Marketing to a Digital Audience
The Pandemic certainly has turned things upside down, traditional businesses were left with a choice whether improve their online and digital play or perish. It also made bare the fact that today businesses can’t really stay purely offline, there has to be an online component to it as well. I have tried to capture Marketing in the Digital Age with a special focus on Online courses which have seen a boost during the pandemic. I have also tried to touch upon why this business model is something which is here to stay and what it takes to get it right and become successful.
What is Marketing and how has it evolved?
Let’s just from the very beginning, Marketing can be defined in several ways, the most common one which I remember from B-school is the one described by the chartered institute of Marketing which says “Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably.”
Now, Marketing in itself has evolved a lot over the years. As Professor Philip Kotler recently put out on one of his posts describing the journey from Marketing 1 to Marketing 5. Marketing 1 was centered around the product and selling. The aim was to use any method possible in order to get a sale, Marketing 2 brought about a better understanding of the consumer and how the consumer makes buying decisions. Marketing 3 asserts that marketers should create, communicate and deliver value that improves the lives, well-being and happiness of the consumers. Marketing 4.0 is the latest iteration in this journey which deals with the digital revolution which has changes marketing and how we understand consumers. Today, most of our consumers have a digital presence, thus the traditional way of Marketing would have looked at customer segments and cohorts, now with digital mapping of customers we can look at the individual customers and how they behave. These individual customers can now directly interact with brands as well through social media platforms like Instagram, Facebook, twitter etc. Finally, with ushering of AI/ML we are now onto the next evolution of Marketing which has been described as Marketing 5. Now, one can argue that AI/ML has been around for some time and what we are seeing is not exactly Marketing 5 but instead Marketing 4.1, but these are mere exercises in semantics. The idea though is clear.
2 Lessons for Modern day Startups
Needless to say, today it is imperative that we have a sound understanding of the Digital medium and how it operates. Businesses that can leverage technology are the ones which can scale the fastest and can grow. Again, going back to my B-school learnings and the course on entrepreneurship which we had in Term 2. There are 2 things that I essentially remember from that course, first is that for a startup today to grow and achieve scale, it needs to be tech based or at least leverage technology and secondly, all great startups are always at the frontier of human knowledge. Now, the first seems quite intuitive, the second might have its detractors. Having said that, let me try to explain the two.
Insisting for startups to be tech based or at least one that leverages technology might sound biased and one that discourages non-tech based startups. What if, all you want to do, is open a coffee shop in your neighborhood. Well, there is nothing wrong with it, just that going in with a brick and mortar cafe involves substantial capital investments and also operating costs. Now, the coffee shop will have space constraints because of which it can only cater to a selected list of customers during the day. Therefore, in order to essentially to generate more revenues, the coffee shop will have to make more capital investments in order serve more customers. This could be either by opening more stores or increasing the size of the existing one.
Now, tech based businesses essentially enable you to scale without making huge capital investments, though you might have to spend on hiring the best people and on research. But it doesn’t take away from the fact it essentially decouples businesses from the trap of incurring huge capital investments in order to grow. Now, if even if your business is not tech based, it is imperative to leverage technology to achieve scale.
The second learning calls for startups to be at the frontier of human knowledge, now this might divide opinion. But it in essence means that we need to be the first in the market and establish your niche.
This was demonstrated very well by a few LinkedIn influencers during the pandemic. At the beginning of the Pandemic, lot of people lost their jobs and many others were looking to upskill in these dire times, in order to be more market fit to face the uncertainties of the this new Covid world. It was at this point, the LinkedIn Influencers who had a large following were able to launch very successful workshops and training programs for their followers. Who knew LinkedIn could be leveraged in such a manner to sell courses and these influencers were first at it. So Vaibhav Sisinty was able to capture the “LinkedIn” Niche, Ankur Warikoo was able to capture the “Entrepreneurship” niche and likewise. Won’t be surprised if tomorrow an Investment Banker starts his or her “Trading in Equity Markets” training program for the LinkedIn crowd if it hasn’t been started already.
Now, if we dig deeper into the business of selling online courses, there are a lot of things I like the business model. For one, these are online courses provided to consumers via the internet, therefore the marginal cost of providing the course to one extra consumer is negligible. though some marketing costs might be involved. It is also a product which can be supplied locally from the comfort of your home to satisfy a global demand. Unlike tangible FMCG, FMCD products where local needs can only be met by local supply. Thus, you eliminate the complete problem of distribution with this kind of a business model. This is exactly the reason why such businesses can achieve great scale in the niche’s that they exist in and at the same time have excellent margins.
How much can you earn?
So, if I take the case of a famous LinkedIn influencer who had over 100K followers on LinkedIn before launching his LinkedIn Workshop on the platform. Now, Each batch has over 1000 students and last I checked, he was close to having completed close to 20 batches. The workshop is priced at Rs 499. Now if one does the math on this.
Rs 499 * 1000 students * 20 Batches = Rs 1.497 Crores
Now, this number is very much on the conservative side as some batches have had over 1500 students as well.
Having already trained over 20,000 students, you can now easily upsell them your more expensive courses which will be priced at a premium. If the premium course is priced at Rs 9999, even with a conversion of 10% that would mean 2000 students enrolling for the premium course. That again would translate to revenues of
Rs 9999 * 2000 students = Rs 1.99 Crores
So, to have such staggering revenue numbers that too during a pandemic is just amazing. You just keep repeating the loop and get more and more people into your funnel for incremental revenues.
Before we get carried away with the amazing success of these online courses. There is a method to these amazing growth stories. Let’s look at a basic framework to understand it.
CATT Marketing Funnel
The very first thing is Content, this is a patient game, you need to churn out great content on various social media platforms where your target audience exists and build you followers. Needless to say that this does not happen overnight and takes a lot of effort and time. When it comes to content writing, you need not be a great writer, you just need to be a great communicator. If you are able to communicate your message crisply then the readers are also more receptive and appreciate of your work. You can start writing on LinkedIn, start your own Blog website or make use of platforms like Medium, which has been my preferred choice for writing my blogs.
Great content can only get you so far without getting the appropriate Attention for your efforts, this involves optimizing your digital presence through SEO, SEM, Ads, Email Marketing etc. This again needs to be done across platforms, more attention you are able to get the more people enter your marketing funnel.
Once, people enter the funnel, it is important that the consumers Trust you, the building of trust also needs time. Its requires personalized messaging to reach out to your desired audience, it is something which is built with time and you need to get your content game and SEO game just right.
After building of trust with the consumer, the next and final process is the Transaction, here again steps ought to be taken to reduce the friction in getting the sale over the line. Ankur Warikoo at the time of launching his very successful future founders conference series had a “Pay what you like” for the initial customers. Not only did it increase enrollment but it also led to a lot of traffic because of people writing testimonials for the course thus further improving the marketing funnel.
Now, it is not surprising why the entrepreneurs who sold their Digital products online were so successful, because not only did they have a great product but they also were able to build a strong Brand. So now when you think of Entrepreneurship, one immediately of Ankur Warikoo or if you think of Digital Marketing one might think of Deepak Kanakraju.
Bringing it all together
Finally, the communication with customers’ needs to be seamless and across platforms. Which calls for a comprehensive Integrated Marketing communication. First of which will involve having a great website with a landing page which directs the people to purchase the product or at least catch their details (Email). Getting the contact of the customers is the best possible way of adding potential customers who can then be sent targeted messaging and be made part of your marketing funnel. Then it just becomes an exercise of repeating the process and optimizing the process as you move along. Needless to say, Digital is the new fulcrum which will drive most business and also makes the Digital space so exciting.