Navigating Growth Design: Frameworks, Challenges, and Success Stories

Upgrades in Gaming Applications

Many mobile games such as Clash of Clans, Candy Crush Saga, and Pokemon GO use a freemium model, offering free usage with the option to purchase additional in-app features or items. While the core capabilities of a game are free to play, players can purchase virtual items, characters, or upgrades within the game. This approach encourages user engagement and generates revenues from users who upgrade their experience in the app. Growth teams analyze user behaviors and game data to identify opportunities for introducing upgrades that would provide value to players. Growth designers craft and place upgrade offers within the gaming experience.

LinkedIn Premium

LinkedIn offers a freemium model that lets users create a basic profile and connect with others for free. LinkedIn also offers a premium subscription that include features such as data on who has viewed your profile, advanced search options, and access to online-learning courses. This approach lets LinkedIn generate revenues from users who need advanced job-search capabilities. Growth teams analyze user behaviors and usage patterns to understand which upgrades could have the most impact, then designs these upgrades.

Dropbox Referrals

Dropbox’s referral program has led to an incredible 3900% growth. Dropbox offered rewards that benefited both the person making the referral and the new user. This double-sided reward system has increased the motivation of both parties to engage in the program because both received more free storage. Plus, the company has rolled out a dashboard that makes it easy for users to track the status of their referrals. Transparency gives users a clear view of their progress and the rewards they’ve earned, encouraging even more referrals.

A Framework: Build-Measure-Learn

In growth design, the Build-Measure-Learn loop is a key method that involves creating solutions, measuring how they perform, and learning from the results what improvements to make.

Build

Growth designers kick off a project by creating designs that align with the hypotheses a team wants to test. They collaborate with the development team to ensure that everyone is on the same page about the purpose of the release. The focus is on setting clear goals and defining metrics for this design iteration.

Measure

The team releases the design to a test cohort of users and gathers data on their interactions and behaviors. They gather quantitative data such as user interactions, engagement rates, and click-through rates, but not just numbers. They also gather qualitative data in the form of user feedback and comments, which is crucial to gaining a proper understanding of the users’ context.

Learn

The team analyzes the data they’ve collected to understand how users are engaging with the design and learn what is or isn’t working and why.

Refine

Based on these findings, designers make informed changes, enhancing user flows, interactions, and visual and other elements for optimal results.

Repeat

The growth team starts the loop again by building the refined design, measuring its impact, learning from the data, and continuing to refine it. Iterations of design and testing continue to further enhance the solution based on user preferences and behaviors.

Growth Team Structures

While growth team structures can vary based on company size, goals, and industry, there are two common team structures. One is a centralized growth team that works on its own; the other is a team that is spread across different departments, reporting to various leaders. Plus, there are project-based growth teams.

A Centralized Growth Team

A dedicated growth team operates on its own, working on growth initiatives across the entire organization. This team collaborates closely with various departments to optimize the entire user journey. Squads within a dedicated growth team often focus on a specific area of growth. They have the freedom to plan and execute their projects independently.

Cross-Functional Teams, or Squads

Some companies have decentralized growth teams, and each department has one or more of its own embedded growth-team members. These teams also include members from different departments such as Marketing, Engineering, UX Design, and Data Analysis. Spotify uses this structure.

Project-Based Growth Teams

Some companies form temporary growth teams to work on specific growth initiatives. Once a project is completed, the team disbands.

AARRR Framework: Structuring Growth Teams

The AAARR framework is a popular method of organizing a growth design team to achieve better results. This acronym stands for Acquisition, Activation, Analysis, Retention, and Referral, which are the five components of the AARRR Pirate Metrics framework. Every team member takes on a role that corresponds to one of these areas. Let’s consider each of these roles.

Acquisition

The Acquisition team’s main focus is on expanding the user base. They work on projects that involve attracting new users to the product. Their focus is on metrics such as click-through rates, impressions, and sign-up numbers. Designers working on the Acquisition track focus on optimizing the usage of existing users and adding new sources of traffic to increase the overall number of users.

Activation

Designers working in Activation are responsible for making sure that once users sign up, they have a smooth, engaging onboarding experience. They work on projects whose aim is helping users to understand the product’s value and features right from the start. Their efforts impact metrics such as task completion during the onboarding process, early retention, and initial feature adoption.

Retention

The Retention team is dedicated to keeping users engaged over the long term. These designers work on projects that enhance the user experience, encourage repeat usage, and prevent churn. They track metrics such as user engagement over time, frequency of visits, and feature usage patterns. Retention teams aim to create an experience that encourages users to return to the product regularly and become loyal to the brand.

Referral

The Referral team focuses on turning satisfied users into advocates. The team’s ultimate goal is to drive user growth and acquisition through word-of-mouth marketing. They work on projects that encourage users to refer others to the product. They monitor metrics such as the number of invitations sent, referral rates, and social sharing.

Revenue

Growth designers on the Revenue team use data to guide decisions that would boost revenues directly. These include optimizing the user journey to encourage more conversions, improving upsell and cross-sell flows, or refining pricing strategies to increase average order values.

Revenue growth designers might work on initiatives such as optimizing the checkout process or designing personalized product recommendations to motivate users to make more purchases. They monitor metrics such as conversion rates, average order values, customer lifetime value, and revenue per user.

Challenges Growth Designers Face in Their Work

Growth designers encounter unique challenges in their work. For example, they have to balance immediate successes with long-term impacts, interpret complex data accurately, and maintain their focus on ethical considerations. Let’s dive into our real-world examples to show how these challenges and product decisions manifest themselves and what results they lead to.

Balancing Short-Term and Long-Term Gains

Uber’s aggressive push for driver recruitment through high sign-up bonuses and incentives led to an influx of drivers. However, this approach actually resulted in an oversupply of drivers in certain markets and, eventually, led to dissatisfaction among drivers due to reduced earnings and resulted in protests and legal issues. The focus on immediate gains negatively impacted the company’s long-term relationships with both users and drivers in certain markets.

Using Data Accurately

Growth designers rely on data to make informed decisions. But the misinterpretation of data could lead to misguided design choices.

For example, let’s say a social-media platform notices a spike in user engagement after a recent design update. However, upon closer examination, they realize that the increase is primarily driven by a temporary viral trend rather than the design changes. If they misinterpreted this data and attributed the growth to the design update, they might make design decisions that could negatively impact the user experience.

Accurate data interpretation involves digging deeper to understand the underlying causes of trends and avoiding coming to erroneous preliminary conclusions. In contrast, data that is interpreted correctly and used constructively can serve as a guide for an entire department or company.

Duolingo grouped users based on their activity levels, as Figure 2 shows, introducing concepts and terms such as Current User Retention Rate, which shows how often current users keep coming back; New User Retention Rate, which measures how often new users come back; Reactivated User Retention Rate, which indicates how often users who have taken a break come back; and Resurrected User Retention Rate, which shows how often users who were away for a long time come back. The team created a map showing how users move between these groups. They also learned that improving the Current User Retention Rate had the biggest impact on the growth of Daily Active Users.

Focusing on the Current User Retention Rate led to the company’s changing its priorities. Previously, the company had spent significant resources on new user retention. However, their approach shifted because of the impact of the retention of current users.

Ethical Considerations

Growth designers must navigate ethical concerns, especially regarding user privacy and data usage.

Facebook’s People You May Know feature is a good example. While the goal of the feature was to connect users with potential friends, its algorithms sometimes suggested connections that were based on sensitive data, revealing users’ private information and connections that they had intended to keep hidden.

For example, users noticed that Facebook suggested their fellow patients at a psychiatrist’s practice as potential friends. The possible explanation behind this suggestion was that these patients had connected with the psychiatrist. Facebook’s algorithm might have thought they were all connected, which led to all of them receiving these friend suggestions.

Growth design has strengths, but also some limitations. For example, focusing too much on short-term gains, as Facebook did, would cause ethical issues. Relying solely on data-driven insights can lead to misinterpretations.

Is Growth Design for You?

If you’re a UX designer, product designer, or marketer and are thinking about whether growth design might be a good fit for you, here are five points to help you understand whether growth design would align with your interests and skills:

• a data-driven mindset—Growth design relies heavily on quantitative data to make informed design decisions. If you enjoy working with metrics, A/B testing, and using data to iterate and optimize user experiences, growth design could be a good fit.
• conducting smaller experiments—Growth designers often work on smaller-scale experiments, in comparison to traditional product designers. If you prefer working on focused, rapid experiments to test hypotheses and iterate quickly, you may enjoy working in growth design.
• interest in psychology and human behavior—Growth design requires that you understand user psychology and behaviors to design effective triggers that can drive user actions.
• cross-functional collaboration—Growth designers must often collaborate closely with the core Product Design team, Marketing, and the Legal department to ensure that their solutions align well with the core product vision.
• resilience and patience—Growth design often includes testing new ideas that have uncertain outcomes. If you’re comfortable with ambiguity and can maintain a positive attitude even when experiments don’t yield the desired results, you would be better equipped to handle the ups and downs of this type of work.