Tag Archives: marketing

You don’t have a marketing/growth problem(YET)

Originally published on Medium

I often come across folks who are getting started with their startups. Many of them are looking for advice and their is one question that almost everyone of them asks without fail.

How can we scale up marketing for our startup?

Make Stuff That People Want

It’s like they’ve figured out everything else and the only thing that is to be solved for now is Growth. First time founders are particularly prone to this line of thinking.Typically in most such cases, there are a few things that seem to be working.

Some Traction

  • The site is getting a bit of traffic or their app is getting a few downloads.
  • A few users are signing up or leads are being generated.
  • There are a few active users.
  • Some revenue or repeat usage of the product.

To the founder’s credit, they’ve built a product and figured out some stuff in getting their product in front of the potential users. However, more often than not they end up jumping the gun in thinking that all the basic groundwork is done and all that remains is reaching to more people.

But incidentally, there’s more to it than meets the ‘optimistic founders’ eye. Let’s dig a little deeper.

A startup’s life comprises of multiple stages that need to be sequentially navigated.

Two Major Phases in a Startup’s Life

  1. Pre Product-Market Fit (Pre-PMF)
  2. Post Product-Market Fit (Post-PMF)

Understanding Product-Market Fit

In layman’s terms, achieving Product-Market Fit means

You’ve figured out a way to solve a problem that enough users care enough about (to pay enough for).

This definition covers three core aspects important to any startup

  • Market — You might solve a problem for a handful users but are there ‘enough users’ that feel the pain/need for a solution?
  • Product — You might have come up with a solution but does it ‘really resonate’ with your users?
  • Monetisation — Your users might be using your product to solve a problem but are they willing to ‘pay reasonably’ for it(or is their a different way to monetise like Ads and such)?

While the above mentioned might seem obvious, I’ve seen more entrepreneurs mistake confusing getting a Pre-PMF with a Post-PMF 
(You might want to re-read the points in quotes above).

Amidst all the buzz around fundraising, press-coverage and exists, the urge to ‘grow fast and kill it’ is understandable. However, before worrying too much about the non-existent growth you absolutely need to understand if you’ve found a product-market fit.

Important: A vastly important point here as I’ve learned over the years is that Market > Product. “Which market to operate in” could be a great heuristic to work with. More on that in a later post.

Why is Product-Market Fit Important?

Product-Market Fit is the Holy Grail of Startups

Nothing kills a bad product faster than good marketing

Premature Scaling or spending effort and money on marketing a half-baked product to solve a half-thought through problem is potentially dangerous.

It requires a significantly harder push to market a product that claims to solve a problem most users don’t realise enough(they have) in a way that doesn’t make sense to them. By resolving to spray and pray marketing you might acquire some users, a few of which might translate into paying customers but more importantly, it will give you an illusion that you’ve figured out what people want.

It’s this precise illusion that’s the biggest problem. Most people who find themselves in this illusion end up adding more features into their product, continue their spray and pray efforts to acquire users, trying to raise funds and more often than not reach the woeful end of “Running out of money”.

Contrast this with a situation in which you’ve found Product-Market Fit. In which case, every single step mentioned above will seem like a breeze (ok, almost like a breeze).

Also, it’s worth noting that one important and often overlooked factor that seems to add up to the illusion of figuring out PMF is the founders psychology. While things begin with a sound footing, many a times the empathy to truly solve a customers problem and delivering a wow experience is quietly taken over by a personal insecurity and need for validation. Once in this zone, the founders tend to look and even gloat in any metric that confirms their illusion. So, being self-aware about your psychology is a must for course-correction.

What does Product-Market Fit look like?

Marc Andreessen on what PMF Looks Like

In essence,

Having a product-market fit means it’s much easier to convert users and retain them

Let’s refer to the user funnel to find more. Here’s what a typical user funnel for B2C/B2B startup looks like

User Funnel

Whether you have found a product-market fit drills down to two metrics really

  • Conversion Rate — 
    (No of engaged users/No of users) or (No of customers/No of leads)
  • Retention Rate — 
    (No of repeat users /No of engaged users) or (No of customers/No of repeat customers)

And out of these two also, I’d prioritise Retention over Conversion as it’s a definite indicator of PMF

Retention vs PMF


If these two metric are reasonably good, chances are you have attained PMF 
and can now focus on scaling growth. On the other hand, if these two metrics, especially the Retention Rate are in single or early double digits there’s a problem. It’s likely that you are yet to find a PMF and you need to go back to the drawing board and figure that out.

Let’s take an example of an app that lets you improve your health by connecting with you a nutritionists or fitness coaches. To check the PMF status we will have to look at the user funnel numbers.

Sample Funnel Data for a Health App

As visible from the data above, it looks like a case of Pre-PMF as both conversion rate and retention rate are weak, therefore they are better of trying to first find a PMF and then worry about growth.

PMF Discovery Tip: Go through your user data and see if there’s some segment of users that has significantly higher retention than others. This just might be the niche for which your offering makes perfect sense. Next, you can double down on sharpening your offerings further for them and then get to finding more such people

I’d like to conclude by saying that at an early state of your startup while you must continue to feed top of your funnel by acquiring some users (more data to analyse the better) but don’t be too eager to press the gas pedal on marketing or growth till you’ve figured out a set of users (around 100 for a B2C business) that truly love what you are doing.

Till the time you’ve found out those users, improve your product offering or consider targeting a smaller niche with your existing product.

Thanks to Sameer Guglani, Navneet Singh, Monica Jasuja, Aditya Sahay and Lakshay Pandey for their feedback.

E-commerce Customer Lifecycle Management (CLM): An Introduction

This is the first part of a series of posts on e-commerce customer lifecycle management. In this post we’ll discuss an overview of CLM (The What & Why) and it should be useful for a marketing/growth person in designing their CLM strategy

A few things to note:

  • Analysing data only makes sense once you have a sizeable amount of it.
  • In this post we are only covering user and customer engagement.We will cover visitor data in a separate post
  • For sake of simplicity in this post we are only looking at linear movement across different lifecycle stages.

There are a lot of lenses to look at e-commerce customer behaviour data from but Customer Lifecycle Management(CLM) is at the core of it all. I believe CLM is the fundamental element that needs to be in place for you to drive good ROI on your marketing or growth efforts. Once you have a defined CLM framework, you can start focusing on other aspects. Let’s dig a little deeper


What is Customer Lifecycle Management?
Customer lifecycle is a term used to describe the progression of steps a customer goes through when considering, purchasing, using, and maintaining loyalty to a product or service.

Customer Lifecycle Management (CLM) is a framework to facilitate a smooth movement of users(non-purchasers) from acquisition towards loyalty (repeat active customers) by maximising the value delivered at each customer engagement touchpoint and removing all friction in conversion

                                    Pic 1: E-Commerce users’ Journeys

 

Why is it important to manage Customer’s Lifecycle?

  1. With limited customer acquisition channels, the customer acquisition costs will continue to rise unabated
  2. It is much easier to convert and retain an existing customer than to acquire a new one
  3. A happy customer will not only purchase more, they will also spread the word for you and bring additional customers.

Or put it other way,

You can’t build a sustainable e-commerce business without repeat customers

The Scope of Customer Lifecycle Management

Let’s briefly discuss what all does a CLM framework entail. We can divide the scope of work for CLM into the following

  1. Defining lifecycle stages, identifying relevant metrics and data
  2. Conceptualising categories of customer communication to nudge users from one lifecycle stage to the next
  3. Designing campaigns and creating content for categories defined above
  4. Executing various CLM campaigns and iterating on them to improve their efficacy.

Designing The Customer Lifecycle

While there’s no standard way to define a customer lifecycle for an e-commerce/transactional business, in my experience I’ve found this flow to do the job well.

                                           Pic 2: Customer Lifecycle (Basic)

This basic version of customer lifecycle is useful to get a high level overview and is easy to get started with.

                                        Pic 3: Customer Lifecycle (Advanced)

For the mature growth/marketing person, this advanced version of lifecycle will be beneficial. The advanced lifecycle is particularly beneficial for mid to large sized businesses.

I find this representation useful because it gives a more in-depth view of what exactly is happening in each lifecycle stage (Pic1). Also, by splitting various lifecycle stages by their purchase activity you get a better sense of how many customers are active, at risk of getting churned and have already churned.

Defining Lifecycle Stages
Before we jump to the metric, let’s quickly understand what each stage means.

                                     Pic 4: Definition of Various Lifecycle Stages

In this content, a couple key definitions one must understand are

  1. Risk Window — Number of days for which if a customer doesn’t purchase they are at risk of churning (X days).
  2. Churn Window — Number of days for which if a customer doesn’t purchase they are churned (Y days).

A churned customer is one who hasn’t purchased for long enough that we can consider them to be lost.

Repeat and Loyal Customers
There isn’t a definite way to define repeat and loyal customers. For sake of simplicity, I’ve defined repeat customer as anyone who has placed more than one order. Similarly, Loyal customers can be defined in multiple ways (orders/revenue etc) but I’ve defined them on the basis of number of orders (Z orders).

Depending on the nature of business, you can decide values for X,Y and Z

With the Customer Lifecycle in place, we now have to define our goals and make plans to achieve them. We’ll cover those in the remaining parts of the series.

Update: You can view the part two of the series in which we cover CLM Metrics and Goals here

Thanks Navneet Singh & Nitish Varma for reading the drafts.

Myntra’s End of Reason Sale in 7 images

# 1: A week or so back

The Build Up

YT ads promoting the sale
#2 Midnight on the day of sale

Midnight of Offer DayAs per Myntra’s twitter account, they were updating the offers

 

#3 Morning of the day of sale

Morning of the day of sale

Front double page ad on HT Delhi

#4 Minutes after the sale begins

Minutes after the sale began

 

Push notification to their app base (along with emails and sms)
#5 Few hours into the sale

Few hours into the sale

User Accounts (some say IPs) on both app and web were blocked for 30 minutes from making any request to the site

#6 Less than 12 hours into the sale

12 hours into the sale

 

 

#7 A little over 12 hours

end_myntra7

If the sequential order numbers of Myntra is anything to go by, the order id increased by over 1L  in the first 2 hours of the sale.

Time – 9:42 AM, Order id: 70303245

Time – 11:42 AM Order id: 70425987

Run rate: 60k orders/hour (16.67 orders/sec)

 

Product Vs Service Based Businesses

Here’s a post I recently wrote for Shack’s blog.

I’ve been into the business of building web applications for a good part of my professional career. During this period(around 3.5 years) I’ve worked for a MNC, two start-ups and also started two companies on my own. A couple days back while thinking about some business it dawned upon  that there are basically two types of businesses (guess you probably know this already) as far as my view point is concerned (Otherwise trading is also a business). If you are not working for someone else (basically a job) and doing your own thing you are either

  1. Building a product (A website, a facebook app or something else for Ex: Kwippy)
  2. Providing a service ( Social Media Marketing, Website design/development, SEO or something else for ex: Dial-a-Book)
  3. Mix of both (for ex: Shack Companis)

These two kinds of businesses (product and service) have almost equal scope when it comes to growing big, becoming popular etc. However what’s interesting is what it takes to get them to that level. I’ve been on both sides of the line that separates a  product business and a services business. I’ve build a product and am now building a service . Kwippy and Dial-a-Book are as different a business as they can get. While Kwippy was all about building a web product from India that had a global appeal, Dial-a-Book is a over the phone service that’s aimed at the local/domestic market(for now at least).

If you think about it product and service based businesses require way different inputs and take way different life forms once they start to grow. I’ll attempt to explore those differences and what we can do to leverage/optimize them

Product Vs Service Based Businesses:

1) Starting Capital: Product based businesses on an average require more capital to startup than the service based businesses due to the raw material and infrastructure needed. While web products don’t require as much starting capital, services will more often than not be relatively cheaper

2) R&D: Irrespective of the line/domain in which you are building a product, you’ll need to spend considerable amount of time as a team or as an individual to understand what’s been done before, what’s not been done, latest technologies involved, costs, maintenance and other issues. While (most) service based businesses don’t need to think as much(it’s a plus if they do) before starting up.

3) Time to go Live: Product based businesses by their sheer nature will take longer time to go live as compared to almost no-time to launch for a service based business. Essentially a service based business is live from the minute the founder(s) decide to start.

4) Business Development/Marketing: How good a services based business will do depends significantly on the founders interpersonal/selling skills the same gets tough for a product based business. For a product based business you need to have the product right, you need to make it easy to find and spread(viral) and market it in a completely different way.

5) Technology/People Balance: I kinda feel that after a while product based businesses are more dependent on the technology than the people as compared to the service ones. For a company that makes diapers for example, the machines, the processes, raw materials are an important bit and once the basics are taken care of it can run without as much involvement  on the founders part. However for a services based business, say a consultancy service started by 5 guys with a finance background the business depends a lot on the people. Even when the organization grows big it will be known/trusted for the few names of smart/senior guys and once they leave for some other company, the clients might just follow them to their new home.

These are some of the differences I could feel and keeping them in mind I feel one might be (slightly)better of choosing the kind of business they want to do depending on their personality/skill set etc.

Guess you know what I mean, if not drop in a comment and we’ll take the discussion forward.

Link to Shack’s post: http://shackcompanis.com/post/1521371790/service-vs-product-business

India: IPL, TV Industrial Complex and Social Media

That new technology, trends etc take their own sweet(not so) time to reach and permeate the Indian market is a well known and accepted fact, and Social Media is no different. While marketing and advertising companies/teams from other countries(especially from the west) might have already dipped deep in the Social Media waters, their counterparts in India are no where close.

When Pepsi ditched Superbowl and chose to spend their budget ($20 million) on a Social Media campaign there were celebrations amongst the Social Media folks world over and everyone(Including we in India) felt that Social Media has finally arrived and the game has changed from being Traditional Media centric to Social Media being equally if not more important. If you think that’s the same with India (transition from Tradition Media to Social  Media at a considerable level), think again.

In the course of last year or so I’ve met numerous Social Media enthusiasts/marketers/analysts and quite a few advertising/media agencies and some guys who are in-charge of marketing campaigns for the brands they represent. Little has changed since last year if we talk about how people who offer Social Media solutions feel and how those who should be using those Social Media solutions feel. Despite all the jazz around Social Media, in India particularly brands are spending a bare minimum percentage of their marketing/advertising budget on Social Media. Not just this, what’s particularly interesting is the fact that in India some brands have started spending more(and not less) on Traditional Media. If these figures are anything to go by

AD Rates for IPL3 and T20 World Cup 2010
you can get an idea of how things seem to be moving in the Indian market. We are increasingly spending more money on Traditional Media and it’s not just TV ads, the print media is also on a roll with Realtors and FMCG companies booking full page ads like anything.  It’s not just a co-incidence that there aren’t any remarkable Social Media campaigns around IPL despite all the hype and hoopla.

Keeping in mind all this and the response that these Traditional Media campaigns manage to get I would like to believe
that the days of TV-Industrial Complex are not yet over in India and it will be another few years before significant changes start to happen.

Lessons in Business from Bala Balachandran

About a couple weeks back I happened to come to know about Mr Bala Balachandran from a friend of mine who also shared with me the printouts of an article titled “I firmly believe that all customers are not equal” that  appeared in Business Standard on 24th December 2002(couldn’t manage to find a link). It’s not often that one comes across this much business wisdom in a 4 page printout.

After giving that article a re-read yesterday, I searched a bit on Mr Bala Balachandran and amongst other things I stumbled upon this series of fantastic videos on everything from Cost Management to Customer Astonishment. This would by far be the best material on business I’ve come across in 2010 and the fact that these gems are hidden from the world is reflected in the fact that these videos had been viewed 2-5 times at max. It’s only now after repeated views from me that these numbers have jumped up :). Also, Balachandran not only shares his business wisdom, he does so in a nice and funny manner. At 72, he has contagious energy and passion.

Only if someone could stitch these  small 2-3 minute videos together would they make into an amazing video.

Re-visiting Meow 104.8 FM

It’s been about a year and a half when I first wrote about Meow FM. For the uninitiated Meow 104.8 FM is an Indian talk based radio station that’s aired across Delhi, Mumbai and Kolkatta.

radiogaga

I’ve been thinking of reviewing Meow FM again to understand and share how it has evolved since then but it was only after one of the hosts at Meow emailed me to know “what I feel about the station” that I finally got down to write .

It took me about a week or so to listen to Meow at different hours to see what exactly they are upto and here are a few things I managed to gather.

1) The “A-Stars” Migration: Ever since last year there has been quite a few A-Stars that have left Meow FM for various reasons. Those who’ve left include Hosts Jaishree(last year?) and Rochie(July 9th) and COO(and host) Anil Srivatsava(June 2nd). The roots of migration of A-Stars in this fashion can mostly be traced down to the boardroom (bad policies or management, or both) and I assume that’s the case with Meow too.

Given the fact that the business Meow is in, the loyalties are almost equally(if not more) associated with the Hosts and the station, the station would have definitely felt the heat.

2) Talks are making way for Music: While during its initial days Meow was as much about conversations as one could be but I feel things are changing. Possible the Host exodus is the reason behind it. With just a few quality Hosts (Ginnie, Divya ,Manisha and Ved?) to handle about 14 hours of airtime(7 am – 9 pm), playing more music is inevitable. I remember listening to non-stop music for about an hour yesterday around 12-1 pm.
As it turns out Meow is mostly about music on weekends, which isn’t particularly good for people like me.

If in case this music fever spreads to weekdays, Meow will lose out on a good differentiator and even if Meow has to play more music they can try to make the whole process of the music selection a bit more interactive. A simple thing could be to ask listeners to SMS songs they’d like to listen(not sure if they do it already)

3) Diluted Positioning: While I don’t have any official word on this but off late I’ve started to feel that Meow is no longer aimed at just women. Be it the fact that they now have a male host for their 7 AM show or the fact the hosts no longer re-iterate Meow is India’s first ‘Just for women’ radio station. Also, unlike previously where male callers were allowed on just a couple of show(Tu-Tu Meow Meow & Top Cat) and on weekends(?) you can hear them on practically every show now.

If there has been a change in their target audience I am afraid Meow will find it increasingly more different to survive the competition and if there isn’t such a change they should try to leverage their positioning a lot more to do more tie-ups and eventually attract more women to them.

4) Focus on Quality: While other radio stations are still busy doing silly spoofs of Sholay’s Gabar or Sunny’s Papa ji dialogue, meow continues to add value by talking about meaningful things. Meow 104.8 FM offers by far the most intelligent conversations across the radio frequencies. Not sure if most RJ’s(from radio mirchi to fever) are stupid or they pretend so to sell to the masses but I am quite happy to note that Meow has a better lot of Hosts which continue to talk sensible stuff.

It’s not surprising that Meow has Dr Kiran Bedi as a co-host on one of their shows and they can also boast of having a great weekly book club.

5) Community: Meow’s ning community started by Anil reflects its listeners loyalty. With about 10,000 members @ ning they have a wonderful community of their customers available for free. This goes on to show that people love the station and want to stay connected.

merimeow

While I haven’t noticed extensive efforts aimed at making the most out of their community they can do a lot of things and make the most of it though I am not sure how it’ll work out with their ning community as it was created by Anil who is not associated with Meow anymore.

I’d like to conclude by saying that Meow has definitely not reached the place it should have given the strong grounds it started with and it’s a very crucial stage they are in and if they don’t do the right things game could swing either ways.

PS: Meow please get your site re-designed and if not at least update the content. It looks like the site hasn’t been touched for ages.

Update: This post is also available on radioandmusic.com (http://bit.ly/5eT7Z)

Dev D, Ghajini, The President is coming and Tata Nano marketing case study

It’s been quite some time since I wrote marketing case studies on

and it just occurred to me to make the pdfs of all these case studies available as a compressed version, hence this post

Click Here to download the rar file containing pdfs of all the four case studies.

Rickshaw Road Shows

Road shows are a common marketing activity in Delhi and rest of North India. It’s not uncommon to find big brands like Spencer’s, Horlicks, etc doing road shows to promote a new store or a new product. Road shows are also excessively used during political campaigns. A typical road show looks like this

Roadshow

While there’s nothing new about road shows, there’s a new(and low cost) variant of road shows that’s increasingly getting popular for doing promotions. Rickshaw Road Show or Cycle Rickshaw Road Show as it’s called consists of a branded cycle rickshaw(regular or a different small one custom built for such activities) with a rickshaw puller driving it within a given area for about 8 hours a day. Driving is the core activity with addons being parking for some time at certain key points like metro stations, bus stops and distributing leaflets/pamphlets .

djm_rickshaw

(Promotion for a Jewellery House)

xs_rickshaw ( Promotions for an automobile showroom and a satsang)

Ricksaw road shows are generally done at least for a month(2 days monthly off) and they cost anywhere between Rs 8,000 – Rs 12,000 per month ($170-$250). The costing includes rent for richshaw, branding and the fees for rickshaw puller. A rough break up for the total cost would be

Rickshaw Puller:  Rs 4,000 – Rs 5,500
Branding : Rs 800 – Rs 1,500

rest would be the rent of rickshaw and the owners profit.

It’s not just small coaching institutes or local businesses that do richshaw roadshows, they are also being used by brands like Fastrack that are also active on the web(Twitter, Facebook et all)

fastrack

So, what do you think about Rickshaw Road Shows ?

Twitter Marketing, or Spamming ?

Twitter being spreading like wild fire is under a lot of experimentation for marketing and since there isn’t a way to advertise or sponsor stuff “Mentions in Tweets” is the way to get eyeballs along with “Treding Topics” and a few other things. Also, since the trending topics started appearing on every user’s home page, the desire to find a spot among top 10 has soared.

Want to get visibility on Twitter ? Get trending, and the way to be trending is by having enough mentions in tweets.

Add this desire to be mentioned in as many tweets(interesting or boring, happy or sad, sensible or nonsense, related /unrelated to the product or company) to the fact that most people will do just about anything to win something for free (especially if it doesn’t ask them to get up from their chairs) and you get a viral campaign like moonfruit‘s.

moonfruit_spam

Apparently there was a similar campaign by SquareSpace a month back but it failed to make it big because it wasn’t offering the phone but a $199 worth gift certificate but I am not complaining as atleast with SquareSpace’s campaign I got saved from the heavy spam attack that Moonfruit campaign led to.  For me the moonfruit campaign is no different from one of those spam attacks in which people randomly started adding some keyword in every tweet, which eventually led to those topics/keywords being in the trending list.

It’s not that I hate all twitter campaigns, for ex: I appreciate Tweetboard’s campaign, asking people to request for Alpha accounts for their service by tweeting(just once) in a given format instead of submiting their email id’s

TweetBoard

TweetBoard

Now that’s a creative and non spammy way to market using Twitter.

Getting back to #SquareSpace and #MoonFruit campaigns, I’d say this isn’t a particularly good way to market because

1) It’s spammy and so all over the place. More than liking I’d hate if everyone in my stream started putting a random keyword in their tweets. There chances of winning something are a lot less than chances of loosing a few followers/friends. I certainly wouldn’t appreciate my company name in tweets like this

moonfruit_sex

2) It’s not a scalable model:  While SqureSpace, MoonFruit and a few more might be able to get some eyeballs because of these campaigns I strongly believe this won’t be a scalable/easily followable model as if more companies start doing this then we’ll  have  a spoiled twittering experince and almost all the trending topics would be full of these promotional keywords which certainly won’t be liked by Twitter and it’s users and would invite some fixes to avoid such things, which’ll in effect led to a reduction in such campaigns.

3) I doubt if there’ll be significant value addition due to such campaigns: Though some of the statistics could look great after such a campaign I doubt if there’ll be a real value add for most companies that do such campaigns. For ex: I doubt if there’ll be a significant increase in moonfruit’s business or more people will start interacting with @moonfruit etc. Most probably the gift hungry crowd that gathered at their doorsteps  would move to a new free gift location in no time, shattering their false hopes.

That’s how I feel about various marketing campaigns on Twitter, what do you think about them ?