Quick ways to attract new customers to your startup

Between 80 and 90 percent of new startups fail. Polls indicate that the main reason that they fail is that they are making products that no one wants. But, honestly I don’t agree.

In the market, there are many good frameworks that help us to figure out what the right features are to build. One of them is the Lean Startup movement, initiated by Eric Ries, which is based on creating testable hypotheses regarding a product that should be verified during interactions with customers. But even if we have a product that our first customers love, it is extremely hard to gain enough users to finally make a profit.

So, it turns out that almost every startup has a product, but only a few have enough customers.

Peter Thiel, a billionaire and PayPal founder said that poor distribution — not product — is the number one cause of failure. And, as a startup founder that from day one has struggled to increase the number of application users, I cannot agree more.

Today, I would like to share with you some techniques that can help attract more users to any startup.

Traction

Recently, I had the opportunity to read “Traction: How Any Startup Can Achieve Explosive Customer Growth”, an excellent book by Gabriel Weinberg and Justin Mares. The authors of the book suggest that choosing the right traction channel to exploit, and the product development process, are equally important and each should get about half of our attention.

They call it The 50% Rule since we should spend 50% of our time on product and 50% on traction. This split is hard to achieve because at the beginning almost every startup founder puts his/her attention mainly on the product. Therefore, they think that investing time in marketing (traction) will substantially slow down the process of product development.

However, the authors strongly fight with the common belief of entrepreneurs, that if they build a killer product, customers will eventually find it anyway. Unfortunately, just as our products do not develop by themselves, users won’t find our apps without proper traction.

So, what can we do to get proper traction?

First of all, we should identify and then focus on marketing activities that result in a measurable, significant impact on the company. Easy to say, but hard to do. Undeniably these activities should be based on ambitious acquisition goals and should be conducted through one or more previously selected channels (eg. SEM, Social & Display Ads, SEO, Content Marketing etc.).

In the beginning, it’s hard to predict which of the channels will work best. We can try to make expert judgments, but until we start conducting tests, we can’t be sure if our original guesses are correct. This approach is similar to the Lean Startup experiments that we described in one of our previous articles, and  the “Traction” book calls the Bullseye Framework.

Bullseye Framework

In short, the Bullseye Framework was designed to help us find the best channel with which to increase the number of users/clients in our startups. It is a repeatable process that contains five steps: brainstorming, ranking, prioritizing, testing, and then focusing on what works. Let’s take a look at how to implement these steps in practice.

Lean Product Development vs. Traction

Brainstorming

In the “Traction” book, nineteen different channels are mentioned that we can apply to our startup (the entire list is available below). In the brainstorming step, we should find out if any of these channels might be useful for our startup and if there any, come up with ideas as to how we could use a particular channel to increase the number of our customers.

Some of these channels might be new for us and sound even bizarre at first, but even so we should consider using them at this stage. To facilitate brainstorming process, I’ve entered all of these channels as goals in the Cayenneapps Goals module (it is also available for you in our app as the sample “Marketing channels for a startup (Traction)” in the library).

Example: Marketing Channels For a Startup - CayenneApps - Goals Module

In the edit mode for each goal in the Notes field, you can find a detailed description of each channel that can help you to understand what this channel means and how you can use it. Additionally, in the Purpose field you can find the questions listed below that can be supportive in the process of determining if this particular channel can be applied to your marketing strategy:

  • How probable does it seem that this idea could work (1– 5)?
  • What is the expected cost of acquiring a customer through the utilization of this idea?
  • How many customers can you expect to acquire at that cost (before saturation)?
  • What is the timeframe needed to run tests?

The blank spaces below each question are waiting for your answers - they are crucial for successfully completion of the next steps.

Traction Channel’s Details - CayenneApps - Goals Module

Any additional ideas for implementing each channel in practice also should be written down now. At this phase, they can be described also in the Notes section, and then at the Testing step will be transformed into doable tasks.

Ranking

After you have gathered together all your ideas and marked the most promising channels, it is time to organize your list and start selecting the ones with most potential.

At first we should place each channel in one of the three columns: Urgent, Long term and For Later. Below you can find questions that will help you to decide where to assign each one:

  • Urgent: which traction channels seem most promising right now?
  • Long term: which traction channels seem like they could possibly work?
  • For later: which traction channels could be useful in the future?

If any of the channels definitely won’t be used in the future you can remove them, but remember that as your company grows, things that worked early on may not scale well (or be worth scaling). So, keep in mind that some of the channels that might not seem promising at this stage of your growth may be useful in the future.

Prioritizing

Now you are ready to carefully decide which of the previously assigned channels are worth spending your precious time on, and then begin setting up experiments to test their performance.    

If you already have three channels in Urgent section, you’re done. You can also select one or two of the long-term goals, but remember that doing too many things at the same time leads to poorer results because of lack of focus.

Move the rest of the goals to the For Later section. We are almost there — now it is time to put your ideas out into the real world.

Testing

After prioritization, you can begin to test your assumptions and collect data to confirm if the previously selected channels are worth focusing on in the long-term. You will make that decision based on results from a series of tests that should be designed on a smaller scale and don’t require much upfront cost or effort.

So, after running a particular test you should replace your educated guesses with real numbers. These numbers are the answers to the following questions that you can find in the Definition of Done field in the edit mode for each channel:

  • How much does it cost to acquire customers through this channel strategy?
  • How many customers do you think are available through this channel?
  • How well do these customers convert?
  • How long does it take to acquire a customer?

To answer these questions, you need to set specific tasks for each chosen traction based on previously gathered ideas in the Notes field. For instance, if you define a task, spend $250 on AdWords campaign, you’ll get a rough idea of how well the search engine marketing (SEM) channel works for your business.

Keep in mind that, when testing, you are not trying to get a lot of traction with a channel just yet, but you want to find out if the channel is promising enough. So, you should keep doing the tasks until you will be ready to make this decision, but at the same time remember to set a deadline for verification of your assumptions to avoid postponing it.

Testing in Kanban - CayenneApps - Tasks Module

Focusing

If all goes well, at least one of the traction channels you tested will produce promising results. At any stage in a startup’s lifecycle, one traction channel dominates in terms of customer acquisition. That is why we suggest focusing on one at a time, and only after you’ve identified a channel that seems like it could actually work. As you dive deeper into it, you will uncover effective tactics and do everything you can to scale them until they are no longer effective due to saturation or rising costs.

If, unfortunately, no channel seems promising after testing, the whole process should be repeated. The good news is that now you have data from all the tests you have just done, which will inform you as to what types of things are, and are not, resonating with customers.

Summary

Bullseye Framework is designed to be a straightforward way to direct your traction focus and maximize your results. First and foremost, it forces you to take all the traction channels more seriously than you would otherwise.

Remember that you should always have a traction goal that you’re working towards. This could be 1,000 paying customers, 100 new daily users, or 10% of your market. Whenever this goal is without constant and repeatable actions you will not achieve it.

In one of our next articles, we will describe each of the channels in detail and create sample tasks for them. So, please stay tuned!

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