Updated: Mar 30, 2020
Noticing a small crowd, gathered to watch something, I too stopped, and tried to get a glimpse. I saw a street artist spraying colors randomly on a canvas. The choice of colors didn’t make any sense…yet he continued to spray.
And then, a form emerged!
It was San Francisco downtown — and now the different colors made sense.
The process of finding target audience for your business, is confusing, chaotic, and seemingly random, but, when you do find that audience, the methods, like the choice of colors, make sense.
But where do we start finding the target audience?
There is a method to the madness called finding the target audience for a start up business. And nowadays there is a technical term for it — growth hacking.
Wait a minute — for a startup shouldn’t customers come before a fully developed product?
Lean startup advocates this method. But, typically, entrepreneurs have an idea stemming from their personal passion, or personal need, or a problem they’ve observed in the world. They may decide to design a Minimum Viable Product and test their assumptions about the problem and customer need.
However, they often skip this process.
The process of designing a product and solution happens in a silo, meaning, first the product is designed and once the product or service design is somewhat ready, the entrepreneur seeks out potential customers.
To find these potential customer, a startup needs to use data and then do the unthinkable
When food delivery website Eat24 was bootstrapped, the founders used their own money to fund the operations, so, were forced to stretch their imagination to survive. They looked at the CPC (Cost per click) data at Google, Facebook, etc, and found it was beyond their budget. The data analysis revealed that porn websites offered the cheapest CPC and high traffic.
Cost per impression on porn sites was one-tenth the combined cost on Facebook, Twitter and Google. With no mainstream brands to compete against, Eat24 found itself in a virgin territory, and caught the attention of audience there. And somehow found that people were ordering food while they watched porn.
So they advertised there and then the company started to find its target customers.
AirBnB too used a data driven approach to take off as a company
AirBnB is another interesting growth hacking success story. Initially, AirBnB posted their listings on Craigslist. They used Craigslist APIs to automatically post the available vacancy listings from AirBnB to Craigslist. This way potential customers seeking temporary housing on Craigslist discovered AirBnB. And slowly the company started to take off …
(If you are looking to use Craigslist APIs, you’re out of luck! Craigslist discovered the loophole and has banned the use of APIs)
So, is there a method to find out growth hacking channels like AirBnB and Eat24 did?
Yes there is! Actually, this process is outlined in book called ‘Traction’, written by the founders of the search engine ‘Duck Duck Go’. It lays out seventeen main ‘traction’ or marketing channels.
However, trying all traction channels at once will make the whole process confusing and where you’re sure to fail.
So, they recommend using the power number three — that mythical number — to find the right channel
We pick three channels, based on what makes most sense for the product and focus on just these three channels.
How I used this process to find the target audience for Rockstor.
‘Rockstor’, was an open source Network Attached Storage software solution founded in 2012, and the first few years were dedicated to product development. Later in 2015, they needed to find their target audience, so I stepped in to help them.
And, I picked three channels but started first with the obvious - social media
I picked out the three most common and easiest to think channels : social media, website optimization (SEO, SEM, keywords, etc), and content creation. But, focussed on social media.
For social media, I used the usual, Facebook, Google Plus, Twitter and Reddit. Not only did I create company pages on social media, but also joined relevant groups and communities. This led to some traction, but not a whole lot of it.
Then I picked up content creation. I wrote articles and submitted to magazines and blogs. Some of my articles were published. However, that too did not bring hordes of customers.
Then I moved to website optimization using keywords. To study the keywords used within the realm of open source software, I decided to use Alexa (now bought by Amazon). Alexa showed keywords, competitive keywords but also traffic pattern of Rockstor’s competitors. I studied the keywords, the backlinks, that is the websites, that pointed to the competition’s websites. Rocktor had five backlinks and the closest competition had eighty-three backlinks.
And suddenly I found what I was looking for!
I noticed that most of these backlinks were actually syndicated feed, and not generated by the competitor companies.
What is syndicated feed?
Once a company (say Apple) is mentioned in an article on an authority website (such as Financial Times or New York Times), many other websites known as syndicating websites (such as Yahoo Finance) pick it up too.
And upon further investigation, I found that the syndicating website generating maximum feed for Open Source Software was Distrowatch (similar to Yahoo finance in above example).
After this discovery, Rockstor decided to advertise on the Distrowatch platform
So, after the power of Distrowatch revealed itself, Rockstor decided to purchase advertising on Distrowatch.
For the first few days after advertising on Distrowatch, there was negligible traction. However, whenever Rockstor put out a software update or any sort of announcement, Distrowatch picked it up, and from there the update or announcement was syndicated by other websites.
And what followed was a sudden spike in number of visitors and paid customers on the Rockstor website. This was a windy way to find the target market, but the ‘power of three’ worked!
So, why of three marketing channels and not four or two?
Three ensures focus. Two feels a little too less, and may be you could start with it, and you’ll find yourself left with time to spare. Four is too much, as you are required to investigate each channel in-depth. Three is the ideal number that hastens the process and insures success.
So, in summary,
1. Growth hacking seems something you can’t control or predict success or timing. However, the power of three, gives the process some bounds and a structure. Growth hacking success is only obvious looking backwards
2. Growth hacking uses data to find customer traction channels. Example : AirBnB and Eat24
3. Growth hacking framework is discussed in the book Traction. Rockstor successfully used this growth hacking framework to find its target customers.
Yes, when growth hacking, you can’t see what channel is the right one at the get-go. You will only be able to document your success, looking backwards when it all makes sense, because hindsight is 20/20.