Tips for Getting Strangers to Give You Money for Your Projects
This is a requested follow-up from my previous post about monetizing your side project.
Your first customer is never as hard as you think. Every first customer I ever received astounded me, because I didn’t even know they needed the product and I knew the person intimately.
From my childhood lemonade stand to the backlink building software I built at HKSEO, my first customer was always someone I knew personally. This was always a boost to my self-esteem, but I don’t have enough friends, family or colleagues to support me through buying the various products I have, so I had to find strangers!
In this post I will tell you how I found strangers to give me money.
Industry Related Open Forums
Open forums allow anyone to register and post topics or stories. Hacker News is the primary source of traffic for this blog.
I have used this strategy to get the first users of a number of services and products in the internet marketing and search engine optimization industries. A lot of these forums do not allow you to post about paid services outside of special sub forums that cost money.
Find your industry’s most open and accepting community, and tell them about your product or service and ask for their opinions. This isn’t a particularly effective way to reach mass-appeal, but you might gain a paying customer or two and a lot of valuable insight, and both of those are equally important to an early-stage product.
Word of Mouth
Word of Mouth is how most businesses get their customers (especially knowledge related businesses, like consultancies). Impress a client or customer, and eventually someone you worked with will switch jobs and recommend your product or service to their new company. The same phenomenon happens when an acquaintance discusses your project with a coworker or a friend who may need this product.
We discussed forums above, and if you think about it, they are a form of social media, and the Twitters, LinkedIns, and Facebooks of the world are just giant forums with a slightly different user interfaces. Regardless, Twitter, Facebook, LinkedIn, Reddit, Google+, etc. are great places to find your customer.
Twitter, Facebook, and LinkedIn have great virality when it comes to spreading ideas and information. You just need to get a page up there, share it will your friends, and a 2nd or 3rd degree connection WILL find it. You will get less insight than you would on an older forum, but you can use Google Analytics to source the traffic, and watch their “Behavior Flow” (by far one of the best tabs in the GA toolbox) to find out the average path through your software. (i.e., they landed, clicked signup, then left might tell you that your signup page needs to be optimized).
Other “new” social media platforms like Reddit, YouTube, Google+, Tumblr, etc. are all very similar to the old-school forums. Find a “Sub” or “Group” that you can talk to about your idea and get the information you need.
Paid Customer Acquisition
This is how the big guys do it, and it isn’t as out of reach as you think. Facebook, Twitter, and Google all have EXCELLENT advertising platforms. My preferred platform is Facebook Ads, and while a lot of people say they aren’t worth the pixels they are printed on, I have had pretty decent luck when running my ads.
For my clients, I have sold, tee-shirts, training and software over Facebook. Tee-shirts was easy, but the most time-consuming, you have to design many, many tee-shirts to get any of them to sell. Training and software took tweaking the audience a little bit, but eventually when you dial in on the right audience, you can get qualified customers for as little as $1.50.
While it isn’t rocket science, you will usually have to spend a little bit of money getting the campaign off the ground and tweak it until you get the performance you want. As with most advertising platforms your CPA (cost per action) goes up the narrower your demographic selection is. This isn’t really a problem, though, because you will receive more qualified traffic that is then more valuable, so the CLTV (customer lifetime value) will be higher, offsetting the higher customer acquisition cost.
Strategies I Chose to Ignore
SEO (search engine optimization) is only a valid strategy if your CLTV is less than the cost of a McDonald’s hamburger. Examples of this are: lead generation, free services that are supported via ads, physical products with a single digit margin, etc.
I worked in SEO for years, and I can say that unless you spend 3 to 4 hours to day keeping up with the rapid changes that Google implements on a daily to weekly basis, you will end up spending more money than it is worth. This is the reason I left the industry and moved to corporate america with advertising budgets in the 7 and 8 figures.
Print Ads are excellent if you have a local, brick and mortar business and you are catering to an older audience and it can be prohibitively expensive if you want to narrow the audience you want to advertise to.
I have used this strategy in conjunction with Facebook Ads to advertise accounting services in a trade magazine ($5k/mo), which did at least pay for itself, because our CLTV was just over $10k. Another client it worked out was in a local parenting magazine ($450/week) for an after school program with a CLTV of just north of $3k.
Print is expensive and you can’t split test it. Your ad goes out, and if it doesn’t convert, you can change the ad for the next printing, but you are out $500-5000 between runs.
Getting your first customer shouldn’t be too difficult if you have a product you have already validated. Most developer and small businesses are afraid to spend money before they have made any. But thanks to the internet the cost to acquire new customers has dropped significantly, so there is much less to be afraid of.
Are there any strategies I didn’t hit on that you would like me to? Put a comment below or send me an email at email@example.com.