What’s the hardest part of starting a business?
You might think it’s getting funding or nailing down the logistics of making your product.
Actually, according to StartitUp, it’s getting your product distributed to your customer (user) base as it grows, “Most companies fail not because they fail to build a compelling or useful product, but because they were not able to distribute their products into the hands of their customers.” What acquisitions strategies can you employ to grow your business and products?
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Back in 2009, when she was the director of international growth for Facebook, Meenal Balar figured out how to grow the social media site to a billion users around the globe (she’s now doing the same thing for educational startup Remind).
Facebook continues to expand its customer base (1.55 billion users as of November 2015, more than the total population of China) at an impressive 13 percent annual clip, according to Charles Sizemore, CIO of Sizemore Capital Management. Benzinga cites Sizemore’s observation that, “I think that their future strategy right now, their biggest strategy, is just increase their user base, which they are still managing to do, which is actually shocking when you consider that roughly half of the world's connected Internet population is already a monthly active user."
How do they do that?
Know Your Customer Base
Balar says there are three kinds of prospective customers:
- Those who’ve never heard of your product.
- Those who know about your product, but don’t use it.
- Those who know about your product, but aren’t interested.
You want to focus on the first two (if you’re really successful with those, the third group might be persuaded to come around). You attack the first group with the usual marketing weapons—advertising, viral marketing, promotions, press releases, industry events—to create “buzz.” The second group represents considerable opportunity, but also presents considerable challenges. “You want to dissect that second category of people who know about you but haven’t converted. That will drive you to understand your audience more deeply, including how they view and experience the product end-to-end,” Balar says.
The second group represents considerable opportunity, but also presents considerable challenges. “You want to dissect that second category of people who know about you but haven’t converted. That will drive you to understand your audience more deeply, including how they view and experience the product end-to-end,” Balar says.
Make Your Product Easy to Find and Use
The way you convert these people who know about your product but don’t use it is to make it easier for them to find and use. For example, Balar’s team looked at how users in Africa could register for Facebook. In most parts of the world, you just provide your email address.
But many people in Africa don’t have an email address, even though they have the capability to go online. So, to make it easier, Facebook developed a way to sign up for its site without an email address.
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Don’t Assume You Know Your Customer
The people who know your customers best are, well, your customers. Identify key influencers in your potential customer base and partner with them to determine their needs. Then come up with solutions that satisfy those needs. If you can develop a few key partnerships and “get them on your team,” so to speak, word will spread.
Fanatically Digital notes Facebook’s emphasis on constant testing of what might be considered a mature product. “The premise of testing constantly is actually very humbling. By committing to constant testing you admit you don’t know.” When you find out what you don’t know, you find out what customers are looking for that you aren’t providing for them.
Look at Customer Data
Pedro Arellano of Birst observes that the “availability of more data can help people make better decisions. Now, decisions made with data should be more successful that those made on hunches.” As you get more conversions, you get more data on customer experiences based on the continual testing you’re doing. More data may point you to patterns you might not have noticed before that could be applied to make the product better or differently.
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Focus on Customer Retention
Never assume that once you’ve won a customer, you’ve always got that customer. Or that you can grow your customer base just because you’ve won a few over. Keeping customers is what allows you to grow your customers. As Paul Boyce points out, “If you lose every customer you acquire, then you will be in a constant race to find new customers just to replace those customers that you lost.
That’s a lot of wasted effort, which doesn’t grow your business. Like a hamster on a wheel, you’ll be sweating hard but not going anywhere.” Besides the fact that it costs you something like seven times more to acquire a customer than to retain existing customers, think of your customers as water pouring into a tub. Your objective is to overfill it by adding more water. It’ll never happen if there’s a hole in the bottom of the tub.