Our readers enjoyed our first collection of early customer acquisition stories, so this week we’re featuring 8 more examples of now successful companies who did things that didn’t scale.
1. ASOS – the ecommerce store mailed its own print magazine to 400,000 customers
Ecommerce brand, multi-channel marketing
Back in 2006, CEO Nick Robertson insisted that the glossy print catalog was still key to making the brand an essential part of customers’ lives. Today, besides maintaining a content-rich site, ASOS also has a magazine with a circulation of 456,000 – the 18th largest in the UK, immediately behind Glamour and Closer, and just a handful of places behind New.
Unconditional, free shipping was irresistable
One of the things that kept customers flocking to ASOS was its incredible shipping and returns policy – even in its early days, ASOS was shipping for free and without minimum purchase. That policy has only just recently changed, but ASOS already has a loyal fanbase worldwide.
2. Nasty Gal – no marketing budget, just listening and tweaking
Founder Amoruso would experiment with a product’s display until it sold well
Founder and CEO Sophia Amoruso went from selling things on eBay, to running a $100m ecommerce store courted by the biggest names in venture capital – just by “listening and tweaking”, and a conviction in the power of perception.
“Back then, she selected her best shots for eBay, and posted them on MySpace to get a more qualitative feel. If the bids were lower than she expected and the comments on MySpace were negative, she’d ditch the model and sell the same item on someone new. Now, she still can’t stop meddling – When a wrap dress was getting just one sale a week, she insisted it be put on a popular model. The dress became a top seller at 400 buys a week.“ (Source: Forbes)
“I just tried to elevate everything, whether it was exciting or not. eBay taught me a lot about perceived value, and how to make things look their best. We didn’t really spend any money on marketing. The whole time we’ve just listened and tweaked, listened and tweaked, and listened and tweaked, and that’s what we’re still doing…. It’s what’s great about online.” – Amoruso, for Into the Gloss
3 & 4. Twitter and Foursquare – exploded their userbases at SXSW with guerilla marketing
SXSW 2007 – Twitter lived streamed the conference on huge plasma screens
Co-founder Evan Williams decided to visualize the service on 60 inch plasma screens in the hallways, because “We knew hallways were where the action was”. Twitter created an event-specific feature that allowed attendees to follow a handful of “ambassadors”.
According to Newsweek’s Steven Levy, “Hundreds of conference-goers kept tabs on each other via constant twitters. Panelists and speakers mentioned the service, and the bloggers in attendance touted it.” During the event, Twitter usage went from 20,000 tweets per day to 60,000.
Foursquare – grew average check-ins from 250k to 350k with just chalk and rubber balls
Foursquare didn’t have a booth like most other brands at the 2010 SXSW convention. Neither did it have Twitter’s marketing budget (Twitter spent $11k on its SXSW campaign). Instead, it set up an actual game of “four square” in front of the convention hall, which involved just chalk and two rubber balls.
The game drew thousands of walk-up participants , Said CEO Dennis Crowley, “We played all day long, and there was always a waiting line. We were handing out tee shirts, buttons, and stickers. Anytime someone didn’t know what Foursquare was, we helped them find it on their phone. We helped get them up and running and using it.”
5. Uber – won over local communities with free rides and kittens
Uber responded quickly to calls for help and filled transportation gaps
Uber spent 2013 getting its name out aggressively. During a bus worker strike in Boston, Uber offered free rides to Boston Public School students stranded by the strike. Uber got massive publicity and ingratiated itself to the local community.
Its hyper local strategy worked phenomenally. By the end of 2013, Uber had expanded rapidly from 12 to 35 cities, and was growing its revenue by 18% a month.
Partnered with Cheezburger to raise $14,268 for animal shelters
Uber also hit a sweet spot with UberKITTENS – simultaneously delighting its customers, and getting lots of attention (because cats). On National Cat Day, it delivered kittens to callers, who would enjoy a 15 minute petting session before the kittens moved on.
Needless to say, #ICANHAZUBERKITTENS was a huge, viral success and raised $14,268 for shelters in Seattle, NYC, and San Francisco.
6. Taskrabbit – focused on delighting moms in Boston
Taskrabbit first cornered the market with one mothers’ group in Boston
Taskrabbit is similar to Uber in its hyperlocal focus. Leah Busque talked about Taskrabbit’s early traction in response to a question “How did you acquire your first 10,000 users?”
“It can be tempting to just go really broad, really wide scale, really fast. But for us, we just focused on a customer segment. We focused on this mothers’ group in Boston. And once we had cornered that market with that moms’ group, those moms were talking to other moms on Beacon Hill and Backbay and Cambridge and it just spread from there.”
7. Airbnb – shuttled from coast to coast to talk to their first users
Founders went the extra mile for their earliest users
Founders Brian Chesky, Nathan Blecharczyk and Joe Gebbia acted on Paul Graham’s advice in their Y Combinator days and “did things that didn’t scale” . Specifically, they went to NYC to acquire their earliest users, then followed up with them extensively.
“When New York took off, we flew back every weekend. We went door to door with cameras taking pictures of all these apartments to put them online. I lived in their living rooms. And home by home, block by block, communities started growing. And people would visit New York and bring the idea back with them to their city.” – Brian Chesky, for The Atlantic
“Because of the Democratic National Conventions, some people were using the site in New York and listing places. We would reach out to the very few people we had and get to know them, figure out what products they needed and what we could offer them. We tried to build loyalty knowing that if we did that, they would tell their friends. We’d host parties and meetups and all sorts of different things.
Through that process, they’d get very excited and tell their friends about Airbnb. It was mostly about generating as much buzz and excitement to get them to tell their friends about us.” – Chesky, Startups Open-sourced
Airbnb believed in generating word-of-mouth, which would attract the press, which would generate more word-of-mouth
“We never dressed up in gorilla suits but we passed out fliers in coffee shops, train stations—we did all sorts of things. I don’t know what tactics worked more than others, but I think press was always the number one tactic for us. The press would spark another group of users, then we’d go visit those people and talk to them and get them excited. It was a pattern that repeated itself.” – Chesky, Startups Open-sourced
8. Yelp – grew a loyal user base by rewarding quality reviews
Gave “Kudos” for good behavior
Yelp wanted to create a tight community of consistent reviewers and high quality reviews. It rightly guessed that people were more likely to write in-depth, well crafted reviews when their names appeared alongside them. So it offered special recognition to users who were first to review a business, and let other users give kudos for reviews that are useful, funny, or cool.
And the numbers in 2006 show that most Yelp reviewers got hooked on the site:
Users who contributed 6 or more reviews:
- CitySearch – 4.8%
- Yahoo Local – 11.1%
- Yelp – 65.8%
Users who left only one review:
- CitySearch – 71.2%
- Yahoo Local – 56.4%
- Yelp – 9.2%
Treated their best “Elite” users generously
The most engaged Yelp users are elevated to “Elite” status, visible by a shiny Elite badge on their account profile. By 2006, a full 44% of reviews on the site were contributed by Yelp Elite.
Dave Kim, a six-year Yelp Elite user with over 900 reviews, explains:
“Yelp does a good job of finding ways to reward people, not through monetary means, but little perks … At regular Yelp Events, Elites often got first-chance to RSVP and even got in an hour before everyone else. There are specific events just for Yelp Elite that offer free food and drinks and swag.”
Edited to mention: Groove – reached out to the customers that “got away”
CEO Alex Turnbull has written a very detailed analysis of Groove’s early customer acquisition tactics, along the theme of doing things that don’t scale. The tactic that stood out the most was scrapping – reaching out to customers who chose other competitors, and sincerely asking the reasons for their choice. From the exercise, Turnbull discovered and fixed several bugs, and convince customers to give Groove another chance.
The complete list of early traction tips from some of the best!
From the first collection
- Physically travel to your target user base [Tinder, Alibaba]
- Populate your site with your own content to get other users on board [Quora, Reddit]
- Design your campaign to encourage word-of-mouth [Dropbox, Threadless]
- Facebook can be a great product feedback loop – and marketing tool [Lolly Wolly Doodle]
- Delighting fandoms yields high returns [Black Milk]
- Freemium isn’t for everyone, but it’s cheap and powerful [Evernote, Yammer]
- Write legendary, jaw-dropping content [OKCupid]
- Harvest interest from target communities before launching [Etsy]
- Guest blog like crazy [Buffer]
In this collection
- Market across a variety of channels – print is not dead [ASOS]
- Test continuously – listen and tweak, repeat [Nasty Gal]
- Experiment with guerilla marketing [Twitter, Foursquare]
- Get involved with your local community; meet their needs [Uber]
- Focus on one community at a time [TaskRabbit]
- Personally follow up with your early users [Airbnb]
- Reward mechanisms incentivize participation [Yelp]
- Consult customers you lost to competitors [Groove]
Lastly, a few words on doing things that don’t scale:
Startup growth isn’t as linear or neat as we’d like to think, and there are a lot of very valuable things you can do early on that definitely won’t work later. And that’s okay, because there’s a good chance that without those early battles, you won’t get a later. – Alex Turnbull, CEO and founder of Groove
 The lesson here is not that marketing at SXSW will magically explode your user base. Mark Suster at FastCo advises that this faith is seriously misplaced, pointing out that Twitter and Foursquare cut through the noise by fulfilling a very real need at convention. Twitter allowed attendees to “conference brag”, so SXSW needed Twitter. Likewise, Foursquare allowed attendees to keep tabs on one another’s exact whereabouts, so SXSW needed Foursquare.
 Interesting note: Airbnb also (allegedly) piggybacked on Craigslist extensive network. It’s more folklore than established fact, but there are accounts that say Airbnb allowed hosts to post their listings to Craigslist and directed travelers back to Airbnb for the transaction. Additionally, Airbnb also lured sellers on Craigslist to list on Airbnb, offering a better transaction experience.