Starting a new business and embarking on the journey of entrepreneurship is an exciting experience for any founder or solopreneur. Customers are the lifeblood of any business. However, finding that first customer is one of the most challenging tasks for a new business.
In 2008, Dropbox faced the challenge of gaining its first customers in the quickly growing cloud storage and file-sharing industry. Co-founder and CEO, Drew Houston, tackled the challenge by creating a demo video titled “The Dropbox Video,” the demo focused on the common problem of forgetting USB drives and presented Dropbox as a seamless solution. Drew posted the video on Hacker News, a popular tech community, where it quickly went viral, attracting thousands of beta sign-ups. The success caught the attention of tech bloggers and media outlets, generating widespread interest. This initial exposure laid the groundwork for Dropbox’s initial traction.
So, where do you start? Let’s explore some effective strategies that startups can follow to acquire their first customer:
Know Your Target Customer:
Start-up companies must know their target customer based on what problem they are solving and the type of business model that they have. For example, are you a high-volume SaaS focused on supporting e-commerce for home offices? If yes, then your target customers are professionals who work from home and home-based businesses. You should consider, Identifying the demographics, age, interests, and pain points of the potential customers.
- Conducting market research to refine your customer persona and tailor your approach accordingly
- Learning your product-market fit to help you set pricing, delivery methods, online and post-sale support requirements, and volume helps you identify ideal customers and set effective marketing strategies.
- Conducting a period of trials with target customers like friends and family to work out your pain points and build validation
Warby Parker was founded in 2010. They disrupted the eyewear industry by recognizing the industry’s high costs and lack of transparency. The founders conducted thorough research and identified millennials and young professionals as their ideal customers. They introduced a home try-on program and emphasized social responsibility. This deep understanding of their target audience contributed to Warby Parker’s success.
Know Your Goals:
After identifying your ideal target customers, you need to define your goals and objectives. To achieve revenue targets, set goals for your customer acquisition strategy. Keep a close eye on key customer acquisition metrics like Customer Lifetime Value (CLV), Monthly Recurring Revenue (MRR), and Customer Acquisition Costs (CAC). This way, you can craft a customer acquisition strategy that syncs up with your overall business objectives.
Select Your Customer Acquisition Channels:
Figuring out your perfect customer personas and developing your acquisition goals accordingly are necessary steps early in your journey.
Researching and identifying the most appropriate channels for your target customers is essential, —whether it’s on social media, popping up in organic searches, or catching their eye with a stunning paid ad. Dollar Shave Club, founded in 2011, crafted an effective customer acquisition strategy by identifying perfect channels and creating engaging content. They succeeded with a humorous and viral promotional video featuring the founder, Michael Dubin. This content-driven approach, combined with a strong social media presence and organic search optimization, allowed Dollar Shave Club to make a memorable first impression.
Build a Customer-Centric Culture: the Airbnb Story
Airbnb built its customer acquisition strategy by actively seeking and valuing customer feedback. The founders, Brian Chesky, Joe Gebbia, and Nathan Blecharczyk utilized various channels like surveys, email forms, and social media to engage with hosts and guests. An exemplary instance was the “Snow White” project, initiated based on user feedback to enhance the platform’s usability. Airbnb’s commitment to ongoing conversations with its community not only addressed issues promptly but also provided valuable insights, showcasing the power of a customer-centric approach in building a trusted brand.
Networking and Outreach:
Attend targeted and relevant industry events, conferences, and networking functions to connect with potential customers and other entrepreneurs. Networking provides invaluable opportunities to pitch your business idea, receive feedback, and even secure that elusive first customer. Additionally, try to reach out to your personal and professional network for introductions and recommendations. In the early days of Slack, co-founder Stewart Butterfield leveraged the power of networking by attending industry events where he distributed beta invitations to try his platform. During a gaming conference, he discovered broader applications for their collaboration platform and his networking efforts provided valuable feedback, leading to a pivot in Slack’s focus.
Author: Tonmoy Ghosh