Suppose that one morning this Fall we woke up to an email from Apple that read: “We have a new iPhone, and we think it’s pretty great. It will be on sale tomorrow at Apple retail stores and on our website.”
No pictures, no description, no Press Event, and no information about the new iPhone other than the fact that Apple likes it and it will be available tomorrow.
There would be lines for that unseen iPhone.
Good marketing may get people in the door the first time, but it’s good product development that gets them in the door the second time and the third time. (Or, in Apple’s case this coming Fall, the fifth time.)
There was a time when advertising was glamorous and brands were built 30 seconds at a time. In those days all you had to do to build your customer base was buy enough television and radio commercials. Getting a new customer was about as easy as getting their attention. Brand loyalty was a two step process:
Discovery → Use
Today, brands are built one conversation at a time. People pay little attention to commercials now and are weary of the new guy who’s selling something. Now people try before they commit:
Discovery → Trial → Use
But it’s not just about using things. We want the best. We want the best lawnmower, the best charcoal grill, the best coffee maker, the best local restaurant, and the best mobile phone. We want to use products and services that we enjoy and appreciate, and we want to tell our friends about them.
Discovery → Trial → Delight → Evangelism
Evangelism is word-of-mouth marketing. It’s the best kind of marketing because it’s honest and personal. We don’t pay attention to television commercials and magazine ads because we don’t trust them. We do, however, trust our friends recommending something to us.
And so, companies want their customers to tell their friends about the product. But try as you may, you can’t force people to talk about your product, which means that the next best thing is to try and get people to at least use it.
Therefore, instead of spending $500 to put their logo and tagline in front of a potential customer, companies are spending that $500, plus operating at a loss, to put their product directly into someone’s hand. They are basically paying us to use their product.
- It’s why networks like Twitter, Instagram, and Facebook let people use their service for free.
- It’s what local businesses are doing when they use Groupon.
- It’s what retailers are hoping for when they sell something on Fab.com
- It’s what HP accidentally fell into when it sold the TouchPad for $99.
Companies are hoping to skip Discovery and Trial altogether with the dream that their product is sure to delight anyone that touches it. They have seen the power of word-of-mouth marketing and now the thrust of their advertising has changed. Advertising has gone from “look at me” to “try me” to “like me” to “please like me so much that you’ll tell your friends about me.”
But if you step back and look at the successful companies that have grown, you’ll see that their success lies primarily in great product development that lead to natural evangelism.
Companies that choose not to spend money on advertising are willfully skipping Discovery and Trial in the hopes of going straight to Delight. This is doable, but it takes either a lot of time or a lot of money.
You can start small and slowly iterate and improve upon your product while gradually increasing your user base through word of mouth. Or you can grow quickly by throwing a lot of money behind your product and paying for people to use it instead of selling it to them.
Both are risky.
If you’re going to slowly build your customer base then you’ll need another source of income to sustain you during that time of growth. But if you’re the one who’s going to pay for the product your customers are using, then you’ll need another source of income indefinitely.