If you are ready to accelerate growth without delay, consider these five tips.
1. Monetize early
Reid Hoffman, co-founder of LinkedIn, has said: “If you are not embarrassed by the first version of your product, you’ve launched too late.” Monetization may be the most important aspect for all startups. Many founders battle with the idea of whether to build an audience or monetize first.
It’s no surprise “the one reason why most startups fail is that they weren’t able to profitably monetize their product.” While many industries expose the idea “grow first, monetize later,” it isn’t a one-size-fits-all approach.
Don’t hesitate to monetize as early as possible. Put your revenue model to the test early and see if your idea holds weight in real market conditions. People only value what they pay for. And paying customers is the quickest way to validate your idea. Growing your audience to high numbers is comforting, but the product/service remains an unvalidated idea until you monetize it.
2. Narrow down customer acquisition efforts
Sometimes, time, effort, and money don’t bring about desired results. In fact, it may be a targeting problem, not a product problem. You can’t be all things to everyone so if you’re trying to market to everyone it’s simply a waste of resources. To accelerate growth focus on a niche audience that has expressed genuine interest in your brand.
To identify your target market:
Consider your ideal client’s gender, age, geographic location, pain points, interests, budget, etc.
Research your competitors paid and organic advertising tactics. You can also use competitor analysis tools like SE Ranking to discover your competitors’ keywords and ads for paid and organic search. Determine who they are targeting and appeal to the same audience or focus on a segment that they fail to reach well.
Speak to prospective customers, attend relevant events, and create online surveys to narrow marketing focus. Use website analytics tools like Hotjar to see who is visiting your website and how they are using it.
All this insight will help you define your customer personas and focus on their specific needs.
3. Experiment with pricing
Pricing should evolve as your company evolves. Only by charging money and split testing pricing strategies can you truly understand how your audience values your product and their readiness to pay for it.
You’ve found your optimal price is when:
a relatively small percentage of people complain that you are too expensive
another small percentage that doesn’t hesitate at all before paying
the biggest segment says the product is quite expensive but they are ready to buy because they see its value
In his book, Selling the Invisible, Harry Beckwith recommends raising prices until 15% to 20% of your qualified prospects resist. Generally, a higher price results in a perception of higher value.
“‘Pricing is the last bastion of gut feel,’ says Greg Cudahy, managing partner of Accenture’s pricing and profit optimization practice. According to Cudahy, companies that take a strategic approach to pricing throughout their business and monitor their success with hard numbers can raise revenue by between 1% and 8%.”
4. Listen to paying customers
People will say all kinds of nice things about your product or service, but listening to all voices is a risk. In particular, don’t base your business decisions solely on free users’ feedback (if you have them).
“One of the underlying issues here is that the feedback you get from your free users is usually pretty different from the feedback you get from paying customers. Paying customers are typically more familiar with the ins and outs of your product, so they tend to ask if you can make things faster, or make things easier to do,” according to Drift, a conversational marketing platform.
Steve Blank suggests, “Part of Customer Development is understanding which customers make sense for your business. The goal of listening to customers is not [to] please every one of them.”
5. Exploit paid growth tactics
Don’t presume that word of mouth and organic growth is enough. Marketing and sales is what makes a businesses actually grow. We all know examples of viral, sticky businesses, like Dropbox. But in general, having a great product doesn’t mean marketing is redundant. Natural growth is just one growth channels and eventually you’ll need to employ others.
What tactics do you use to boost startup growth? What has worked and what did not? Let us know in the comments.
Liudmila Ganzha is a passionate blogger, content marketer, and artist sharing startup tips on behalf of live help chat widget HelpCrunch. She loves sharing her experience and knowledge about customer success, e-commerce, content marketing, and startups. Connect with @helpcrunchcom on Twitter.
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