Growth Experiments Template
Test strategies for scaling your business with our Growth Experiment template.
The Growth Experiment template helps you test strategies for scaling your business. Which strategies are most effective? How will they impact your revenue? How does each strategy compare to similar strategies you developed in the past? Conducting growth experiments will allow you to answer these questions.
About the Growth Experiment template
What is a Growth Experiment?
A growth experiment is a systematic method for testing a strategy to scale your business. Let’s say you want to conduct a marketing campaign, or you want to transition your business from freemium to pay-per-use. These decisions are costly -- and they are often leaps of faith. But growth experiments allow you to test these strategies before fully committing, saving you precious time and money.
How to use the Growth Experiment template
Anyone who has ever seen a diagram of the scientific method at a kid’s science fair is familiar with the design of experiments. Experiments can be time-consuming and resource-draining, especially if you are running several at once. Use the growth experiment template to keep track of your experiments. You might find it especially useful if you are simultaneously testing marketing campaigns, social media campaigns, business growth strategies, advertisements, and more. Regardless of what you are testing, here are a few key steps.
First, form a hypothesis. Many companies, especially startups and small businesses, tend to make marketing or product choices because their competitor is doing it. The hope is that if it worked for them, it will work for you. However, that can be a costly and damaging decision. The better choice is to form a hypothesis based on data about your own customers.
For example, let’s say you would like to offer a pay-per-use option for your music editing app. Your data suggest that your customers are happiest after they have used the product for about a month. In fact, users who enjoy the service for a month are most likely to continue using it for a year. You hypothesize that users will be willing to pay for the service.
Once you have your hypothesis, you can start brainstorming possible strategies for growth. Remember, your hypothesis is just an educated guess about how the world works. You and your team still need to figure out you can leverage that information to grow your business.
Start by using the growth template to organize a brainstorm. Try asking every individual on your team to brainstorm on their own and come to the meeting with ideas. As everyone talks it out, you can start ranking the most creative and actionable ideas. If the team gets lost or stuck, refer back to the hypothesis. It can serve as a guardrail so you stay focused on your goal.
To stick with our example, you might come up with a strategy for monetizing your app. After 30 days, your users can switch to a paid model.
Armed with a strategy, it’s time to do some research. Find out whether similar companies have adopted comparable strategies. Have they worked? What could you do better? What would you change? If the strategy still seems to hold water, take care of the logistics you will need to run the experiment: align with other teams, get buy-in, survey the potential impact on existing customers, and study any technical limitations. If the strategy no longer makes sense, you might want to revisit your hypothesis or hold another brainstorming session.
Now, design the experiment. Your design will vary depending on your hypothesis, the size of your team, the number of customers you might impact, and other factors. In general, you will want to specify: any copy you need to include in the experiment, your treatment group and control group, methods for tracking and measuring the experiment, timeline, and a sample size. Importantly, you will want to decide what success looks like. How will you know that the experiment worked? What predicted outcome do you think will occur?
In our example, you could roll out the 30-day paid option to a certain percentage of your customers. Your data suggested that you need to offer this option to 3% of your customers to achieve statistical significance. If 25% of them switch to the paid model, then your experiment was a success.
Build an experiment sheet. Drawing on the information above, you can build out a sheet on your template to help guide the experiment. Here’s a typical outline:
Our hypothesis is…
To verify this, we will…
We will measure...
If the experiment is a success, we will see…
You can also include a section that amalgamates quantitative and qualitative results.
Run the experiment and perform an analysis. Many experiments unfold over weeks or months. If that is the case, consider meeting weekly or biweekly to keep everyone informed. Update the growth experiment template as you go along.
Once you have your results, meet with your team to discuss them and figure out next steps. See if there are any key learnings or implications. Often, you will find that new experiments arise from these meetings. If that’s the case, then start the process again!
Why do a Growth Experiment?
Conducting a Growth Experiment will help give you an edge over the competition. Instead of taking a leap of faith on marketing or product decisions, you can test your strategies before rolling them out to your entire customer base. Growth experiments offer a systematic, reliable method for informing your planning sessions and scaling your company.
Why are Growth Experiments important?
From startups to enterprise companies, all businesses must deal with uncertainty. But growth experiments take some of the uncertainty out of your high-stakes business decisions. Rather than investing time and resources in an unproven strategy, growth experiments allow you to test hypotheses and grow your business with minimal risk.
When to use the Growth Experiment template
Use the Growth Experiment template any time you’d like to test a business strategy, marketing plan, or any decision that impacts the growth of your company. You may find this especially beneficial when testing multiple strategies at once.
Growth Experiments Template
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