‘Be Quick to Cut What Is Not Working And Save Resources’- Chijioke Dozie on Startup Growth Strategies
The UK-Nigeria tech hub organized a webinar on Growth Strategies that startups use to increase their customer base. Piggyvest’s Odunayo Eweniyi, Carbon’s Chijioke Dozie, and Iwoca’s Laurence Booth-Clibborn were the three members of the panel.
Here are the major takeaways.
Cost of customer acquisition should be less than generated revenue
A sustainable growth strategy that increases the number of customers for the startup must take the cost of customer acquisition (COCA) into account. If the COCA is greater than the revenue generated from each customer, then the increase in customer base is of no positive use to the startup.
The return on investment should always exceed the cost accrued from whatever customer acquisition strategy is employed.
Growth of customer base and company is continuous
As a startup continues to be in operation, it reaches a point where it starts growing in terms of customer base, sales, profits and other metrics. For Piggyvest, one of the growth points was getting 1,000 customers in December 2017. The acquisition was as a result of testimonials of existing Piggyvest users on social media, and was just the first of other growth the startup has witnessed.
The individual journey to a startup’s value is what the growth of the startup is hinged on. The goal of customer acquisition is to shorten the time taken to acheve that on a largeg scale.
For a startup like Piggyvest which does not see paid marketing as a first choice, the four growth strategies employed are features, events, content marketing, social and community drivers. The bulk of the growth was not driven by funds, but by the features of the platform itself.
Startups can use positive customer feedback and user experience in content marketing as a means of growing the customer base. Physical and virtual events that push the company’s products and services help prospective customers connect better with the brand than if they had no prior engagement with the company.
The social and community drivers would mean that startups leverage social media platforms and the interactions of users on their social handles. Having a customer-oriented focus in customer service dealings, as well as social media relations will endear the products to the customers.
Paid advertising also works, as Chijioke Dozie, CEO of Carbon, shared from his own startup’s experience. However, testing different marketing tactics and being quick to eliminate whichever is not working is crucial. This will make sure that the startup’s resources are not being wasted.
Being intentional about the results of each advertising route is essential in deciding which one works and which one should be eliminated. Having a system that works well, such as an Excel sheet, for keeping track of efforts and results for customer growth is important to keep the focus on sustainable customer acquisition.
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