Few would argue some really key business tenets:
- It is harder to acquire a customer than keep one.
- It takes a long time (sometimes years) for customers to become profitable.
- The best salesperson you could ever have is your (happy) customer.
I could go on for pages!
Before looking at how to please your client, what does he or she look like? The profile can range from market-to-market, but I believe five things are generally true:
- He is jaded about advertising and therefore often immune to its’ effects
- She is busy. Like, crazy busy. She wants to use your product or service to replace a task that is difficult or time-consuming today. She does not want to learn your unique way of doing it. She might even want to enjoy herself.
- He wants it to work. Period.
- She wants you to own the problem if it doesn’t work – even one time.
- If your product works and is fun to use, he is happy to brag to all his friends about it for the social currency it brings him.
I believe these five things to be true whether your product is a car, washing machine, or espresso maker.
The Dropbox story is well told, but I want to position it against these five points.
- Dropbox tried standard customer acquisition strategies (e.g. SEO) and found that it was costing north of $200 to get a customer with a lifetime value of less than $100. No good. People aren’t listening to those channels.
- You don’t have to think to use the product. It is familiar to anyone who has used an operating system since the original Mac or Windows. Even better – now I get it on all devices. And I get a network effect immediately without additional effort.
- It works. Period. Across all my devices.
- They are always in a state of learning and making it better. Few complaints with 275 million users.
- Sure people invite friends for the extra storage, but they wouldn’t share if it didn’t work. They wouldn’t share as often if it didn’t increase their social currency, if it wasn’t cool to be using Dropbox. How can we be sure? If they shared it and it didn’t work or was a drag, they would have no friends!
It is important to remember that Dropbox entered a crowded marketplace and have since had many large vendors try to take them out. I believe the core of their early success was that online backup and sharing was non-intuitive. Now, they have tremendous loyalty and shared networks. What could possibly make me leave and try another service?
What does this mean for Travelabulous. Let me save that for my next post.
‘til next time … Kirk, out.