Archive for the ‘distribution’ Category
After helping 8 companies with their distribution issues and taking some time to reflect, I started to notice a few patterns. There were definite patterns on what has worked with distribution already and what distribution ideas the companies wanted to try next.
Before I get into these I want to lay out a few pre-cautions. All of the companies I worked with were primarily consumer facing internet companies, they had a product already out in the marketplace, most had a transaction they took place in (booking, subscription, charged directly for product), and all had a base of pre-existing customers.
These methods might not work on enterprise focused companies, straight advertising business models, or companies outside of tech.
That being said here are some of the distribution ideas I saw which worked across all of the companies or distribution ideas that were going to be tried next:
Offer you can not refuse (preferably paid sample) + habit – This is the combination of a couple of strategies and works best with a product you are selling directly to an individual.
First you want to create a sample that makes it impossible for a person to refuse trying it. Next you want to create a habit within the customer of using the product. Then once you have shown value and the product is an ingrained habit you want to charge for the product, preferably on a subscription bases.
The best contemporary example I can think of is a service called SaneBox. They have a product that helps you save time with your email inbox, initially for free without even asking for credit card info (offer you can’t refuse). They show you value and create a strong habit of using the product daily over their 15 day trial. Next after the trial is over they ask if you want to continue on a monthly or yearly subscription.
Personally I tried so hard not to convert to a paid subscription but the value of the product was so apparent and my habit was completely changed to rely on SanBox is was ridiculously hard not to continue using it.
Personal story – It is much easier to make a person famous versus a product famous. People tend to respond to personal stories, emotions, and feelings much more than product features, benefits, and differentiation points.
We tried this ourselves with a new product we launched, GroupTie, and it definitely led to much higher conversions for wanting to try the product out.
You can either tell your own personal story (if you’re solving your own personal problem) or use one of your customers personal story.
For example if you are selling a product to restaurant owners your story should be told from another restaurant owner. It should be centered around the individual restaurant owner and it should be their emotional story on how your product is helping their life. It’s much easier to make a person famous versus a product famous.
Partnership with customer pool – Sometimes it’s much easier to partner with a pre-existing organizing that has a large pool of your ideal customers already in their community.
The best example of this is how PayPal leveraged eBay in its early days. One of PayPal’s strongest customer segments were people who were making peer to peer payments and one of their largest customer pools were people who bought things in online auctions. eBay was the largest online auction company at the time so PayPal made the strategic decision to focus all of its energies on eBay as its sole marketing channel.
This could either be in a direct partnership relationship, acquisition, or off-the-radar marketing tactics to go after the organization with your customer pool.
SEO directory – A simple distribution strategy is taking a network that isn’t currently online and making it freely available for anyone to use.
I can’t publicly talk about the best example of this but a good example is Yelp which took the previously private & commercial directory of local businesses (on Yellowpages) and created a free & accessible directory of local busnisses for anyone to use.
This takes a lot of time and energy but if your directory becomes the de-facto directory for your industry the distribution from that will be enormously valuable.
Special gift or special package for journalists – This is a strategy specifically for getting media attention.
Journalists literally get pitched about new companies 1,000x times a day with the same underlying message: “Please write about me”. Instead of writing the same boring message create a special version of your product specifically for journalists.
For example if you have a product that helps parents find babysitters: find all of the journalists who are current parents, create a high touch service product to specifically help them find a babysitter, then after you have provided service ask them to write their honest opinion on how the service was good or bad.
A word of caution on this one: If you do this it has to be a genuine offer, only contact journalists who fit your demographic, and this could never be a quid-pro-quo deal.
Open contributors but one group is highlighted – This is a strategy if your product depends on contributions from others.
We personally use this extensively for StartupDigest. Anyone can submit events to us but in each city there is curator who the email newsletter is published under and that person gets all of the reputational benefit for doing the newsletter.
If you’re interested in this method also look at programs like the Yelp Elite, Reddit contributors, and Wikipedia editors.
Who else is using this? – A simple but effective tactic to try out. One of the biggest questions anyone has when landing on your product page for the first time is, who else is using this?
Make sure to have a testimonial page or customer reviews page highly visible and use peoples real names.
Who of your friends use X? – This is a variation of the tactic above. A better question is not who else is using this, but which of my friends is using this product?
For example if you were creating a doctor recommendation service a good question to lead with on the home page might be to ask, “See which doctors your friends are using”.
Not only are you creating a compelling indirect way for a new customer to create an account with you but you are bringing all of the implicit trust persons close friends bring with them.
Crazy outrageous stunt – This is also primarily a strategy for getting media attention.
The press loves unusual stories and one good way to get press is to do an outrageous stunt. A good example of this is the company WePay dropped a 600 pound block of ice at the PayPal developers conference, ridiculing that PayPal freezes your money, getting them a ton of national media attention.
Stunts have the potential to completely backfire but if successful can gain you massive amount of attention for very little input.
Conclusion: Above are a few distribution ideas I saw work over 8 separate companies but their are a lot more strategies out there. The strange thing with distribution and marketing in general is its very hard to know what will actually work beforehand.
The only way to really know is through small testing and experimentation of different ideas and measuring the results from it. If you try any of these start small and test distribution ideas at as fast and cheap as possible.
Feel free to comment below on other distribution ideas that worked with you or other experiments you are thinking of running. Would love to learn more about the field and see what worked for you.
I have been studying distribution & reading over 30 books on distribution and I wanted to outline some broad principles I have learned which I am calling the “principles of distribution”.
The best three books on this topic of them all were three historical books:
- My Life in Advertising & Scientific Advertising written in 1917 by Claude C. Hopkins
- Tested Advertising Methods written in 1961 by John Caples
- The Life of P.T. Barnum written in 1855 by Himself
All three of these guys, especially P.T. Barnum, were quite the characters and they were some of the early pioneers into what we now call marketing, advertising, PR, and the ever-so-fashionable distribution hacking.
Very broadly there were three principal methods these guys used to get distribution for new products.
The first is through gaining access to an already pre-existing widespread pool of customers. A good story of this is how Claude Hopkinks marketed Van Camp’s evaporated milk.
Back in the 1900’s evaporated milk was a completely standard product where: none of the existing products had an advantage over one another, a few brands controlled 90% of the market, that those brands held that share for many years against many competitive attempts.
Given those conditions Claude’s plan for getting distribution in this highly competitive evaporated milk market was this. In an advertisement he inserted a coupon good at any store for a 10 cent can of Van Camp’s evaporated milk. In return he paid the grocer his full retail price and for three weeks the advertisement he ran told the personal story of Van Camp’s evaporated milk with the coupon insert.
He sent copies of this advertisement to all of the grocers and told them that every one of their customers was to receive one of these coupons. It was at that point evident that they must have Van Camp’s evaporated milk on stock because every coupon meant a 10 cent sale and if they missed it (remember this is 1900’s money), it would go to a competitor.
The result was universal distribution at once. They first tested this plan in a few small cities and next rolled it out to New York City. In three weeks, in New York City, Van Camp’s evaporate milk achieved 97% distribution in groceries stories in the entire NYC area. Just through this campaign alone 1,460,000 homes were all trying Van Camp’s evaporated milk all in the same week.
The second is through making an offer so compelling, literally on the verge of being altruistic, that no one could refuse your offer. A good story of this is the 1900’s a coffee vendor who sold coffee by wagon in 500 cities who wanted to increase his sales.
His experiment was instead of trying to sell coffee to each person he would drop by each persons house with a half-pound of coffee and say, “Accept this package and try it. I’ll come back to you in a few days and see how you like it.” When he came back, he came with both a small gift and a if the person liked the coffee an order to charge the person 5 cents on each pound he delivered from that point forward.
Instead of trying to directly sell his coffee he offered a free sample, service, a gift, and found that such an offer was resistless. The result was 9 out of 10 trials leading to reoccurring sales.
The third is through creating a situation or stunt so outrageous that every media channel will want to write about what you are doing. A good story of this is how P.T. Barnum bought a old woman named Aunt Joice who was believed to be 160 years old and believed to be the nurse of George Washington (keep in mind this was in the 1830’s and its probably illegal to purchase somebody now, so please don’t try this).
She was bed stricken, blind, and couldn’t move much but she was really sociable and would talk for hours about her “dear little George”. Everyone who came to see her absolutely believed her age and she even came with a “bill of sale” detailing her life story with a guarantee on the claims and her age.
P.T. Barnum made on average $1,500 a week (~$30,000 in todays value) showing Aunt Joice off and using the press extensively to drive people to his showings across the country. He would invite journalists, doctors, and researchers to come study her and write their accounts and his exhibitions attracted tens of thousands of people in every city he visited.
When the novelty wore off and visitors started falling off he would secretly write articles disproving the age of Aunt Joice and even went so far as to claim she wasn’t a human being but a “constructed automation made up of whalebone, india-rubber, and springs ingeniously put together.” After these reports came out thousands who had previously not seen Aunt Joice came out to inspect for themselves if she was real and if they had been deceived.
The result of all the press was always a larger audience at every show P.T. Barnum put on. This specific story might sound a little ridiculous in 2012 but the principal still stands: do something outrageous and every media channel will want to write about what you are doing.
Conclusion. These are the three broad principals used over and over again by the distribution hackers of the 1800 and 1900’s: gaining access to pre-existing distribution channels, offering no-brainer offers, and gaining press through outrageous stunts.
These principals were sometimes used separately, in conjunction with each other, or on varying degrees but in every case tapped strongly into one of these methods.
My goal is to apply these lessons to the 8 products I am helping out with and report back to you with some case studies and real examples on how you can use these principals too. Stay tuned.. 🙂
Last week I offered distribution help to the readers of the StartupDigest Reading List.
After vetting through a few hundred applications here are the 7 companies I’ll be helping out with over the next week:
- Crowdflower’s Image Moderator
Really looking forward to thinking creatively and helping these awesome products out!
Today I am trying an experiment which is a little different and a little crazy.
I’ve been studying and practicing the art of getting mass initial distribution and I want to help others who are going through the problems of getting mass initial distribution for their product with my time and personal perspective.
Here are my only conditions:
- You have to have a good product that has already been built.
- You have to have a committed team around you (doesn’t matter if its 2 or 100 people).
- You have to have the ability to produce your product on your own, no outsourcing.
That’s it. If you’re interested tell me about what your working on here.