No matter what business you are in, you need clients to sell. Whether your activity focus on B2B, B2C or any other acronyms, you will have to plan and execute different strategies to attract new clients, retain those that you captured already or upgrade them.
From all those activities, bringing new clients, whether they are consumer or other business, is one of the most difficult challenges, as there is no one success formula.Certainly, there are different strategies that worked, have worked and will work with higher or lower results, but only if your potential targets already know your brand and/or service.
Moreover, does it make sense to apply the same strategies for companies in different markets, different product stages or different industries? At first glance the common sense tell us that it doesn’t sound right.
To start with, there are different development stages (Products or Services) focusing and targeting different population segments. As Diffusion of Innovation Theory (DOI) defends innovation expands into a society according to 5 different population groups, as shown in the table above. Those population groups have different interests and needs. According to that theory it make sense to segment your targets and update your communication strategies.
For instance, if we are a startup pursuing growth and looking for increase our user base or upgrade our service.
- Where do we acquire those users?
- Are we pursuing the right user at the right time?
Being familiar with DOI is crucial not only for product manager but also to marketers. All stakeholder in any enterprise trying to engage with users, clients or partners should be familiar with DOI. This theory is basically just the concept of opportunity cost of consuming any service or product based on the development phase as well as market knowledge.
Not all users of yours, whether they are already in your platform or not, develop trust and respect for your service, brand, company at the same speed. This is why it is so important to segment and to classify all of those according to what their opportunity cost would be. Once you excel in doing it, marketing and customer success strategies will excel as well, because they will handle specific “timing needs”
Timing, educational needs or trust will vary from industries, products or regions. However, within that framework you potential target or customer will always be divided in the population groups shown above. Meaning: before planning any strategy, we should think of the characteristics of every single group. That will help us to design and tailor better tactics, sorting out potential customers and indirectly tackle our need of acquire more users and grow the business.
Sort it out Partner – Customer needs & your will be automatically solved
Any Startup or any other enterprise should consider its market as following before launching or pushing any service or product
- Innovators – These are people who want to be the first to try the innovation. These people are willing to take risks, and therefore also willing to take the pain in early phases.
- Reward their willingness to take the pain, as this could bring them on board for longer, and enhance the word of mouth
- → Usually, lower CAC but high retention cost
- Early Adopters – These are people who represent opinion leaders. They enjoy leadership roles and embrace change opportunities. They are already aware of the need to change and therefore very comfortable adopting new ideas.
- Those that kick the breakthrough off, is where the growth come from.
- → CAC on this population group increase, and on the top of that it needs leaders to back up. Therefore, strategies focusing on innovators are still needed
- Early Majority – These people are rarely leaders, but they do adopt new ideas before the average person. That said, they typically need to see evidence that the innovation works before they are willing to adopt it.
- Strategies such as Business case generates really positive results.
- → Mass market strategies, and more operational strategies. CAC decrease, although taking a look at Churn Rate is crucial.
- Late Majority – These people are skeptical of change, and will only adopt an innovation after it has been tried by the majority.
- Strategies to appeal to this population include information as well as branding.
- → High cost generate low incremental results
- Laggards – These people are bound by tradition and very conservative. They are very skeptical of change and are the hardest group to bring on board.
- Strategies to appeal to this population include statistics, fear appeals, and pressure from people in the other adopter groups.
With these points in mind, designing and thinking how to sort out customer needs, and how to pay off their opportunity cost, would help you to get better impact on your marketing strategies. Moreover, having DOI in mind will let you figure out what your CAC or LTV will look like.