Today we are going to talk about startup growth. This is part two of our growth video, which
you can find in the description.
The reason I know any of this is because I'm the CEO of a company called Slidebean, and
for our first few years, I handled most of our initial marketing experiments.
In the previous video, we talked about the 19 growth channels available in the world, so
in this episode, I am going to talk about the ones that we've tried, the ones that failed,
and the ones that worked.
This is how to grow a small business, part II.
Big disclaimer, these tactics apply to our particular case: a SaaS company with a presentation
design product that saves (a tremendous amount) of time.
These might or might not apply to you, but hopefully, they can give you some ideas.
Another detail is that we measure these tactics by their success in terms of ROI. Time (which
means money) spent in a campaign, and revenue obtained.
Here are the channels that we tried and failed: Public Relations.
In the early days, we focused a lot of time and effort on being featured by the press.
There's this thing about being featured on TechCrunch.
This validation of being hosted in this startup site.
Our first TC publication gave us around 10,000 sign ups- but after that, most of our PR has
had a low impact in terms of signups and revenue.
We've been in TC a couple more times, and TheNextWeb, and others- but the impact in
terms of revenue has never been clear. While there's a brand awareness benefit, it's very
intangible.
Side topic: Brand Awareness vs. Direct Response This brings me to a side topic, which is Brand
Awareness vs. Direct Response. There are two broad categories of marketing efforts to position
a product or service.
Direct Response refers to all the campaigns that have a measurable impact in revenue,
or at least in leads. You can very clearly calculate the cost of the campaign, vs. the
revenue received or leads obtained.
Brand Awareness campaigns are intangible. You can measure the impact of impressions,
or top of mind, but there's no way to know how much revenue gets generated. Many Social
Media efforts, billboards are brand awareness campaigns.
Don't get me wrong; Brand Awareness can go a long way- they empower your brand, which
translates into measurable KPIs such as conversion rates. However, it's a long term bet, and
we, startups, need quicker results.
I believe that a tech startup should spend 3/4 of their time and money on Direct Response,
and the remaining 1/4 on brand awareness. That's the way we do it, at least.
Press has been a Brand Awareness campaign for us, for the most part. And that 1/4 of
our marketing efforts is currently going to other campaigns that have more impact.
The same way people become ad-blind, we are
much better at detecting Promotional emails. And Gmail is too.
We've never seen a lot of success with emails. We have around 1,000,000 emails from people
that have signed up for our product or our newsletters at some point, but it's tough
to provide value to such a massive email base.
Also, we have to be careful about getting flagged. Even though we follow all the guidelines
of the SPAM act: unsubscribe button. Gmail gets pretty sensitive if we send a lot
of emails in a short period, and starts sending them to the spam folder.
This happens, likely, due to low open rates and some users clicking that nasty 'mark as
spam' button. There's also the cost of a mailing system that can hold 1,000,000 emails. It's
in the thousands of dollars a month.
We prefer, instead, to focus emails on the audience of active users who want to hear
from us, and email works great to stay in touch with them! But we mustn't abuse it.
Business development is a must- and we do
it- but it's not a channel to scale our product. Even though most of our customers are small
businesses, our customer acquisition cycle is B2C. The only way to win is to get thousands
of customers through our funnel, and that is more easily achieved with the channels
we'll cover in a minute.
We have an affiliate program, you can make
around $30 for every customer you bring to us, but so far, only a handful of users have
come from our affiliates. Not really something we rely on to scale.
We've done a few meetups and love doing them-
they don't translate into sales. More of a Brand Awareness thing. Some of that 1/4 of
the time/budget will continue to go to these.
I do public speaking events all the time,
and I'm always thrilled to be invited- but It's really hard to get people to take action
after listening to you on stage. Once again, a Brand Awareness thing.
Enough with the fails. Let's talk about the channels that have worked-
I think this is one of the most critical growth
channels out there. Let me explain.
The core difference between Google Search ads and display ads is a concept called Moment
of Intent. Facebook is REALLY good at targeting people based on their behavior. We know very
well how bad that can be.
However, when you see an ad for a presentation platform on Facebook, or for any product for
that matter, it's disrupting your experience. You're there to do something else, and these
ads are in the way. You are not ready to buy; you are not even planning to buy- the moment
of intent is far away.
Search ads, on the other hand, are well targeted at the right moment of intent: if you are
on your cell phone, looking for a car towing service, you are very likely in need of a
towing service right now. If you are looking for a platform to make a pitch deck, you know
you need a pitch deck, you are just looking for the service to help you with it. The decision
is made — the moment of intent.
This is why search ads are generally very expensive, more expensive than display ads, but at the same time, they are
one of the most direct ways to convert customers. We spend over $100,000/yr on Search ads and
make at least $300,000 in revenue from it.
If you can crack the code on SEM, then the
next obvious step is SEO. We made a video about this, on our very early Youtube channel-
where a drunk me tries to explain this while drinking shots. Not our best Youtube times.
The idea here is, only about 10% of Youtube Searches end up clicking an ad. The other
90% goes for organic results. The problem is, appearing in those organic results takes
a lot of work: years of optimization, hundreds of articles, and thousands of dollars.
You only want to do that when you know, for a fact, that the audience is there, and
that it's going to convert. That's where SEM is vital.
Basic steps, Identify keywords that your customers are
looking for. Pay some ads, and test if the CAC economics
work: you make more money than what it costs you to acquire a customer.
If the economics don't work, you have to adjust your conversion funnel,
or your pricing even- until this works. When it does, and you know that you can make
the money back with customer conversions, scale budget.
You know that you are going to get the money back. So, it doesn't matter.
And finally, once you have these keywords, work on ranking organically for them- which
is, of course, a ton of work that's going to take a lot of time.
Our engineering as a marketing product was
born as a new startup idea, but it ended up becoming a fantastic lead generator and brand
awareness/strengthening mechanism. It's called FounderHub.
It's basically a checklist for starting a company with some excellent documentation
on how to solve the legal bits, the business strategy, and the launch. It's free, but by
the time you get to fundraising, we hope you'll consider using our product.
You are watching our content marketing efforts
right now. And they work. To give you an idea, this channel now gets around 250,000 views
per month, and it's still growing. Do you know how much those Youtube sponsorships cost?
It's usually a 5-digit number. And we get the same exposure for free.
We ask every one of our customers where they heard about us. In September 2019, at least
$20,000 in revenue came from people that specifically said they came from Youtube.
It took us years to figure it out, we still spend around $5,000/mo in making these videos
(we made a video about that), but it's all worth it.
Before Youtube, our content marketing focused on the blog- and it worked as well. It was
an essential part of our SEO strategy. But who reads blogs anymore?
We also come up with actionable items, like telling you that if you want your presentations
to look like this, you can sign up for one free month on any of our plans by using the
link in the description. See?
Last but not least, Social & Display Ads: We mostly use these to close the conversion
loop. Maybe you watched this video, and then you start seeing our ad everywhere. Well,
that's a lot better, and cheaper, than just pushing those ads to strangers who have never
seen our logo.
We also use these display ads as part of our onboarding. Different users in different parts
of our sales cycles see ads to help but them back into the funnel or show a feature that
they might be missing.
And that is how Slidebean uses the channels of growth. We'd love to hear what your company
uses, and if you want me to dig deeper into any of these, let me know in the comments.
See you next week.