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“Jamie, our new product has just been launched, could you help sharing it in your fan group?”
This is a request that often appears in my inbox, and most of the time I would turn them down. It is not that I am not willing to help. I like helping entrepreneurs very much. It is just that most of the products that I am asked to help, have very low relevancy to my readers.
The reason my readers follow me, is that they would like to obtain information regarding internet-related entrepreneurship, to help them in their current or future career. But the products that need my help to spread the news, are mostly aimed at general consumers. So, sharing the information about these products to my readers, would not only be of little benefit to loyal subscribers/customers, but it would be of little value to my readers too, if it is not presented as case analyses.
The key point in marketing is to provide your target audience (TA) excellent value, and the key point in branding is to shape the purchase preference of TA. These methods are nothing new to the long-term readers, but when a new product comes into being, maybe because it is too exciting and there are just too many things to pay attention to, I think many entrepreneur CEOs might forget these two central ideas.
Allow me to offer what I think is the ideal managing procedure for when a new product is launched.
Step 1: Define Your TA
It is very difficult to define TA, but this task is the most important cornerstone for great success in marketing. TA of different natures will have different preferences, a single product can hardly satisfy everyone, and so there is a need to segment a group of TA to aim at.
There are many ways to describe the TA, gender, age, income, place of living, education level, nature of occupation, and so on are the most fundamental demographics. Interests, hobbies, favorite brands belong to further psychographics. What have they done, where have they been, what have they bought are the ultimate behavioral data.
Only by being able to define the TA clearly, will you be able to decide on the channel to get in touch with them. Without a clear definition of your TA, the marketing work that follows would be pretty much inefficient.
Step 2: Achieve High Retention
A good product has to fulfill the TA’s needs, satisfy their desires and bring them great value. Whether or not a product is valuable to the TA cannot be proven entirely, but if they are willing to spend a lot of time or money on it, and they regularly make return visits and repurchases, then it could be seen as valuable.
So, the first step in a product launch is not to reach out to a large TA, rather it is to reach out little by little to a couple of hundreds, thousands of TA through your own fan group, then keep fine-tuning the product’s retention based on the users’ experience as well as their feedback, until the product reaches its best condition.
Step 3: Obtain High ROI
Once your product has achieved good retention, you can prepare for advertising, using paid media to enlarge the membership base of the product. However, if the return on investment shows a negative figure, enlarging the membership base would only speed up the death of the product.
Therefore, at the initial stage of the product launch, you need to keep it small, and make sure the return on investment (ROI), which is LTV/CPA (Customer Lifetime Value / Cost per Acquisition) shows a positive figure, or that it would turn positive as the number of users increase. If you are not able to achieve this state, then you should go back to fine-tuning the retention and TA, until you are able to reach high ROI.
Step 4: Enlarge
Once you have obtained high ROI, you could employ various paid media and earned media to enlarge the membership base. Coming to this stage, the importance of a clear definition of the TA would become even more obvious.
You have so many media to choose from, Google’s and Facebook’s advertising platform even provides almost unlimited ways to segment the TA. You will need to rely on the clear definition of the TA in order to choose the media to cooperate with and secondary channel to invest in, accurately and efficiently.
Step 5: Continue To Monitor, Fine-Tune And Expand
Because of the quantity and the concentration of the TA, you would discover that retention and ROI are not unchanged figures. The longer you put the product on the market, the retention and ROI of the members from a single channel would begin to show an obvious downslide.
At this point, you would need to look for other channels to get in touch with your TA, and continue to fine-tune your product to maintain the retention and ROI. Until the day when you “reach the cap” in a particular block of TA, then you have to start thinking about how you should expand the TA of the product, help the product to realize growth to the next phase without affecting the user experience of current TA.
This article is originally written by Jamie Lin, a well-published author based in Taiwan. The article is translated from Chinese by Loh Sin Yee and is reproduced here with permission. Images were added into the article for visual purposes.