So as a startup, when you want to
implement an incentive plan into your marketing plan, what do you need to do?
So first of all, like everything, it has to make sense.
Your offering should be part of your product,
which means that your offering should make sense to you and
you need to encourage something that you want your users to do.
You want the offering to be precise for your users,
is something that offer money.
It doesn't have to be money, it can also be virtual coins.
Let's say that I'm promoting a virtual game, and
if you're going to invite your friends.
I'm going to give you 50 coins.
Okay.
I don't care about it, but my users care about it, and
they will eventually, hopefully pay for it.
So they think this is a good thing.
So a few examples about how to create great promotional plans.
First of all PayPal, they probably created the first and
most famous promotional plans for start ups.
They basically paid the users to open an account and invite someone else.
Thinking the target was if you open an account you get ten bucks
into your account, do whatever you want with it.
If you're inviting someone else, you're getting ten bucks and
he's getting ten bucks.
And that helped them to go to about 100 million users in a very fast way.
They obviously didn't pay so much money for so many people, they
reduced it gradually from five bucks to one buck, eventually to nothing.
But that really helped them go significantly.
Another example that people may know even better is the Dropbox example.
They gave a lot of storage to their users who invite other peoples so
you could get a free account basically of up to 12 gigs of free storage room.
Back in the day.
Back in the day was like three years ago, four years ago.
That was a lot to get.
Today, I have like two tera and I'm paying ten bucks.
But that was huge and people was competing each other.
Who will get to their friends faster, know to invite them and
make sure that they will accept the invitation.
And both examples the people in DropBox makes perfect sense.
People, it's all about the money, you're getting the money in your account,
you can do whatever you want with it.
And you can use it to buy on eBay for
example, that was the best source of growth back in the day.
And for Dropbox.
We're a storage company.
You're getting free storage.
Invite your friends.
That had them grow to so many users,
and people are still trying to imitate those promotional trends.
Another example is Zynga.
When you're inviting your friends,
you're getting virtual currency for to see the games that they're promoting.
Not only Zynga, obviously, everybody who creates games that has some kind of
virtual currency in it, let's you do that.
And by earning that virtual currency, by earning those things that
you want in order to pursue your dreams, they can encourage this behavior.
Another example is Lyft.
Lyft is competing with Uber in many geographies throughout the US and
throughout the world.
And Lyft wants to get more market share, how can they do that?
One of the strategies is to pay you to ride with them.
So let's say I want to get from point A to point B in Manhattan and this
is a ride that will cost me with Uber 20 bucks, with a yellow cab, 15 bucks.
Lyft will give you money to ride with them so
it will cost you five bucks, or six bucks.
In this way, they can encourage the behavior that they want to encourage,
that forming a habit, if you associated Lyft with
taking a cab by encouraging you and giving you money to use them.
One major thing that you need to be very cautious about when you're doing
incentive problem is making sure that your lifetime value,
your LTV, is higher than your customer acquisition cost, your CAC.
A lot of companies tend to
exaggerate with acquiring users, focusing on growth,
which is obviously the most important thing for an early stage startup.
As you grow, as you become more and
more successful, people take advantage of that.
The math doesn't make sense anymore.
It was working for paper.
But as you're growing more and more users, you don't want to do it
anymore because you want to encourage them to actually pay for that data.
You don't want to make them dependent on your specific dynamics and
mechanics for earning virtual currency.
That can be something very dangerous for
a startup, to be dependent on the incentive plan.
And are focusing on keeping the users engaged
further the dynamics of the product itself.
One more thing is that
incentives can only enhance the quality of your product.
It will not replace anything, so if your product is great, the thing that you're
doing with incentives is encourage what you hope that your users will be doing,
that's the final push, that's not the main thing.
You push them to share, you push them to activate,
you push them to use it one time because you know that once they use it for
that one time they'll be hooked, but it won't replace that product.
It won't replace that user position structure.
>> Okay so now that we've gone over the general checklist for
launch let's explore ways to get your app noticed.