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Summary of Traction: How Any Startup Can Achieve Explosive Customer Growth

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For startups trying to scale, traction is the key. I've created a detailed summary of Gabriel Weinberg and Justin Mares book Traction: How Any Startup Can Achieve Explosive Customer Growth. It lays out the core tenets of the book and is best paired as a reading guide for entrepreneurs and marketers alike.

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Summary of Traction: How Any Startup Can Achieve Explosive Customer Growth

  1. 1. Notes on TRACTION HOW ANY STARTUP CAN ACHIEVE EXPLOSIVE CUSTOMER GROWTH by Gabriel Weinberg and Justin Mares summary by Spencer Maroukis
  2. 2. TRACTION - MARKETING FOR GROWTH COMMON THEMES 1. Startups focus on the same channels 2. It's hard to predict what will work
  3. 3. 3 GROWTH PHASES Phase 1: Making something people want. Test traction channels to see if a product is getting better. Phase 2: Marketing something people want. After finding product-market fit, it is time to really focus on traction and scaling the userbase. Phase 3: Scaling the business.
  4. 4. THE BULLSEYE FRAMEWORK
  5. 5. One traction channel dominates in terms of customer acquisition.
  6. 6. Identify channels in the "outer ring". Brainstorm a channel strategy for each.
  7. 7. Select the three most promising channels and build quick tests.
  8. 8. TESTING How much does it cost to acquire customers through this channel? How many customers are available in this channel? Are the customers in this channel the kind we want right now?
  9. 9. RE-EVALUATING Re-evaluate your channels, placing them into buckets of "Inner Circle" (inner ring), "Promising" (middle ring), and "Long Shot" (outer ring).
  10. 10. 19 TRACTION CHANNELS TO RULE THEM ALL Many are interrelated and feed off one another. You may be comfortable with some, uncomfortable with others. Try them all. You don't know which ones will work.
  11. 11. "Poor distribution, not product, is the number one cause of failure."
  12. 12. LEAKY BUCKET ANALOGY Time should be ideally split 50/50 on product and traction.
  13. 13. 1. VIRAL MARKETING Reality: not likely to obtain true exponential viral growth But pursuit optimizes "hooks" in the product and its distribution Low cost, high volume "Optimize Everything"
  14. 14. VIRAL LOOP A customer is exposed, loves the product, tells someone else who is exposed, loves the product, tells someone else... Provide free branded content Minimize friction Allow users to test product before signing up
  15. 15. VIRAL MATH viral coefficient, K = [Invites per User] x [Conversion %] Conversion %, made of Click Thru % and Sign Up % K>1: exponential K>0.5: worth pursuing
  16. 16. TESTING Map out your viral loop Find viral pockets Have personal hooks Optimize conversion pages buttons vs text links / size, color, contrast of CTA / images / copy 1% improvement will compound Seed with SEO or online ads
  17. 17. COMMON MISTAKES Product isn't inherently viral Not testing enough Virality as a tactic instead of product strategy Not learning from others and copying details
  18. 18. 2. PUBLIC RELATIONS (PR) Stories now filter up the media chain Bigger outlets scour smaller ones for captivating stories "Start Small To Get Noticed"
  19. 19. EXAMPLES TechCrunch & Lifehacker pick up stories from Hacker News and Reddit. The New York Times wraps stories from TechCrunch into a larger narrative. Donorschoose.org received local coverage, then Newsweek, then Oprah, then the Gates Foundation
  20. 20. HOW TO PITCH Follow industry influencers and reach out to blogs they often link to Show significant milestones raising money, launching a product, breaking a usage barrier, a PR stunt, a big partnership Combine milestones for a greater impact Offer exclusivity and giveaways Keep it short and sweet Example Template
  21. 21. AFTER GETTING A SOLID STORY 1. Submit it to community sites with large audiences 2. Share it with social networks 3. Email it to influencers that may share with a larger audience 4. Ping bigger blogs 5. Write a "How We Did This" follow up
  22. 22. 3. UNCONVENTIONAL PR "Systematize Richard Branson In A Space Suit"
  23. 23. PUBLICITY STUNTS "Halfway, OR" ⇒ "Half.com, OR" Richard Branson Chargify Bull at SXSW
  24. 24. VIRAL VIDEOS Blendtec's "Will It Blend?" Youtube Videos (8M views) Dollar Shave Club's "Our Blades are F**cking Great" (31k fb shares, 9.5k comments) Grasshopper.com's "How Entrepreneurs Can Change the World"
  25. 25. CUSTOMER APPRECIATION Gifts Contests & Giveaways Customer Support
  26. 26. HOW TO DO IT Look for larger trends hit themes that don't have a ton of content yet Success is unpredictable have a defined process for brainstorming and selecting ideas
  27. 27. 4. SEARCH ENGINE MARKETING "SEM" or "paid search" or "pay-per-click (PPC) Buying ads for keyword searches "Find Your Baseline"
  28. 28. TERMS CTR, click-through rate: percentage of ad impressions that click CPC, cost per click CPA, cost per acquistion: CPA = [CPC] / [conversion rate] conversion rate, % that make a purchase after clicking on the ad Quality Score: overall score that includes CTR, time on site, and more
  29. 29. CASE STUDY: INFLECTION measured CTR on ads for different landing pages before launching spent over $100k/month in SEM on around 50k keywords SEM is a way to get early customer data in a fairly controlled, predictable manner...decide to spend $XXX on an advertising campaign to get an early base of customers and users.
  30. 30. PROCESS 1. Find & group high potential keywords into ad groups 2. Test different ad copy/landing pages within an ad group 3. Remove underperformers, tweak existing to improve results
  31. 31. ADVICE Beginning - just test 4 ads Track which ads are converting (not just being clicked on) Successful if close to break even after a few weeks
  32. 32. ADVANCED SEM Advanced content networks (Google) retargeting (Google, AdRoll, Perfect Audience) conversion optimizer (Google) negative keywords scripting
  33. 33. RESOURCES Google AdWords & Dynamic Keyword Insertion Feature Keyword Planer KeywordSpy, SEMrush, SpyFu See also: 7. SEO - longtail keywords
  34. 34. 5. SOCIAL & DISPLAY ADS Display Ads - are broad Social Ads - are indirect "Go Broad or Indirect"
  35. 35. DISPLAY ADS The banner ads you see on websites Normally target a broad audience In Phase I go directly to smaller sites to advertise Otherwise use networks like Google's, Advertising.com, Tribalfusion, or niche ad networks
  36. 36. SOCIAL ADS Ads on Facebook, Twitter, Foursquare, Tumblr, Pinterest, etc. Build awareness, not necessarily to convert Create compelling content Only employ social ad $'s when your message is starting to buzz
  37. 37. TARGETS Make a list of small sites and contact them directly Use an indirect response strategy on social ads, providing compelling content first and foremost
  38. 38. 6. OFFLINE ADS Radio, TV, magazines, newspapers, billboards, and direct mail " "F*ck It We'll Do It Live
  39. 39. BASICS What are the demographics? How does this line up with my target customer? Request an ad kit Use remnant advertising to run cheap tests Track with url shorteners, promotional codes, and web hooks
  40. 40. EXAMPLES
  41. 41. InstaCab cyclists handing out business cards DuckDuckGo took out a billboard in SoMA (Google's backyard) highlighting Google's privacy issues "An ad might be good for a quarter, or a year, and then decay slowly until it wasn't valuable anymore. It was unpredicatble and decayed over time: so the only thing we were left with was trying everything and measuring what worked" ~ Jason Cohen of Smart Bear
  42. 42. TESTING Remnant advertising Ads in small niche publications Advertise free products or services
  43. 43. 7. SEARCH ENGINE OPTIMIZATION (SEO) Ranking high in search results Magnifies traction in other channels Strategies: Fat Head or Long Tail "Content + Links"
  44. 44. " At its base, SEO is starting with a content strategy and finding a way to attract relevant visitors through search engines. You have to intelligently design this kind of [content] and make sure search engines can find and rank that content.” ~ Rand Fishkin founder of SEO software company Moz
  45. 45. STRATEGIES Your ability to rank on the first page should be a deciding factor in whether to pursue a particular SEO strategy at all.
  46. 46. FAT HEAD Are search volumes large enough for growth? (10%) New products are harder (no one was searching for "taxi cab alternatives") Testing buy Google ads, look at conversion narrow list of keywords, look at trends determine difficulty in ranking high for keywords make sure other sites link to you using desired search terms
  47. 47. LONG TAIL The majority of searchers Bundle long tail keywords together Look at competitors websites, check Alexa search rankings "Long-tail SEO boils down to producing a lot of quality content."
  48. 48. BUILDING LINKS Building links is at the heart of SEO Use other channels, PR, Content Marketing, and Widgets to drive links Quality content organically builds links infographics, slideshows, images and research
  49. 49. 8. CONTENT Good content ⇒ recognition as an industry leader Impacts other channels Unbounce and OkCupid Examples "You Are What You Eat Content"
  50. 50. UNBOUNCE (PHASE I) Biweekly, shorter posts Blogged for a year before launching a product Started guest posting after 3 months Took over 6 months to get traction First 6 mo.: < 800 monthly visistors Later: 2k visitors/mo.
  51. 51. OKCUPID (PHASE III) Switched marketing focus to blogging ⇒ expedient growth Longer posts, less frequent Controversial Data driven Received much more organic PR
  52. 52. LESSONS Create consistently, quality After every post ping influencers for feedback Engage readers Be patient Give away free (premium) content to build email list
  53. 53. HOW TO PRODUCE GOOD CONTENT You should know more about your industry than your potential customers Write about problems your potential customers face Infographics are 20% more likely to get shared Show readers a problem they don't know they have
  54. 54. TARGETS Blog consistently for 6 months Do things that don't scale Create in-depth and unique posts
  55. 55. 9. EMAIL MARKETING Capitalize on the email lists you've built through other channels Advertise on email lists of your prospective customers Improve activation rates "Test Everything"
  56. 56. TYPES The "You Are So Awesome" Email The "This Email Will Make You Nostalgic" Email The "Access This Premium Feature" Email
  57. 57. TIPS Successful email marketers A/B test everything subjects, formats, images, timing Never send from "noreply@yourdomain.com" Trickle update with features
  58. 58. TARGETS Personalization Building a great list Set up a series of automatic emails Use online tools to A/B test emails
  59. 59. 10. TARGETING BLOGS Good for Phase I Advertisements, guest posts, & coverage Mint case study "Go Where Your Potential Customers Are"
  60. 60. CASE STUDY: MINT 20k signups before launch, 100k within 6 mo. of launch, 1M within 12 Tested different segments Covered/mentioned by blogs Wrote guests posts Advertised on smaller blogs Used sharability and exlusivity through Mint badges
  61. 61. TARGETS Make a list of all relevant blogs Run tests on a variety of blogs and audiences Use linksharing communities to generate traffic, feedback, and buzz
  62. 62. 11. ENGINEERING AS MARKETING Get quality leads Solve a problem of your audience Keep it as simple as possible Look internally for inspiration "Create Valuable Tools For Prospective Customers"
  63. 63. EXAMPLES HubSpot's Marketing Grader WP Engine's Wordpress site render speed test
  64. 64. TACTICS Take advantage of cyclical behavior Create micro-sites for your tool(s) Create widgets
  65. 65. TARGETS Standalone, low friction sites that lead back to product or a sales channel Extremely relevant to your core business Demonstrate value as quickly as possible
  66. 66. 12. BUSINESS DEVELOPMENT Need to be strategic, easy to pursue weak partnerships Find mutually beneficial partnerships Create a pipeline "Exchanging Value Through Partnerships"
  67. 67. Make sure your milestones are defined Only pursue partnerships that will help you on this path "Good BD aligns with company and product strategy. It is always focused on strategic milestones and traction goals"
  68. 68. TYPES "standard": Apple-Nike "joint ventures": new products. Starbucks-Pepsi "licensing" "distribution deals": Groupon, Kayak powering AOL searches "supply partnerships": Hulu and content providers
  69. 69. TARGETS Have a pipeline of 20 potential deals place emphasis on attributes instead of name get to know partners' business beforehand seek out advocates and foward thinkers Focus on how BD will help you reach the next milestone
  70. 70. 13. SALES (more of a B2B strategy, we'll skip this for now)
  71. 71. 14. AFFILIATE PROGRAMS For retail, information products, and lead generation Use existing affiliate networks Better than PPC since you get to define conversion "Take A Cut"
  72. 72. TYPES
  73. 73. RETAIL coupons or deals (like RetailMeNot) loyalty programs offer cash back on spending aggregators aggregate products from retailers email lists - affiliates recommend products to a large audience vertical sites like individual blogs
  74. 74. INFORMATION PRODUCTS books, software, music, and education have their own affiliate networks (Clickbank.com) LEAD GENERATION insurance, law firms and mortgage brokers will pay a lot for customers
  75. 75. TARGETS Build a relationship with content creators Look to customers as affiliates Know how much you are willing to pay for users Play a flat fee for conversion Keep payouts simple and below cost of acquisition
  76. 76. 15. EXISTING PLATFORMS Appstores and Social Sites "Get In The Charts!"
  77. 77. APPSTORES Top apps & featured listings will get traction How do you get into the charts? buy ads through other channels high ratings think hard about what the editors are looking for
  78. 78. SOCIAL SITES Airbnb's crosslisting to craigslist strategy YouTube & Myspace
  79. 79. CASE STUDY: EVERNOTE Evernote uses existing platforms as their main traction channel They receive early promotion for free, but with risk that platform fails They think about what editors want Evernote Peak used Apple's smart cover to create flashcards "We work day and night, for weeks in advance, to make sure that Evernote is in the app store on day 1"
  80. 80. TARGETS Figure out where customers are online Create new features to fill a gap of that platform Try new platforms
  81. 81. 16. TRADE SHOWS Build interest in what you're building or launch it Driven by strategic goals Look to the future, years in advance Be social "Show It Off"
  82. 82. PREPARATION Set overarching goals Write down all of your industry's events Evaluate in the context of your goals List key attendees you want to meet, schedule meetings before the event. editors, bloggers, customers, vendors, potential parteners, press
  83. 83. AT THE SHOW Have an outbound strategy (talk to people) Have a call to action Give people a reason to come to you redeemable vouchers, swag, etc. Sponsor a dinner with hot ticket speakers Partner with others to keep cost down
  84. 84. 17. OFFLINE EVENTS Phase I: meetups and events Phase II: larger tech conferences like TC Disrupt, Launch Festival, SXSW Hosting your own "Scale By Doing Things That Don't Scale"
  85. 85. SCALING OFFLINE EVENTS 1. Attend, start your own, or sponsor local meetups 2. Try a day-long mini-conference 3. Consider larger events focusing on attendee quality
  86. 86. TARGETS Attend and engage at local meetups See if there is an appetite for bigger events Be creative
  87. 87. 18. SPEAKING ENGAGEMENTS Benefits other aspects of your business, e.g. management Get started for free Become a recognized industry expert Get paid to talk and get customers simultaneously "Teaching Sells"
  88. 88. GETTING STARTED Give free talks to small groups of potential customers or partners Refine your speeches, build a reputation Landing talks establish your expertise pitch conference organizers on what they want to have covered
  89. 89. SPEAKING TACTICS Why are you important enough to be the one giving a talk? What value can you offer? Have one or two core talks Advanced Record speaking engagements Reuse slides - each slide is a story and can be swapped Build relationships at e.g. speakers dinners
  90. 90. TARGETS Speak at a small event, even if you're not pursuing this channel Tell a story on stage Leverage referrals and past engagements
  91. 91. 19. BUILD A COMMUNITY Build an inital audience Have a mission Be transparent and truly engage "Will You Be Mine My Community?"
  92. 92. EXAMPLES Stack Exchange Joel Spolsky and Jeff Atwood were already "internet famous" Found what their community needed and built it Reddit Alexis Ohanian sent emails to anyone who wrote about reddit Sent early users shirts, stickers, and other gifts Sponsored open bar tour for redditors
  93. 93. COMMUNITY BUILDING TACTICS Have a mission, write a manifesto Foster cross-connections, launch with a meta Ensure quality through guidelines
  94. 94. TARGETS Build an initial audience Cultivate and empower envangelists Set standards early on Tap your community for product development and potential hires
  95. 95. FIN Thanks for listening! Get the whole book: | | Learn more about The Edible Project: free with university log in text audible www.edibleproject.io
  96. 96. SOURCES "Chargify Bull" © grasshopper.com "SEO" © moz.com see for how I created these slides with reveal.js and reveal-md the repo

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