1st step to building a sustainable business!
As entrepreneurs / cofounders / PMs here's the first step one ought to take towards building a business that’s sustainable...
What does “sustainable business” mean?
When the confusion is real for some who may correlate to the word “sustainability” as a domain, the meaning in question here is far from that. This concerns the growth phase of the product, how one strategizes, channelizes & aligns teams’ efforts towards improving the probability of hitting success.
Making sales sustainable here essentially means optimizing yields from the sales funnel and that could be achieved by working towards constantly improving the quality of ToFu (Top of the Funnel) leads starting off with prospecting so as to improve the probability of conversions across stages thereof leading to a higher percentage of closures at the BoFu (Bottom of the Funnel).
I learnt about a problem from a recent discussion involving startup founders operating in various streams across the world. The problem was a common one most tend to resonate with & that’s obviously targeted at growth:
→ “how does one find more customers & how does one go about building a pretty strong business pipeline”?
Although a few of them were a part of the exchange, it certainly would have resonated with the whole group (which was easily in 1,000s) for sure. This seems to be a problem spread wide across every startup. When most times the budget is the question, at times it also boils down to clarity over the initiatives, what’s landed them success in the past, what they’ve done so far & mending their ways learning quickly as to what’s worked & what’s not.
But of course, the answer very simply lies in “MARKETING”.
When that seems to be the default solution route suggested by most, it is very possible that nobody has any clarity over:
what route would suit us the best?
how do we arrive at finalizing that ONE route?
how do we choose our content strategy & what do we base that on?
how do we keep the budget in check?
how long do we run the whole operation for?
Only if people had some kind of premonitions about what would work, the depth / impact of a plan, the world would be so simple & things would have been much easier.
Here’s a visual showcasing survey results conducted by HubSpot regarding identifying how users found products aimed towards determining the default marketing channel:
And here’s a comparison of the average cost of operations alongside the probability of success / landing conversions over each of those channels.
So, which channel does one pick / target to build awareness & improve conversions?
One thing is pretty much a given. It is never going to be enough for a business to acquire a few paying customers & hang their boots over it. Come to think of that, it never was & never will be. Even in times of monopoly where there was no competition one could see how businesses strived and strived hard to build what they termed a business pipeline and keep it at a healthy number. And in the SaaS era the waitlist took precedence and centerstage as well given how every website seemed to have a landing page with the words “JOIN THE WAILIST HERE” during pre-launch. But, the key in essence revolves around the initiatives the org. resorts to, to get the word out to as many people as possible, to a sample space that has been identified and earmarked as a target given the persona the problem resonates with to say in the least.
Going by conventional wisdom, the channel with the lowest average cost and the highest probability of conversion ought to be a natural choice. When that could seem pretty straightforward, that in essence is also the whole purpose of this write-up as well.
In technical terms & the language of marketing - ATL, BTL & TTL does offer a decent explanation to all of this.
DEFINITIONS:
ATL - “Above the Line” marketing refers to a form of marketing that targets a wide audience through mass media such as television, radio, and newspapers.
BTL - “Below the Line” marketing is a targeted & direct approach to marketing & includes promotional events, direct mail campaigns & targeted advertising.
TTL - “Through the Line” marketing combines the above two methods. It involves using both ATL & BTL marketing strategies to create a comprehensive, integrated campaign that targets a wide range of consumers across multiple channels.
And now, to the all important question: -
→ Why does the choice have to be JUST ONE between these channels & why can’t it be all (as many) of these in parallel which in essence is what TTL prescribes?
Firstly, a startup needs to be well aware that it is consistently a growing market space & given the cut-throat competition it is very possible that a lack of intent / lack of efforts in the proper direction would mean a huge opportunity loss for the org. Given that scenario, what prompts a startup org. that’s willing to go all-out and mandatorily shell out heaps of dollars to still end up choosing / sticking to ONLY one of the above channels. Does that make any sense?
OTOH it does make total sense to apportion marketing efforts along as many channels as possible given how fuzzy conversions could be from each of them. When cost could be one of the major worries for startups, it ought to make sense to utilize the funds towards the most significant channel with the highest probability of conversion (Online – as far as our data here goes) whilst also concentrating enough on the other channels like enhancing Referrals or pinning on the right GTM channel (like Retail Stores for instance). When building TV adverts may not suit a startup given the high barrier of entry & the not so impressive conversion, one could think of them as a follow-up channel to build mass awareness after embarking & hitting the first step of what could be an exponential growth path.