For a startup, traction is crucial. It’s what separates a successful startup from a failed one. Why? Because “everybody” can build a great product, but not everybody can get enough customers or users.
Lately I’ve been reading up on traction, and wanted to blog and share with others what I’m learning. I decided that I wanted to not only blog a summary of what I’m reading, but to apply the theories and showcase it with one of my startup projects as an example. Hopefully this journey will end with the startup getting traction, and all of us learning more about how to do this in general. And if it it fails, we’ll all learn from that as well – you don’t often hear about all the failed efforts, and I think that’s a missed learning opportunity.
First, what is traction?
Traction is the number one thing you need, no matter what industry or life stage your company is at. Traction shows customer demand. It shows that you’ve made something customers wants, and that you have figured out how to reach those customers. What specific number that shows traction might vary from company to company, but it is always linked to customer demand.
My goal is to apply the principles from the book “Traction” by Gabriel Weinberg and Justin Mares, and blog about it. Hopefully we’ll figure out what we need to do – and get it done!
Second, what are the reasons for not getting traction?
It is so frustrating to create a great product, and then … nothing. A good way to avoid this is to focus on traction before launching, something we did with Authenpic. Still, it doesn’t guarantee success.
In the book “Traction”, they outline 4 common reasons for lack of customers:
You have a product people want, but…
- You don’t have a viable business model
- There isn’t enough customers to make it profitable
- Reaching customers is cost prohibitive, the market is hard-to-reach
- Other companies are offering the same product.
Personal experience – Authenpic
One year ago, we released our app Authenpic. The app works as a disposable camera for your phone. That is: You can take 24 pictures with your phone – but after taking each one you will not get to see the picture. Not before you develop your full roll, and get the pictures printed and delivered to your physical mailbox. This takes away the pressure of perfect pictures, it frees up time and attention to the stuff you’re actually doing, and it adds an element of surprise when you get the pics in the mailbox. All in all, it’s a perfect little app!
We have managed to get a lot of press, and we have lots of downloads. Still, we do not have the traction we need to grow this from a side project to a full-blown business. Our users love the product, and the feedback in general is great. So why haven’t we gotten the traction we hoped for? This is a common challenge – you build something people love, but you don’t get the users.
Luckily, we have both a viable business model and a large enough market.
The business model is to sell people paper prints. The charge is $10/per roll, and we have close to 60% profit margin. The market is also there. The widest segment is “everybody” that takes pictures with their iPhones, for personal use. We can also narrow it down to people that care about getting physical memories. Our initial feedback shows that both tech-savvy teens, tech-overloaded 30’s, and the less tech savvy grandmothers all love the product – so we need to do some more research before pinpointing our key segment.
Before we made the app, we also considered how we would reach people – and if there was a high level of competition. We knew upfront that we would have zero dollars to spend on marketing and sales.
We started off by trying out a Kickstarter campaign. The main goal of the campaign was to get customer feedback – did this seem like an app people wanted? We did get press coverage, and a lot of very interested users. We did not get enough to reach our goal, but the enthusiasm from people wanting the app was so high that we decided to go ahead with developing the app.
We searched high and low for competitors, but no other app delivered the same experience. Yes, there were apps for printing pictures, but no app for taking them, hiding them, and then printing them. What we didn’t know was that several other apps were in the making..
Confident that we could get PR and attention enough to get the initial traction, we went ahead with the app development.
We were so excited to launch! And then it happened. The same month we launched, two other apps launched – just days before us. This was a disaster for our PR strategy, as it made it so much harder to get coverage. Still, we managed to get some press – especially in Norway, and we did start growing our user base. The competitors also showed us what didn’t work, and what stories the users didn’t relate to. Tech people are not the key audience for this app – it’s a lifestyle app.
It’s close to 10 months since we launched, and our competitors are gone. The marked was to new and hard to reach – especially with competitors. For us, this is a great time to try to get more users. There’s no-low competition,we have more experience, feedback from current users – and it’s almost Christmas, a key season to use our app!
Setting traction goals
The goal is to build Authenpic from a side project to a full-scale, viable business. We would like to raise a seed investment as soon as we’ve cracked the code to user growth. As the founders both have fulltime jobs, we’ll also look to hire someone to support the growth effort. To get an investment, we need to grow our numbers! In general, investors want to see 20-30% monthly growth. For this app, developed rolls is the no 1 ‘success’ metric. It’s not that hard to get someone to download a free app – the challenge is to get them to use it.