April 16th, 2014

Key mobile themes from the 4/15 NY Mobile Startups Meetup

Yesterday’s NY Mobile Startups meetup featured an exceptional lineup of mobile experts, including Semil Shah, Steve Cheney, Jordan Cooper and Sarah Paiji. Over the course of an hour, the panelists discussed a wide range of topics in mobile - from mobile commerce to iBeacons to contextual targeting - and underlined some of the trends I’ve been seeing in the market. To capture this conversation, I’ve summarized the key themes below. Special thanks to Shai Goldman for moderating the panel and Chieh Huang for organizing the meetup.

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1. Look beyond the App Store for distribution
We’ve all heard entrepreneurs complaining about the challenges of app store distribution. ASO is difficult, getting featured by Apple or Google is next to impossible and sophisticated marketing tools don’t yet exist. Even if an app is doing well, it must compete against established players who either have first-mover advantages or deep pockets to spend on install campaigns.

With so little control over their destiny, apps must look beyond apps stores and embrace classical web strategies to rise above the fray. To me, this simply means thinking about marketing in a holistic way and using channels like PR, content, email marketing and SEO-optimized landing pages to drive people down the acquisition funnel.

Jordan challenged the audience to think outside the box when devising a mobile distribution strategy. He recommended that entrepreneurs find new ways to break their app store dependency, in particular by transferring the responsibility for distribution to third parties. His company, Wildcard, which powers the infrastructure behind card-based mobile interfaces, is a great example: it relies 100% on its partners (eg Twitter, ecommerce apps, etc) to scale.

2. Drive engagement through context
Another classic complaint in mobile is that people are unaware of the value that apps can deliver in specific moments and places, which contributes to low engagement. Much of this is due to structural issues of a small UI paired with the growing number of apps on people’s smartphones.

On Android, companies like Cover and Aviate have been attacking this problem by surfacing relevant apps on the cover screen and via the launcher. But they also complicate the UI of the underlying OS, which is why Apple does not allow them in its ecosystem.

For apps, surfacing value in the right context is paramount to driving higher engagement. They simply cannot rely on people to develop a usage habit. According to Semil, there are two ways to do this:

1) Hardware: Using hardware sensors like the camera, GPS or bluetooth low-energy to determine context. One of the most common examples of this is geo-fencing a specific location which triggers a custom push notification. With iBeacons, for example, a big box retailer could automatically be notified of an in-store pickup as a customer arrives in the store’s parking lot. 

2) Software: Developing intelligence around past customer behaviors to personalize the future experience. Sarah noted that traditional ecommerce companies like Amazon have done a great job in this area with sophisticated recommendation engines and behavioral tracking. She added that deriving insights from data is even more important in mobile, where small screens give apps fewer opportunities to correctly guess their customers’ preferences.

3. Develop a strategy for unanticipated intent
While apps may serve a great purpose for anticipated intent (eg Kayak for travel), the existing mobile ecosystem makes it difficult to find the right solutions for unanticipated intent (eg I need to address a problem right this minute). According to Jordan, this leads people to look for answers in the mobile web, which often lags the native experience on important metrics such as conversion.

To better serve their customers’ needs, mobile entrepreneurs should optimize their presence for the mobile web, either by adopting card-based interfaces or creating specific funnels that drive people to the app store. Simple tactics like adding an app store overlay module to webpages, enabling an SMS option or capturing people’s emails are a step in the right direction. While recent stats show mobile apps in a dominant position over the mobile web, this is bound to change. Entrepreneurs who successfully link the two ecosystems will capture both types of intent and anticipate the pendulum swing in the opposite direction. 

4. Understand people’s reality to drive behavior
One audience member was baffled that B2B customers were singing praises for his app, but not actually using it. In response, Steve noted that:

It’s difficult to change behaviors with mobile technology

You could even argue that behavioral change is more difficult on mobile than web because it involves reaching for a device, unlocking it and finding the right app. Even big names like Square Wallet have missed the mark here, despite building very polished products.

To drive behavioral change in mobile, it’s important to understand whether your app is a “painkiller” or a “vitamin,” according to Sarah. Behavioral change is much easier for the former because it involves mission-critical work, whereas it’s more difficult with the latter because existing behaviors are often good enough. The best way to gather key insights on these behaviors is by asking customers directly and mapping out the process/flow that an app replaces.

5. Build a lean full-stack team 
From an investment standpoint, building a great mobile product today is harder than ever. Jordan noted that rising development costs and the need for a full-stack team have make seed rounds in the $500-750K range not viable. He believes that a figure is now closer to $1.5M. This puts additional pressure on mobile teams to build breakout products, many of which stand out through finesse and polish (“the last 10%”).

Steve offered a potential solution: look for top talent among inexpensive offshore teams, like the new crop that’s emerging in Eastern Europe and South America. His company, Estimote, took this route by setting up shop in Poland and attracting developers from top-tier companies like Google. He also noted the number of skilled programmers graduating from college in these markets is greater than ever before, which opens additional opportunities for efficient development.

SUMMARY
The challenges of mobile are many, but the promise of rapid growth in the steps of Instagram, Tinder and WhatsApp will continue to fuel excitement for the medium. As the panelists at NY Mobile Startups meetup observed, the winners will be companies which tap into a core human need, develop new ways to circumvent existing distribution models and drive engagement through meaningful, contextual interactions.

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RECOMMENDED READING: 2014 MOBILE TRENDS
Anticipatory computing
Touch-free mobile interactions
Lightweight engagement
Unifying app discovery
The rise of the mobile marketing manager

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April 8th, 2014

Marketing Fundamentals Canvas for Union Square Ventures

This post first appeared on Medium and includes my full analysis.

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About a year ago, I decided to rewrite Union Square Ventures’ creative logo brief as the firm was redesigning its logo and website. The exercise proved very useful to USV, which benefited from a more compelling way to present its briefing information, as well as the broader tech community, which could see this framework in action.

Today, I’m applying my recently launched marketing fundamentals canvas to USV. I’ve deconstructed each of firm’s key marketing areas to provide clarity around its unique value proposition in the market, target audience and long-term direction. As you can seee, the canvas is a powerful yet flexible tool that applies to VC firms just as much as it does to startups.

Note that I’ve based my assumptions on publicly available information about the firm as well as my personal knowledge.

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Union Square Ventures’ Marketing Fundamentals Canvas

I invite you share your thoughts and feedback on USV’s marketing canvas below.

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March 24th, 2014

Marketing Fundamentals Canvas answers the “Why”

When I launched my Marketing Fundamentals Canvas last week, an important question arose:

How is the Marketing Fundamentals Canvas different from the Lean Startup Canvas?

At first glance, the two frameworks seem similar because they provide a structured way of thinking about companies and growth. In reality, however, they are fundamentally different. Here’s how I explained the difference in my FAQ:

The Marketing Fundamentals Canvas helps companies to articulate their customer-facing value proposition and provides a structured approach for evaluating marketing channels. The Lean Startup Canvas, on the other hand, helps companies to validate and test their business ideas before a concept is firmly established.

But the question stuck, and I could see it becoming a recurring problem as I introduced people to the framework.

As I thought about the problem, I began drawing parallels to Simon Sinek’s work about leadership. In his breakout TedX talk, ”How Great Leaders Inspire Action,” Sinek introduced a simple framework called the Golden Circle. It looks like this:

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Simon Sinek’s Golden Circle framework

Sinek argues that most leaders communicate from the outside in (What > How > Why). They inspire no one because their arguments are functional, rational and bland. Great leaders, on the other hand, communicate from the inside out. They infuse their language with beliefs and emotions, and use those factors to drive behavioral change.

To demonstrate the superiority of purpose-driven approach, Sinek presented Apple’s value proposition both ways:

1. Start with “What”
We make great computers. They’re beautifully designed, simple to use and user friendly. Want to buy one?

2. Start with “Why”
Everything we do, we believe in challenging the status quo. We believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use and user friendly. We just happen to make great computers. Want to buy one?

Bingo - it all made sense.

What makes the Marketing Fundamentals Canvas unique is that it answers the “Why.”

The Lean Startup Canvas, on the other hand, answers the “What” and the “How.”

To go a level deeper, each concept presented in the Marketing Fundamentals Canvas can be rephrased as a “Why” statement:

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The Marketing Fundamentals Canvas explained with “Why” statements

Mission: Why we exist
Vision: Why you’ll take notice
Brand: Why you should love us
Target audience: Why we’re relevant to you
Market niche: Why we’re better than competition
Key message: Why you should listen 

Reading these statements, it’s clear that the Marketing Fundamentals Canvas has a strong emotional core. It aims to articulate the purpose of the company and the reasons why people will choose its product over another. It’s a deeply human exercise and should be approached as such.

Functional modules like “key metrics,” “revenue model” and “channels” are important, but they don’t really answer the “Why.” For this reason, I’ll be including them in later frameworks.

Startups today need to stand for something more than just a list of features or technology for technology’s sake. Doing the Marketing Fundamentals Canvas will help them to articulate the “Why” and arm them with the emotional language to inspire their customers. Once this knowledge is in place, it will be much easier to answer the “What” and the “How.”

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I'm a founder, marketer and mobile consultant. These are my thoughts on building and growing technology startups.

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