Roadkill your competition with these growth tips!
By Team Ankur
Growth rates define success for technology startups. They are designed to grow fast since they fill an existing need and their customers are ready for them. One can choose from a variety of channels, tactics and methodologies to scale good and fast in today’s hyper connected world. Companies such as gmail (with their invite only), Airbnb (with their Craigslist integration), hotmail (with their signature feature) and Netflix which boasts around 150mm paying subscribers made only 1 or 2 moves that were out of box yet they hold them to posterity. Closer to home, companies such as Flipkart, Razorpay and Cult applied winning growth philosophies and metrics. It is one thing to have a growth idea and quite another to give it wings and make it fly. We were joined by Harshil Mathur and Ankit Nagori in conversation with Rema for the 12th edition of Ankur Capital Dialogues and got some great insights into their respective growth journeys.
What can everyone in the b2c space learn from Ankit Nagori from his journeys of captaining Flipkart and more recently, Cult -
- Figure out pockets of growth and excel in them — Who will buy your product and become an evangelist? How can you get the first 50 customers to convince the first 5000 to join your bandwagon? Think extreme customer delight and let their euphoria be your ultimate north star metric. The 3 pillars of delight to customers are Selection, Price and Service/Delivery. You have to have the best selection in the categories they entered. The 2nd pillar — price — the metrics have to be very clearly defined — to be the top 10 percentile in terms of lowest prices on the net. On delivery and this is where Flipkart laid down the holy grail for all ecommerce companies, they pioneered deliveries within 48 hours.
- Master one category before adding another one — Be damn good at one area before entering another. In dance parlance, you want to master the side split on the ground before doing it in the air like a butterfly. In b2c business parlance, founders should drive business in a category, become the best they can at it and then only think of adding other categories.
- Tailwinds matter and how — Could ecommerce or foodtech have been a success had India not been ready to order online? While finding big problems is important, it is critical to check whether the appetite and infrastructure to support your next big idea exist. As a contemporary example — if India didn’t offer the cheapest data and smartphones in the world, how would innovating for farmers to take them on the cloud help? If schools and colleges had not been forced shut thanks to Covid 19, would edtech see the kind of adoption it is riding on today?
- Don’t spend monies on digital marketing to get the first 90% of your customer base — With digital marketing becoming more expensive as the day goes by (cause that’s how bigtech earn their ever growing revenues), founders should never commit the mistake of acquiring customers online by paying for them. To cross the bridge for the last 10%, sure. Once you impose this restriction/rule upon yourself, you are forced to be creative and immersed in the process of selling firsthand, which is the crux of any good founder.
- Spend adequate (>30%) of your time in the market you are building for — This although a no brainer, seems elusive to many, many founders building for the next billion. The next billion is not limited to your maid in Bombay or Bangalore, it includes the homemaker sitting in Chandigarh wanting to supplement her income, it includes the sweet shop in Bareilly that runs 14 franchises, it includes the proprietor of Kanpur’s oldest tannery. If you are building an app for the farmer, spend time with the farmer. Live days in his/her life. Figure out a problem you want to solve for him and deliver euphoria when you do.
- Open an experiential store where possible — Wherever you can open a store for customers to come and touch and feel your product, do. Apple has mastered the art, most electronics stores do it. Indian startups such as Zivame and Ather are good examples. Human beings are tactile. Know this bit of psychology to roadkill your competitors.
What can b2b founders imbibe from Harshil Mathur who started Razorpay when the market was already thriving with fintech startups and odds were against him:
- Define what you want to fix — When starting up, Harshil wanted to solve for SMEs and offer them the kinds of financial services that enterprises had access to. Enterprises are large accounts and bagging one means survival for a startup. However, Harshil saw that they were being serviced well by a suite of players so turned his focus on those who were underserved. Problem statements are the crux of the whole startup game — what pain point are you solving for? It can be iterated several times for it drives how you assess what you build.
- Go deep with your target customer segment — Solve for your first set of customers before moving to any other customer segment. Go deep into the kind of problems your customers face — from not having enough money to pay upfront to needing a rollout yesterday; and meet (later surpass) their expectations on each and everyone of them.
- Use lateral moves to acquire customers — Razorpay spent 0 monies to get its first set of customers. He reached out to potential customers who were other founders in the fraternity on whatsapp groups and through personal networks. Another very unique methodology that Harshil applied was its application of content. It educated its potential customers on success parameters. They held workshops on how to crack YCom or Techstars. Depending on your target audience, there are always tangent ways to acquire them and stay with them.
- Everyone works the phone, yes, everyone! — Customer service rotation should be sacrosanct for everyone regardless of the department and designation. Working the phones helps customers cultivate empathy and learns to cultivate empathy for the customers’ problems.
- Traditional marketing is passe — We encourage founders to make ‘word of mouth’ a barometer for customer satisfaction. Use it deliberately to extend and redefine LTV of existing customers to max in the first few years.
- Expand your horizons — Think of your future markets and address them today. Harshil respected the potential that Tier 2 cities hold and beyond held and took them seriously from the get go. They held camps and sessions in cities far and wide to show what their product could do and to give a user interface experience in the real world. This was way before the next billion became a catchphrase!
- Working with your dream organization is a process — For those in the b2b space, it’s important to remember that building a solution for a large company can take time. Harshil started meeting Flipkart 4 years back to understand what a large dynamic company needs in a fintech vendor, and only won them as an account last year! The harder the fight, the sweeter the win!
While there are many metrics that businesses can use to capture how much customers love your product, such as customer health score, expansion MRR, customer retention cost, churn rate and others, there is none better than the Net Promoter Score to measure their love. Amazon hovers between 7–7.5 usually and Apple’s ranges from 7–8 depending on the model they recently launched. If you are a founder innovating for the next billion and aim to build a company which has an NPS of 6.5 or higher, please reach out to us at firstname.lastname@example.org