All early stage companies have the same concern. How do we acquire more customers?
Back in the day most people would buy ad space in a newspaper. You have text, images (sometimes) and…the medium of communication, the paper itself. If you swap the analogy of newspaper for the web, you have: text, media and the platform hosting your ad.
Another method was to go go door to door with a sales pitch and a product. Sales people would also act as marketing of the company as they would pitch customers on the spot and also memorize scripts for every occasion!
That was a lot of effort!
Then radio, TV and web came to light…things got better for advertisers, but the basics did NOT change!
Companies started investing a lot more money into paid advertising.
When people see an ad, the idea is that it captures the viewers’ attention. Making them see what you place in front of their eyes for an extremely brief moment.
Can you convince them that your product or service is worth it? If so, you won. Marketing worked. Paid advertising worked.
Has this marketing channel been effective? Did your audience click/ call/ visit to learn more?
That’s all that matters ultimately.
Problems begin when multiple advertisers join the game. Suddenly there are 100s of ads all over your screen and only big spenders can keep playing.
Yep, we got ourselves a problem
We know that it’s not going to work out for you, startup business, when the ad-space gets too crowded.
Sure you can up your budget. Taking valuable resources from other parts of the business.
Sure you can hire the most fantastic copywriters. Costing you valuable resources.
It becomes an expensive mouse and cat game.
Should you go all-in, in paid advertising? Well, did it work out?
What ELSE can you do?
Find alternative channels!
A good start is to pick from these options:
- Content (via social shares, SEO)
- Marketplaces and Directories
- Direct outreach with email/calls
- Forums and communities
- Digital advertising
- Word of mouth
Some of these channels can be expensive, but you can leverage the free ones first. What happens when you successfully acquire the interest of your audience? The audience wants to find out more about you.
This is where I would ramble on about landing pages and acquisition funnels, but this is a topic for another time 😇!
You - but ideally your userbase - produces content on your platform, be it long or short form: Comments, reviews, articles, questions, answers…
The content generated should be used to increase traffic and interest from those looking outside-in. Content can be paywalled, half-paywall or open. Using the first two methods you exchange a sign-up for access to the right to “consume” and eventually “generate” more content. This is what Yelp does for example.
Using SEO you can leverage this content to rank higher. You can use programmatic SEO to generate interesting content pages that act as acquisition. The higher you rank the bigger the audience you will reach.
Examples: Quora, Reddit, Yelp, Thumbtack have all used content (in different formats) to create an afflux of audience.
Why: I rank it a 10 because other than upfront costs, SEO makes user-acquisition nearly free. You do have to spend resources to produce, optimize and collate the content. However, as you offer compelling content, your audience will find its way. Then it’s all how good your funnel is!
How to: Use tools like Google Keyword tool and find what keywords (long and short) you can leverage. Your vertical will dictate this. Then fly off and create the content that you can use to mesmerize your audience.
Alternatively to creating smart content-first acquisition funnels, sometimes you have an amazing product that people want to naturally recommend to their acquaintances, they do that by letting them know through the word of mouth. This can lead to exponential growth, especially if the users that do the recommendation are able to convince their acquaintances to remain active. Negative-churn!
Examples: Instagram, TikTok and Uber are great examples of this.
Why: As humans when we see something they really, we will naturally tell others. Family, friends, acquaintances, colleagues…even our dentist.
If you create a platform or content that can go viral, you will be able to see word of mouth or social sharing rise to the stars. This will drive people onto your platform and once again, this is where your funnel will be what will make it or break it!
How to: Creating virality isn’t simple. Word of mouth doesn’t just happen unless there is a strong product-market fit. Either the content is really relevant, really outstanding or it really leaves an impact. There are countless cases of virality on the web! Remember how the video/song “Gangnam style” drove billions of views to YouTube? Or how the referral program for Uber allowed Uber to gain millions of new riders?
Using digital advertising directly you can target the audience you’re after. The downside is, that it is expensive to create, manage and fuel ad-campaigns.
This channel works well when you’ve already well identified your audience. Your biggest enemies at this point are ad-fraud and competition who are also bidding on the same ad space (keywords, audience etc).
Oh! And shitty landing pages!
Examples: Allbirds, Bonobos, Quip, Turbotax, Expedia
Why: By crafting great marketing messages and using ad-platforms you can target people who are searching (or show intent to purchase) for certain things. There are other mechanisms such as retargeting and audience-targeting that will allow you to hit the bullseye for certain demographic or behaviors.
How to: Picking a paid channel isn’t simple, there are many ad networks but they work differently. For example if your audience is younger demographics, TikTok and Instagram might work better than LinkedIn or Pinterest. More on this another time 😎
There are millions of businesses that acquire customers through partnerships with larger platforms. Apps on Shopify, Salesforce or Stripe are prime examples. There are thousands in each marketplace There are businesses turning million of dollars in profit from selling extensions. Partnerships are hot! Whether you end up on a marketplace, a dedicated partner portal or a direct partnership it’s a great way to acquire customers!
Examples: Shopify Apps, Salesforce AppExchange, Stripe Partners, Zapier!
Why: You can leverage other people’s audience to build your own, especially when you have something to sell them that is a “painkiller”, that solves a pain the customers are facing. This way you become part of an ecosystem that grows and lets you grow with it.
How to: It’s extremely tough to choose a platform and become a leader of a category, as it requires deep knowledge of the overlaying platform, of the business model. Partnerships are on the rise as an acquisition channel but aren’t as “easy” as one might think!
After picking an acquisition channel that works for you, you need to be diligent and stick with it. Alternatively, quickly understand why it’s not working.
Can you fix it?
Was there a wrong assumption anywhere?
The more time you spend on a channel that doesn’t work, the longer you’re delaying your growth.
Once you find a channel that works for you - it’s imperative that you focus down on how you can maximize the benefits from utilizing this channel.
As time passes, your acquisition teams will become wider (headcount and expertise) and more knowledgeable as the challenges they are facing increase. No more one-person growth hacker teams - but instead a balanced team with designers, engineers and PMs all shooting at the same bullseye 🎯.
These teams will be contributing to your growth and will have influence over the company’s objectives as they optimize processes, whether it’s SEO, paid advertising, community building or something else.
Sometimes things don’t work out. Like most things in life, there’s no one single answer as to why things don’t work.
Take SEO and content as a channel to acquisition: it might take months before you see any results.
In paid Advertising, most people ask what is the minimum amount of time someone should run an ad campaign?
It’s really hard to give answers as to why some things might not work out, but there are also red flags you can detect:
- How does the channel fit in with the overal business strategy? Sometimes it just doesn’t make sense to even consider one channel over another one, simply based on the type of business you’re in.
- Are your tests all-in or half-baked attempts? Sometimes you just didn’t do “enough” to make it count.
- How far from way your bullseye are you? Sometimes you’re just a couple of steps away from hitting the right inflection point
User acquisition is a huge stepping stone - when a company gets into a channel and understands how they specifically can leverage it to gain customers they can go all-in until they saturate it.
As your company grows more and more channels will be added, that will create a perfect ladder for exponential growth.
With every channel added, new experimentation and timelines are required, and your company will have to invest time, money but more importantly human brainpower to get it right.
And as we all know, time, money and brainpower are limited and extremely valuable in young companies.
Time to start drawing some plans on a board.