by Trevor Cornwell
The core challenge behind most new ideas isn't funding—it's sales. Most companies think they know what is involved to get sales. But if getting sales were that quantifiable, any rational company would simply do the math and pay its way through to linear growth or beyond. You can calculate the cost to drive traffic—maybe. With some experimentation, you can figure out what ads cost and then measure how many users click through to your site. But then what? How many buy? How many come back later and then buy? And even if you can, and do, measure all of that, you are still left with the question of why. Why are users buying or not buying? Is it the UI? Your product? What most companies punt to is the hope that their product will go viral. To be sure, a lot of companies do go viral—and this concept extends beyond the YouTube video that gets a million views. Companies like Box.net or Dropbox attract large numbers of users by having a great product that people want. Friends tell other friends, and all of a sudden the cost of acquiring a customer drops to a very low number.
Viral Isn't a Plan—It Is a Consequence
When asked what their marketing plan is, many people answer "this can go viral." But viral is not a plan; it's a consequence of doing a lot of things well. The product has to be great—that is the first essential. The cost of switching is not so high that mediocrity can be tolerated. At a traditional retail store, good spreads slowly, and bad spreads quickly. Marketing can move faster than word of mouth. With an online, digital good, the reaction is lightning-fast. But that doesn't mean you can simply build something great and they will come. To market ideas, you need to harness your network and put it to work.
Making a Good Fire
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The future is in crowd marketing. Marketing works in a series of tight, concentric circles. The people you know come to love your idea or product, and their network is connected to the next circle outward, which connects to the next circle, and so on. This is a powerful way to promote an idea or a concept; with crowd marketing, you can move from circle to circle.
The first step is organizing your fan base. Start with people you know, and make sure that they are aware of your idea. That is really the easy part, but it's one that is often ignored. The next step is figuring out the affinity audience for your idea. This requires the most imagination but also has the most potential to spread your idea like brush fire. Your friends and family are the match that lights the fire; the people who will have an interest in your idea are the kindling. To make sure your idea catches, you need to set up the fire just like you would in your fireplace. Better yet, think about setting the fire when you are camping, you have only a few matches, and it is damp outside. Getting everything set up well is critical, and you likely don't have a second chance. Your first circle of friends will help, but the spark or small flame that is created needs to have every chance to catch on. You have a 1,000 times better chance of succeeding if you get your fire set up right.
We tend to ignore these steps after we have spent a lot of time perfecting everything else: concept? check; engineering? check; price? check. Then we launch something, and what happens? Nothing. It may not have anything to do with a bad product. A lot of good ideas fail because they don't receive the right marketing.
Bands have fans. Movies have fans. Even products have fans. You have fans. It's time to put them to work.
OK, so where do you find all the fans if you don't have a publicist or a marketing firm? Many exist in the keywords of your idea. You can find crowds and fans in Facebook and Twitter. Facebook knows a lot about what engages its users just by virtue of what they are talking about on the site. You can mine for crowds by marketing to people you know on Facebook who are talking about subjects or using keywords related to your business. That is a powerful way to find the people who already like what you are doing. The same goes
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for Twitter: you can find what people are talking about related to your idea and reach them through a dialogue about your shared interest.
Life Ahead Is eBay Without Having to Ship Stock from the Attic
But what is the future? eBay paved a new path by creating peer-to-peer selling for the things we have in our attics. Brilliant. Match a product you have with a need that someone has, don't limit the sellers to just stores, and build trust through reputation. That model was destined for success because it understood a few things: there are a thousand ways to market, selling isn't something for just big stores, and trust can be scored. What now seems obvious was, a few years back, revolutionary. So does this strategy apply to digital goods? You bet. Distribution is a huge pain point for developers and apps. Apple and Android have created consignment stores, but getting attention for a new app isn't easy. How can you do it? First, stick with basic principles. Identify people you know and ask them to buy your product. Engage in a dialogue by talking to people on Twitter. Create a fan page to share and report and excite people on Facebook. Your blog is a chance to invite people behind the scenes to see what you are working on. We all have enough professional marketing hitting us every day. Take a moment to talk about the struggles that you have had and share the learning points; people will come back again and again to identify and connect with you—and your product. eBay's CEO calls the company the first social network. That may be right. It is social to sell, but just like with physical goods, you don't market tires to people who can't drive. Find your specific audience and engage it.
Let Them Buy Wholesale and Distribute
appbackr takes the approach to allow fans to buy wholesale and sell retail, and was inspired by the eBay model. A key to that "first social network" is enabling people to promote their products in their own way. Another key element is allowing the sellers to profit from the difference in the value that they give to the product and the value that a retail customer is willing to pay. The market for digital goods allows for the same model. Sometimes it is assumed that
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for a digital good—since there is no incremental cost for manufacturing it or costs for shipping it—that distribution is not necessary. But in a digital world, distribution is social. Note, though, that just because it is social doesn't mean that your "friends" will do it for free. At appbackr, we allow "backers" to buy digital apps at a wholesale price and profit when the apps sell at the retail market. What is the value of the backer? Well, he can buy in bulk so that the developer gets immediate payment for thousands of apps at once. That has a value because it benefits cash flow, allows for the creation of new features, and creates a marketing budget for new apps. But the real benefit comes in the crowd marketing for apps. Imagine a thousand backers each working to promote an app. That can have a huge effect in helping the app to achieve top-10 status, which in turn helps it to sell more.
Fans, Friends, Launchpads, and New Markets
The idea is simple: make each fan a marketer. If you view each of your fans as having her own launchpad to a thousand different friends, colleagues, and followers, you begin to see the promise of crowd marketing. That is the future of the Internet—and the social infrastructure that Facebook and Twitter and their hundreds of millions of users have built. Your product has fans, and those fans are connected to others. The social graph is your way of connecting your product to the people who want it.
About the Author
Trevor Cornwell is the founder and CEO of appbackr inc, the first wholesale marketplace for apps. appbackr was a winner of the PayPalX 2010 Developer Challenge.
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