“Traction: How Any Startup Can Achieve Massive Growth”

Email marketing

Email marketing can be used for all stages of the customer lifecycle: building familiarity with prospects, acquiring customers, and retaining the customers you already have.

One of the email’s strengths is that it is a way to get feedback from your customers. Allow them to reply with their questions or problems.

For finding customers
Traction channels like SEO and content marketing can help you build your email list. Ask for an email address in exchange to access premium content, a free course related to your area of expertise, a whitepaper, or a video.

Consider advertising on email newsletters complementary to your product.

For engaging customers
Customer activation (getting customers to engage with your product) is very important to success. Email marketing is a great way to improve your customer activation rates. A popular approach is to create a sequence of emails that slowly exposes your new customers to the key features in your product.

Determine the steps absolutely necessary to get value from your product. Then create targeted emails to make sure people complete those steps. For those who fail to complete step one, create a message that automatically emails them, when they’ve dropped off. Repeat this at every step where people could quit.

For retaining customers
The retention emails will depend on the type of product you have.
For infrequently used products, email marketing can be the primary form of customer engagement.

For revenue
A common way to drive revenue through email marketing is sending a series of emails aimed at upselling customers.

Email retargeting is another tool you can use for revenue. For example, sending emails with a special offer to a customer that has abandoned a shopping cart. For freemium products, send an email explaining premium features.

For referrals
If a friend emails you to tell you about a new product, you are more likely to try it.
Some consumer apps ask their customers to import their address books to share the site with their friends (this tactic has elements from viral and email marketing)

Email marketing: How to write emails
The ultimate guide to email marketing
7 Little known techiques in the new email marketing
Email marketing: How Vero got a 450% increase in conversions

Viral Marketing

In the context of startups, “going viral” means that every user you acquire brings in at least one other user.  That new user then invites at least one other user, and so on. This creates true exponential growth. It’s responsible for the explosive growth of startups like Facebook, Twitter, and WhatsApp.

Viral marketing strategy begins and ends with viral loops. When viral loops are working, customers sign up in great numbers at very low acquisition cost. A viral loop in its most basic form is a three-step process:

  1. A customer is exposed to your product or service
  2. That customer tells a set of potential customers about your product or service
  3. These potential customers are exposed to your product or service, and some portion becomes customers themselves.

The process then begins again with this new set of customers. It is called a loop because it repeats over and over again. Each company executes viral loops differently.

Main types of viral loops:

  • Pure word of mouth, your product is so remarkable that people naturally tell others about it.
  • Inherent virality occurs when you can get value from a product only by inviting other customers. For example, if your friend doesn’t have Skype, the application is worthless. Same with Snapchat and Whatsapp. This type of virality comes with the advantage of “network effects”, where the value of the network increases as more people get on it.
  • Encouraging collaboration. The product is valuable on its own, but it’s far more valuable when used collaboratively.
  • Embed virality into communications from the product. Apple, “Sent from my iPhone”. Many software products do this with their free customers. They add branding to free customers’ emails and websites by default which can be removed by becoming a paying user. Examples: MailChimp, Weebly, UserVoice.
  • Products can incentivize their customers to move through their viral loops and tell others about the product. Examples: Dropbox, Airbnb, Uber, PayPal, Gilt
  • Viral loop that leverages social networks to attract new customers to a product or service. The user’s activities are broadcast to his social connections.

Viral marketing tactics

To pursue this channel effectively, you need to measure your viral coefficient and viral cycle time from the start (this will be your baseline). Then get your viral coefficient up and your viral cycle time down to levels that yield enough new customers to produce steady growth for your business.

The viral coefficient, or K, is the number of additional customers you can get for each customer you bring in. The viral coefficient formula is:

K= i* conversion percentage

(i it’s the number of invites sent per user, and conversion percentage is the percentage of customers who sign up after receiving an invitation)

Any viral coefficient above 1 will result in exponential growth, meaning that each new user brings in more than one additional user.

Two variables that affect your viral coefficient.

  1. The number of invites (i) that each user sends out. To increase this number, consider including features that encourage sharing, such as posting to social networks.
  2. The conversion percentage. If your product is being shared but not generating new customers, you won’t go viral.

Viral cycle time is a measure of how long it takes a user to go through your viral loop. For example, you have a viral cycle time of three days if it takes an average of three days for invites to convert into customers. The shorter this time the better.

Run as many A/B tests as you can. Focus for weeks on improving just one metric (example, signup conversion rate).

Map out every aspect of your viral loop. What are all the ways people can enter into the loop (landing pages, ads, invites)? Cut unnecessary steps and increase areas where customers can send out invitations.

Use surveys, sites like UserTesting.com and ask people directly to help you understand why people are clicking on your links and signing up. Common items to test and optimize:

  • Location of CTAs
  • Size, color, and contrast of action buttons
  • Page speed
  • Adding images
  • Headlines
  • Site copy
  • Testimonials
  • Signs of social proof (pictures of happy customers, case studies, press mentions, statistics about product usage)
  • Number of form fields
  • Ease of signup
  • Length of the signup process

There will be subgroups of customers growing far more rapidly than your total customer base. These subgroups are called “viral pockets“.  To know if you have any “viral pockets”, calculate your viral coefficient on distinct subsets of your customers (country, age group).

Since most viral loops are not self-sustaining, you need a constant stream of new customers entering your viral loop. This process is called “seeding“. When seeding, you are looking for people in your target audience who have not been exposed to your product. SEO and online ads are good for seeding.

The easiest way for a beginner is to copy someone else’s viral loop until yours starts to work in a similar way.
Successful viral strategy involves constant testing, measurement, and trying new things. It’s a numbers and creativity game.

Types of viral marketing
How to Model Viral Growth: The Hybrid Model
What’s your viral loop? Understanding the engine of adoption
5 Crucial stages in designing your viral loop
Lessons learnt – Viral marketing
Facebook viral marketing when and why do apps jump the shark

Engineering as marketing

You make useful tools like calculators, widgets, and educational microsites to get your company in front of potential customers and generate leads and expand your customer base. This also can help with publicity and SEO. Consider the tools you build as marketing assets that have the potential to become a continual source of leads.

HubSpot’s Marketing Grader tool
Moz’s Open Site Explorer
Build vs buy calculator
Buzzer created Pablo

One way to boost your efforts in this traction channel is to take advantage of cyclical behavior. Example: Bingo Card Creator makes holiday-themed microsites for Halloween, Christmas, and other holidays that can use year after year.
DuckDuckGo created the microsite donttrack.us to show how Google tracks your searches.
RJMetrics has built several tools and microsites like http://querymongo.com/, http://www.cohortanalysis.com/

Single-purpose tools that solve obvious pain points are best. To maximize impact, put your tools and microsites on their own domains. It makes them easier to share and it’s good for SEO by picking a name that people search often.

Business Development

It’s primarily focused on exchanging value through partnerships. You are partnering to reach customers in a way that benefits both parties.

Major types of business development partnerships:

  • Standard partnerships: Two companies work together to make one or both of their products better by leveraging the unique capabilities of the other. Examples Apple/Nike (Nike+ shoe)
  • Joint ventures: two companies work together to create an entirely new product offering. Examples Starbucks Frappuccino or Doubleshot Espresso (Starbucks and Pepsi)
  • Licensing: Works well when one company has a strong brand that an upstart wants to use in a new product or service.
  • Distribution deals: One party provides the product or service to the other in return for access to potential customers. Example: Groupon, Kayak and AOL
  • Supply partnerships: Help you secure key inputs, which are essential for certain products.

Getting traction from this channel requires strategic thinking. Focus on meeting your startup’s core metrics.

Guide business development partnerships


Sales is the process of generating leads, qualifying them, and converting them into paying customers. It’s a useful channel for enterprise and expensive products because people want a more interpersonal interacion before buying.

To structure your initial sales conversations with a potential client, you can use the SPIN (Situation, Problem, Implication, Need-payoff) question model. It is a four-part question framework developed by Neil Rackham (outlined in his book SPIN Selling).

  • Situation questions. They help you learn about a prospect’s buying situation.  Ask only one or two of these questions per conversation. Questions like, how many employees do you have? Or How is your organization structured?
  • Problem questions. Questions that clarify the buyer’s pain points. These questions should be used sparingly, just to quickly identify the problem they are facing.
  • Implication questions. Questions meant to make a prospect aware of the implications that stem from that problem. (What customer turnover are your experiencing because of this problem?, does this problem  hurt your productivity?). These questions are aimed to make your prospect feel the problem is larger and more urgent than he may have initially thought.
  • Need-payoff questions. Questions that focus attention on your solution and get buyers to think about the benefits of addressing the problem.

Once you undertand the potential customer’s problem and you think your solution can help them, focus your conversation on closing the customer. Get answers for these areas:

  • Process (How does the company buy solutions like the one your are offering?)
  • Need (How badly they need a solution like the one you are offering?)
  • Authority (Who has the authority to make the purchase?)
  • Money (Do they have the money to buy your solution?)
  • Estimated Timing ( budget and decision timelines for a purchase)

Build a repeatable sales model. Picture a funnel. Your first goal is to drive leads into the top of the funnel (often using other traction channels).

The next stage is lead qualification. You determine how ready is the prospect to make the purchase.

Once you have a qualified lead, the last step is to create a purchase timelime and convert prospects to paying customers.

Affiliate Programs

Affiliate programs are frequently found in retail, information products, and lead generation. The affiliates that join these programs vary widely, but fall into the following major categories:

  • Coupon/deal sites
  • Loyalty programs
  • Aggregators
  • Email lists
  • Vertical sites

Affiliate programs tactics

Using this channel effectively will depend on how much you are willing to pay to acquire a customer.

It’s recommended to use an existing affiliate network since it’s easier to recruit affiliates. Setting up an affiliate program on an existing network requires an up-front cost (in some cases more than $2,000).

The other option is to build your own affiliate program independent of an existing network. You recruit partners from your customer base. You don’t have to pay your affiliates all in cash. You can use the features of your product as currency.

After getting customers involve in your program, contact content creators  (bloggers, publishers, social media influencers, and email list curators)

As a startup, when deciding how much to pay your affiliates start by paying a flat fee for a conversion o a percentage of a conversion that occurs.

Major Affiliate Networks

Commission Junction
ClickBank for digital products
RetailMeNot, Inc.

For startups that don’t have a lot of money, affiliate marketing can be a good place to start.

A Primer to Setting Up Your Own Affiliate Marketing Program
How to Start an Affiliate Program That’s Actually Successful

Existing Platforms

Existing platforms are websites, apps or networks with huge numbers of users that you can potentially leverage to get traction (Apple and Android app stores, Mozilla and Chrome browser extensions, Facebook, Twitter, Pinterest, Tumblr, Snapchat)

Strategy: App stores
The most efficient way for an app to get discovered in the app stores is through the top app rankings and featured listings sections. How app promotion works:

  1. Ads get the app into the charts
  2. More people see it
  3. It gets more organic downloads
  4. This makes it go a bit higher up in the charts
  5. Now it gets more organic downloads
  6. People start spreading the word
  7. It goes higher in the charts
  8. Repeat from 5

Initial tactics to get into the charts: buy ads from places like AdMob, buy installs from companies like Tapjoy, cross-promote apps (cross-promotion networks), using services like FreeAppADay. Also publicity and targeting blogs.

For top rankings, you need to have a compelling app that is rated highly on regular basis.

Strategy: Social sites
Social sites remain one of the best ways to rapidly acquire large numbers of customers. It makes sense to focus on platforms that are just taking off.

First, figure out where your customers hang out online. Then create a strategy to target potential customers on these existing platforms.
Create a feature specifically to fill a gap for that platform’s users.
Focus on new and untapped platforms.

How to Research and Locate Your Audience Using Social Media
Where to find your customers online
How to find the most profitable social media platform for your business

Trade shows

Trade shows offer you the opportunity to showcase your products in person. The best way to decide whether to exhibit at an event is to visit as a guest the year before so you can get a feel for it without spending money.

To prepare, make a list of attendees you want to meet at the trade show, and schedule meetings with them before attending the event.

Trade shows give you more direct interaction with customers, partners, and press in a short period of time that most other traction channels. Those connections are especially valuable if your key customers and partners are geographically diverse.

Offline events

When you are in the phase of building something people want, offline events give you the opportunity to engage directly with potential customers about their problems.

Offline events are especially important when your target customers do not respond well to online advertising and do not have a place to congregate online. They are particularly effective for startups with long sales cycles.

Conferences are the biggest and most popular type of offline event.

You can also connect with a target group of customers at a meetup.

Speaking engagements

You can start by giving free talks to small groups of potential customers or partners.

To land speaking engagements you have to get the attention of event organizers. Pitch your talk to an event organizer if you have a good idea and see an event that aligns with your area of expertise.

Make a list of the events in your industry to determine where you want to speak. Different kinds of events have different crowds and different expectations of speakers.

Capture the audience’s attention by telling a compelling story. Tell the story about what your startup is doing and why you are doing it.  People want to know why your are important enough to be giving a talk and what value can you offer them.

Record your speaking engagements and post them online so you can reach more people.

You can also leverage social media to reach people that could not assist to the event.

If you give the right talk at the right time to the right people, it can make you a respected industry leader overnight.

Community building

When building community, it is very helpful to have an existing audience. If you want to build an awesome community, you need to have a mission.

It is also critical to foster connections among your community (through forums, events, and user groups). Community members love to hear about other members but also about you. So connect with your evangelists and let them know that you value them.

Community building works well with other channels like offline events and speaking engagements.

A challenge is keeping the quality of the community high  when you scale. It is important to focus on quality early on and set standards that can be maintained as the community grows. When quality remains high, the community becomes an essential asset for the company. Examples are Wikipedia, Yelp, Codeacademy, Stack Overflow.