How To Get Your First 100 CustomersRamon Ray
Anand Srinivasan, the founder of Hubbion, shares his insights on how to get your first 100 customers. Here are a few ways to do it.
Back in 2014, I published a book titled ‘How We Did It’ for which I interviewed over a hundred entrepreneurs – like the founders of tech behemoths like Freelancer and Fiverr, as well regular mompreneurs who produced and sold maternity gowns.
Although it has been several years since I published this book, the fundamentals of how one goes about acquiring the first hundred customers have not changed – through hustling. In this article, I will offer a short guide on how you may go about this.
Narrow down your target customer
Regardless of what product or service you sell, you need to know who your target buyer is. But here is the thing – oftentimes, the demographic that has the highest chance of converting may be abysmally small.
For instance, if you sell CRM software, then you could practically target any business entity with your product. However, to optimize your conversion rate, you should be targeting a segment that is underserved by the current fleet of CRM applications available in the market.
When you narrow down your market this way, you will find that there are only a few hundred or so prospects you could target. While the market opportunity here may seem low, this is exactly the kind of market you should go after when you first launch.
As you grow, you could target industries that are upstream or downstream to your current target market – and this way, you could broaden your market over time.
Find the best ways to target them
Now that you know what customers you should be going after, the next step is to figure out the best way to reach them.
As Paul Graham put it, this is the point where you do things that do not scale.
If your target customers are all within the same city or town, you should consider knocking on their doors.
If they are all in a very niche industry, you could attend a convention and reach out to them here.
As a last resort, you could also look into cold calling or emailing (assuming you comply with your local laws regarding this)
How to acquire 100 customers when you have no history
At this point, you have figured out who your target customer is, and how you should be reaching them.
The question still remains – how are you going to pitch your product to this prospective buyer? What makes you stand out from established competitors in this space?
The easiest answer to this is to lower your price. It’s an easy decision for the buyer to make when you are the cheapest provider in town.
But this is seldom a good strategy. Competing based on price is simply a race to the bottom. There is always someone who is ready to charge lower than what you do.
This is especially a bad strategy when you are starting out and do not have the runway to sustain without turning a profit.
What you must be doing instead is to offer the value that your competitors cannot or won’t do at their scale.
Here are some examples of how you do this.
- An apparel maker can offer custom-stitched products to customers.
- A CRM tool can offer custom features and APIs specific to a customer’s requirement
- You could offer free installation and onboarding for long-term contract customers
The point is to come up with a value proposition that customers need, but cannot find among existing providers.
As a business looking to find its first 100 customers, you shall realize that this strategy can help acquire customers at a much higher conversion rate than what you may have otherwise achieved.
Free vs. Paid Acquisition Strategies
Sure, you can knock on hundreds of doors to get your first hundred customers. However, what you are basically doing here is to trade money with time.
If you are a founder who can afford to pay for marketing, then, by all means, the paid acquisition must be your top priority.
Here’s why – paid acquisition channels cost money. But they also help you acquire customers much faster than free strategies.
What this means is that you can make bank sooner, and this gives you a better chance at building a sustainable business.
But there are a few things to note here.
Traditional paid advertising channels, including PPC and display advertising have long sales cycles. People clicking on your ads could potentially offer their email addresses or phone numbers. But you are still going to spend some time nurturing them and turning them into paying customers.
This is a luxury that not all businesses have.
If you can afford to spend money on advertising, consider these two specific channels.
Advertorials – You may have come across native ads on media outlets like CNN. These are often advertisements that look similar to regular editorials.
An advertorial is a fantastic platform to sell a hitherto unknown brand because it allows you to build the narrative and describe your product with the help of a story.
An average visitor spends mere seconds on your webpage before bouncing. But advertorials typically have longer attention spans, and this gives you the extra ammunition to nurture and convert customers right away.
Coupon marketing – Earlier in this article, we talked about the risks of competing on price. However, coupon marketing works because, unlike a price war, you do not bring down the value proposition of your product.
Instead, you create a sense of urgency among prospective buyers to get all the value you offer at a lower price.
The general rule of thumb while seeking your first hundred customers is to hustle. It doesn’t matter whether you can sustain this strategy or not. As long as you are experimenting and finding clever ways to reach customers, you are doing it right. Perseverance is ultimately the difference between those who succeed and the ones that fail.
Anand Srinivasan is the founder of Hubbion, a suite of free business tools and resources. He is the author of “How We Did It – 100 Entrepreneurs Share The Story Of Their Struggles and Life Experiences”