How to Run Growth Marketing During a Recession

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They say pressure makes diamonds. I would argue that this is also true of recessions creating amazing startups. Airbnb, Uber, and Groupon are great examples of companies that emerged during the 2008 recession.

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How do you create, scale, and manage recession headwinds, especially when consumer behavior changes dramatically? And that’s without even getting into the complexities of 2022, such as deteriorating ad targeting (due to Apple’s App Tracking Transparency Program) and post-pandemic behavioral shifts.

But there is a path we can follow to strategize and execute during a recession—my Tripe R model: reforecast, reprioritize, and refine.

Repredict Your Models

If there were new channels and major experiments on the horizon, it is probably better to postpone them until the markets recover.

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It’s no secret that average revenue per user (ARPU) is falling across all companies. A prime example is stock trading platform Robinhood, which reported a 62% drop in ARPU to $53 from a high of $137 in the first quarter of 2021.

This is a massive decline. Where Robinhood once broke even in user acquisition for $137, now it will attract users nearly three times as much as it earns.

CAC/ARPU Robinhood modeling by channels. Image Credits: Jonathan Martinez

In the chart above, ARPU drops from $137 to $53. In particular, the colored circles represent channels and their CAC/ARPU ratios. Robinhood attracted users with a CAC in the $130 range and expected an ARPU of $137. The shift in these channels shows how CAC stays constant while ARPU falls.




Credit: techcrunch.com /

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