Zero to Million users – A 10 point checklist

Needless to say, the success of any social network/social media products (YouTube) depends on the audience it can attract to the site and its ability to engage & retain this audience.

Easier said than done!! I attended a panel event that discussed exactly this challenging topic – the panel included Aaron Finn (Adready.com & classmates.com), Len Jordan (VC), Todd Sawicki (lookery.com), Yannis Dosios (smilebox.com) and Shirish Nadkarni (livemocha.com). This post has my perspectives on some of the key takeaways from this discussion.

It reinforced my belief that product marketing should be a part of product planning and not an afterthought when approaching the release date. This post covers aspects of product development, customer acquisition and retention

1. Value exchange: If the product involves a registration process (linkedin, facebook, etc) make sure that the process is as simple as possible or ensure a “value exchange” to give the user an incentive to go through the registration process. Example: www.classmates.com would usually ask the user for personal data first and then follow this up with a question about “the school you went to”. As an experiment, the process was reversed – first ask the user about his/her school
à present value using the data just filled: “there is XX no. of your classmates you can connect to” and then offer to exchange this by asking the personal data. This “value exchange” created a quantum jump in the conversion rate of the people who landed on the registration form. The key is to keep an eye out for what works and what doesn’t. Keep experimenting .Also make sure that you have instrumented the analytics to measure the effect of your actions/experiments

2. Niche and branch out: Sometimes it makes sense to focus your first release on niche segments instead of a big bang mass market approach .An example of this approach – RealNetworks in its first online audio venture(late 90’s)focused just on getting out voice quality (not music quality) grade production. This worked for the niche audience for whom “online radio news” was a need and could access the news station of their choice anyplace. Amazon’s initial focus was just on “books”. Both RealNetworks and Amazon have branched out to multiple segments after their initial success in the niche segments. An example of a product still in the niche stage is www.retrevo.com which is a search engine focused on the niche audience – “buyers of consumer electronics”.

3. Let them evangelize: If your product has a premium paid service – make sure there is enough to wow the customers in the free version. Build your product in such a way that the customers can evangelize it. Examples, now taken for granted,” email this story to your friend”, “share this video”, “Digg” this, “Did you like this card – do you want to share this with someone else”, etc.

4. Distributables: Build useful “distributables” that can link back to your site. Make sure that these are simple to distribute online. One example of this can be seen in the way Yahoo distributes its airfare meta search so that bloggers and other travel related websites could add it to their site. A click on the search button would take the users to the Yahoo air-fare results page.

5. Downloadables: It’s debatable on how effective downloadable desktop clients are. Some products are web only; some can be download-and-use or can be a hybrid of both. You need to have the right balance for your product. Smilebox’s Yannis said that about 50% of the users dropped out when they encounter a downloadable executable in the process. On the brighter side, there are some advantages of having a desktop client as a part of your product. The customer does not have to recall & type your website. You have a share of his/her desktop. This in itself is like building a minor switching cost and shields against the competition from stealing him/her from you. Below is an example of widget from Yahoo Travel that sits on the users desktop.

6. First 100 users: Once you have built, hopefully, what is a compelling product; evangelize it with your friends and family. This includes relatives, common friends, posts in your alumni networks etc. This should help the user base reach the 100s. Make sure your product has a good “viral co-efficient” (defined as “the number of additional members a new member brings”). Here is a link that talks about increasing viral co-efficient

7. The next 1000:The next level of growth can be from bloggers, SEO and SEM – follow some of the prominent bloggers in your area (including techcrunch) and build relationships with them by having genuine interest in what’s covered in the blog, contributing to it (comments,etc). A positive mention in the blogs could lead to a considerable increase in traffic. No one discounts the value of SEO and SEM. Some free resources on SEO can be found at (www.seomoz.com). But as a general rule make it easy for users to create incoming links to your site. There is a temptation to create a great “look and feel” by having a lot of flash but remember that this prevents the discovery by search engines, so use them judiciously. Smilebox’s Yannis believed that a combination of SEM+SEO (i.e. the link appearing on the sponsored and general search) has been very effective for Smilebox.

8. Personalization and game behavior: Personalization can be a great asset in retaining users.”My Yahoo” was a great success in spite of a huge proliferation of news sources/aggregators because the user spent more than 3 minutes in configuring the settings that suits him/her. Having done this the user has a great affinity to coming back to what was his/her setup/creation.
Also incorporating competition or game behavior in mundane activities can be a great source of engagement. Livemocha (www.livemocha.com), which is an online place for learning/teaching languages, incorporates game behavior for the interaction between teachers and learners.

9. Market place networks: These are networks/communities that have two user groups with different goals -buyers/sellers, contributors/readers, teachers/students, job-hunters/recruiters, etc- it’s important to move two customer acquisition needles and treat both of them differently, with equal priority as both are equally important to the success of your online network.

10. Acquisition cost: If you are a pure free service (i.e. intent to make zero money from the user/consumer) the cost of acquiring the consumers should be as less as possible (close to zero) Todd of www.lookery.com argues that for such products the focus should be to build a very high viral co-efficient in their product.

Tags: internet, product management, product marketing, product planning, Startup, Technology, user generated content, web 2.0