Dec 9, 2019
How Successful Startups Conquer Competition Through Mindset & Strategy
You got your great product idea, have a team lined up ready to execute, now all you need are your first paying customers. Getting out the word about your product or service is crucial. To find out how to do this, without spending prohibitive amounts of cash, we talked to Alan Frei, co-founder of Amorana.
The topics we covered are
You can listen to the full interview with Alan Frei here.
In the early stages of your venture, your customers will be buying your vision and personality rather than an amazingly polished product. Therefore, make sure you have inspiring stories ready for them. The most common format for your „story“ is an elevator pitch. It’s worth investing some time to perfect it since (hopefully) you will be telling your story hundreds of times. A few words on elevator pitches: keep it short and sweet. Try to include interesting facts which benefit your audience beyond simply knowing your product. Avoid being „the Uber of X“ or „the Airbnb of Y“, have the courage to be one of a kind. Lastly, and this is probably the most underestimated trick, don’t take yourself too seriously. Be funny. People love to laugh and giving them a positive feeling will really benefit your brand.
When you convincingly told your story, give people a simple call to action. This could for example be your business card with a coupon code for your product. This brings us to our next point.
If you don’t have half a million to spend on marketing like Uber, tap into whatever you can get for free or at least don’t have to spend money without guaranteed revenue. One great example is free PR: think about where you’d like to be featured and research what has been written in this publication about topics related to your company and/or your industry. Put together some interesting facts and figures and reach out to the journalist which has covered this topic in the past. Emphasize your insights, not your company or product. Give the journalist a clear deadline for accepting or rejecting the story. If they reject it, you move on to the next outlet with your story. This way, you position yourself and your brand as experts on a particular topic and even if your story is rejected this time around, the journalist might reach out if they run a story in the future.
In terms of marketing techniques, there is a simple three-point framework you should follow when first getting started:
The first metric which you should pay attention to when starting your marketing efforts is conversion rates, meaning the ratio of people who visit your website to those who end up buying your product. To understand what drives (or hampers) your conversion rate, consider doing some simple user testing. Ask your aunt to visit your website and make a purchase. Observe her buying journey and try to understand where she might struggle and give up. Iterate and improve until you reach a value close to your industry benchmark (this will be between 1-2% for most industries).
Once you are confident that people who visit your website will likely buy your product, it’s time to drive traffic. To find out which acquisition channels work best for you, it’s advisable to test them all. Test sequentially in order to be able to easily determine which source is generating your traffic at any given time. Again, try to use free resources or agree on revenue shares in order to avoid paying for things which don’t work. For example, hire an influencer and agree on paying him/her a percentage of the revenue he/she helped to create. Another option is to ask for free trials in order to determine whether a particular channel is worth spending resources on.
Having optimised both conversion and traffic at a low budget, the third important concept to focus on is your customer lifetime value, or the amount of revenue a customer will generate for you over an extended amount of time. This metric is often overlooked in startups since they are preoccupied with attracting as many new customers as possible. It is however worth considering since it will help you get a higher return for your acquisition costs. The key takeaway here is to keep your customers engaged. Even if they are not interested in buying anything at the moment, you should stay on top of their minds so once they are ready, your brand will be the first thing they think of. One way to achieve this is through compelling content that delivers value to your customers. Videos are known to perform exceptionally well in that regard. Since they are costly to produce however, you might want to test the waters with a less resource intensive blog or infographic format.
Measuring your metrics is everything, therefore google analytics will be your best friend. If you want to integrate other tools, a spreadsheet will probably do as a dashboard in the beginning. As your processes become more complex, there are a lot of great tools out there to help you manage. Alan’s go-to solutions are Asana for teams and Minubo for business intelligence.
The marketing landscape is in constant flux. To excel it is therefore important to stay ahead of the curve and discover new trends and channels early on. For the Swiss market, Alan predicts that Youtube, podcasts and compelling email newsletters will gain significant importance in the near future. It’s certainly worth to give it a try!
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