Dear friends,

In JC’s Newsletter, I share the articles, documentaries, and books I enjoyed the most in the last week, with some comments on how we relate to them at Alan. I do not endorse all the articles I share, they are up for debate. 

I’m doing it because a) I love reading, it is the way that I get most of my ideas, b) I’m already sharing those ideas with my team, and c) I would love to get your perspective on those. 

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🔎 Some topics we will cover this week

• How to find and foster great product sense

• How to notify users without being spammy

• How to develop a new one in a scaled company

• How to increase virality through referrals - the right way

👉 Finding and Fostering Great Product Sense (Stay Saasy)

❓ Why am I sharing this article?

• Even the people I know with the strongest product sense had never overnight success with 0 iteration. For me, product sense is about:

  • Having bold convictions on how the world should be that are educated by the sum of intuitions you have built by knowing the shape of technology and how it is changing, the competition, talking with members, knowing very well the problem

  • Being able to go for those bold bets without compromising, and iterating until they are successful (being also actively patient)

  • I don't believe that even the best product people (including Jobs, Ive, Fadell) had overnight success, and it was a very long & iterative process to design to perfection.

  • The big thing with product-sense is to not be driven by customers' yesterday needs and being the ones understanding & even defining customers' tomorrow needs.

• To foster more product sense:

  • Reading a lot about other products

  • Testing a lot of other products

  • Debating on the first principles of why it should work

Product sense

• Hiring product builders who have great product sense is a make-or-break move for startups. A great product is the foundation for a successful tech business, and such products can only be built by teams with great product sense.

• High-quality product sense involves generating solid, highly profitable ideas for making money and intuiting whether a product is likely to be successful without running lengthy research upfront. This ability to make accurate judgments without extensive data gathering is vital.

• Without sufficient product sense, a team can only optimize to a certain point. When faced with real challenges such as a market downturn, strong competition, or a technology sea change, you need product inventors who can make significant changes, not mere optimizers.

Hallmarks of Great Product Sense

People with great product sense tend to share a few common traits.

• Lots of Good Ideas: They have a very high volume of reasonably-good-to-great ideas. They view great ideas as a renewable resource, not a scarce luxury, so they don't fixate on any one idea.

• Structured Product Opinions: They have structured opinions on the products they like and dislike. Their product opinions are based on explicit chains of logic rather than gut feelings.

• Non-Linear Solutioning: They draw from a much broader solution space when deciding how to solve problems. They tend to be first-principles thinkers and draw from a wide range of sources for inspiration.

• Easily Testable Solutions: They are good at finding feasible solutions because they distill problems to their core pain points and define MVPs effectively.

Is Product Sense Teachable, or Innate?

• I believe great product sense is trainable and learnable, but it seems innate because most people aren't willing to take the steps to get better.

• Improving your product sense requires launching many products, understanding business and technology fundamentals, and being open-minded to motivations.

• These steps take effort and require a willingness to risk embarrassment, which prevents many people from improving their product sense.

👉 Five attributes of distinctive product marketers (Medium)

❓ Why am I sharing this article?

• What is our vision of the PMM role compared to this blogpost?

• How to be very clear in terms of B2B Marketing

• “B2B customers are like any other human”

• An exceptional PMM can do anything — jump in for the PM, dive deep into the pricing strategy, craft compelling messaging, incubate your sales motion — whatever your business needs to make your product successful.

• Product marketing is responsible for three things: 

  • 1. Strategy — synthesizing user and market insights to inform the product roadmap and build the go-to-market strategy;

  • 2. Launch — actually bringing the products and features to market, crafting the narrative, creating marketing collateral, enabling the sales teams, etc.

  • 3. Growth — driving ongoing awareness, growth, and adoption of the product). PMMs are like the CMOs for their products.

• There are a lot of skills that are clearly critical for a good PMM — synthesis, storytelling, cross-functional effectiveness to name a few.

• I can’t count the number of times I’ve visited a B2B marketing page and not understood what the company actually does even after several minutes attempting to decode the homepage.

• B2B customers are like any other human :). They appreciate clarity and specificity. 

  • Amazing PMMs agonize over each word on every landing page and email. 

  • They mull and debate over every turn of phrase to make it as specific as they can and to make sure it means something.

• PMMs must sweat the details in so many areas that are *not* always visible — from the carefully-devised launch contingency plans, to the meticulously organized day-of-launch checklist, to the rigorous funnel analysis that they pore over post-launch. 

  • An exceptional PMM brings energy each day to making the work as excellent as it can be, always bringing the customer’s needs to the forefront.

• Distinctive PMMs are multi-dimensional athletes who can tackle any problem, at any altitude. 

  • They can span the spectrum from being hyper-creative to highly structured and rigorous. 

  • They can scrutinize drop-offs in a funnel or the assumptions behind a financial model, and then build a creative customer-facing narrative.

👉 How to notify users without being spammy case study by Growth design

❓ Why am I sharing this article?

• Great takeaways on how not to saturate a channel

  • When you force people to do something, they tend to do the opposite of what you want. Especially when they feel their freedom of choice is threatened.

    • They took the example of Duolingo who's well known for being too spammy and driving users out of the app instead of in

    • They describe it as a psychological effect, finding the proper frequency and mode of interaction is what makes users interact with your app

  • Users Don't Care About Silos. One of the reasons this situation happens is because departments don't synchronize well with each other. Be careful not to let internal miscommunications influence the user experience negatively

  •  People don't want to overthink. Make it really easy for them to choose what they have to do next, and they'll engage with your content.

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👉 Can Substack Save the Social Network? (The Split)

❓ Why am I sharing this article?

• We should give the feeling to our customers that “there’s a sense that there’s always a new feature on the way” that is going to be valuable to them. 

• I like the idea of a public raise.

• So much so that when Substack had trouble raising a Series C from traditional growth stage investors in 2022, it’s $5 million round raised from its writer community was oversubscribed within 12 hours (more on the public raise here). The rationale from customers speak for itself: 

  • “People sometimes ask me why I’m on Substack instead of a cheaper publishing platform. In the early days, my answer was because I could get Substack on the phone and get their advice. Even though that’s still true, my answer shifted to their recommendation feature once it started powering my free signups growth. But really, I’m on Substack because there’s a sense that there’s always a new feature on the way — that suddenly my business could get better because they had a great idea.”  Eric Newcomer

👉 Product: How to develop a new one in a scaled company (Tom Shields and Matt Mochary)

❓ Why am I sharing this article?

• Very important to differentiate the 0 to 1 and 1 to 100 needs

• The only way to successfully build a new product within a scaled company is to recreate the early-stage building mode. 

• This means taking a team of 3-5 dedicated people and making them autonomous. 

• This regains all the build fast elements of the YC startup. 

• No brand, no customers, no need for security, scalability, or industrial code.

👉 Referral programs - Interesting examples of companies who focus on value over cash

❓ Why am I sharing this article?

• Excellent ideas about building referral programs (tiered incentives, reward with gifts…)

• The level of iteration you need to be successful at referrals

• Zendesk “Our referral program gifts customers a bottle of wine when they refer their peers or colleagues for a 20-minute discovery meeting or call.”

• How Morning Brew’s referral program built an audience of 1.5 million subscribers

• While the referral program obviously doesn’t account for all 1.5 million subscribers we have today, it does account for over 30% of our total subscribers and is the “secret sauce” that makes our growth flywheel spin. It’s helped turn readers into evangelists and evangelists into walking advertisements.

• Start with the product: When your product is good enough that people instinctively refer others without any sort of incentive, that’s a strong indicator that you’re ready to build a referral program.

• Tiered incentives: a set of stickers when you refer five people, a tee-shirt when you refer 25, or a trip to visit our HQ when you refer 1,000 

Top of the funnel: Newsletter share section (“share the brew”) to inform the casual reader about the referral program or to incite more action.

• Referral Hub: Educate, motivate, and assist the end user to continue to share our product with others = a page where users can learn about the rewards, track their progress, and utilize tools to help them share the Brew seamlessly

  • Making the rewards as clear, visual, and repetitive as possible is crucial.

  • We motivate users by providing a real-time counter that tracks how many referrals someone has, along with some encouragement: “You’re only X referrals away from receiving Y!”

  • The ultimate goal is to remove any bit of friction:

    • Unique referral link along with explicit directions on how to use it

    • Allow users to refer others via email (3rd party integration with Cloudsponge, which allows them to import contacts from Gmail, Yahoo, or Outlook)

    • Within the form for the email content, we provide a pre-drafted “blurb” explaining the Brew and its value proposition (however it is editable)

    • We provide a section dedicated to sharing on social platforms

  • A lot of tests to define the best channels for users to share (share by emails, social media...). Example: we also found that sharing via WhatsApp and SMS leads to 10x more signups than LinkedIn, 5x more signups than Twitter, and 2x more signups than Facebook

• The initial ask:

  • Convincing someone to go out of their way to share our product (or any product) is a challenge, so most of our focus goes into enticing them to get from 0 to 1 referral.

  • Our hypothesis: After reading the newsletter for a week, readers are at their peak excitement about being a new subscriber and digesting business news in a fun and entertaining manner. It’s at this point that they are most likely to talk about it and refer others to join. 

  • We’ve tested this initial “7 day email” from dozens of different angles

• Milestone emails: These emails are triggered after your first successful referral and at each subsequent referral milestone in which you unlock some sort of reward (5, 10, 15, 25, 50, 100, 1,000). The purpose of these emails: to acknowledge the reader’s accomplishment, show them how to redeem their reward (if necessary), and to motivate them to hit the next milestone.

• Nudge Emails: The lowest hanging fruit in the pipeline is what I call “nudge emails.” Essentially, readers who have been stuck for two weeks just one referral away from a milestone (2, 4, 9) receive an email to nudge them to get that one last referral.

• Giveaways: we do a big giveaway every 4–5 weeks. It’s nothing revolutionary, but it’s a massive stimulant to the referral program. The messaging is simple: For the next X hours, every person you refer who confirms their email is an entry into the giveaway. The more people you refer, the more entries you have. Given that the biggest challenge is getting a user from 0 to 1 referral, we’ve found that providing a strong incentive via a giveaway converts thousands of new subscribers who previously had 0 referrals to refer.

👉 Facebook Earnings, Generative AI and Messaging Monetization, Open Source and AI (Stratechery)

❓ Why am I sharing this article?

• “Meta has cracked the post-ATT code when it comes to ad targeting.” and might still be a great platform to invest (to be checked and assessed) 

• Why we should sometimes go beyond myths

• Myth 1: Users Are Deserting Facebook — In fact, Meta increased users sequentially in every single market, cresting the 3 billion daily active user mark.

• In fact, Instagram engagement continues to surge, thanks to increased Reels engagement.

• Meta has cracked the post-ATT code when it comes to ad targeting.

• Our AI work is also improving monetization. Reels monetization efficiency is up over 30% on Instagram and over 40% on Facebook quarter-over-quarter. Daily revenue from Advantage+ Shopping Campaigns is up 7x in the last six months.

Second, last year Meta disclosed that its click-to-message advertising business, which connects would-be customers directly with advertisers in WhatsApp and Messenger, was running at a $10 billion run-rate (Meta didn’t update that number, but Li said that it continued to grow last quarter).

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