Transcript
Your goal through customer discovery and validation is to really find product
market fit as Marc Andreessen had defined the term product market fit
means being in a good market with a product that can satisfy that market
that's a very clear simple definition very hard to find product market fit an
example of a poor product market fit is the Segway scooter now it's a genius
device really amazing engineering the fact that it could stand up by itself
and roll it along really fast and it's very you know long battery life etc but
the question is who is the customer what do they really want do they want to look
really silly standing up there with a helmet on a scooter when everybody else
is walking or riding a bicycle or whatever this was obviously not a very
well thought out strategy before they invested millions and millions of
dollars in designing this amazing widget now once you've found that product
market fit now we can talk about actual marketing and marketing is composed of
what we call in the industry a marketing mix and those are the four things that
you see on the slide product price promotion and place if you can think of
the four things in the marketing mix now you're ready to start advertising and
what is advertising advertising really is reaching that customer I mean when we
are doing our customer research we were standing outside Starbucks but when we
know exactly what we got to sell when we got a product and sometimes even before
we have that product we need to start reaching as many
people as we can for feedback on that product and selling that actual up and
selling the product the problem is advertising can be very
difficult to AH directly tie in to return on investment John Wanamaker
famously said in 18 something half the money I spend on advertising is wasted
the trouble is I don't know which half so is advertising really a waste of
money it's very hard to know and very hard to quantify if you're gonna buy an
ad on a billboard is that a good way to sell a scooter if you're gonna buy an ad
in a magazine is that the best way you need that feedback and so what I found
the best way to get feedback on advertising is by selling online because
you know very clearly if the user clicked and whether or not they were
interested and you don't have to make new ads you don't have to redesign
flyers and so forth you can just adjust the pricing so half your ads or at $100
half their ads are $200 it's very simple to test different pricing points so as
from the google adwords website they say let's say you have a product that costs
$100 to produce sells for $200 which is $100 profit you sell six of these as a
result of advertising your sales are $1200 your AdWords cost $200 so that
means your return on investment is 50% so it's very clear the effectiveness of
advertising on Google AdWords for instance it's less clear if you're
advertising in a newspaper where you might
by the ad for $100 but did anybody look at the ad was it the Wooding was not
good with the graphics not good did the newspaper not go out to as many