After launching the product into the market and gaining initial recognition, how can we further expand the user base? In order to find ways to acquire customers and market , many founders have to reduce the polishing of their products. Ryan Farley, co-founder of LawnStarter, faced similar issues. Four years ago, LawnStarter was just merged into Techstars. Although they successfully gathered a small group of users at that time, they did not figure out how to expand their customer acquisition channels . They spent a lot of time thinking about how to expand their user base, but most of it didn’t help. One investor told them, “You should set a goal for yourself - test at least 1 new channel a day, 5 is even better.” However, Ryan Farley believes this is some of the worst marketing advice he has ever heard. He had seen many startups that were in trouble and ultimately failed. The reason these companies failed was not because their products were bad, but because they did not open up sales channels and could only rely on continuous testing to understand the actual situation. Since then, Ryan Farley has learned a lot about startups and marketing. This marketing knowledge helps entrepreneurs gain a clear understanding of their ideal growth channels. He also wants to share this knowledge with other founders so they can waste less time finding marketing channels and spend more time building cool products. Ryan Farley divides the knowledge that needs to be understood during the user acquisition process into two parts:
1. Basic customer acquisition concepts for startupsBasic Concept 1: You Must Have a Good ProductThe premise of all the following content is that you have a group of people who are willing to make a good product. The truth is, it’s incredibly difficult to bring a bad product to market. As Y Combinator President Sam Altman says, no matter how creative your growth approach is, your product has to be good enough for people to spread the word. Of course, there are companies whose products are not very good but have achieved significant expansion by finding large enough channels. But it’s best not to think you can be part of this. Basic Concept 2: The number of growth channels is limitedMany companies adopt this model: gather a large group of smart people in a room with a whiteboard and brainstorm ways to help the company grow. But it doesn't really have much effect. When Ryan Farley communicates with other entrepreneurs, he says that companies that have truly achieved some success from nothing rarely do so through true creativity. A veteran startup marketer also told him, “There aren’t actually that many marketing channels.” Andrew Chen, who has been paying attention to corporate growth issues over the past 10 years, once wrote an article specifically summarizing this issue. He believes that there are only five ways to really help companies speed up and scale up: (1) Paid acquisition If your users provide you with funds, you can use that money to buy new users directly through advertising. Generally speaking, companies will maintain a 3:1 "customer lifetime value: customer acquisition cost" ratio to maintain profit margins after deducting other reasonable costs. (including eBay, Match, Fab, etc.) (2) Viral Spread If users like your product, you can get viral word-of-mouth promotion . If user interaction drives your product to go viral, you can further use A/B testing to optimize the viral loop and get more viral promotion . People use the "viral factor" to measure the effectiveness of attracting new users, and you certainly want your viral factor to be over 1.0. (Facebook, Instagram, Twitter’s “viral factor” is 1.0) (3) SEO (Search Engine Optimization) If your product can create a massive amount of unique content in the form of Q&A, articles, and long-form reviews, you can generate millions of unique pages, thereby attracting hundreds of millions of new users through search engines . (Yelp, Rap Genius, Stack Overflow, etc.) (4) Sales For startups targeting small and medium-sized enterprises, they ultimately have to rely on a large sales team to achieve development. This is especially true for companies targeting local SMEs, where telesales are their only option. Of course, to make it work, the revenue you earn needs to be several times what you pay. (5) Others There are also some wacky partnerships, like the one between Yahoo and Google , that can make or break a startup — but they’re rare and highly context-dependent. But sometimes it happens! Note that each of the above categories has many varieties. For example, there is a big difference between Google Adwords and TV advertising in the paid category. But the key is to understand one thing: there are actually only a limited number of ways to truly drive company growth. Basic Concept 3: Your Channel Depends on Your Customer Lifetime Value and Your Product FeaturesAt some point, you need to have some data, or at least a reasonable assumption, about the lifetime value (LTV) of your customers. You should calculate your current LTV, possible future LTV, and ridiculous LTV, and then tell investors directly when you present your product. This in itself should eliminate a lot of customer acquisition channels. You need to live within your means, with your expenses at most equal to your income. Ideally, ARPU should be 3 times the ASU and then reinvested into customer acquisition within 6 months. This isn't a hard and fast rule, but as long as you stay within this range, you'll perform well. If you're selling a subscription product for $29 per month, you probably can't afford to have sales reps trying to drum up customers with aimless cold calls. If you monetize through advertising ( social networks or media sites), you need to use almost free methods to acquire customers. Basic Concept #4: Developing a scalable pipeline takes time, effort, and/or moneyEntrepreneurs often say, “We tried this channel, but it didn’t work.” In fact, it should be said that your first attempt did not work. Due to the nature of market efficiency, it is often the case that growth channels are difficult to penetrate, so it often takes time and/or money to really get things moving. For example: Paid Acquisition: With Adwords, you might have to bid on a million keywords to find the few hundred that actually convert . We spent $75,000 on Facebook before we finally found the right balance of creativity and audience targeting—many companies spent more than we did. Going viral: While the clicks you get from search may have no marginal cost, you need to create content and have a performing website — both of which cost money. In addition, you also need to build external links to your website, usually through public relations or content promotion, which also takes time and money. Search engines themselves don't give you instant results - even if you do everything right, SEO can take 12 to 18 months to show results. Sales: In an enterprise environment, it takes about 9 months to close a deal - many startups can't afford to pay a salesperson for that time. Most of the time, your first try won’t be great. But you shouldn’t give up on a channel just because of this; instead, you should determine whether you have what it takes to make it work. Then you can start iterating until you see results. Basic Concept 5: Explore MoreIf you’re one of the majority of startups who don’t yet have a large scalable pipeline at your disposal, don’t worry. There are many untapped growth avenues that can be explored, and exploited more quickly and with less difficulty. They won’t help you IPO or even raise a Series B, but they may help you make progress toward validating your product, generating a little revenue, and even more funding. Airbnb used to spam Craigslist in its early days, and many companies have auto-follows and auto-likes on Twitter. At LawnStarter, they optimized to get a high ranking on Yelp and then used daily Groupon deals to attract early users. 2. Help you find customer acquisition channels through 9 questionsThere are currently many variables in each of the 4 scalability channels above. Additionally, “exploring more” can also open the door to a variety of strategies. Through hundreds of conversations, hours of reading, and his own experience at LawnStarter, Ryan Farley believes that to determine which channels are most likely to work, it's best to think about your customers and how they're likely to buy your product. This requires asking a series of questions and tracking customers and their buying journeys to uncover acquisition channels. Since his focus is on transactional consumers and small and medium-sized enterprises, the following analysis will also focus on this aspect. Of course, this is not an exhaustive list of issues, nor are the issues mutually exclusive. It doesn’t mean that you will succeed just by following this list. These strategies may not be suitable for everyone, but I hope they can help you. Q1: Do you sell to large companies?If you are selling high-value B2B products, you may need to scale up through an enterprise sales team. Even companies that achieved viral growth early on, like Slack and Dropbox, or started out as grassroots campaigns, like Sendgrid and Twilio, added sales teams later. Don't assume that because they sell to businesses, they don't need many salespeople. Explore more: Almost all of the B2B company founders Ryan Farley knows start out selling their products themselves. They typically leverage their networks to acquire the most enthusiastic clients and then treat the sales process as a learning experience. Just finding a few clients yourself can pay off and give you enough experience to hire sales representatives to scale up. Scaling up: Typically, scaling a B2B business requires converting the first few transactions into common processes that can then be taught to others. Since one’s network of relationships will eventually run out, it’s important to develop a customer acquisition process. This may be achieved through push marketing such as proactive door-to-door sales or mass emails. Alternatively, it can be achieved through inbound marketing such as trade shows, paid acquisition, or content marketing . Content marketing can also serve as an important channel for certain products. As mentioned above, some products will achieve viral growth, but the vast majority of companies will build a sales team at some point. Q2: Are your sales targets small and medium-sized enterprises?Marketing to small businesses is difficult. Peter Thiel once said: “Products require personalized sales pitches, but when it comes to price, there aren’t enough resources to send a real person to talk to every potential customer about price every time. That’s why so many small and medium-sized businesses don’t use the tools that large companies take for granted. It’s not that small companies are lagging behind or that good tools don’t exist, but that the distribution channels have encountered hidden bottlenecks. ” When selling to small and medium-sized enterprises, there is really only one effective method: cold calling. If you sell to small businesses, it seems inevitable that you'll have to build a telemarketing center with each sales representative making 120 calls a day, hoping that each of them will sell one or two products a day. Explore more: You’re going to have to put on a smile and start making sales calls at some point. Since this is bound to happen sooner or later, it is better to do it as soon as possible. Founders and early employees should make the calls themselves, refine them into specific lines, and then hand them off to others to follow to make sales calls. If you're targeting a niche market, maybe you can join some communities or publish articles in some publications. Many of these require a fee. But the benefits gained through these means quickly run out. Scaling up: The great thing about developing products for small and medium-sized businesses is that you can keep scaling until all the businesses are exhausted and there are no more calls to make. Or the additional costs of managing these salespeople are too high and unaffordable. Until then, every sales representative can create value. Once you've nailed down your telesales content, hire some confident entry-level employees to generate new business. Once you feel that this process is delivering a positive ROI, you can hire more employees. Eventually, you can recruit a group of ambitious young people, train them, and have them make 120 calls a day, and be prepared to lose 50% of your employees every day - this is the case for all companies at this stage. As you scale, you can also do some inbound marketing, but it will still be too few compared to the customers that sales representatives attract. Something needs to be done to improve the marginal effectiveness of the sales team. Q3: Is the customer looking for a solution? Do they know what they want to buy?Bellhops provides cheap local moving services through a tech platform. The number of people who move each year is limited, but these people all have a need for moving services. Intercom defines this as category-based purchasing. Customers know what type of product they want, they want that service, and they’re actively looking for it, most of the time online. This means you can scale through search, most likely by integrating paid search with SEO. Explore more: SEO takes months or even years. At the same time, you can identify companies that already dominate the search results. Search all the keywords that reflect buyer's intentions on Google and see which websites rank at the top. Take a look at the search results for “austin tx photographers”: You can see that there are 4 aggregation websites appearing in all search results. Each of them can purchase advertising space or obtain natural search advertising space through optimization. It’s much easier to get on the front page of Yelp than Google — just get customers to send you a few reviews. Let’s look at another B2B example. Below are the search results for “web scraping tool”. You can see some articles and a review website. You can find a way to get yourself included in the article, or you can find a way to rank at the top of Capterra. If paid search is available and the price is low enough, you can start it right away. Whether you need to start optimizing depends on what you’re doing in other areas. Scaling up: When it comes to SEO, you need to give yourself 18 months to see results. You should be able to find content that you think is valuable on search engines, and you should also develop a public relations and content promotion strategy to attract external links for yourself. It’s ideal if your product can generate content itself, because then you can scale infinitely — this is the case with Yelp, TripAdvisor , and Stack Overflow. Paid search. You may need to have a very healthy testing budget to find out which keywords convert and which don’t. Ultimately, you’ll want to build or deploy a system that allows you to test your ad copy. You’ll eventually need to have a paid search expert on your team, and you can even do this programmatically at scale. Q4: Are you targeting a passionate or self-reflective audience?If you are reading this article, you may be a growth marketer or a startup founder. I’m not trying to sell you anything in this article, but if you were selling to either of these groups, this would definitely be a good place to do it. If the product you sell relates to something in your target user ’s life, consider creating content they will find interesting and make them want to come back for more. Intercom is an example of this, they produce a lot of content targeted at product managers and marketers . Do you think they published a book or made a podcast out of the goodness of their hearts? Of course not. Moz is a classic example in the SEO space. Producing high-quality content earns trust and attention, and also makes people familiar with your brand . The following is a simplified description of this method:
Explore more: You will definitely have no audience initially, and your content will not automatically rank on the first page of Google. The current state of social platforms also makes viral searches very difficult to achieve - you may occasionally publish a popular article, but don't hold your hopes too high. So, when you create content on your own website, you have to promote it manually to attract your audience’s attention. It’s best to start with communities that specialize in sharing this type of article. It could be Reddits, Hacker News, Slack groups, Facebook groups, Quora, or various forums. You can get by by sending spam messages, but you'll probably end up getting blocked. It’s best to be an active participant in the community and occasionally share a valuable article you’ve written. This way you will eventually get noticed for your authority on the topic. You can also create content for other sites by leveraging their audience and authority in your field. You may not be able to rank very high in the search results, but other websites in the same industry may be able to do so. You can use platforms like Medium to attract attention to your content. Scaling up: Tom Gunguz points out that content marketing is a hybrid skill. It takes months or even years to get the hang of it, but sometimes it really pays off. This can be divided into three categories:
SEO is often crucial to building an initial audience, but social network sharing can help, too. You can find an open social platform that matches your content, such as YouTube . Building an audience requires some opt-ins, primarily through email lists and to a lesser extent social platforms. Over time, you may add new content formats to promote to your existing audience. Intercom is a model like this, they have popular blogs, podcasts and even books. As your content accelerates and engages with audiences, some of them will spill over and convert. This is when you can use marketing automation and lead scoring to determine which audiences are interested in purchasing your products. Q5: Is the customer experiencing a problem but unaware of your solution?Self Lender companies can help individuals build credit. Even though one in four Americans has no credit score, solutions are few and far between. Would you search for a product you didn’t even know existed? However, since credit scores are so important and 25% of Americans don't have one, you can bet there are a lot of people looking for such a solution. Therefore, Self Lender invests in producing a lot of content that addresses these issues while also offering paid solutions. When your car makes a weird noise or something doesn't seem quite right, you just know there's a problem but there may not be a solution. That’s why Yourmechanic provides a Q&A section, where these issues are presented in a Q&A format, and then you can make a direct call. If your customers are searching for solutions, you might be willing to invest in content marketing. There is certainly some overlap in this section with the previous content, but there are also important differences. If your audience is self-reflective, you should use content to capture their attention and build your brand, so you must avoid direct conversions. In this case, your audience becomes less reflective and more of a random solution seeker. This way, you can have a more direct conversation. Explore more: Early on, your content will not appear at the top of Google rankings due to lack of external links. But there are many Q&A sites that have achieved high rankings for this type of question. Search on Google to see if there are any relevant forums or Q&A websites so that you can provide valuable answers and reveal your solution. No place to do that? Then make your own login page. You can also make videos on YouTube, publish long articles on Medium, or ask and answer your own questions on Quora. In fact, it is equivalent to using other authoritative websites. First, make sure your answer has enough text so that Google considers it the most relevant answer on the site. Then make sure your comments or posts are spread across the site so that your content can be crawled by search engines and get backlinks. Scaling up: To scale this content marketing, first list all search results related to your question and then put them into Google’s keyword planner. This will let you know which ones have more search volume. Then determine the priority of keywords based on the data. You have no way of knowing which articles will be effective, so you need to produce a lot of articles and ensure their quality. It also needs to be supplemented with some content marketing and external link building strategies. After a while (say 12 months), you'll start getting traffic . Some of these can convert very well into purchases — and that’s what you should be doing SEO for specifically. Additionally, you may have some content that has a lot of traffic but a low conversion rate , and you may be able to find ways to increase the conversion rate. Maybe you can find some useful templates. For example, Zapier found success by targeting searches for “X software” and “Y software” that integrate with each other, and then created pages for each of the different software combinations people wanted to integrate. Q6: Is your product a low-friction product with mass appeal? Will it bring convenience to people’s lives?We often have many passwords in our lives. This may not be a big problem, but remembering too many passwords is not easy either. Almost everyone has to deal with this problem. Dashlane makes this problem easy to solve through a low-friction payment solution. Ryan Farley didn't know he needed a service like this before, but he's glad he tried it because remembering passwords is a real pain. Blue Apron is also an example. Most people eat three meals a day, and many people cook several meals a week. By inserting content such as "Easy ways to prepare a delicious dinner" into information flow ads , the distance between users is gradually shortened until they accept Blue Apro's services. Both services are easy to sign up for. Dashlane offers a free tier, and Blue Apron’s first meal is cheap. However, their products are all very good, so the long-term purchase rate is high. If something can attract a large group of people, the friction of trying it is low, and it won't replace a habit, then you just need to find a way to get high traffic in a low-cost way. It would be even better if you could refine it to your audience. Explore more: This kind of product can get a big early boost on Product Hunt. The media can also be a driving factor for products. Fundraising and product launches are easy to attract media attention, but beyond that, you have to be creative. Reports about founders can be very interesting. Lawnstarter doesn’t fall into that category, but when The Guardian reported on their crazy sleeping arrangement experiment, the company saw a spike in traffic. Dashlane also took advantage of the password leak trend, earning coverage in the New York Times . There are many other ways to attract attention. Being trending on Reddits or Hacker News can also be a big help because people will think “that’s really useful, I’ll try this out,” even if they’re just coming to the site looking for an article about machine learning or something else. It can also be effective to find an influential person to share your product. Quora may have some popular questions where you can attract attention by answering them. Linktexting.com is a small tool for sending links to mobile applications, which can bring complementary benefits in the B2B field. If you search for Linktexting on Quora, you’ll see how much of a reaction they’ve generated, with many users posting things like this: Scaling up: Companies that have this low-friction feature and can complement life often scale through paid advertising on Facebook or mobile platforms. These ads are focused on direct conversions — you don’t need to “educate” or “build” someone’s interest to get them to use a password manager, you just need to connect with enough people at the right time. Most of your energy should be spent on testing creative ideas, refining users, or optimizing conversion funnels. Additionally, paid viral marketing or referral programs may help, but the effectiveness may vary greatly. You have to ask yourself, “Do people have a reason to share this with their friends? Does sharing this create social capital or does it cost social capital?” Giving people free meals adds value, so perhaps it creates social capital, or it can be social capital neutral. That’s why Blue Apron’s referral program is successful. But recommending a password manager to someone else might not have such a positive effect. Q7: Does your product have social attributes?Social networks aren't the only social products. Uber is also social in a sense because it involves interpersonal communication. Living Social also has social attributes. The key is not the name, but the fact that the discount activities and experience process need to be completed with friends. Venmo and PayPal are also social because you are paying other people. The same is true for Dropbox, because your content needs to be shared with others. Everyone wants to try the referral program, but most don’t work. But if your product is inherently social, then a referral program is worth considering. It’s no coincidence that all of the companies mentioned above saw their growth boosted by referral programs. Explore more: Don’t think that just putting out a promotional page like “Buy 20, get 20 free” will work. Instead, try and understand existing social behavior related to your product. Then imagine how to use various incentives to increase the frequency of existing social behaviors. For paid referral programs, Ryan Farley recommends using LTV to calculate the maximum cost you can afford to acquire a new user. Then add a discount because referral programs 1) often cannibalize other user acquisition channels and 2) are significantly less effective due to cheaters. Now, arrange an incentive program so that you break even on referrals. For example, if your theoretical LTV (after accounting for cannibalization and fraud) is $40, try a “buy 20, get 20 free” offer. Then test it. You will probably lose money, or at best break even. However, this will give you a quick way to understand whether your referral program has any vitality. If there is no vitality, then give up quickly and move on. If the effect is good, then you can move forward. The next question is how to optimize it. Scaling up: If you see a big opportunity in a paid referral program, you’ll want to scale it. Please note that for every user you acquire, you can acquire another. Use your intuition, analytics, and user feedback to determine which of these are useful. This can be used to increase the number of users who see the invitation interface. In addition, you can also understand at which stage of the life cycle the customer is when sharing. Can it be accelerated? Can it motivate those who have already shared to share again? You may want to build an internal testing framework to test on various dimensions. Q8: Are you building a social network or some kind of community?Your community won’t (and probably shouldn’t) generate revenue until you have millions of repeat visitors. If so, you need free (or nearly free) customer acquisition channels that can scale. This often means going viral. Explore more: Every social network has some sort of “secret sauce” for taking off. Here are some of the approaches Ryan Farley has heard about. Reddit fakes a lot of usage before people actually join in. Facebook posted many photos of college students online without their permission, allowing people to judge whether they were "sexy or not", and became popular among college students. Nextdoor reportedly built its initial network manually. Growth Hacker s will automatically like many relevant tweets, eventually gaining followers and developing a community. Scaling up: Every major social network has grown through viral marketing . LinkedIn and Facebook rely primarily on email. Instagram and Pinterest grew through sharing pictures on Facebook. What is clear is that without this mechanism, extremely successful communities and platforms could have achieved this scale, just not as quickly. They built a great reputation and then accelerated forward. If your platform doesn’t have strong engagement and reputation, simply bringing in contacts won’t lead to rapid growth. These platforms will plan SEO measures after the viral spread slows down, so that user-generated content can be indexed by search engines. Since social networks usually get a lot of coverage, backlinks aren’t a problem. Q9: Have other people seen your product being used? Is there any way to achieve this?Ryan Farley gave an example: Two weeks ago, he noticed an e-scooter in the middle of the sidewalk in downtown Austin. He thought someone just left it there temporarily while going to the store next door to buy something. The next day, he was seen outside my building again. A few days later, he saw someone next to the scooter, fiddling with a smartphone for a while, then riding away. Afterwards, he received a recommendation text from Bird. He finally understood, and then he began to see more and more people riding these electric bikes. He and his entrepreneurial partners often talked with investors late at night, so they decided to try this electric car for free. After seeing them riding electric bikes, the investors started talking to them about electric bikes. In this case, the product itself becomes the trigger for viral marketing, and then a little external force is added to give it the ability to spread more widely. “Making private actions public” is one of Jonah Berger’s methods for increasing word-of-mouth marketing. In the case of Bird electric scooters, this behavior is public. But what if your product itself is private? See if there's any way to expose it. Yelp, Tripadvisor and Grubhub offer incentives to get businesses to put up their stickers. On-demand services like Favor, Taskrabbit and Doordash give errand runners T-shirts and car stickers. Wag not only gives people T-shirts, but also provides tools with their branding. There are also examples of this in the digital world. Intercom puts their branding in the live chat interface, Sumo puts it in a pop-up window, and Hotmail adds a “Sent from Hotmail” text at the bottom of the email. Explore more: For real-world products, if you think your product has the potential to grow virally, then you should use it to achieve explosive growth. This often means starting small and not being able to expand. Specifically for Bird, they put the scooters out every morning and collect them back at night (to avoid them being confiscated), and they can only be placed in densely populated areas. Yelp went door-to-door and offered restaurants their window stickers. Since these actions often make people more familiar with you but don’t inspire purchases, you definitely need to find a way to convert. This may require the help of recommended projects or media coverage . Digital viral marketing can be done at a low cost by offering a free tier of service or a little extra if customers are willing to add your logo to their website. Scaling up: You can’t keep electric cars on the road forever, or stickers on windows forever, so you have to find other ways to get the job done. Fortunately, you have already mastered a set of methods through previous attempts. Additionally, it may be possible to promote virality through paid acquisition, and better measure the effectiveness of different parts of the strategy. 3. ConclusionIf you’re looking for your own customer acquisition channels, don’t put all your eggs in one basket, don’t place too much emphasis on creativity, and don’t give up easily just because you don’t see results yet. Instead, think carefully about how your customers buy and use that as the basis for your customer acquisition strategy. Find ways to scale and then make long-term investments while maintaining a balance in all aspects. The author of this article @长歌 is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting! Product promotion services: APP promotion services, advertising platform, Longyou Games |
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