Contextual

Category: Cost of Acquisition

  • Forget Content Marketing. Context Marketing Has Arrived!

    Forget Content Marketing. Context Marketing Has Arrived!

    By now you are overwhelmed by the daily volume of blog post notifications, newsletters, and relentless social posts on LinkedIn and Twitter. 

     

    A daily tsunami of content marketing fills our inboxes powered by platforms automating: cold-email, drip email and newsletters. Product-led companies use email as low-hanging fruit. The problem is as McLuhan said: “the medium is the message“*.

     

    Your Content Marketing  competes for your user’s inbox attention along with: other SaaS/App/PLG products, marketing companies, e-commerce platforms and plain-old-spammers.  I’ve even noticed one smart startup only emails on Saturday (no weekend rest for you dear reader!)

     

    Your Content Marketing might be well-targeted, but McLuhan tells us the user will just see it as more junk mail. Add to that floods of App push notifications, social media posts, PR strategies, inbound marketing etc. 

     

    The user is fatigued.

     

    Content marketing** in an internet (SaaS/Mobile App) product was popularised by one of the most successful SaaS companies, HubSpot.

    A Brief Description of HubSpot

    HubSpot’s slogan reads: Helping millions grow better. 
    When the company started out in 2004, they were considered trendsetters from the get-go. HubSpot was the first one to recognize that the disruptive marketing strategies of those days were outdated and didn’t seem to work anymore. 
    Hubspot created inbound marketing  – this focuses on offering help to users and clients instead of interrupting and harassing them with advertisements and solely sale-oriented strategies. 
    HubSpot’s strategies attempt effective content marketing, to help the user solve their problem they indicated they had.

    The only problem is:

    1. a) not all leads are qualified
    2. b) the granularity of audience segmentation is rarely nuanced.
    3. c) it often has no way to update based on a user’s journey. (similar to when you still see ads after you bought a product!)

    If Content (inbound) Marketing is perceived by the recipient (not you as the sender) as spam, then we should all stop spamming right? ????
    Well, no….Content/Inbound is a valuable component of bringing the user back into the app – so lets just get better at segmentation.

    From Content to Context

    Product Led Growth is about making your software at the center of the users happiness (and buying) journey.

    Context marketing is the conscious recognition of the 80:20 rule:

    1. a) new user acquisition is costly – 80%
    2. b) existing user retention (if you have a product that solves the user’s JTBD) costs 20%.  Retention is the most effective spend you can make.
    3. c) your App is a Context marketing platform.

    Like Content Marketing, we aim to help and educate the user – but with Context:

    1. a) Your UX and the customers data 
    2. b) the timing of the user journey is available to you. 

    Being contextual is critical when it comes to user journey and experience. The key point here is to be there for the right person, at the right time, in order to deliver the right content. 

    Product-led companies should deliver (or allow self-service) targeted helpful InApp content to their users; then user engagement deepens and user happiness increases.

    Tools, such as Contextual, can simplify parts of the user journey: such as onboarding or feedback. User journey data also helps with identify the best time to trigger availability of specific and unique content based on the user experience.

    Credit: thewayofdamasio.com

    The Importance of Context Marketing

    Context matters. But why? 

     

    Because of the 80:20 rule discussed earlier, we argue that Product Managers and inApp Growth teams are significantly better contributors to company revenue than acquisition personnel!

     

    As mentioned earlier, timing is one of the defining elements of context marketing. With proper timing, product-led companies can easily deliver useful, helpful content that adds to the user experience and boosts user engagement.

     

    But there are other reasons why context is important. 

     

    Let’s consider Dave McClure’s AARRR! Pirate Metrics through the lens of content and context marketing. McClure’s Pirate Metric is a simple tool created to help with product and business growth by analyzing five concepts, as follows:

    • Acquisition
    • Activation
    • Retention
    • Referral
    • Revenue

     

    The five parts of this model each represent a tactic that, once focused on, can help with product adoption and user retention.

    Does Context Matter?

    Based on this model, content marketing responds to Acquisition. Content (or inbound) represents the channel through which potential users get to know your product and your company. They might hear about you through SEO, social media, content creators, and so on. However, this step alone might not be enough to get to Activation, no matter how diversified your content marketing is.

     

    To get to the next step, you need context. Activation is about a potential user familiarizing themselves with your app or product. For this, you need to be more specific with your marketing by finding a niche that resonates with the potential client. Optimization leads to product adoption and to Retention. 

     

    Just like Activation, according to the Pirate Metrics, Retention is also context-dependent. Through context marketing, customers can better understand the benefits your app brings to their workflow and their life. At this stage, the key focus for product-led companies should be reducing user churn by optimizing the content each user sees, be that through email or in-app notifications. Style the content to the user’s needs to make them feel heard and validate their needs.

     

    Referral represents the likelihood of your users sharing their thoughts about your product with their friends. Think of it as the equivalent of the NPS survey’s question: “How likely are you to recommend this product to a friend?” Happy users lead to more referrals. How to make your users happy? Pay attention to context.

     

    Revenue is the sum of the success of the previous four concepts. It grows exponentially with each happy user. 

    We can see that the majority of these concepts are greatly influenced by context marketing vs. content marketing. Optimizing your marketing strategy to be useful and helpful for your users results in happier people who are more likely to go through with product adoption and spread the word about your app. 

    It’s Time to Focus on Context Marketing

    But how do you do that, you might wonder. That’s simple. Use Contextu.al!

    An easy-to-use and helpful platform such as ours can simplify your life when it comes to context marketing. As our name suggests, we are all about context. 

    Contextu.al knows your users and helps them in their user journey to product adoption and retention by putting the most contextual content in front of them. With us, you can also measure the uplift or increased engagement by the user, to know if we helped them! 

    To get the best tips, notifications, and guides for your users, book a demo with us today at contextu.al!


    * The irony is not lost on us that some readers will have seen this from an email newsletter.

    ** Benjamin Franklin is apparently the first content marketer when he published “Poor Richard’s Almanack”

    *** Banner image credit: freepik.com

  • Product-Led Growth to drive down your CAC

    Product-Led Growth to drive down your CAC

    “Product-Led Growth is about helping your customers experience the ongoing value your product provides…” — Nir Eyal, Author of “Hooked” and “Indistractible”

    A few years ago Wes Bush got started building a community around a way of acquiring customers that was the natural descendent of lean startup.

    He ultimately wrote a book, created an online “Summit” and now has grown to become a physical conference.

    “Product-Led Growth isn’t a tactic or hack. It’s a model that drives teams and companies to deliver the maximum value and experience to their customers directly from the products they build and design. Getting this right means you need a deep understanding of those you serve and how to help each customer become successful. If you can just get these two things right, you’ll increase your odds of building a company with legacy value.” — David Axler, Growth and BD, WaveHQ

    I spoke to the Deputy Growth guys (Francois Bondiguel – Head of Growth and Jordan Lewis – Director of Growth) about their experience bringing the method into a fast growing startup where different stakeholders have different opinions on how to drive leads while driving down cost of acquisition.

    This is one of the main promises of the book: “How to Build a Product That Sells Itself”.

    The point is that advertising is expensive, which means your CAC (Cost-of-Acquisition) is high. The promise is that if you design your product experience, then customers will:

    1. recruit customers,
    2. refer customers or
    3. the product automatically draws other customers in
    4. and the product is so closely aligned to a users “Job-to-be-done” that the churn rate is low and people start to talk as a substitute for advertising.

    The video and transcript are below.

    Conversation Transcript

    David Jones 0:01
    Yeah. So you guys have been been active (or Jordan’s been active) in the product Product-Led movement, I guess you could say. And that seems to be associated with a lot of OpenView Associates, portfolio companies. Do you want to just speak to that about what’s been great about product with and what you think where that sort of fits in the modern way of viewing things is from a product team perspective?

    Jordan Lewis 0:26
    Yeah, I just got back from the Product-Led growth summit in San Francisco that OpenView put on and I could spend in the last three years, it’s gone from 20 people to 80 people in the Boston office to now you know, a conference center in the valley. So it was pretty cool to see.

    Product-Led History

    Jordan Lewis 0:43
    The thing I love about Product-Led is that it really backs the product – it backs the quality of what’s being built to sell itself and it says essentially, if you provide a low barrier to entry, and you get your customers to experience the value you have, if you’ve got a great product that will sell itself. And obviously that that runs out as you get to the higher end of the market and the company like Deputy that has small to enterprise businesses. But we get people organically taking a trial you know that you know thousand plus employees <…> approach we have that really healthy tension with sales like phone numbers a great one, you know, “we should make phone number mandatory” and the Product-Led growth mentality says “no”, and that as part of our CEOs ethos as well, I guess.

    What is Product-Led?

    Francois Bondiguel 1:32
    Yeah, absolutely. I agree with your with your definition and why I mean, ultimately, like, you know, I’ve been working in software for almost 11 years now actually studying my career working as an operation manager for a web design company. And then six months later, you know, three people like through your first created our own SaaS, which we’ve done B2C SAS for about three and a half years. And, you know, when you have a software company, you’re a Product company in the same way that if you are manufacturing, anything physical, you’re product is what sell, you know, you need a great product. And ultimately, you know, if you forget that and, you know, you could make great marketing and great sales and get to revenue, but your product is at the core of what you do and your value should always be valuable is the product delivering on the promise, you know, because saying, as Ashik (Deputy CEO) says, our mission is, every shift on Deputy will help businesses around the world, you know, manage their employee better will increase the employee happiness level. And we make sure that, you know, business don’t break the law and pay employee accurately. If you have that mission on paper, but your product doesn’t deliver, then, you know, it’s kind of funny, right? Where you think Product-Led growth is very much like, hey, the product is aligned with the mission. And, you know, that’s what is driving the growth and what we’re here for is more amplifying that. Make sure that everyone in the world that is relevant should know about us.

    David Jones 3:05
    How do you draw a line between? Or how do you explain to that sales person that wants the phone number in there? What Product-Led growth is, you know, like, okay, sure, it’s, it’s easy to say, okay, it’s a barrier. You know, by asking for making the phone number mandatory, it’s a barrier to actually getting that and you’ll get a drop off rate. Do you literally show the salesperson the drop off rates at that particular point? Or do you go back and say, Product-Led is about aligning that with the mission, how do you how do you kind of communicate that product with…

    How to communicate Product-Led inside the company?

    Jordan Lewis 3:38
    So, in one example we had the salesperson come to me and Francois with the costings right. They are, like, “if we had this built we will get X amount more drop off during the onboarding flow, but we should be able to convert X percent more and therefore the revenue uplift is this”. And that’s quite a compelling argument. Right, but what isn’t there is the costings of sales team itself. The scaleability of that business unit. So there’s other factors that play that maybe isn’t part of the day to day concern? Yeah. So it’s really where we just, I don’t get into that argument because they are right. And there may be a short term view and in a long term view. So so you know, for example, in iOS, we put it we put a field and that didn’t exist before to capture phone number. And we did it in such a delightful way that 55% of the <…> and the sales team are really happy with that. So it’s just about finding a balance coming with the numbers and kind of iterating too mandatory if you have to. But one of the games, for example, and gamification, where you can see here, the third one, which is a blue phone, is to essentially give us your phone number and we say “because we’ll send you a link to download the app”.

    David Jones 4:50
    Yep, gotcha.

    Jordan Lewis 4:51
    So we say “cool, I hear you How else can we get to this result in a way that doesn’t cause drop off?”

    Francois Bondiguel 4:57
    This is what I was talking to, you know Wes Bush?

    David Jones 5:01
    Yeah. The guy who wrote the book.

    Francois Bondiguel 5:03
    yeah. Yeah. So I just actually just done an interview podcast with him recently that that is going to be in the Product-Led growth summit, I think in the end of January, which is a big online event.

    David Jones 5:14
    Yeah, yeah, I saw it.

    Francois Bondiguel 5:15
    Yeah. So I think there’s hundred plus speakers. So I got the opportunity to talk to him. But one of the things that I didn’t discuss with him, but I think could be interesting in this forum, is that, you know, Product-Led growth is not a religion. It’s not something where, you know, like, any decision you’re going to take is just Product-Led growth, you know, like, we’re not on a crusade here. We’re here to have a principle, which we really believe that if you continue product innovation, and you solve real problem with real product solution, then you’re going to win in the long term. But it doesn’t mean for example, if we realize that if you talk to someone, with a conversion rate is 63% then of course, we’re going to try to connect you with someone because you know the revenue is there, right? So it’s a principle but it’s not a religion.

    David Jones 6:05 
    Great, excellent. Thank you.