Will you test marketing methods to find ways to win more customers for your business?
Get big fast’ is an axiom ascribed to Jeff Bezos, founder of Amazon. For start-ups today, that translates into burning through millions of dollars to own the largest network in the world.
This has put an extraordinary focus on customer acquisition and some very clever people have developed very effective marketing strategies to do this. Many of these people are featured in Traction, a book by Gabriel Weinberg and Justin Mares.
Weinberg starts us off in the preface with the impossibly homely: ‘In 2006, I sold for millions of dollars an internet company that I had co-founded a few years earlier… A few months later my wife and I moved from our 865-square-foot apartment near Boston to a country house 25 miles outside of Philadelphia. I had just turned 27.
‘She went to her job and I sat at home doing nothing for the first time in my life. We knew no one for a hundred miles in any direction.’
So he decided to set up a search engine to compete with Google. The unique selling point of DuckDuckGo was that it would not capture any user data. His objective was to gain 1% market share.
He made a lot of mistakes chasing growth and when he looked for advice, he found there was none. So he wrote the book with Mares.
‘Traction’ is a sign that your company is taking off, they write. For example: ‘If you’re an organic bakery your number of transactions is increasing every week.’
Based on more than 40 interviews with successful founders, the writers discovered there were 19 different ways to win customers… and two key issues: people tend to use only the marketing tools with which they are familiar; and it is hard to predict which method of getting traction will work best.
“Many entrepreneurs who build great products simply don’t have a good distribution strategy,” Marc Andreessen, co-founder of web browser pioneer Netscape, told Weinberg and Mares.
Building something people want is certainly required for traction but it isn’t enough, the authors write. Instead you need to pay attention to the 50% rule: ‘Spend 50 per cent of your time on product and 50 per cent on traction.’
Why? The founder of PayPal, Peter Thiel, tells them the answer: “Most businesses actually get zero distribution channels to work. Poor distribution – not product – is the number one cause of failure. If you can get even a single distribution channel to work, you have a great business.”
Weinberg and Mares promote a ‘bullseye’ model. In the outer ring, you brainstorm every method of getting traction, before testing the ones that seem most promising in the middle ring. The ones that make it there should be tested simultaneously and the best promoted to the bullseye. The test should allow you to say three things about a channel:
- How much will it cost to acquire customers through it?
- How many customers are available through it?
- Are the customers you are getting through it the kind that you want right now?
‘Once you truly focus on a channel you will become an expert in it. Channel experts uncover new channel strategies and tactics, which are often the best ones simply because they’re new.’
‘The company that leverages a newer platform that’s growing quickly will have a significant advantage over companies chasing the same old methods.’
‘A major function of this book is simply helping you overcome your biases against particular traction channels by educating you about them.’
The founder of four companies including Smart Bear and WP Engine, Jason Cohen tells them: “It can almost be a competitive advantage if you can acquire customers in channels that others cannot or refuse to try.”
For those of us not in a start-up, the 19 short chapters that follow are a treasure chest of marketing ideas. Traction will help you to think differently about your business and how to achieve growth. It will repay your engagement with it. If you are in a start-up, then I am sure you’ve already got a copy!