You haven’t fully got Product-Market Fit, and you’ve hit a scale where you can’t cover that anymore. It could even be that Product-Market Fit has shifted, as it does over time. For example, a recession causes people to re-evaluate what they value and find important.
The best measure is the traditional Product-Market Fit survey, but alternative identifiers are that retention and referral are dropping, and it is becoming harder to convert new customers.
It may feel like a head back to ‘Go’ on your monopoly board and start again, but the paper money you gathered in the previous rounds is still there. You haven’t lost all your monopoly houses and hotels; rather, you need to reconnect with your customer to understand what is happening and why.
Your messaging is too broad and does not speak specifically to your customers’ needs.
As a result, you struggle to scale up your channels and get your website converting where it needs to be. This drives up your cost of acquisition:
Time to get specific. It seems counterintuitive, however, really focusing on specific audiences can bring you more customers with better results:
Narrowing down the specific Jobs to be Done and understanding how you can best position yourself for solving them better than the competitors.
You were too reliant on one channel or a form of social proof. Something changed; maybe the algorithm behind the ad channel, or you are no longer allowed to use that social proof. Suddenly everything drops.
If 50%+ of your customers come from one channel or collaboration, it is a risky place to be in, especially if it is Meta ads of Google Ads/Search. I always say Meta giveth and Meta taketh because your results can massively improve or plummet in a blink of a second.
This does not mean stopping what is working; rather, spend time and budget exploring new avenues of growth to diversify the mix and reduce your risk.
Your channel mix is like an investment portfolio; you want a variation.
You have been focusing on the wrong channels, namely the ones everyone uses, rather than the ones that are right for you. You keep trying to get them working, and sure, you’ve landed some customers, but it’s a lot of work (and high costs) for little results.
Time to research your market and learn what works for you, not your competitors.
You’ve gotten too caught up in optimizations vs. big-impact areas, and all the obvious ‘quick wins’ are completed. You see this when your experiments are all low impact, high confidence, and high ease. Or that you keep working on the same areas without exploring new ones.
It’s time to take some bigger bets based on the major areas for improvement.
You’ve been equating marketing to growth too much, and, as a result, you’re restricting your brand team by making them focus on conversions.
This is usually the case when growth and marketing are casually used interchangeably and follow the same process. Ideally, your growth team is a mix of different departments, like in this example:
And your brand team follows a different process where it’s free to focus on their KPIs:
This does NOT mean that brand doesn’t care about growth KPIs or vice versa. But instead, growth gives brand the room to focus on long-term brand building and awareness.
You’ve been trying to do too many things at the same time, and that lack of focus is holding you back. It feels like you are running from one area to another without ever getting to explore one fully.
It’s time to get picky. Start with your overarching growth goal and define the main growth levers: key KPIs / areas that impact growth. Then, work out where there is the biggest opportunity to impact growth and focus on just those areas.
A lack of focus on growth is a process and culture problem. Your process needs to create focus, and your company culture must continuously push for it.
It’s been too long since you did customer research, so you’ve lost touch with what customers need.
A sign of this could be that despite running many growth experiments, nothing seems to be leading to growth.
Gut feeling will only get you so far; schedule a chat with your customers. A great way to do this is to add an email to one of your customer flows to ask for customer feedback interviews to ensure you are regularly interviewing customers.
Your teams aren’t working together as one growth team, which has led to silos and a lack of alignment.
Each team is focusing on their goals and projects rather than seeing what is the most impactful to reach your overall goal, your North Star Metric.
Again, this relates to who is in your growth team, but also, is your process pushing for collaboration?
It’s time to get everyone in the same room, whether that’s physical or virtual.
Is it not anything within your control?
Even with external factors, like the economy, it’s a sign to look at how to make your business more recession-proof. For example, you could focus more on a less price-sensitive market or develop alternative pricing or payment options.
Try to understand what factors are impacting your growth.
For example, if the issue is seasonality, is there any way to diversify your offering to include products/services that are less seasonal? Or should you focus on creating a way of working that prepares everything in-between for those season peaks?