Last updated on June 1st, 2020
The COVID-19 pandemic has severely damaged businesses in so many ways. Small businesses particularly have mostly lost their ability to compete due to their limited resources. They are finding it hard to adjust to the new harsh realities. But following some new marketing and branding strategies can help them emerge as a winner during these difficult times.
Most small businesses were not prepared for the coronavirus pandemic and it struck them all of a sudden out of nowhere. The crisis has now completely changed the ways of running businesses. Many companies have switched to online for selling their products. However, a few changes here and there in the conventional marketing plans will not yield the results. Some entirely new thinking and strategy at the basic level can do the trick for businesses during the crisis.
Growth Marketing Is The Key
Considering that, Designhill, the leading creative marketplace, conducted a webinar to address this issue for businesses. The marketplace invited Neilo Leone, the founder of Urban Monks to share his views on the new strategies businesses should adopt during the crisis. The topic of the webinar was ‘Marketing & Branding Challenges for firms during the COVID-19 downturn. The webinar was held on May 8, 2020.
Nelio Leone is a renowned marketing strategist who is also CEO and founder of @Urban Monks. He is a growth marketer and helps businesses build digital brands. He is known for implementing effective conversion funnels. Companies like Careem and a laundry startup called ‘Washermen” and many others have benefited from his growth hacking strategies. His new marketing tactics have specially come to the rescue of entrepreneurs who are stuck in the pandemic situation. He has given such businesses a smart new angle to think and implement marketing plans.
During the webinar, Nelio shared his growth hacking marketing views based on his first-hand experience of working with different companies. He gave valuable tips on how your business can get prepared to face the crisis and replan your marketing and branding strategies.
Here Are Some Excerpts From The Webinar Where Nelio Leone Advised Businesses On How To Prepare Well To Be Competitive And Relevant During The COVID-19 Crisis
What is growth marketing?
Growth marketing or growth hacking started with the original growth marketer, which is Sean Ellis. He is a big advertising guy. When banners were a thing back in the 90s, he was in one of the top teams of banner ads. When it started to burst, he started his own company and realized that pouring money in a lot of banner ads was stupid. It didn’t bring a lot of conversions.
Growth Within The Marketing Funnel
Ellis developed a new system to engineer a system that brings a lot of conversion without spending more money on banner ads. He started to engineer growth within the marketing funnel that you already have. I’m a big fan of him because he understood how to engineer growth form within the funnel. After engineering this funnel, he went to Eventbrite and then to Dropbox. He proposed his formula to Dropbox members who adopted it. As a result, the new Dropbox scaled as fast as any tech company has scaled up today. It’s the fastest-growing company in Silicon Valley and tech history. He repeated the growth story at Eventbrite as well.
Later, he wrote a book on the growth hacking – Hacking Growth, which I consider as my personal marketing Bible. This book is my point zero. When I went from corporate to startups, I read that book five times. If you guys haven’t read it, I recommend you to do so. If you do not read it, you are missing on the key documented process to get that mindset right.
What happened at Dropbox was very significant. Once he established that process and understood that growth was cross operational, he wanted to serve people whose true north is growth.
All these marketers would come to him with three-year plans and business plans that do not apply to environmental scarcity. These plans apply to normal businesses that have money to wait for 12 months before seeing results. What really mattered for him was people who were focused on. He was interested in the use cases that were analytical, inexpensive, creative and innovative methods to acquire, activate and retain customers. I’m a big fan of Sean Ellis, and I do recommend this book Hacking Growth.
What is the difference between traditional marketing and growth marketing?
Traditional marketing is all about stakeholders, management, and process iteration. These types of marketers focus on reapplying the same processes over and over to have a predictable result. And that is aligned with all the different stakeholders internally, in startups, or in tech companies. You do not have the luxury of time and resources when there is high volatility in the process.
It is like the difference between the pirate and the Navy guy. The pirate is always looking for a solution to adapt to the environment instead of trying to control the environment. At one time at Twitter, they thought they were plateauing in terms of active users. Then the new head of growth came in with this new high tempo testing methodology. And that’s when this person said, if we don’t start testing more things systematically, in a shorter period, we’re never going to grow. And when they started to implement this high tempo testing methodology, Twitter became Twitter. It is an excellent explanation of what growth hacking does.
Pillers Of Growth Hacking
So, growth marketing comprises of pillars:
- marketing and sales,
- marketing and behavioral psychology,
- data and experimentation,
- tool stacks, and automation.
After you master these pillars, you become a growth marketer. But what should you be doing to become a growth marketer? Well, you need to get the new marketing skillset. The beauty of growth marketing is that you will never be a complete growth marketer because it never ends. So if you’re an infinite learner, then this field is for you.
It is fascinating to do growth marketing as you start from the statistic and then promote programming to analytics to psychology and brand storytelling. Once you start diving into it, you know that every skill set has a given framework. So, you have frameworks for statistics and data science, programming like UX UI, especially on the front end, analytic analytical framework, and behavioral psychology framework.
So everything is pretty much captured in a framework with a set of very practical and applicable knowledge that is simply fascinating. Interestingly, a growth marketer or growth hacker is a product marketing generalist, he or she truly masters only two verticals, but then has to have that broad knowledge across the T shape.
A Tangible Skill
One of the reasons why I’m really passionate about growth marketing is that it is a very tangible skill. When you hire growth marketers, you need to question the mastery of the different tools they use. This is because if you are just a digital marketer, then you are good at advertising. And that’s pretty much it.
When you are a growth marketer, you have tool-based skills. So, this super hard, tangible skill is extremely empowering. This marketing skill comes from startup tech trenches, and it deals with an environment to a scarcity situation. There are no resources. Growth marketing is desert tested.
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Six-Step Proven Framework Of Growth Marketing
- Identify the pain point.
- Map out your growth funnel.
- Identify the point of differentiation of your product.
- Identify frictions.
- Define what are the growth channels
- Build content, which includes advertising as it is nothing else than competing with organic content.
Step-1: Identify Pain Points
The first and foremost step to take for growth marketing is to identify the pain point. So when I first joined the laundry company, Washermen,they told me that customers who need suits need the company’s services. But later, as I asked their customers, it was found out that the big problem that the laundry solved was giving back people’s time. So people would say that laundry is a waste of free time, or they have got too much laundry. These were the problems that we were solving.
Step-2: Map Out Your Growth Funnel
We mapped out the entire growth funnel. To do that, we went from acquisition activation. We understood where the problem was, and I realized that talking to people for almost the first two months after taking the responsibility as the head of growth. I simply took the phone and started talking to our customer database. So if you have a business, even if you have only 10 clients, schedule some time with them. Call them to understand the issues and do this inward work.
It was clear that we had a top-funnel problem. The top of the funnel was fragile since the rest of the experience was pretty good. So we couldn’t complain about the rest of the experience where we were weak was simply on the top of the funnel.
The company didn’t have a problem with the retention of customers and engaging them with the brand. The problem with the brand was that people would not understand who we were. This is where we applied the third step, which is the point of difference. We realized that Washington was better than regular laundries. It was not because of their marketing, but because of the strong operations that we had on the back end.
Step-3: Identify The Point Of Differentiation Of Your Product
So, people were very excited about the product. The investors told us that we had a great product. But the problem was that we did not have enough acquisition. It was then that we started to understand what really would make our customers unhappy.
I realized that inner data. We started picking up all of our databases, which was not very big. I started thinking in terms of clustering by behavior. So there was one group that was had no problem with the product. But there was one group that got my attention. These were people who used to spend a significant amount of money with us, meaning that their average order value was almost like twice what it would normally be for the average customer.
Conversion Issue Resolved
And so we thought that why these wealthy people were not converting anymore. Why were they churning? Why were they leaving us? We thought that might be we ruined their clothes. Only 4% of that cluster match with data of ruined items. So, we checked on Google if there was a new laundry in their neighborhood. But that data set was so scattered across the city, that while they couldn’t be like a laundry. That didn’t make sense. Then, we thought that maybe the wealthy people went back home. It may be that they left Dubai for good.
We called them, and they still had their number valid, and they were still living in Dubai. So what was the reason? It could be that people like all these customers, the premium VIP customers, were all environmentally aware. They might felt terrible about the number of plastics that we would deliver to make sure that the shirt or the clothes would be like entirely hermetically sealed to ensure top-notch quality.
Price Sensitive Customers
And then the second thing was that people were price sensitive. We went on social media, and social media confirmed this. Out of desperation, we use your full service for the first time this week. Regular laundry charges less than half of our rates. This was due to the plastic mass after we packaged every single handlebar item in an individual bag, and it was ridiculous.
That means that the most significant VIP segment of users of less than 100 people was paying all of our startup’s bills. These guys were actually the most important customers that we had on our address book. And this is what they were complaining regarding the service. So what to do?
To address this issue, I went to my CEO, my chief operating officer, and basically what I told them is that we need to find a solution against the use of plastic. We need to send the clothes in recyclable plastic or whatever that is. They were complaining because we were charging a lot for a shirt. Well, if we start using these like super new cool, no plastic things, well, that shirt will cost them twice and it will have an impact on pricing.
Therefore, we thought of removing plastic from the packaging of laundry clothes. But then, we felt that if we remove plastic, it would be hard to ensure the same level of quality of the clothes. So, it was a bit of a difficult problem to crack. But we eventually did. And stay tuned, because at the end of the presentation, I’ll show you how we cracked this problem.
We like our channel Google because it makes sense. If you need laundry, you’re going to type laundry. It is Yellow Pages sort of business. While you are looking for laundry near you, it makes sense to spend all your marketing budget on Google. If you are looking for laundry, well, you better spend all your money in ranking first every time someone types that they need laundry. I realized that yes, Google was the fastest-growing channel, and it was growing by nine x.
Step-4: Identify Traction
However, the mass of our market was on Facebook. And this is what we mean by the growth trap. Is that because the channel is growing faster than anything else, you start investing more money in it because you feel traction? And as an entrepreneur, you love traction. You love feeling the wind, like that tailwind that is driving you fast. But the problem is that while you are going fast, you are pretty much going nowhere.
Step-5: Define Your Growth Channel
So it’s not about speed, it is about direction. We started directing our focus towards the channel where most of our potential users were. These channels were Facebook and Instagram. And that’s where we began shifting the channel. So this is what we learned from this experience of Washington.
In my first six weeks with the company, I understood that people didn’t care about their professional attire. Instead, the pain point we solved was like they had no time, and they got too much laundry. The top funnel had a problem. So, people love the service, but they weren’t proud of being a Washington customer.
So, as an eco-friendly company, our VIP customers perceived us as too expensive. And then the last thing is that we were focusing too much on Google. While we fired the Facebook guy as the channel did not bring any results, we had to prioritize Facebook because that’s where the market was.
There is a difference between two types of marketing — push marketing and pull marketing. I need to buy a new phone. It’s the market that is pulling the demand. But for a product like Washington, your phone could become your washing machine. That is why most of the innovative companies focused on Facebook and Instagram because you need to suggest the idea to people that this is even possible. So keep understanding where the growth channel is based on push and pull marketing.
Step-6: Build Content
Then we started building content, and by content, I also mean ads. Why? Because I am a firm believer that ads are nothing else than an element that you force into people’s feed, that is simply competing with other countries. Imagine that if you go on Instagram today, you’re going to see the feed of your little sister, your mom selfie with their dog, your friend doing yoga on the beach, and you’re going to see an ad. So you’ll agree with me that that ad is competing for your attention. And that attention is competing at the same time with the yoga, the dog, and with your little sister.
Talked About Value Of Time In Content
So, what I needed to make sure that our ads or our content would really convert if we would talk about the value of the VIP customers’ time. We would boost awareness with eccentric designs because laundry is boring. So it was our job to make it eccentric, insistent system quality and customer service, and then make people feel that Washermen is eco friendly. This is even if we drop like tons of plastic each time they order a shirt insist on the entry-level offer, so it’s not perceived as very expensive and then optimizes all the content for Facebook.
I realized that the company had 21 vans running around the city, and these white vans were white. These vans were like moving billboards, and therefore a vector of growth. We could not afford to buy billboards in town. The van driver has a little device like an app, which app will bring all the vans where the demand concentrates.
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So you’ll agree with me that if you’re on a third date on a Thursday at 5pm, everybody in Dubai Marina is ordering laundry, well, then all of those 21 bands are probably not like 80% of those 21 bands will go to Dubai Marina. They will congest that area. You’ll start seeing as you come back from work, Washermen back then, as you enter your building. Oh, there’s a Washington, another Washington man Park. Oh, there’s another Washermen van blocking the traffic.
People would see them so much that they would perceive that these guys are everywhere. These guys are huge, even if only 21 vans are running across the city of almost 3 million people. We branded our vans and made them visible to everyone at the right time in the city.
Due to this strategy, our growth started to pick up the day when all of our vans started to be branded. The cost of this was very cheap.
COVID-19 has made businesses rethink their marketing strategies. Nelio Leone, the renowned growth hacking expert, advised businesses to adopt a six-step plan to deal with the present crisis. He gave tips about identifying pain points and map out growth funnel. Then, identify traction and build your content accordingly.