Sean Ellis on why new user activation is the best driver of engagement and retention

Sean Ellis coined the term “Growth Hacking” and defines it as: “a scientific approach to figuring how to grow a business.”

It involves testing and analyzing all of the levers a company has to grow: acquisition, activation, retention, monetization, and referral.

Of these five levers, Sean believes acquisition is by far most important, and it’s the first lever he focuses on when he works with a company.

He explains why:

“Engagement and retention are essentially about, ‘What brings someone back again and again to use your product?’ And of course the most powerful thing to bring people back is a great first experience, which is activation. So the biggest driver of retention and engagement is a great activation step in the customer acquisition process.”

If your goal is to retain users and grow your company, you should always be asking yourself: “How do I make sure that every time someone uses the product they’re even more likely to come back and use it again?”

This is a pattern you see across the best product teams. When Chamath Palihapitiya led Facebook’s Growth Team, he focused on three things:

1. How do you get people in the front door?

2. How do you get them to an “aha moment” as quickly as possible?

3. How do you deliver core product value as often as possible?

Start with a cohort of your most engaged users. What features are they using? What pathways in your product did they take? Then work backwards and try to get all of your users to that state.

Full video: EO “How To Validate PMF EffectivelyㅣSean Ellis, Hacking Growth“ (Mar 2024)