Etsy fmr CPO on Growth Products (Part 3)
There are many ways to drive revenue with growth products. Sometimes, it’s not only about user acquisition or selling subscriptions. In the case of Pandora, we set out to increase engagement in order to drive purchase decisions down the road.
At the time, Pandora had 80 million active listeners per month and over 250 million registered users. The vast majority of the listeners used the free version that ran ads. Conversely, a smaller percentage was signed up for Pandora Premium – which is the ad-free subscription version.
Given the size of the user base, our goal was not to acquire new users. Instead, we set out to increase engagement by getting people to listen to more music. By increasing time on the app, advertisers would be inclined to spend more money. On the other hand, users would get sick of listening to ads and be more interested in switching to Pandora Premium.
We used two key data points to come up with a solution. First, it’s important to note that people feel good when they listen to music. In addition, people get excited when they hear a song that they weren’t expecting and really like it. This is the best response that a music product can deliver – and we wanted to give our users more of those moments. Second, we found that 76 percent of our users slept next to their cell phones.
So we started to think – people like hearing music and they need an alarm to wake up every day. Instead of waking up to an awful alarm clock sound, we thought “why not wake up to music?” Taking it one step further, we realized that people could wake up to music they liked instead of conventional radio. To validate our assumptions, we hit the streets of Oakland for user experience research. The response was incredibly positive and engagement significantly increased once we launched.
In the end, we created a growth product that created joy and provided a solution to a common activity – which in turn produced new revenue opportunities for Pandora.
About the speaker
Mike Grishaver is the SVP of Product at Beachbody, where he manages the Beachbody on Demand streaming service with over one million paying customers. He was SVP of Product at Etsy where he led the team through the IPO process. In addition, Mike worked asVP of Product at Pandora, and a senior Product leader at LinkedIn and Yahoo. Mike also bootstrapped a social media marketing startup with customers including Fox, NBC, and Atlantic Records.