New Company On The Block? Strategies To Acquire Your First Customers
Gaining insights from early-stage ventures in Nigeria, Ghana, Kenya and South Africa.
“When you’re selling any product to a Nigerian, you have to talk about money. It has to be something that will help people make more money. It’s a jungle, everybody is after money. That’s why, as a business, you have to offer enough value to your customers. The more valuable your offer is, the more money you can charge.”
This is the advice of Aaron Ejeme, CEO and co-founder of Zuri when it comes to acquiring customers in Nigeria.
Initial customer acquisition is a crucial part of a startup’s validation phase. I’ve had the privilege of working with the founders of Adi+Bolga, Kweza, Massira, Nadia, Niqao and Zuri while they were building their businesses at MEST Africa. They are operational in Ghana, Nigeria, Kenya and South Africa. A few months down the line, here are some of the customer acquisition strategies that worked for them.
1. Deliver the right kind of MVP
… and don’t shy away from getting your hands dirty.
The minimum viable products (MVPs) of the portrayed businesses looked quite different. They were certainly all high-fidelity, digital products. However, when it comes to delivering them to new customers, the “digital” aspect is very often reduced to a minimum.
Niqao in Accra, Ghana offers a platform that connects merchants with customers who want to make payments over a period of high-priced products.
Niqao made use of a “Wizard of Oz’’ MVP — an MVP where you put up a front that gives your potential customers the impression you have a real working product and they’re experiencing the real thing. (Read more about different kinds of MVPs in this article: 18 Types of Minimum Viable Product (MVP) That Won’t Break The Bank)
Zuri in Nigeria and Kweza in South Africa went for “Concierge” MVPs. They simplified their product by replacing automated components with humans, and basically delivered the value proposition manually.
“In order to onboard beauty professionals to our platform, we offered them a package. Not only did they gain access to our booking platform but we also offered them professional photoshoots to showcase their salons and their services. Since we were a small team, we had to organize these photoshoots all by ourselves; recruiting photographers, finding models, scheduling with the salons, etc. Obviously, we can’t organize 1000 photoshoots a year, so this strategy is not scalable in the long term. But in the beginning, it was a great strategy to get our first customers on the platform!” (Aaron Ejeme, Zuri)
Kweza in Johannesburg, South Africa, enables informal retailers to order products at the best price and receive deliveries directly to their stores. Their founders chose a similar path: They manually took over the order and delivery component of their app. During the first few months on the market, you could see the founders doing the heavy-lifting, meeting several customers a day, negotiating terms with wholesalers and arranging pick-up and delivery.
2. Understand what customers really want
In the beginning, founders spend lots of time on extensive research and customer discovery. When going to market, many think they have a fairly good understanding of their customers. The truth of the matter is that it’s not that straightforward. Customer acquisition only works with customer understanding.
“Our initial goal was to gain a deeper understanding of who exactly our customers were, why there were in business and what challenges they were facing on a day-to-day basis”, says Bekithemba Ngulube, co-founder of Kweza in Johannesburg, South Africa.
By constantly interacting with prospects and customers, you will understand them better.
Zuri Beauty Services in Abuja, Nigeria, is an online platform that helps beauty professionals manage their customers and provides an easy way for people to find and book beauty services. According to its co-founder Aaron Ejeme, the secret is to not ask too many questions, but rather listen and observe. When he meets potential customers such as hairstylists or make-up artists, he tries to have an empathetic conversation with them.
“If you ask your customers “What’s your biggest challenge”, they’ll say “To make more money and to get clients”. But through listening to them we found out that one of their major problems actually is managing and trusting their staff.” (Aaron Ejeme, Zuri)
This ties directly into the acquisition part: When you constantly interact with your customers and empathize with them, you’ll be able to anticipate what they really want. “We are imagining where our customers want to be in the future: They want to grow, become a bigger business, open more saloons and maybe get a loan from the bank.”, says Ejeme. He can then align the company’s value proposition directly with these anticipated needs.
3. Leverage small communities
Word-of-mouth and referrals are still some of the most successful customer acquisition strategies. Everyone can probably think of a product, an app or a service that was once recommended to them by a friend.
A company that combined the strategy of word-of-mouth with the power of small communities is Ghana-based Niqao.
The company first tried to approach customers individually and on a personal basis. Niqao offered them different products that they could buy on credit. The founders, however, realized quickly that the first few customers recommended their service to peers in their immediate network, e.g. coworkers. Since they had similar needs (“One community of coworkers was only demanding gadgets”), Niqao was able to cater to them quickly and partner with merchants who offered the requested items.
The benefits of new services spread quickly within small communities, such as student groups, coworkers, neighbours or family members.
“One person starts becoming our customer, and then it sparks within the community. And word-of-mouth spreads fast because people are close to each other. The community-model really worked for us.” (Osborne Saka, Niqao).
4. Build relationships early
Building relationships is one of the key activities that founders need to engage in. And we’re not only talking about users and customers. Building relationships with partners, legal authorities, associations, and even competitors is crucial to get a business up and running.
Nadia in Nairobi, Kenya is a personalized automated health companion that provides quick medical attention and prescriptions. “When we went to market, we didn’t really know anybody. And no one knew us. As a platform that connects doctors with patients, we needed partnerships to bring on the supply side. Otherwise, our product wouldn’t work.”, says Ahmed Elmi, co-founder of Nadia.
For the Nairobi-based health tech startup, their founders made it a priority to contact as many doctors, nurses and healthcare associations as possible. Cold calling, emailing, visiting, being referred — you name it. Their persistence paid off and they were able to find allies who supported their vision.
“After a couple of months, we’ve really made a name for ourselves in the industry. We’ve established solid partnerships with key players who then referred us to others. Like that, we were able to continuously increase credibility and trust.” (Ahmed Elmi, Nadia)
It’s not enough to launch your product and start acquiring users and customers. Oftentimes, businesses need partnerships in order to provide and sustain their offering: Niqao needs merchants. Zuri needs beauty professionals. Nadia needs doctors.
“We realized early on that we need to establish partnerships with various players in the industry. Our target customers are Spaza Shops. That’s why we started building relationships with their associations and business councils that helped us reach a wider audience.” (Bekithemba Ngulube, Kweza)
5. Meet customers offline
When designing out their go-to-market and customer acquisition strategies, new businesses sometimes jump too quickly into online channels. Website, social media, online ads, content — these channels might all work, but most often over time.
It’s crucial for early-stage businesses to engage with prospects and users “in the real world”, especially in the beginning.
“Our customers are not very tech-savvy. Some have Facebook but are not active users. Many use WhatsApp — but how do we use it as a channel if we don’t have their numbers? So we had to meet people on the ground and present them with our value proposition. In the beginning, we walked around with a printed price list to show what we offer (although our app aggregates and showcases all prices for retailers). In personal conversations, our customers got to see the people behind the app and could get all their questions answered.” (Bekithemba Ngulube, Kweza)
Nowadays, Kweza continues to use sales agents on the ground to engage with and acquire new customers.
6. Organize events
This strategy worked well for companies Adi+Bolga and Massira. Adi+Bolga’s brand BARE uses machine learning and computer vision technology to gather data around black skin and creates conversations around black skincare. They need customers to interact with their platform. However, real, offline interactions with their prospects were what fueled their customer development. Mainly through organized events around skincare.
“We always knew that building a brand was crucial, just as having face-to-face conversations with our customers. Skincare is a feeling. Self-care is a feeling. Our entire story is about how people feel about themselves. And we needed to bring that feeling to them, in a physical way. Offline events around skincare were a great avenue to reach our customers.” (Abimbola-Kofoworola Oladeji, co-founder of Adi+Bolga).
Massira’s whole value proposition is about creating a community of women and a safe space to talk about sexual, reproductive, and mental health. The community is online so that members feel safe because of anonymity. However, offline events proved to be a good strategy “to get the conversation started”.
Massira organized events around sensitive topics, such as sexual health or relationships, invited experts, and offered the opportunity to exchange experiences. “Despite our online community, we realized that we needed a personal touch. People wanted to see who is behind the brand. They wanted to talk to us, get to know us. Then they felt more inclined to join the platform”, says Samirah Maison, co-founder of Massira.
7. Make use of social selling
It’s an advantage for businesses when their prospects and customers use social media channels. However, this avenue needs to be used in a strategic way: Simply reaching out to prospects who have never heard of your brand and trying to “sell” them your product won’t work. It’s just like with personal relationships; if you want to gain something, you need to give first.
That’s when social selling comes into play where businesses use social media to provide value to prospects.
Show interest. Engage with what they say. Comment on what they post. Give insightful information. Answer questions they might have.
“Many of our business customers use social media channels like Instagram and Facebook. First, we tried to cold call businesses that we found online. But that didn’t work because they didn’t know us. They were not even interested in talking to us. We then changed the strategy: Started following them on Instagram, commented on their posts, reposted their content. By showing real interest and establishing a relationship, we could approach them with our value proposition.” (Aaron Ejeme, Zuri)
Massira adopted a similar strategy: The goal of their platform is to offer “a community across sexual, reproductive and mental health”. However, by using online channels, they already started conversations about various topics before users joined their community. Engaging with and sharing other people’s content or answering questions were some of the strategies Massira applied.
8. Make the value proposition clear
It sounds obvious but too many businesses struggle with it. They build great products that nobody wants. Founders need to translate product features into real customer benefits.
“In Nigeria, the economic situation is difficult. Everybody needs to make money, everybody wants to make more money. So what we communicate to our customers (hair & beauty businesses) is that when you use our platform you will end up earning more money. We show them a clear path to what our solution provides to them. With Zuri, you get more clients through the booking system, you prevent loss in revenue through cancellations and you can manage your staff more effectively. So the bottom line is with us you’ll make more money.” (Aaron Ejeme, Zuri)
When it comes to customer development, communicating value and benefits is crucial. And not just in the beginning but all the time. Only when people see a constant value through using a product, will they stick to it. This is particularly important in challenging markets and highly competitive industries.
(Thank you to all the founders for their contributions!
The insights in this article were gained before the introduction of lockdown restrictions during the coronavirus pandemic in early 2020.)
