Nino Medina's Growth Scoops: Mastering the game of user growth in 2024.

You have spent the last +15 years helping companies grow. What are your biggest insights on what makes a difference?

Nino:
Spending time at Slack I observed that most high-performance teams are those who take the time and the money to invest in two things:

Systems: They commit time and resources to sophisticated analytics and feedback mechanisms, leveraging internal data and feedback loops with their ad platforms.

Creatives: They spend time refining and nailing down their most effective creatives.

Here's where the big change is coming into 2024. The landscape has transformed, with AI playing a pivotal role. As creative resourcing has always been a bottleneck the standout performers will be those who master AI to enhance their creative output, accelerating their production and fine-tuning performance.

‍Keeping your eyes on the ball‍

What do you think is the foundation for success in 2024?

Nino:
What made sense back in 2019 doesn't make sense anymore. Long gone are the days of zero interest, blowing money on ad platforms, and hoping for the best. The conversation is now shifting heavily to ROI.

In today's climate, where CFOs and boards scrutinize every penny, questions about ROI, payback periods, and LTV to CAC ratios are inevitable. If you can't provide solid answers, you need to start looking. Expect to defend your budget rigorously – it's not just about crafting a narrative, it's about backing it up with undeniable results. This is why shifting your game to value is going to be critical. 

For the love of value

Can you help us understand more about what you mean by value?

Nino:
The scoop is: Not all customers are worth the same. During my time at Slack, we’d treat product signals of Fortune 500 companies or large COs (contracts in the thousands), the same as mom-and-pop shops. Back then we didn't have another option. I wish we had a system to channel revenue signals from closed deals, directing spend towards attracting similar high-value sign-ups. This approach would have dramatically improved unit economics, enhancing LTV, payback period, and more. If we could have built that technology back then, this vital feedback loop would have been a game-changer. The good news is that since then AI has taken a front seat in helping you play the game of value. Also Google and Meta offer value-based performance campaigns AKA Value-Based-Bidding.

How to value, value?

Is this idea of value the same for all types of business or are there differences between verticals or services?

Nino:
For e-commerce advertisers, where most customers purchase on day one, value-based bidding is straightforward: just send the values and Google or Meta will sort and target right the users. The real test is for PLG and SaaS companies like Slack or consumer marketplaces like food delivery, with their 'try-before-you-buy' or freemium models.

Here, customer journeys are lengthy and purchase scenarios vary widely in price and duration. These situations demand thorough analysis, creative bespoke models and the ability to project a user's future value in a format the ad network can grasp without confusion.

Moreover, a robust feedback loop is crucial, confirming successful customer acquisitions and encouraging the pursuit of similar prospects.

How do you recommend making the switch?

Nino:
For e-commerce advertisers, where most customers purchase on day one, value-based bidding is straightforward: just send the values and Google or Meta will sort and target right the users. The real test is for PLG and SaaS companies like Slack or consumer marketplaces like food delivery, with their 'try-before-you-buy' or freemium models.

If you are considering value-based targeting in 2024, you can begin with a straightforward approach, crafting a basic model devoid of machine learning, perhaps segmenting into 3 or 4 distinct groups as an initial stride. However, a new advertiser, or a team lacking robust engineering support, may grapple with the complexities of synchronizing with the APIs and the mechanics of ad platforms.

Such intricacies could not only hinder success but also slow progress. In this scenario, I would say be prudent and think about accelerating the shift to ROAS by seeking external assistance with a team that has the expertise to deal with both model building and ad networks. The stakes are high and the opportunity cost of losing a Fortune 500 contract because your model was built off or wasn't up-to-date with the latest network models is not worth the effort of DIYing this.

Any last remarks?

Nino:
Consider what you anticipate the outcome to be and what you're opting not to do in favor of this direction. The key question to ponder is what success looks like for any of your 2024 endeavors and what the potential risks are if you decide not to pursue it. This approach helped me outline for myself and leadership both the prospects of success and the stakes involved.