The satisfaction trap

With the end of free money being upon us, we will undoubtedly start to wonder more about how we spend our money. That will also manifest itself to the digital products and services we use, where we will be more keen to ensure that we feel, we get real value for our money.

But not only will we do that. We will also insist more on trying things out for free to get a sense of the value at hand, before we decide to commit our money towards a given service.

This poses both an opportunity and a threat to startups.

While the idea of offering something for free and then convert to a paying customer is by no means foreign to startups – it’s called the ‘freemium model’ for a reason – startups need to be very aware that they are not being lured into the trap of having to offer too much for free with slim prospects of ever making the conversion happen.

The nightmare scenario to avoid is one where the startup will need to deliver the full experience and go above and beyond to prove it’s worth to a potential customer only for that customer to choose something different or just stay with their current solution. That scenario will incur excessive cost on the startup with no prospect of recouping that cost, and it goes without saying that that will not be a viable model going forward.

Getting this right is a delicate balance to be sure. Because while a startup won’t want to be caught in the trap, the broad expectation on the customer side is to be delighted every step of the way when trying out a new product or service to see if it fits the customers business needs.

The most successful startups at striking this balance will be the ones who understand precisely what’s needed in order to delight customers – no more, no less – in order to turn them into paying customers. Furthermore, the best startups will understand the need to develop models of payment for their services that grows with the customers needs, keep them engaged while at the same time ensuring that the underlying business model is viable not only in the long term but also in the shorter term.

This is a delicate balancing act, and in order to get it right it will most probably require deep insights into the customers domain area to understand what’s important drivers of customer delight and what aren’t. This again will force startups to reconsider their hiring practices within customer success in order to make it less about generic skills and more about understanding the customers and what they’re actually looking to achieve within their line of work.

Ultimately the point is that not only is the era of free money and uncaring customers over. The era of ‘one size fits all’ customer success and growth strategies is also over. It will take focus, dedication, experience and insight to delight the right kind of customers going forward;

Those that actually end up paying their bills.

(Photo by bruce mars on Unsplash)

Cash value of communication

Often times I meet people who question the value of a focused, operational communications strategy. The argument is that there are plenty of other more important jobs to get done before looking coherently at communications.

Allow me as a former communications professional to take a step back and look at the kind of value, great communication can unlock for a startup. I will do so over a couple of posts here, and today I will be looking at one of the really easy ones to measure:

Sales.

Normally, when we think of sales, we think it of it as an effort to get our offer in front of the right people in order for them to make a decision on whether they want to buy our solution or not. The more we work diligently with sales, the better we will be at getting it in front of the right people, the more hot leads will be created, the better conversation rates will be and – ultimately – the more we will sell.

Ok.

So what role does communications play in that? Let’s look at it from a structured operational perspective:

Let’s assume you have your OKRs in place. You know what your objectives for the upcoming quarter(s) are, and you have identified the measurable key results that will support you in understanding what kind of progress you’re making towards reaching those goals.

If we look at sales, the objective could be to launch a new product successfully, and a key result could easily be to get 200 new hot leads and book 50 first sales meetings.

Ok. Where does communication come into play here?

Easy.

When you look at the job of getting 200 new leads, you need to figure out where to find them but – more importantly – WHAT to tell them in order to get them interested, so they become a hot new lead, you can work with.

In order to know what to tell them, you need to have a clearly crafted value proposition and a wording of it that resonates with the intended target audience, so you can optimize your conversion.

That’s all about communication and getting the actual words right.

Furthermore, in order to be on the radar of your future customers, when you try to convert them into hot leads, you need to have created awareness and a presence about your startup, your brand and, most importantly, your product(s). And you need to have done so in a way that is available and convincing in a way that sits well with your future customers.

That’s all about communication, too.

Finally, when you have the sales meetings, you need to ensure that the people you meet get hooked enough to buy. They need to be convinced by those final killer arguments for why your product is the solution to their problem, and doing so in a scalable way requires not only a solid structure but also – again – the most effective words.

Surprise, that’s communication too.

All in all a focus on great end effective communications is a powerful an extremely valuable driver for driving sales. It’s not just a marketing job – and yes, marketing is communications too. And communications is not only about PR and looking good on SoMe.

So do yourself a favor and prioritize your communications efforts in your startup. Doing it right can – almost – be translated to money in the bank.

(Photo by Tadeu Jnr on Unsplash)