
Startup Idea: User Retention as a Service - PStamatiou
http://paulstamatiou.com/startup-user-retention-lifecycle-email
======
mapgrep
If you find yourself writing a "tl;dr", consider just writing a clean, full
English sentence instead.

For example, INSTEAD OF....

"tl;dr Trying to draw attention to the importance of lifecycle marketing. I
build up the case, talk about where lifecycle marketing makes sense, show an
amateur first attempt at it, then proceed to layout a grand idea for a
lifecycle email marketing service I want to see someone build. Please share
this post."

...write THIS INSTEAD:

"I want this essay to draw attention to the underappreciated art of 'lifecycle
marketing.' In the paragraphs below, I'll define the term, show an amateur
first attempt at it, talk about where the practice makes sense, and then
outline a comprehensive lifecycle marketing service I hope someone else will
build."

A formally declared "tl;dr" with sentences that are super concise, to the
point of being ungrammatical, is better than no summary at all. But good
writers can gracefully communicate to readers the essence of material to come
using nothing more than plain words. Doing so does far more to encourage the
reading and sharing of your entire essay than an explicit "please share this
post."

(Apologies for veering a bit off topic.)

~~~
seiji
In the Real World™, a tl;dr is called an "Executive Summary." It's a nice way
of saying "Here's what this writeup means if you don't have time to read it or
aren't bright enough to understand it fully."

~~~
anamax
> In the Real World™, a tl;dr is called an "Executive Summary."

Umm, no. "tl,dr" means "I didn't read it, don't think that you should, and now
I'm going to tell you how smart I am."

Executive summaries are written by people who bothered to read {whatever}.
Some are even written by folks who aren't tooting their own horn.

~~~
seiji
That's a good point. Originally tl;dr was written by _other_ people who were
summarizing an overly long post. Now people preemptively tl;dr their own
overly long posts.

Write more concisely and make a point instead of tl;dr'ing yourself.

------
patio11
FWIW: Even the dumbest _possible_ implementation of this, which is "Send
someone an email 1 day after signup and 6 days after signup, with both goals
just trying to use the service again" prints money in my experience.

~~~
maudlinmau5
so true. poor retention is far better than no retention

------
pospischil
We (Custora, YC W11) are hard at work on exactly what you're asking for:

<https://www.custora.com/home/tour_lifecycle>

~~~
noelwelsh
How does it work? "the latest algorithms being discovered at leading academic
institutions" reads like marketing fluff to me.

~~~
pospischil
Whoops! Thanks for the feedback! That's an old page that was supposed to be
replaced on our latest redesign.

The simplest explanation is pattern matching: we analyze customer and
transactional data to understand how different customers behave. Using this
understanding we can make predictions for how each user will behave in the
future.

We use all of that analysis to power actions - take actions on the right user
at the right time, optimizing for CLV.

Here's more: <https://www.custora.com/home/customer_lifetime_value>

~~~
noelwelsh
That says a little bit more. Do you treat it as a reinforcement learning (RL)
problem, or as a classification problem? It seems like a sequential decision
making problem, so RL is appropriate but AFAIK there is no RL algorithm that
generalises over states while still retaining some error bounds. I suppose you
could brute-force a Bayesian solution via MCMC.

~~~
aaronjg
There are two big problems that we deal with. First is estimation of customer
lifetime value. We use a latent attrition model, which is the 'pattern
matching'

The second is figuring out which promotions/emails go to which people. This is
a supervised learning problem. We train the model with users past responses to
discounts and their past behavioral states (which are the posterior
probabilities from the latent attrition model). Then we use this to predict
how users in those states will respond to similar promotions in the future.

~~~
moe
Are your predictions visible in the web-interface so we can verify if they
hold water?

~~~
aaronjg
Yes. In addition to the lifecycle marketing product, we have a section of the
application devoted to predictive analytics.

------
ryanwaggoner
So one YC startup (Picplum) is begging for a service that another YC startup
(Custora) has evidently already built and is publicly promoting?

Maybe YC is too big :)

~~~
PStamatiou
Yeah I should have remembered about Custora... I bought their office chairs
from them when they moved out!

~~~
omarchowdhury
dat shit cray

------
moozeek
To me this sounds - a litte - overengineered.

To do more than 99.9% of the companies out there it would be enough to just
send generic follow up autoresponders based on sign up date. Email them on day
0, 1, 3, 7, 11, 14 ... etc.

You can do this with AWeber, Mailchimp, Getresponse and a dozen other
services.

Just tell the customer what he can do with your service and ask a lot of
questions: "Have you tried this?", "Did you know you can...", "How can we
help?". Use the feedback you already have to come up with ideas for content.
Point them to a lot of your help and learning resources. In each email tell
them you are really interested in their feedback and give an easy option to
contact you. Then read the feedback as it comes in - like manually reading,
with your eyes ;-) - and respond promptly and indvidually.

Setting his up takes a day or two - and mostly consists of coming up with
ideas for the content. After having this running for a few weeks you might
come to the conclusion that you don't need a complicated machine learning,
metrics based system :-)

I've written about this in another context earlier this year, basically about
how we handle the trial period: <http://news.ycombinator.com/item?id=2979048>

TL;DR: "Eighty percent of success is showing up." (Woody Allen)

------
aaronjg
We're offering this service at Custora. You upload as many creatives as you
would like, and then our product figures out who and when to send them.

Say you have emails suggesting TASK X, TASK Y. You upload the four creatives,
and we can tell you that TASK X worked for new users and inactive users, and
TASK Y worked for active users. We also close the loop and look at the effect
of the email actual actions (sign-ins or purchases depending on the business)
rather than just email opens.

The goal is to send fewer, but more relevant emails. Rather than emailing
everybody every week, just send emails to the customers when the become
inactive.

~~~
reinhardt
How does this compare with, say, Marketo?

------
AznHisoka
Sounds like an useful service. Though, I'm not sure whether email bombarding
is a good idea. You used the example of AppSumo but I unsubscribed after 3
emails sent too close together. Most people don't unsubscribe but rather just
ignore the email.

I don't need an email every time a small feature is released, or pushing me to
come back... there's a reason I don't revisit, and it's not because I forgot.
What I like are emails that give me something of value whether it's free
content, a story, a free tip, etc. Teach me something new.

~~~
PStamatiou
It definitely sounds like a lot of emails in my article. But let's say you
never engage with the service. You might receive 2 in 2 months and then never
hear again. Smart, not abusive.

While I mentioned reminders often as it's easiest to describe, "Teach me
something new." is exactly right. Engaging mailers should offer help, tips and
such.

~~~
ay
I would agree with AznHisoka. Periodic mails are like shouting in the room to
gain attention. When everyone else is quiet, it works like a charm. The others
pick up this trick. Soon no-one can hear anything, and those who do not want
to be disturbed, wear earplugs ;-)

That's precisely what I did with my Gmail account when it became near-unusable
after I used for several signups for startup services which I eventually was
not interested in - just signed up to try out. Someone send me an email that
does not pay me back with something useful for the minute of the attention I
spend reading it - I create a filter to send it to 'adware' folder, which
rarely, if ever, gets read.

This is of course my personal behavior, which may or may not be more typical.

~~~
cdcarter
Be nice to newsletter statistics, unsubscribe.

~~~
ay
Why ? I've already paid with my attention to the mails that I did not need.

But more than that - in more than one case my attempt to unsubscribe gave zero
results. Once I even had an exchange with a _human_ person, who promised "oh
of course we will remove me". And that did not happen. So why would I invest
my time into further attempts ? I'll just use the solution that works.

------
twakefield
Awesome post Paul. We've been thinking quite a bit about this at Mailgun.

As usual, we default to giving developers more tools to help build this. We
are rolling out some exciting stuff early in the new year to make this a lot
easier.

------
danhodgins
Your theory that the current state of a user's account and their past usage
patterns should determine which mailers and communications the user receives
essentially refers to the techniques outlined in Seth Godin's book "Permission
Marketing". Check out Seth's book - I would imagine your readers and users
could also use a summary or refresher of the principles behind "Permission
Marketing" - it's powerful stuff!

------
karlwirth
My startup, Apptegic, www.apptegic.com is building a "user retention as a
service" service. On a per-user basis, we can track events, patterns of
events, and business usage (like # of photo batches sent). We can combine
these to score engagement and we can segment and filter groups of users based
on these combinations.

There are lots of other ways our Beta customers are using this info already.
But many have asked for the ability to do targeted emails based on usage and
engagement. We don't have email system integration into MailChimp, Constant
Contact, and others like Paul described yet but we are working toward it.

Do you have suggestions on what a a minimal viable email system integration
would be? Let people script a download of the list of emails that fit a
criteria and script upload that into their mail system of choice?

If you have suggestions please comment below or contact me at kwirth at
apptegic dot com.

------
kmfrk
Great article, but URAAS isn't exactly the best acronym. :)

With regards to your article, I remember an article - which was probably
submitted to HN - whose author had a great method for engaging (loyal) early
users. Instead of using scripts that sent the users tailored messages, he had
scripts sending _him_ alerts on important days like, say, birthdays or
registration anniversaries.

This allowed him to give the first hundred users who had stuck with the site
some personal e-mails that weren't computed by scripts, but himself.

This obviously is intended for early-stage start-ups, but it is important
never to go full Google and use robots, AI, and whatnot to face the users
instead of human beings, or what sounds like it.

I don't think Disqus would have got the traction and success it had, if Daniel
Ha's insane user engagement weren't there to humanize the transition to a new
comment system, especially for the people who don't know anything about
programming and web services.

Perhaps ironically, it's obvious that Disqus use analytical tools now to alert
them whenever someone is having problems with the service or saying bad things
about them, and the automation and ambiguous motivation for the Twitter
response tends to dehumanize the service, even though they may use the alerts
with the best of intents. Daniel Ha also didn't do the best job of giving
users a sense of participation in making feedback; he kept using a phrase
along the lines of "it is on my list - we will get to it eventually", although
many never came to fruition. This was back when Disqus had its own "forum" at
disqus.disqus.com (as I recall), which created a small, tightly-knitted
community that had to go, as the site picked up its pace.

There are some incredibly important good and bad things to be learnt about
Disqus, but I honestly believe that the core business model of Disqus had more
to do with the user engagement than it had to the service and its efficacy
itself. People simple weren't allowed to be antsy about trying the service, if
Daniel Ha could help it.

------
jot
What would you say to someone that refuses to email users at all and even
rejects the idea of collecting email addresses at signup? They think asking
for email addresses and using them for anything is only for spammers. Sadly
they also have a retention problem.

------
paulf
Funny, I just did an "Ask HN" about something similar yesterday and didn't
receive any feedback [0].

I recently launched LetterPush, a basic email newsletter service [1]. I've
been thinking of focusing on adding lots of developer features (robust API,
webhooks, etc) to help automate marketing and transactional email processes.

I think that most businesses stop at MailChimp email blasts and "Welcome"
emails on user sign up. Having a service that marries MailGun to your CRM/CMS
tools would be absolutely brilliant (and quite profitable, I imagine).

[0] <http://news.ycombinator.com/item?id=3375802>

[1] <http://letterpush.com>

------
ams6110
I'm not sure if I'm in the majority but I'd find this annoying. If I dropped
out of your 12 step sign-up process at step 4, don't bug me with emails about
it, make your damn process simpler.

Further, I basically don't even open unsolicited email unless it's from a
person (person, not company) I know. It's like ads on a web page, it hardly
even registers. If I get enough of it from one sender to take notice, it's
more likely than not that I'm not going to be happy.

~~~
devmach
So true. One more e-mail from the service which i don't care can turn my
ignorance to "anger". And yes, there is something called bad marketing.

------
betterlabs
Great post and I couldn't agree more on how important retention is for web
businesses. Our product, Nurture (<http://www.nurturehq.com>), addresses this
need in a flexible fashion and is being used for exactly this requirement
(User Lifecycle Marketing for improving engagement) by a few customers.

------
r0dica
It's a neat idea, but it sounds like what you're proposing is a subset of
marketing automation, which has not been mentioned almost at all in this post.

I would recommend doing a bit more research about what marketing people are
already using, what other products your product may interact with yours, and
how it would fit in the arsenal of marketing tools.

------
danhodgins
Here is a follow up post and video response to Paul's article:
[http://www.getspotta.com/user-retention-as-a-service-
lifecyc...](http://www.getspotta.com/user-retention-as-a-service-lifecycle-
marketing/)

I agree with Patio11 - even a super simple implementation with minimal
business rules is still better than zero communication.

------
badclient
[http://turbo.paulstamatiou.com/uploads/2011/08/picplum_step1...](http://turbo.paulstamatiou.com/uploads/2011/08/picplum_step1_drag.jpg)

Slightly OT but I find something very confusing about the styles of the 3 tabs
in that screenshot.

Each tab seems sort of different when really you should just have an on style
and an off style.

~~~
aparadja
It looks like step 2 is already done, and the user is now doing step 1.

------
andygcook
HubSpot has a lot of this functionality as well. You can send out automated
"personalized" emails that are triggered on certain events. Their software is
usually used for inbound marketing before the user activated (aarrr), but I'm
sure you could use it for after a user is signed up.

------
jamiequint
Hubspot does this, they acquired Performable which was doing this before and
its now integrated into the Hubspot product offering. Other companies do this
stuff too but not so much selling to startups and more to the enterprise (e.g.
Marketo)

~~~
PStamatiou
Yeah I want to see more companies do this that aren't enterprisey. I remember
Performable and even went through some video tutorial they had long ago but it
definitely seemed to be more oriented towards ecommerce/shopping cart
applications?

~~~
reinhardt
I'm not familiar with any of the mentioned companies but I'm curious, what
exactly does make products such as Marketo "enterprisey"? Just more features
that you don't need right now?

~~~
PStamatiou
For one, I can't even find out how to sign up for Marketo. I don't want to
chat with a sales specialist, I want to start setting up and importing events,
and making filters/campaign triggers. They have way too many products -- it
makes me wonder if they even spent enough time working on the lifecycle
marketing product of theirs. I want a company that just works on that one
thing and does it amazingly well.

------
jamesjyu
Someone needs to build this. Now.

~~~
PStamatiou
Happy birthday James! You're the reason I blogged about this. Your email
asking me to blog about the email template stuff got me thinking about this
too haha.

~~~
matthewnourse
So James & Paul, are your needs covered by Custora or one of the other
services? Or is there something more that one or both of you need?

------
czcar
Like a few others - we're working on a similar idea, and in fact applied for
the last YC batch with it. But yeah there are a couple of companies already
focusing on it... But could be alot better...

------
freshlog
I'm sorry to be off topic, but are those slow cookers cooking PG's recipe in
the first picture?

~~~
PStamatiou
Yup! It was tuesday, so dinner was being prepared. Bigger picture:
<http://dl.dropbox.com/u/186198/Screenshots/vmeh.png>

~~~
freshlog
Amazing!

Was it PG's rice and bean Ramen Profitable recipe? I don't remember slow
cookers used in that recipe.

------
TheFman
may be its just me.... The copy in both places (picplum and custora)is too
confusing to understand the service they offer.

