Me, Myself and Muziboo

Debunking Entrepreneurship

Initial Product Marketing – Online Vs Offline

with 10 comments

In the last post I had concluded that there are a few online marketing strategies that go hand in hand with product development which trump other offline approaches. Any approach that is measurable and can be easily iterated upon is a great initial strategy that can help in validating the product concept against a customer base.
From our personal experience, we have seen that, following a  targeted approach offered by online marketing (SEO and SEM) has far better results than following the blanketed approach in offline strategies. The early adopters of your service are most likely the ones that are actively searching for you. And a  majority of those solve their problems by searching for solutions online. The good thing about making yourself available to that set of audience is that they are actively looking for you. This without doubt puts them ahead of those who haven’t even realized that they have a need. And that exactly is the risk involved in offline marketing – spending resources on an audience that hasn’t realized there’s a need yet.
Also on the internet, the prospective customers that you reach out to are just a click away from your product unlike an offline approach where the funnel is too deep.
When we launched Muziboo, we busied ourselves with marketing by distributing Muziboo posters and demo-ing in colleges. What better way than marketing our product to the youth which will inturn help us spread like wild fire! Let me hasten to add this: it was all a gross misadventure for all the reasons stated above. And of-course, to make use of the volume discounts, we printed posters in huge numbers. For one, printing in large volumes totally discards the possibility of iterating on the messaging. And another, even if the messaging is right, the cost of distribution is enormous. We have changed our positioning and offering since then (which is inevitable for a startup) and hence couldn’t salvage much from the resources already spent. We still have thousands of them sitting tight in our attic while some of them occasionally  get used for brainstorming – thanks to the one blank side!
To come to the point, we pretty much shot ourselves in the foot by spending most of the initial but crucial months on this approach. And worse still, missing the opportunity of having the early entrant advantage with an app when Facebook app platform was launched. Unfortunately we couldn’t keep up our focus on either product development or online marketing with our offline efforts.
Just to give you an idea, we signed up about a hundred users a month during those months. But ever since we realised the power of online marketing we have been growing steadily. And today we sign up around 15k users every month with ZILCH marketing spend. We achieved this rate of growth sitting right in front of our comps from our bedroom office (we have a proper office now though) without  having to step out or spend resources.
Well, after this experience would it be terribly wrong to conclude that offline marketing for a consumer internet start-up is a non-starter for a strategy?

A Bootstrapper’s Diary

In the last post I had concluded that there are a few online marketing strategies that go hand in hand with product development which trump other offline approaches. Any approach that is measurable and can be easily iterated upon is a great initial strategy that can help in validating the product concept against a customer base.

From our personal experience, we have seen that, following a  targeted approach offered by online marketing (SEO and SEM) has far better results than following the blanketed approach in offline strategies. The early adopters of your service are most likely the ones that are actively searching for you. And a  majority of those solve their problems by searching for solutions online. The good thing about making yourself available to that set of audience is that they are actively looking for you. This without doubt puts them ahead of those who haven’t even realized that they have a need. And that exactly is the risk involved in offline marketing – spending resources on an audience that hasn’t realized there’s a need yet.

Also on the internet, the prospective customers that you reach out to are just a click away from your product unlike an offline approach where the funnel is too deep.

When we launched Muziboo, we busied ourselves with marketing by distributing Muziboo posters and demo-ing in colleges. What better way than marketing our product to the youth which will inturn help us spread like wild fire! Let me hasten to add this: it was all a gross misadventure for all the reasons stated above. And of-course, to make use of the volume discounts, we printed posters in huge numbers. For one, printing in large volumes totally discards the possibility of iterating on the messaging. And another, even if the messaging is right, the cost of distribution is enormous. We have changed our positioning and offering since then (which is inevitable for a startup) and hence couldn’t salvage much from the resources already spent. We still have thousands of them sitting tight in our attic while some of them occasionally  get used for brainstorming – thanks to the one blank side!

To come to the point, we pretty much shot ourselves in the foot by spending most of the initial but crucial months on this approach. And worse still, missing the opportunity of having the early entrant advantage with an app when Facebook app platform was launched. Unfortunately we couldn’t keep up our focus on either product development or online marketing with our offline efforts.

Just to give you an idea, we signed up about a hundred users a month during those months. But ever since we realised the power of online marketing we have been growing steadily. And today we sign up around 15k users every month with ZILCH marketing spend. We achieved this rate of growth sitting right in front of our comps from our bedroom office (we have a proper office now though) without  having to step out or spend resources.

Well, after this experience would it be terribly wrong to conclude that offline marketing for a consumer internet start-up is a non-starter for a strategy?

Written by Nithya Dayal

March 22nd, 2010 at 5:09 am

Posted in Entrepreneurship

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10 Responses to 'Initial Product Marketing – Online Vs Offline'

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  1. Nice post.

    If you don’t have a problem with revealing the stats, can you tell me, now what % of your users are students. Like, for our case, at interviewstreet, we know that all the students are our potential customers and they will get benefited by taking a interview.

    But for muziboo, only a small percentage of the students will be interested in music right? Maybe is that the reason offline didn’t work for you?

    sp2hari

    23 Mar 10 at 6:41 am

  2. Hi Hari,

    This is some question I asked myself before calling it quits with my offline approach. Atleast today I am talking in retrospect. The time I asked myself this question, I didn’t even clearly know what online strategy would work. Which only made me defend the offline approach harder.

    I do not have qualms revealing stats, but in this case we haven’t done any segregation based on user profiles. I know that we are signing-up college students too. But what % of the total sign-up or how it looks against the backdrop of past numbers I do not know. If you feel, not all college students are potential users of Muziboo, fair enough. I have been to Music schools too where everyone is a possible customer. But I didn’t see spectacular results there either!

    As I mentioned in the post, our efforts in that direction were not totally fruitless. We signed-up about hundred users a month. But the following few questions I could never answer in the affirmative which helped me make the decision.
    Does the return justify the cost my investment?
    Does my number look good considering the size of the possible market?
    Is the approach scalable without adding manpower?

    Also, another philosophical question we asked ourselves was ‘Do we want to sell the product or do we want to evolve the product before selling?’ Yeah, it is true that we all make products that scratch our itch, but asking oneself if that product can cater to the needs of a large enough audience to make a business is imperative. Sometimes with the basic product idea and a few tweaks here and bits of additions there carried out with the help of user inputs, one might actually be able to evolve a product that caters to a much larger audience. For an established market, the ‘Make & Sell’ approach offered by offline marketing would work. Otherwise it may prove to be a resource sink.

    The funnel to money in a business is something like this:

    Appealing to target audience
    Possible customers remembering to check you out when there is a need
    Signing-up if the product is interesting
    Paying if the service is compelling.

    In an offline approach, the % conversion from the first step to the second would be pretty low. The reason is that there is a wide gap between the time they get exposed to your service and the time they feel the need to check you out. Whereas, while online they are just a click away from experiencing your product. Also, the cost of an ‘appeal’ is so high offline that you may not repeat your approach with the same audience. Whereas in an online approach, it doesn’t cost much to make yourself visible to the same set of audience again and again for brand recollection.

    If I was in your position, I would try to reach the possible market online than offline. Have you tried marketing online? Are you happy with the returns on your offline approach. If yes, why not recruit more people across cities to market your product as fast across geographies and establish yourself faster?

    Nithya Dayal

    24 Mar 10 at 4:14 am

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