My goals today Basic marketing and product strategy • The Whole Product • Segmentation, targeting and positioning Online marketing 101 • Two big realities (not trends anymore!) • SEO, SEM, Social media Metrics A/B Testing
What I won’t talk about Qualitative measurement • Competitive landscape, UX quality, … Standard financial metrics • Revenue, Balance, Burn rate, Runway, … All possible metrics in the world • As many as asses
Strategic PlanningSource: Tony Seba’s High Tech Marketing course @ Stanford U.
People don’t want to buy a ¼’’drill.They want a ¼’’ hole!!! Theodore Levitt, Professor of Marketing @ Harvard
Valuecreation: theproductbenefits bringsomethingnew to theuser
Valuecapture:someonepays for thegeneratedvalue
What’s a market segment■ Group of clients or potential clients of a set of product/services that posess a series of needs, behavioral patterns and common characteristics, and that communicate among each other when deciding upon a purchase decision.
Tipos de segmentos■ Geography (e.g. Per region)■ Size (e.g. Per income, revenue, growth rate, …)■ Industry (e.g. Per SIC code)■ Purchase type (e.g. Centralized vs decentralized)■ Personal (e.g. Risk profile)■…
■ Product must be positioned w.r.t. two elements: • Client needs • Competitors
How to position■ Relative to technologies, products o processes■ Relative to competitors • Avis: “We’re #2, that’s why try harder”■ Finding a unique niche • Genentech: “small” ($300M-$600M) oncology markets■ Becoming a category leader
Cluetrain Manifesto 1. Markets are conversations 2. Markets are comprised by human beings, not demographic sectors 3. Conversation among human being sounds human ■ … and other 92 thesis http://www.cluetrain.com
Organic vs Paid Search10% of Clicks90% of Clicks
SEO is the practice of improving and promotinga web site in order to increase the number ofvisitors the site receives from search engines.
Marketing in search engines■ Advantages • Top ranking captures 90% of clicks • No cost per clicks • Helps select prospects during discovery stage • Content beats budget (by now!)■ Cons • No guarantee • Takes time (months!) • Difficult to control • Difficult if competitors are already positioned
Don’t look like a Farm siteOld SEO tricks don’t work anymore:• Reciprocal link pages• Keyword-variant abuse• Generic design and layout (watch out CMS tools!)• Anonymous contact forms• Keyword-stuffed titles and pages• …
Marketing in search engines■ SEM: Search Engine Marketing■ PPC: Pay per Click■ Used in paid searches■ E.g. Google AdWords■ Paid per keyword use■ Advantages • Control on ranking, text and “landing page” • Typically uses “auctions”. One can compete • Campaigns can be tested■ Cons • No pay, no exist • Not so reliable • Expensive • If someone pays more, wins
Marketing in search engines■ Contextual advertisement■ E.g. Google AdSense■ Advantages • Good for branding • Not just in search engines! blogs, facebook, twitter, … • Easy to test■ Cons/Challenges • Do FB users want to click on ads when chatting? • Difficult (i.e. expensive) to test and succeed
Social Media + SEO: big win Facebook shares Twitters tweets, RTs Google +1s Youtube … These are all taken into account by Google, Bing
Types of users Visitor Contributor Distributor
ViralityAmplification rate:• (#shares, #RTs, …)K-Factor = AR *conversion rate• = 1: steady state• > 1: growth ➤ 1.4 < x < 2.1 => hot & viral!!!• < 1: decline
The Four Viral App Objectives % viral hosts Contact rate per active host Duration of each active host’s infectious time period Infection conversionSource: http://framethink.wordpress.com/2008/01/15/the-four-viral-app-objectives-aka-social-network-application-virality-101/
Customer Acquisition Cost gross margin per customer CAC Ratio= sales/marketing costs per customer Bessemer: average ratio of SaaS companies = 0.6
LTV vs CAC Of course, LTV > CAC But, moreover: LTV > 3x CAC
Freemium. Conversion Rate Free Users Delayed subscription Premium (test the service & engage) Conversion Rate Time@justohidalgo
Freemium for Books. Price per page Price/page Profit threshold Growth Consolidation time/conversion rate@justohidalgo
One key question for the whole AARRRcycle■ How effective is a web page compared to another? ?
What’s A/B Testing? Visitors are randomly distributed Version A Version B time 1200 new users 1000 new users Version A is better than B
What should you test? The call to action’s (i.e. the button’s) wording, size, color and placement, Headline or product description, Form’s length and types of fields, Layout and style of website, Product pricing and promotional offers, Images on landing and product pages, Amount of text on the page (short vs. long)… anything that you think it might affect your Key Metrics.
Is A/B testing perfect? Very good for ONE-SINGLE-GOAL projects where the KPI can be measured by counting actions • E.g. Downloads vs Quality perceived Granularity of the A/B test is paramount • If “A” better than “B” or is it just that the headline in B is horrible, but the rest is much much much better than “A”? A/B testing is suboptimal** Recommended:http://untyped.com/untyping/2011/02/11/stop-ab-testing-and-make-out-like-a-bandit/
Thanks for your time!Justo Hidalgohttp://email@example.com@justohidalgo
Credits Olivier Guin, from The Noun Project Dima Yagnyuk, from The Noun Project Redesign from Otl Aicher’s icon, from The Noun Project Axsys, from The Noun Project Monika Ciapala, from The Noun Project Rob Schill, from The Noun Project Martin Karachorov, from The Noun Project Alexandre Mendes, from The Noun Project All other icons from The Noun Project Publishers trademarks, logos and brands belong to their respective companies.