How to evaluate the Potential Impact of Growth Levers?
So far, we have discussed how Growth levers can be identified, and how they can be mapped to relevant Growth metrics.
However, due to real-world constraints, we have to prioritise only a few Growth levers for the Growth roadmap at a time to work upon.
Hence, we have to estimate the potential impact of growth levers beforehand.
This involves assessing how much influence a particular action or change can have on the identified key metrics.
This process requires:
☞ analyzing past data,
☞ understanding market/competition trends, and
☞ making informed predictions.
Example:
Let's consider 'BookMyRead', an online bookstore. They plan to introduce a recommendation engine as a growth lever.
To evaluate its potential impact, BookMyRead analyzes data from similar features implemented by competitors and industry benchmarks.
They predict that the recommendation engine could lead to a 15% increase in average user session time and a 10% increase in cross-selling opportunities, based on observed trends in the sector.
Explanation:
The evaluation process is crucial for prioritizing which growth levers to implement. It involves not just looking at internal data but also considering broader market dynamics.
For BookMyRead, the decision to implement a recommendation engine should be backed by quantitative analysis - how similar features have historically impacted user behavior and sales in similar contexts.
This kind of rigorous evaluation helps in forecasting the impact of the lever and justifying the investment in its development and implementation.