Each week or so, I publish a newsletter called Drinking from the Firehose. It leads off with “One Big Thought.” This series is a collection of those thoughts.
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My first big thought for 2017 comes from an article by my Lightspeed partner Nikki Quinn. In her post below, she details a key success factor for emerging consumer brands in 2017: a proprietary channel to market. It’s too easy to say that “brand” defines these companies. Brand is more of an effect than a cause. The thing these great brands have in common is owning or dominating a marketing channel. I’ll be thinking more about this critical success factor as a consumer investor in 2017, and I’m sure Nikki will as well.
The consumer space is increasingly noisy and the top emerging brands are using novel marketing methods to cut through the clutter. These new, scalable, repeatable, customer acquisition channels to both find and retain users represent a key opportunity for consumer brands to succeed.
Net Promotor Score is one of my favorite tools for measuring customer loyalty. It is often misused and misinterpreted, so I decided to write a post on some tips for using it in the context of a startup.
High loyalty is doubly good. It lowers your effective cost of customer acquisition because loyal customers refer their friends. It also raises your lifetime value because loyal customers (1) spend more with you over time and (2) are more likely to stick with you when times get tough. High customer loyalty should be goal #1 for any product, and NPS is a great measure of it.