How Zalora kickstarted a 6-figure product growth strategy and tips for how you can too
Let’s face it, product growth and experimentation have pretty scary connotations in the world of CX. If you search the term on Google, you’ll notice others aggressively searching for examples, strategies, definitions, and how-tos.
May Chin, Principal Product Manager (Analytics & Growth) at Zalora, spoke at our recent CX Circle APAC event on her guiding principles and best practices for enabling product growth.
Having kickstarted Zalora’s product growth strategy ten months ago, May demystifies product and experimentation strategies for us—the Zalora way.
Product growth requires continuous optimization and dedication
May defines product growth as: “the systematic and continuous cycle of optimizing a product’s features, value propositions, and user funnels to achieve specific and measurable company goals”.
Sounds a little intimidating, right? Let’s make this simple by breaking it down into two steps:
Two steps for getting your product growth strategy started
Step 1: Establish your product analytics landscape
“Kickstarting a product growth strategy starts with establishing a solid product analytics landscape,” May explains. “What analytics, what metrics, and how this translates into revenue.”
Revenue-driven metrics allow you to build a case for the funding of your product and experimentation teams. At Zalora, May and her team have a deep understanding of their monetization model, using their own formula:
By multiplying these data points, (Zalora uses: the sum of catalog views, catalog CTR, add to cart rate, cart to checkout rate & ABS above), you can identify what your top 5 metrics are in line with your bottom line: revenue. To identify your own north-star metrics, have a look at your own customer journey from site entry to check out and pick your 5 winning measurable steps in the customer journey.
Here’s a sample of how Zalora documents this process in a simple spreadsheet:
Step 2: Prioritize your growth backlog
Your revenue function formula should then inform your growth backlog. At Zalora, the backlog is informed by dips and anomalies from the data identified in Step 1.
The Zalora team adds to this backlog by creating line items based on reasonable hypotheses they develop to address ‘dips’. These are then mapped against a status column (for project management purposes) which is then assigned success metrics or data points from the monetization formula. Linking the two ensures your growth is linked to revenue and ROI.
To establish a goal, Zalora adds a calculated priority score to each hypothesis in the backlog. This score is based on success metrics, projected uplift, and the supposed impact on their customers.
Putting this backlog all together, you should then have a rudimentary business case and prioritization for your hypotheses. At Zalora, it looks like this:
So, how did Zalora drive 6-figures in revenue?
Starting with their weekly analytics deep dive, Zalora’s product team noticed an unusual dip in checkout rates between their product pages. Based on this, the team developed the following problem scenario:
“We noticed that our product page to check out rates have been lower than normal in Q3. So we’d like to launch some experimental features to see how we can alleviate this.”
The team explored two hypotheses.
Hypothesis 1: The user journey on the product page isn’t streamlined
Zalora’s product page only had one CTA option which said: “Add to cart”. The team tested a secondary CTA which said “Buy Now” to help eliminate potential friction points.
The test ran for 10 days across their Android app. At the end of the test, they saw a 6-figure revenue uplift. Additionally, the team learned that Zalora customers have a desire to perform single-product checkouts.
Hypothesis 2: There’s not enough information on the product page
As a simple fix, the team pushed this up the backlog’s priority queue to add a line of social proof to the top of their page in the form of page views.
They tested two variations to target the average user with positioning on the top of the product and a second variation closer to the CTA for high-intent customers. Both variations cumulatively led to revenue uplift of up to 4-figures, fueled by a 5% increase in purchase click rates—all from a simple two-step product growth plan
What can you do to kick off your own product growth strategy?
May left us with some of her top tips to get started:
- Growth is a process. Growth isn’t a one-time project, but a fundamental mindset shift. Continuously embed this within every product team’s cadence.
- Be laser-focused. Narrow your focus to target specific parts of your revenue function so that you are specific in successfully launching new features and products.
- Don’t let analysis paralysis get to you. Nobody is a fortune teller, launching small-scale experiments and A/B testing to mitigate risks always beats standing still.
For more on Zalora’s product growth strategy, you can catch the full talk here.
Interested in hearing how Telstra, Network 10, Estee Lauder, and PVH are leveraging experimentation and personalization to deliver better online experiences? Check out their sessions from CX Circle here.