Never underestimate the power of unbiased feedback
I started my first (real) company when I was 17 years old in 2001. It was a digital marketing platform that connected mortgage lenders with mortgage borrowers. I had no clue what a mortgage was, but I had connections who would pay me a significant amount to generate leads. I didn’t know that brokers charged large fees for loans. But I knew they wanted to pay me around US$20 to get a user to fill out a mortgage form, and I was going to find a way to generate thousands of leads a day at all costs.
At the time, I had no clue exactly how to do a mortgage from a mortgage lending perspective. I did, though, have a number of companies approach me and offer to pay me for each mortgage lead I could generate for them. In turn, I saw an opportunity in filling a gap online by building a platform to connect mortgage lenders and people needing a mortgage.
For my whole career and for nearly my whole life, I have only worked in online marketing. After the downfall of the mortgage business, I worked full time as an affiliate marketer. I would get paid to generate both sales and leads for many different types of businesses, including skin care companies, mobile games, mortgage companies, fashion companies, consumer lending and more. I bought traffic at a CPC and then would arbitrage it back into an effective cost per action.
Nowadays I take my experiences and I work with startups, venture-backed and established companies on the most important driver of their business: user acquisition. I take the same tactics and strategies I used in the past and apply them to real-world companies.
Questions that I get all the time include, “When should I start acquiring users?” or “My startup is super early. When is a good time to market?” I always give the same response, and that is “right now” for the following reasons:
- You want to be able to uncover pain points and figure out what is pushing customers to either buy your product or not buy your product. If you start running ads earlier in your product lifecycle, then you can start seeing your users’ pain points early and tweak your product to fit them.
- You can gain trust. Consumers are becoming smarter. Very rarely do they make a purchase based on the first ad impression that they see from you. It usually takes between six and eight touch points before they actually make a purchase. If you reach them early in the product lifecycle, even with a “sign up to get a free discount” ad, they’ll be more likely to make a purchase of your product at launch. The more a consumer sees your ad, or sees content that you produce that brings value to them, the quicker they are likely to purchase your product or service.
- You can build marketing collateral. Most startups or new entrepreneurs’ launch strategies include trying to spend a significant amount of money on both Facebook and Google to get a user to purchase their product. They don’t have a pre-existing email list or any remarketing list of people who already showed intent. This leads to a lot of wasted money and stress, as they are most likely going to spend a significant amount of time and money getting their campaigns to work at a profitable cost per action. By acquiring users right away with a “coming soon” or a “get a specific reward for registering now” message, you can create an email list of pre-existing users who have showed purchase intent for your product.
Overall, so much of my market research over the years has come from running ads on Facebook. I’ve found that people use products for different reasons, and that each user usually has a specific use case.
For example, I once had a company that was selling women leggings on Facebook. I wanted to figure who the exact competition was and how much they were selling their product for. This was very important to my business model.
In essence, I created a fan page around people who were passionate about leggings, then on that specific fan page I posted the question, “What is your favorite place to buy leggings and how much do you usually spend?” Then, I ran ads directly related to that question and I got an insane amount of feedback, which I applied to both my product and its pricing.
Most people think running ads is all about getting users to purchase or getting them to act. The truth is it’s not. You can run ads on Facebook for so many different purposes. I run ads continually to figure out how to solve complex problems within my business.
In my opinion, the best time to start acquiring users and test out market fit is right before you start building your product (if you’re building a B2C product), or while in the process of going into Alpha. If your product is heavily based on your ability to drive qualified leads, sales, and acquire customers at scale, then you need to understand your customers on a very deep personal level.
Hi YEC’ers , My name is Steve, I am an internet entrepreneur, I currently run MuteSix.com. We are team of data-driven customer acquisition fanatics that specialize in driving growth for eCommerce companies on Facebook, Adwords, and native ads. On my spare time I love to travel, play basketball, and watch House of Cards.
I blog about life on Stevenjweiss.com
The Young Entrepreneur Council (YEC) is an invite-only organisation comprising the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched BusinessCollective, a free virtual mentorship programme that helps millions of entrepreneurs start and grow businesses.
A version of this article appeared on the author’s blog.
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