How to Reduce “Time to Value” in order to Improve User Retention
Four elements to consider when evaluating product concepts part 3: Time to Value
Have you ever installed a new app on your phone, only to play around with it for a few minutes and then immediately uninstall? The app probably didn't provide you with enough immediate value. After your initial excitement and motivation dissipated, you lost interest and quit.
This is where "time to value (TTV)" comes in. TTV is the amount of time it takes a new user to get (perceived) value from your product.
After defining your target market, understanding your customers, establishing your core value proposition, and ensuring you have a good hook, your next priority is to reduce your product's TTV to be as short as possible.
Think about how short a typical user's attention span is. Microsoft conducted a study in 2000 showing that the average attention was 12 seconds. In 2015 it dropped to 8 seconds. It's probably even lower now.
That's why a short TTV is critical in reducing new user churn (and thus, retention). Just look at the abysmal churn rates for mobile apps—day one churn is 25.4 percent, increasing to about 50 percent at the 30-day mark.
Your window of opportunity to retain new users is shorter than you think. Every additional second your users waste makes them much more likely to churn. So don't add unnecessary non-value adding things during the new user experience (NUX).
As designers, one of the most critical metrics to keep in mind is TTV. By designing for a reduced TTV, you're in the unique position to make a tremendous impact by improving user retention—something all businesses struggle with.
So how do you reduce the TTV in your product? The answer: "progressive disclosure". Progressive disclosure is the practice of deferring (or hiding) tasks and information only as they become relevant and necessary. This interaction design pattern is often used in new user experiences and onboarding. It's much better to provide users with value (as much of it upfront and related to your core value proposition as possible).
For example, if you download a new app and immediately force you to create an account before you get to explore the product—you'd be dissatisfied. It'd be much better to let you play around a little before asking you to complete a task.
As a user, once you get value from the product, it refreshes your motivation and makes it much more likely to complete another task. Whereas if you force the user to complete many tasks in succession without any reward, they're likely to just leave.
Progressive disclosure is also used to make tasks seem less overwhelming. A standard implementation of this is breaking up a long onboarding process or form from one screen with 10+ fields to several more digestible steps. This principle works based on Hick's Law, where the decision-making time (related to TTV) is shorter based on the number of choices or inputs the user has to make.
Time to Value (TTV) Example
Let's take Duolingo as an example. In their web version, they used to have a fantastic NUX with short and sweet TTV. Within three clicks, new users get to experience their core language learning value proposition.
Every step is finely tuned to either make the experience better (logging in, choosing a relevant language) or is related to their value proposition ("what sound does this make?").
Now, look at their new experience, which has added five unnecessary screens to their NUX. Screen 3 gathers growth channel data which provides no value to their user. Screens 4, 5, and 6 do not provide immediate value and aren't critical for a new user's experience.
Based on progressive disclosure, they should be moved out of the NUX and into a latter part of the experience.
Avoid front-loading all the work (sign up, notifications, setting preferences). Let users experience value first and sprinkle in optional (but relevant tasks) later. Duolingo could've asked new users to do all this extra work completing their first lesson instead.
Useronboard.com did a great analysis of their previous NUX, which I recommend reading.
In essence, reducing TTV aims to empower users to get what they came for as soon as possible. This leaves the best first impression and increases their likelihood of becoming long-term users.
Think about all those products that force you to create an account, only for you to use it once and forget about it. Don't be one of those products. It's a cheap trick and leaves a bad taste.
The "retention threshold" (sometimes called “tipping point metric”) is the point in a user's journey where they're no longer at risk of churning. It's often correlated with the "aha moment," where your users experience actual value from your product for the first time.
Retention thresholds are different for all products. It could be a specific set of conditions a user needs to fulfill or a repeated habit they've adopted with your product.
Facebook's "0-1 billion users" growth strategy focused on unlocking the conditions for new users to experience their value proposition as soon as possible (reduced TTV).
Their initial retention threshold was for new users to "add seven friends within the first ten days." The rationale was that it's hard for new users to get value from Facebook without having enough connections for meaningful interactions.
On the other hand, Pinterest's growth strategy focused on getting their new users to build a consistent habit with their product. Their retention threshold was for new users to save at least one pin per week.
Both Facebook and Pinterest are now wildly successful because they focused their efforts on enabling as many users as possible to reach and sustain the retention threshold they identified.
Many thought leaders in the startup space believe that product-market fit is the number one indicator of product-market fit. Marc Andreessen even famously wrote about how product-market fit is the only thing that matters.
So what? Well turns out user retention (flattened retention curves in particular) is one of the best indicators of product-market fit. So as a designer, if you can improve retention by reducing TTV...then you're golden.
This is one of the best ways to demonstrate high business value for new products and startups to become an impactful designer.
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