Articulate a Clear, Specific, Compelling Value Proposition
For many of the startups I looked at, I had to kind of scratch my head and think for a few minutes as I tried to figure out exactly what benefit they offered consumers. The value of your product or service, your unique competitive advantage, should be clear within 5 seconds of visiting your site. I’m sure you’ve heard the old copywriting mantra of “list benefits, not features”. Take that to the next level. Take the single most important benefit of using your service, and make that your headline.Take the single most important benefit of using your service, and make that your headline.If you could only have one feature in your app, what would it be? Your “killer app” can lead to your biggest benefit, and that’s how you need to introduce yourself to customers. I could write volumes about writing headlines, but a simple statement like this is a good place to start. Especially if you’re selling a B2B service, as many of you are, you need to make the immediate benefit or ROI of using your service crystal clear. If you’re building a B2B app to manage payroll, “Cloud hosted SaaS payroll for your business” is not a good headline. “Spend less time worrying about payroll” is a better one. “Cut payroll management costs by 37% instantly” is even better.
Find Your Target Market, and Segment the Hell out of Them
Another issue I ran across rather frequently is a distinct lack of marketing focus. When asked who their target market was, many people responded “small businesses” or, worse “anyone”. Alright, fine, you sell your SaaS products to small business in the US. But what kind of small business owner converts the best for you? Which customers are most likely to be profitable customers? Who is most excited about your product? You have been tracking these things, haven’t you?
You don’t have the budget to target all small businesses, so start with a specific niche or industry you think your product has particularly strong appeal for. Selling time tracking software? Start positioning as time tracking software for accountants, or dentists, or landscapers. How about targeting a specific task or feature and finding people looking for that feature only? Or what about people who already use a particular competitor’s software? I’ll go into competitor bidding at a later time, but it’s a fantastic way to get motivated early users.
Build super niche landing pages or, even better, microsites targeting each specific market segment you want to go after, emphasizing the specific benefits of your product to that group only. Not only is this a very strong SEO play, but it will increase your quality score and relevance in AdWords, as well as greatly increase conversions.
If you have a landing page targeted to doctors, test putting a stock photo of a smiling doctor using your software on your landing page. It’s cheesy, but there’s a reason companies use it- it works. Similarity is a very powerful principle of persuasion. Tech people respond well to screenshots of software. Local small business owners may not.
By the way, this applies to ecommerce startups as well. If you’re a clothing company build pages like “Top products for new moms” or “Tshirts for fans of __”, they will do very well.
Optimize Aggressively for CLV
If you’re running a subscription service of any kind, customer lifetime value(CLV) is by far the most important metric you need to be thinking about. More than conversion rates, burn rate, SEO, or anything else, CLV will determine whether your startup lives or dies. Try to determine this number, at least an average for your entire customer base, as soon as possible.
There are so many ways to increase CLV that fall outside the scope of this post, but just remember that effective monetization of the backend is where many online businesses live or die. Effectively upselling or cross-selling once you’ve acquired a customer could mean the difference between outbidding your competitors and capturing more market share or falling behind.
You don’t have to be spammy or annoying to upsell well. This can be as simple a showing a notification when your customer is close to reaching a usage limit, urging him to upgrade to the next tier of service, or emailing your most loyal customers with special discounts.
Start measuring engagement, churn rate and attrition, visit frequency, etc, loyalty and so on. If you’re selling a $20 a month service but you know that you will net $400 over the lifetime of an average customer, suddenly you have a lot more options for marketing, not to mention some great metrics to show investors.
Start Marketing Early and Validate Your Idea ASAP
You don’t need a product to start marketing. Let me say that again. You don’t need anything to start marketing. All you need is a vague idea and a landing page where you can collect email addresses from prospective customers. It’s called dry testing, and it works, at least for gauging initial interest to see if an idea is worth pushing further.
It pains me to see so many startups emailing me who have already spent months or even years building a product without thinking about promotion or validating their idea at all before launching. “Launch first, then figure out marketing” is a recipe for disaster. You need to be able to answer at least these questions as soon as possible, ideally before you write a single line of code:
- Is there a target market for my product and how big is it?
- Who are the current players in the market? Is it controlled by a few big players or dominated by many smaller companies?
- How much market share can I realistically expect to capture, and how well can I monetize them?
Remember this: A startup is a business. And any business requires basic market research. If you were thinking of opening a coffee shop, would you jump right in and start building it? Or would you first see if there are any other coffee shops nearby, how many customers they have, how much they charge for coffee, etc?Remember this: A startup is a business.
Marketing isn’t just emailing bloggers and driving traffic. It’s everything- product, price, placement, and promotion. Start thinking about these things before you launch, learn from them, and iterate quickly before wasting a lot of time and money.
Very nice wrap of the most important point when marketing out your startup.