It happens all the time. I’m meeting with an entrepreneur, who is telling me about a really innovative product idea for a consumer website. And I’m liking it. We’re going back and forth on product ideas. And before I know it, we’re approaching the end of our meeting. I then ask them, “So, how are you going to acquire customers.” And that’s when it happens. That’s when I realize that they’ve spent all their time focusing on the product/site, and aren’t nearly as innovative when it comes to their customer acquisition plans. They view marketing as something they can “bolt on” afterwards.
The most disappointing answer is when they say “Oh, we’ll just make it viral.” As if virality is something you can choose to add in after the product is baked - like a spell checker. Let’s imagine the conversation at the marketing department of the wireless phone companies. “Let’s see. Should we spend $4 Billion on advertising this year…or should we just make it viral?”.
Virality is something that has to be engineered from the beginning…and it’s harder to create virality than it is to create a good product. That's why we often see good products with poor virality, and poor products with good virality. The reason that over $150 Billion is spent on US advertising each year is because virality is so hard. If virality was easy, there would be no advertising industry.
That’s why First Round Capital’s website has always said: “Too many companies treat marketing and sales as a tactical afterthought. We believe marketing is strategic and seek companies that are marketing focused – with marketing requirements driving product development.”
Customer acquisition (also called distribution) is the number one challenge facing consumer web properties. And that's why I'll be digging in deep on this subject through a series of blog posts where I hope to focus in depth on the challenges (and opportunities) in customer acquisition… Up next: "Business Development and Distribution"