecaller tens of millions of users in new markets. Read more about some of these partnerships here:
Truecaller adds payments and Google Duo video calls in move to rival WhatsApp in India
Truecaller partners with Huawei as it eyes global expansion
Acquisition Loops
Viral loops have played a major role in our growth thanks to the fact that our product solves a burning need for the consumer. Whether we identify an unknown call or block a spammer, the gratitude our users feel from saving time or avoiding a nuisance call makes it compelling to pay it forward by telling their friends about our product. Make sure to trigger sharing behaviors right in the moment when you have solved a problem for the user.
When to Buy Growth
To have long-term sustainable growth, you need a positive return on investment with a Customer Acquisition Cost (CAC) that is less than your users’ Lifetime Value (LTV).
However, when market conditions are extremely competitive and it’s crucial to win the market first, it does make sense to temporarily buy growth to get that initial traction. A classic example of this is when Uber was seeing stiff competition from Lyft among others. As they believed they were facing a winner-take-all scenario (or at least winner-take-most), they decided to consciously:
- Buy drivers to ensure supply (by guaranteeing drivers hourly rates)
- Buy passengers (through paid channels and incentivizing referrals)
- Subsidize rides (giving away free rides to users until there was enough demand)
Read more on Uber’s growth strategy in Simon Rothman’s blog post here:
Why Uber Won
Activation
For a user to become active, you need to get them hooked on to your core value proposition as quickly as possible. This needs to happen within seconds, it can’t take hours or days before a user understands your product. For Truecaller, the AHA moment happens when we successfully identify three unknown calls for a user.
Another example of this is Facebook’s AHA moment that was defined as reaching “7 friends in 10 days”, since if you don’t have any friends in a social app and enter with an empty news feed, you’ll most likely churn straight away.
Measuring Engagement
We mainly focus on tracking DAU/MAU ratio for measuring engagement, since stickiness and daily usage has the biggest impact on any ads-based business model.
Depending on what service you offer you could also look at tracking:
- Time spent
- Sessions/day
- Actions/day
- Or feature participation to understand what parts of your product is being used the most
Increasing Engagement
After proving core product value, the aim is to continue proving value over and over again. Either with the same use case or by layering the cake and solving other problems for the user. These are five areas our product team worked on to boost engagement within our app:
- Educate users
- Improve speed and app performance
- Go deeper in existing use case
- Go horizontal to broaden use cases
- Drive community engagement
Engagement Improvements
With a clear focus on driving daily usage and implementing the above measures, our teams managed to increase DAU/MAU ratio by 30% in two years’ time. This work made us excel on this metric and stand out as one of the apps that score highest on this globally.
Retention Loops
Retention loops are normally time-based or action-based and if they are smartly designed and configured, they will automatically bring back passive users to your in-app experience depending on certain user behaviors.
Retention with Product-Market Fit
Most users decide which apps to keep within 3–7 days from downloading them. Depending on what type of service you provide, you’ll need to focus on different time periods. In any case, it’s a good exercise to plot your full retention curve from day 1 to day 90 or longer. Ideally, your retention curve should flatten out to prove healthy retention. If it doesn’t, you have not yet found product-market fit and need to reconsider changes on the product side before focusing on growth. Read more on retention in Brian Balfour’s blog here: The Never Ending Road To Product Market Fit
Metrics
A north star metric should aim to:
- Measure customer value (retention / engagement)
- Represent the product strategy
- Be a leading indicator of revenue
Metrics Hierarchy
Once you have set your north star metric for the whole company, you can break down that goal into sub-goals for each team that is supporting the bigger mission. One way of doing that is to use a metrics hierarchy tree to plot out priorities where each team can add the most value to the overarching goal of the company.
Building your Growth Machine
Growth is rarely the result of one big breakthrough. It’s the sum of many things coming together over time. Instead of looking at growth hacks only, agree on a systematic process for how you work to achieve long-term growth with your team. These are some steps to get started and you should always try to refine and improve your process over time.
- Goals. Set ambitious goals for the areas that you estimate will impact your growth funnel the most. For example, should you start with acquisition, retention or building out more channels for inbound user growth?
- Ideas. How will your team continuously come up with growth ideas? Do you gather feedback from app store reviews, user studies, partners, employees or your own intuition?
- Business cases. How do you quantify and test your ideas with a proof of concept to prioritize what to build next?
- Analysis. How do you measure success or failure for your projects
- Learnings. Summarize feedback from each project and share it in a structured forum with your team.
In the end, you need to keep experimenting to see what works. You can always get inspiration from others, but you need to find a way of working that suits you and your product.
Thank you
Special thanks to Alan, Nami and the whole Truecaller team for building a world class product that enables our growth across the world. Thanks to Ben Grol and Bryce Keane at Atomico for great feedback and support. And thanks to Brian Balfour and the Reforge team for sharing content and best practices to keep learning from each other.
Hope you enjoyed this post and if you have any feedback or thoughts, drop a comment here or send me a message at: @n1ckdahl
