This is going to be the most straightforward and to-the-point post you will probably read all month. I am not promoting any brand or product, I just want to share with fellow entrepreneurs the strategy that worked for me when I first launched my SaaS company.
Now, before I share details of my strategy, I should caveat it by saying that just because it worked for me doesn’t necessarily mean it will work for you. There can be a lot of intricacies involved. However, this should still give you a general idea of how you could do something similar.
I’m not going to explain any entrepreneurial jargon as I’m assuming that if you’re ready to acquire customers, you’re already familiar with these terms.
When Do I Even Start Customer Acquisition?
The answer is: from day 1. Before I even executed on my idea and wrote a line of code, I knew I needed to verify my assumptions through market research. My market research was just talking to potential customers and some online research.
This period of market research pre-MVP (before I had a Minimum Viable Product) is what I consider the passive customer acquisition stage. “Passive” because I am talking to “potential” customers, but I am not actively converting them at the moment.
During this time, I talked to ~20 people in my industry (marketing) to understand if they faced the problem I was trying to solve. I made sure to get into a mindset of considering these interviews as primarily information extracting and relationship building sessions. The idea of a long sales funnel in hopes of converting them into paying customers one day was secondary.
Here is why this strategy is effective:
- I asked open ended questions and heard them out. I let them do all the talking. People like being heard.
- I maintained a relationship with them. I requested if I could follow up with them in a couple months time and I did. This made them feel like they’re part of the journey with me and made them invested in the idea. Reality is, people like the idea of being able to one day say, “I was one of the first people this now successful company interacted with”. I stayed honest to myself and focused on building the relationship and learning from them, not on the end result of converting them (this is not how you want to approach it).
- I tailored my product to their specific needs. If my product can solve the problem for a handful of people, it can solve the problem for millions. Building a custom product for them gave them a sense of ownership, further investing them in the product.
Spoiler Alert: Of the ~20 marketers I did market research on, 13 converted to become some of my first paying customers. When time came to launch, they were ready to try out my MVP; all because I maintained a healthy relationship with them.
Active Customer Acquisition
This process starts once you have launched with an MVP. Before I pretend to be a know-it-all, because I’m not, I must admit that I had tried a couple failed strategies before I stumbled upon a successful one. I tried cold calling, cold emails, standing outside conference, etc. These yielded no success for me, but it’s in part because I was not doing them right.
I looked at the current paying customers and realized that an overwhelming majority of them came from my “market research” stage. And then the lightbulb lit. Instead of cold emailing and cold calling people trying to pitch them my product, I cold messaged them on the premise of market research and product development.
Here is why this strategy is effective:
- I told people I wanted to meet people like them because they had a lot of experience in the industry and I could learn from them. This made them feel admired and powerful, therefore making them more inclined to help.
- Sales pitches can trigger a lot of unconscious biases and negative perceptions people have towards sales. When you’re sold to, your guard naturally goes up and you’re less likely to want to “give in”.
- Similar to the passive customer acquisition stage, I built a relationship with them to make them feel like they’re part of the journey with me.
- Even if they eventually didn’t end up using my product, the feedback in itself was super useful. You should never stop talking to your users, no matter how large your company becomes.
- With the exception of buying the odd coffee here and there, I spent almost nothing. This is a super inexpensive and easily replicable strategy with long-term benefits. I didn’t have money to run ad campaigns but my laptop and phone alone served me well.
- I only told them about my product towards the end and ensured it was a natural segway. For example, when they would express frustration with a particular problem, I would say something along the lines, “Funny you say that, because (insert how my product solves that problem)”.
Now, you should NOT use this strategy as bait and switch. You absolutely do not meet with someone or get them on a call and shove your sales pitch down their throat. It has to be natural. Also, you want to build a genuine relationship with them so your intentions gotta be pure. Your first 50 to 100 customers are your early adopters and they are your biggest advocates.
Final numbers: In a span of 1 month, I cold messaged over 300 people, heard back from ~80, interviewed ~70, and converted 41. Fortunate to say that I had 54 paying customers within the first month post MVP.
Well, as time went by, customer acquisition became easier. This is because I already had a few users and they were my biggest advocates to others in the industry. But also, I could now use these early adopters’ success stories to highlight in my sales pitches.
I slowly transitioned back into just cold emails with sales pitches as I got too busy to keep doing calls, but this time they were more effective. This was simply because I had evidence and metrics to showcase.
Last but not least, the game and journey is different for everyone so don’t take the above as gospel. The key is to just keep hustling and iterating and you’ll get there, trust me. Your product doesn’t need to be “disruptive” to be a business.
I wish you all the best with your customer acquisitions and feel free to drop a comment or question below 🙂