Ever wonder what it takes to design a product so good
it grows into a $6 billion business?
No?
Is it just me?
Is that weird?
What's up, it's Jamal from HubSpot.
We're going to take a deep dive into Canva's product strategy
and see how the Australian unicorn is disrupting the 128
billion design services market.
If you like the story, you know what to do.
Hit the Like button and subscribe
to the HubSpot YouTube channel.
Now, we've all Googled a question, Ubered to a party,
Venmoed to your friend maybe a little
bit too much for those nachos.
Having your product name become a verb
that people use in everyday conversation
is the Holy Grail for any brand, especially in tech.
It means that your product has become ingrained
in people's lives.
Now Canva isn't a verb just yet, but with 40 million
monthly users in 190 countries, it's well on its way to
becoming the next TiVo or Skype to make the linguistic leap
in our consciousness.
The idea for Canva began in 2007 when CEO Melanie Perkins
grew frustrated teaching students complex design
tools like Photoshop.
Hey, Photoshop, that's another verb, nice.
Perkins and co-founder Cliff Obrecht
had a vision for an online tool that would give the whole world
access to high quality design capabilities
without having to master complicated design software.
With the addition of technical co-founder and chief product
officer Cameron Adams, the first version of Canva
launched in 2013 with a team of 8
and Adams doing the product design and much of the coding.
The product designed by Adams in the Canva team
set it apart from the competition
and set the stage for massive growth.
What can we learn from Canva's $6 billion innovation?
Let's find out by looking at the four
major pillars of the product.
The first is Canva's ease of use.
According to Canva, it only takes 23 seconds
to learn graphic design using its browser and app based
design tools this might be a slight exaggeration,
but the product really is incredibly simple,
even for users who have never touched the design tool.
Looking at Canva 1.0, you can already
see the clean and intuitive Editor tool that is still
the core product, neat.
Adams has described the central product philosophy
as just simple enough, a promise in keeping with Canva's mission
to make design more accessible.
Canva's ease of use starts with on-boarding
the moment you hit the site.
Users aren't required to sign up or log in, just one
click to start designing.
Boop, there you go.
You did it.
Once you're working in the Canva editor,
everything is drag and drop.
The app proportionally resizes images and prevents users
from accidentally stretching images out of proportion.
Text dynamically resizes as you type and grid lines appear
as you move things around.
These are pretty familiar functions now,
but they were extraordinary when Canva debuted.
Adams describes these types of design guardrails
as having great defaults.
In Canva's case, that means enabling new users
to produce great design right out of the box while still
allowing experienced users to go deeper
with the tools as their abilities increase.
Your business probably has different defaults,
but it's all about optimizing for the solution that
works best for the most users.
The idea of defaults in Canvas design system
drives product's second major component, templates.
Canva offers over 250,000 free templates
that users can customize and publish.
That number almost doubles for pro subscribers.
Templates play a crucial role in Canva's product.
With so many templates available,
Canva also have to put lots of effort
in helping users find the templates that
are right for them.
Just like Netflix or video on Spotify for music,
Canva uses machine learning to optimize
its temperate recommendations, creating personalized
suggestions that users might not even
be aware of but that make the entire Canva experience more
satisfying.
And I've been saying this for a while now,
but the minute that machines start learning,
that's the future, baby.
Templates also provide a cornerstone for Canva's site
architecture and SEO strategy.
The website features dozens of template landing pages
and hundreds of sub-pages that act as lead magnets.
When new assets become popular like TikTok templates or Zoom
backgrounds, they create a new landing page
and watch the traffic pour in.
Responding quickly to consumer trends
is critical for any business.
It's one of the ways that Canva has stayed on top.
We have a whole video about campus digital marketing
that you can check out when this one's over.
Look for the link in the description.
Templates have always been a part of Canva,
but their fundamental importance wasn't there
from the beginning.
Their current importance is a result
of data that shows users are much more likely to publish
a design if they use a tablet as opposed to starting
a design from scratch.
Data driven decision making is critical for any tech company.
And it's the third ingredient to campus success.
That's why I Canva passes every imaginable
web and digital analytic and is constantly testing iterations
to make improvements.
In Canva's case, this can mean testing a new team invite
dialog and discovering that improve conversion by 88%
or increasing activations by 10% by testing a welcome pop up
that asked users what kind of poster
they want to design when arriving through that channel.
For your business, being data driven improvements
can mean anything from optimizing your high performing
platforms to increased conversion
or testing different apps or descriptions
to improve visibility.
Start with any data you have easy access to and run a pilot
program to test and iterate.
You'll be amazed how quickly those sort
of methodical improvements can turn into positive change.
Feeling out of your depth or want a refresher
on some of these concepts?
We've got you covered with literal days of content
with HubSpot Academy, all geared towards helping you
and your business skill up check it out
in the description below.
Now when it comes to data, you can only
get insights on the things that you're doing.
You can't measure what you aren't doing
or what you could be doing.
That's why Canva focuses on qualitative data as much
as quantitative data.
In a 2020 interview, Canva's head
of product growth and monetization Dave Burson
said, "It's important to balance talking to your happy customers
as much as your unhappy customers,"
yet he admits that most companies don't
do enough of this research because it can be
more cumbersome than analytics.
It was from talking to customers that Canva learned
users didn't understand the phrase "magic resize
in marketing" for Canva pro.
But by changing it to "magically resize
your design in just a few clicks"
the sign ups magically increased.
I wonder if they can do that with food,
just make a really big chicken.
[APPLAUSE] Only hope.
The real mystical thing about magic size
though, is that it is one of the few features on Canva
that is limited to pro users.
Almost all the product functionality
is available in the free tier, keeping
with the company's mission to democratize design
for the whole world.
In an interview with NPR'S How I Built This,
Perkins describes this philosophy
as providing as much value as you possibly can.
So how does this business model work?
That's the fourth pillar of Kenya's product success,
upgrades.
Users are encouraged to upgrade their service in order
to access tools that add convenience,
like magic size, as well as expanded content like premium
templates and images.
This is done with a light touch compared to many other freemium
services.
So a pricing page that dynamically changes
with the size of your team, a prompt to get a subscription
before buying a premium template or image, or a Canva pro button
in the bottom Navigator bar of the Canva mobile app.
Despite the soft sell, Canva has acquired over 1 and 1/2 million
paying customers who account for an estimated $230 million
in annual revenue.
That's a lot of money.
The company just released its balance sheet,
but it claims increasing profitability
every year since 2017, something that no doubt helped
it obtain that multibillion dollar unicorn valuation.
But the real value investors see is
in the ability of Canva's product to revolutionize
how we do graphic design.
No matter if you're a Fortune 500
company, or a scrappy startup, or just
someone who's doing design for work or pleasure,
every successful product out there as a result of thousands
of small decisions.
Get enough of those decisions right,
and you have a good chance of success.
Canva is a product that got a lot of decisions right,
from its ease of use and template for its design system,
to its store data driven decision making and freemium
upgrade business models.
Keep watching the channel for more lessons that
will help you make the right decisions for your business
and let us know what companies you'd like to see us
cover in future episodes by telling us in the comments.
If you'll excuse me, I'm going to get back on the grind now
for Jamva, which is my $12 billion company.
You'll hear about.
I'll see you next time.
The idea for Canva began in 2000--
2000-- 2000-- words.