One of the hardest things about starting a company is that barely nobody knows you. It may sound like an obvious thing, but it has huge implications and sometimes it can be neglected. Since all the people within the team feel the product as an important part of their lives, they might be biased assuming that everybody feel the same.
It makes sense, though, they are spending a lot of time working on it, this creates a perception asymmetry between you and the rest of the world. Ultimately this can lead to poor decisions based on what you believe or assume, rather than what the rest of the world actually knows about it - which tends to be close to nothing.
If your product is a direct substitute for something they’ve been already using for a long time, this translates to a “simple” problem of awareness. If you do a good job getting to know the product, its core value and why anybody should care, people might start using it. Then you will get the gold opportunity to deliver value and keep the customer. Sounds easy, right? It is not, but the good news is that if your customer was already using this kind of stuff, the battle for “why I’d need this in the first place" has already been resolved.
So if your product is good enough to substitute the one that they’ve been using, and it comes in a fairly similar fashion, the moment you get the chance to deliver on the expectations you’ll have higher possibilities that the customer sticks to it.
This is not, by any means, what happened to us. It is true that we substitute something that already exists, like keys and remotes. But we do it in an entirely different fashion, so the moment you have never heard of the company, your default feeling is skepticism. The main problem we face is that people are not aware that what we offer is even an option or a possibility. Our potential customer doesn’t know that opening the door with a phone is even possible.
In this context we’ve struggled so much when it came to bring in new customers. That’s because no one knows about us (of course, we’ve been around for just a couple of years…) and accesses are a pretty sensible area to trust a no name company to handle them.
Therefore in order to bring in new customers we needed to execute in three areas.
- Create awareness so our name resonates with within the market segment.
- Explain that opening the door with a phone is possible.
- Deliver a great product so the moment they try the service, they don’t want to ever look back.
Awareness and brand recognition is a tricky thing, specially when you can’t pour tons of resources in media channels and big ad platforms. That’s the case for almost all the companies that are starting up, so it’s not an option by itself. But it is also true that nowadays the internet lets you target people more accurately. We can get really specific about who we want to see our content and those tools are available to anybody.
This is helping surface a whole lot of niches that were not available before, but the catch is that mastering them is also more and more expensive.
Not having a lot of competitors doesn’t help either. If you are a startup and you don’t have any competitors you might have a problem. I don't want to enter in Peter Thiel's territory about competition, but if no one is exploring that space, it might mean that it is not interesting at all. Moreover, competitors will definitely help you heat up the place the firsts days of your existence.
In the early days you won’t die from competition, the opportunity is still huge, so it won’t be “them” who will lower your options of success. Even a big player entering your space is good news, because 1/ it has perceived you market as good business opportunity and 2/ it will bring media attention to your niche. For example, (I know is not fair because it is not a direct competitor, but you get the idea) when Apple released HomeKit, we had our best week by means of traffic coming to our website and also an increase of more than 15% in sales that month.
What Apple (with Homekit) did for startups in the space of the Internet of Things (and specifically related to appliances and utilities) was to light up the entire area and show the world that this is an important market for them.
So, awareness is important, but once the customer gives you an opportunity, you have to deliver a great experience. If you don’t, then all the effort you’ve done to bring the customer to your door becomes pointless.
We’ve noticed that product value is key when it comes to returning customers, but we have to admit an unfair advantage in this area. Lots of products vie for your attention at any moment. Notifications, emails, messages… They are pushing you to use the service and engage with it.
iomando is way different in this regard. Once the users have installed the app, theybwill be coming back by themselves any time they need to access the place (and trust me, this is more than once a day). So, of course we have to deliver amazing value, but we don’t need to worry about them returning if we do a good job, because they will do it out of necessity.
Of course our acquisition process is more complex than the canonical web service, but hardware provides us with greater stickiness and the sole nature of the service gives us the returning customer. Yet obviously, only if we deliver.
So to sum it up, what has worked the most for us is having a great product. The impact that word of mouth has in the sales of a product like ours (we don’t need billions of users to capitalize on them, like a social network) is the most powerful driver of revenue.
But keep in mind that social proof only ignites after the awareness has brought your existence to the customer’s attention and then you have delighted in a way they didn’t expect. If those factors don’t kick in, social proof won’t spread, or worse, they will backfire. But if you deliver on those, then you’ll create a virtuous cycle that will grow by itself.