Data Addict

Startups, Self Quantification, and Internet Culture


Archive for August, 2011

Sivers is Right: Customer Service is the New Marketing

Back in June I read an interview with Derek Sivers about his CDBaby customer support. I’ve always found his writing educational, but in this interview his closing sentence struck me as particularly true: “customer service is the new marketing.” That got me thinking about my own experience with Skritter and how much we labored to do marketing “right.”

We started Skritter on a shoestring without the explicit intent to run it like a boostrapped business, but that is essentially what it became. We decided that we would either make money and support ourselves, or stop working on the site. After the first year, the site was generating cash, but not very much. Nick, Scott and I decided we needed to hit marketing hard. We partnered with a great guy in China (Doug) to help us reach more customers and we set about our marketing.

We began with Adwords. We attended several relevant trade shows. We tried promotions and giveaways on the site. We started Tweeting and developed a strategy for Facebook content. We had two marketing interns in China talking to learners on the streets of Shanghai. We were present at Chinese testing centers, we contacted schools to sell site licenses, we did webinars, distributed print ads, setup an affiliate program, spent serious time on SEO, created a content strategy to improve SERP results, collected quotes from marketing consultants and agencies, redesigned the appearance of the site, and conducted A/B tests.

Throughout all of this, we continued to grow, but our growth curve didn’t look a hockey stick, it was the gradual upward movement of a well liked company.

We always made it a priority to bake in tracking to our marketing, and after a year with little to show for our effort, we decided to give it a temporary rest.

That week we watched in amazement as the site kept right on growing, despite negligible marketing outlays. We nervously twiddled our thumbs, waiting for the growth numbers to level out and go into free fall, but that never happened. Instead, Skritter continues growing to this day, and we have strong evidence to suggest that it’s because of the way we treat customers.

First, we conducted a poll of our user base and found that more than 35% of our customers had personally been in contact with either Nick, Scott, or I. That meant 1 of every 3 paying customers had traded a personal email or met us face-to-face! Considering the size of the site at the time, that was an astonishing number of customer interactions.

Second, even after months of no marketing, growth continued unabated. Moreover, we continued seeing a trend we hadn’t paid much attention to earlier: people arriving at the site and telling us (albeit not in an easily quantifiable way) that they were there because of referrals. This was corroborated by a forgotten poll we had done more than a year before which attributed most new inbound customers overwhelmingly to referrals.

So, while we were trying our best to find scalable marketing solutions, all those hours spent in front of keyboards being sociable and helpful to current customers drove site growth. Our customer service has been our marketing, which directly supports Derek Sivers’ opinion.

What’s the takeaway here? Simply put, marketing doesn’t always make sense for startups. Where marketing is concerned there are two schools. The first is the “build it and they will come” school of thought. The second is the “most startups needs marketing” school. We clearly followed the latter and although we are just one data point, when I start another company, I’ll take Derek’s advice to heart and disregard marketing, at least at first. When you’ve only got 5 customers, there’s a real temptation to focus all your time and effort on finding more customers. But that’s missing the forest for the trees.

In our experience, the key to a larger customer base is the person right in front of you, money in hand, waiting to see how you’ll treat them.