by Frank Gruber
The biggest reason to sign on a PR agency is to get very specific opportunities. For example, if you want to be on the Today Show or do a major television news show blitz, then you might need to hire an agency with the connections to make it happen. Relationships are one of the most important things a PR agency can offer you.
As you think about PR, start by doing some strategizing. Who is your target market? Who do you want to reach via press? Start by doing some research and making a list. Find out who writes about your industry, competitors, and related topics because they are more likely to write about you. As you think about press, consider everything from national mainstream publications to local media and topical blogs—anyone with an audience that you want to get in front of. Doing your homework here can really pay off.
You have limited time, so optimize it. Don't spend it pitching to a random trade publication that has nothing to do with your product or audience—it wastes their time and yours. If you're targeting stay-at-home moms, being featured in a slew of tech blogs is great, but you should also target the topical blogs that your customers actually read. Is your product a fashion product? Make a list of the top 100 fashion blogs and publications online and pitch to them.
Whether you pitch the product yourself or you use a PR agency, here's some advice on your pitch:
Keep it short. Journalists are busy covering many stories.
Make it timely and relevant. Help journalists with the angle and relevancy. Think about why people should care about your product in the context of their everyday lives. Figure out how it affects them positively and tell that story to reporters. Remember, if your story will get reporters a lot of page views, they'll want to tell it!
Don't send mass e-mails to reporters. You're much more likely to get a reporter to respond to you if you connect with them one-on-one and make them feel special.
Iterate on your pitch the way you iterate on your startup. Figure out which of your hypotheses may be wrong and test them. For example, you might believe that “journalists will open e-mails with ‘sexy’ in the subject line” but get zero responses when you try this approach.
Pitch early. Allow for plenty of lead time so reporters can interview you and write a story without feeling rushed.
Most important, don't be arrogant. No one wants to shine a light on someone who is arrogant, unless of course it is to show everyone else just what a jerk you are.
Build Relationships with Press
One of the best tips for dealing with reporters is to try to build relationships. Become a human being to them—not just a faceless sender spamming them with press releases—and they'll be much more likely to cover you. Reporters are people, not machines. Follow them on Twitter, and leave comments on their posts (not to the point of being annoying—find the right balance). Engage them, and find out how they like to be approached.
Once you've been covered, use a service such as Primeloop or just a simple spreadsheet to track your press mentions. Many startups display these on a press page on their website to add credibility.
The Harsh Reality
Launch time is exciting and can be a rush. But as much as you prepare and do your research, you have to be ready for the unexpected. Try to keep a level head; you'll need it to weather the storm.
Cheek'd is a New York–based dating startup that got on the cover of the New York Times Style section, which garnered lots of visitors and crashed their website. But even worse was a glitch on the back end that went unnoticed until after the fact. Cheek'd is a subscription-based business, and unfortunately its developer didn't flip the switch to store credit card information. Founder and CEO Lori Cheek shared that, “With hundreds and hundreds of new sign-ups, we lost nearly $30,000 in revenue from this simple mistake. I joke now that our London-based Web developer is lucky that he didn't live in America at the time.” Although Cheek'd had a tough loss on opening day, a lesson was learned—don't let it happen to you.
More likely, your problem will be that you don't get very much attention around launch at all. Be prepared for that. Launching can seem like the end-all, but getting attention at launch is just the beginning. Now you have to go to work every day and keep your company going. Obsessing over launch is like obsessing over the wedding, then forgetting about the marriage part that comes next. Craig Bryant, founder of human resources management software Kin, agrees with me: “A product's initial launch is not the finish line,” he says. “It's the starting line.”
Celebrate: Enjoy the Journey
Launching an actual product people can use is not easy. It can take long hours and lots of sacrifices by the team. So once you launch, don't forget about the people who helped make the launch possible. Thank them with time off or rewards; figure out what your team cares about. For example, after Jason Calacanis and his team launched Mahalo, he took everyone to Disneyland as a reward. If Disneyland is too far, then try something nearby: dinner, a fun movie, a long weekend—anything to acknowledge the team's efforts.
You may not think of this one first, but also take time to celebrate with family or friends—since you've probably been neglecting them in the weeks or months leading up to launch.
Jason Calacanis
Jason Calacanis was the cofounder of Weblogs (sold to AOL in 2005). He went on to start a variety of ventures, including the Mahalo search engine, ThisWeekIn podcast network, and the LAUNCH conference. Founded in 2010, LAUNCH now has a tech news site, podcast, and fund. The events attract thousands of attendees and allow startups to unveil themselves to the world. Based in Los Angeles, Calacanis is also an angel investor in startups such as Uber, Evernote, and Circa and founder of the stealthy startup Inside.com.
Besides team and family, you can also celebrate with your community. For example, Las Vegas–based startup Tracky turned its launch party into a celebration of the Vegas tech community. They picked uniquely Vegas venues: the press event was at Switch's huge data center, and the party was at the former home of Mike Tyson, where part of The Hangover was filmed. Cofounder Jennifer Gosse shared, “What was most satisfying about the whole experience was the genuine sense of goodwill there. Everyone that I hugged and shook hands with that night expressed seemingly real enthusiasm about Tracky's launch. We've heard resoundingly good feedback about the deep sense of community and friendliness shared amongst then-partygoers, and now community members. And that, my friends, makes it an epic launch party to remember.”
Final Thoughts
Although the art of the launch can be done a number of different ways, it's important to realize that the best way to launch a business is a moving target. Conrad launched three startups in a 10-year period, and each time he used a slightly different approach. Every business calls for a different launch strategy based on the customers the business is trying to attract. But the common denominator is usually relationships—relationships forged with the media, partners, and community.
Chapter 7
Metrics
If there is not a metric [for it], it doesn't exist.
—Harper Reed, chief technology officer of Obama for America 2012, quoting Jim Messina, Obama's campaign manager
In 2012, Uber had a math department that included two nuclear physicists, a computational neuroscientist, and a machine learning expert. Uber had launched in 2010 to provide on-demand rides to passengers, but it wasn't a transport company—it didn't own any sedans or taxis. Uber was in the business of logistics, and that requires lots of data.
Lots of different metrics matter to Uber. One is month-over-month growth, which hit 26 percent after about a year and a half. Uber also looked at the percentage of paying users who had paid in the last month, an indication that users were still active, not paying once and forgetting about the app altogether. Users are also active when the number of rides per rider per month goes up.
On the revenue side, Uber was interested in average revenue per person per month and average revenue growth in each city. As the company launched in new locations, it saw its rev
enue growth getting better and better—a sign that it was streamlining its processes and learning with each launch. The company also analyzed how much average revenue it was making on day 1, day 2, day 3, and so on, of a user's lifetime.
Uber used metrics to investigate assumptions—the service had worked in San Francisco, but would it work in other cities? Revenue growth said yes. Was Uber satisfying customers? The fact that customers were taking more rides per month looked promising. Metrics can help you test out ideas, track progress, and see how changes you make affect usage. Metrics are the symptoms of health or sickness in your startup baby, but not all new entrepreneur parents know how to understand them. This chapter will give you a primer.
Types of Metrics
One standard for startup metrics has been articulated by Dave McClure, the founder of 500 Startups. He calls them Startup Metrics for Pirates—AARRR:
Dave McClure
Dave McClure is the founder and general partner at 500 Startups, an accelerator based in Mountain View, California. Founded in 2010, 500 Startups has invested in more than 600 companies, including Twilio, SendGrid, and MakerBot. It has a global focus, running invite-only trips around the world called Geeks on a Plane to learn about local startup communities. McClure is also a cofounder of StartupVisa.com, which mobilizes support for better immigration laws for entrepreneurs. Prior to 500 Startups, McClure spent time doing marketing for PayPal and Simply Hired and investing as an angel and a fund director.
Acquisition: To acquire visitors on your site, you should focus on things such as advertising, e-mail marketing, search engine optimization (SEO), and public relations (PR). Think about which keywords are associated with your product, what your value proposition is, and how you compare to the competition.
Activation: Activation metrics include things such as time on site, number of page views per visit, sign-ups, clicks, shares, downloads, and comments—in other words, users going from passive to active. You need to determine how much and what type of activity constitutes “active” for your product. Twitter was able to increase the number of people who finished the sign-up process (an activation metric) by tweaking it so finding people to follow was easier.
Retention: Retention means people come back, and a great way to drive retention is by sending e-mail reminders. From there, you can track open rates, click-through rates, percentage of those who come back, and frequency of visits. The metric you're trying to minimize is churn rate: the number of users who leave and never return.
Referral: Users can refer your product through channels such as e-mail and social media. The typical advice is to aim for a viral growth factor greater than 1. Viral growth factor equals the percentage of users who invite others times the number of people they invite times the percentage who accept the invitation. In other words, a viral growth factor of 1 means every user is referring (on average) one other user to the service.
Revenue: Revenue-based metrics include things like customer acquisition cost, the lifetime value of a customer, and the like.
In tracking all these types of metrics, focus on numbers that are actionable—those that actually have a bearing on your decisions. On Obama's 2012 reelection campaign, chief technology officer (CTO) Harper Reed and his team aggressively used metrics to help them take action faster. “Every time you had a conversation, you came with numbers that would back up your decision,” says Reed. “You have to look at the numbers and say, ‘Does this work?’ You have to do it every single time.” That approach helped them raise more than $700 million in online contributions.
Unfortunately, there are many metrics you could track that aren't actionable and have no bearing on your decisions. To avoid getting distracted by unactionable metrics, lean startup expert Eric Ries recommends that you hone in on these four types:
Comparison metrics: These metrics are derived from split testing (A/B tests), which allows you to choose one version over another based on which one performs better.
Per-customer metrics: Uber used average revenue per person per month. This is more valuable than tracking revenue, because revenue (hopefully) is always going up. But revenue can go up while average revenue per person per month goes down, which should set off a red flag.
Keyword metrics: These metrics track how users perform based on which keyword brought them to the site. Uber, for example, might learn that it earns more money from people who search Google for “private cars” than from people who search for “cheap taxis.”
Cohort metrics: Cohorts are users who are grouped according to a certain characteristic. As lean startup entrepreneur Ash Maurya explains, you might separate cohorts by the date they joined, where they came from (Facebook or Twitter, for example), or their age. If the cohort of users who joined in March is performing way better than the cohort of users who joined in February, that might give you a clue that the new features you added in late February are popular.
Which Metrics Matter?
All this info is well and good, but which numbers should you actually be focusing on? This will be unique to your business and company stage. You need to look at your business and really hone in on what activities drive success. If it's getting users, track acquisition and referral metrics. If it's driving usage, track activation and retention. And so on.
The metrics you track also depend on your role in the business. If you're on the product development team, you want to look at conversion rates and see how the features you build affect them. If you're a marketer, you're looking for marketing channels that have a small price tag but high conversions—those that provide the most bang for your buck.
As you grow, expect your metrics to change. The metrics you use when you're validating a minimum viable product (MVP) will look different from metrics during launch and growth phases. For example, when you're trying to figure out which promotion channels are most effective, you may focus on conversion and churn rates. When you're validating your business model, you might focus on revenue per customer.
If you really believe in keeping things simple, listen to the advice of marketer Sean Ellis. He's known for advocating only one metric that matters until you hit product-market fit. That metric is 40 percent: getting to 40 percent of users who, when asked how they would feel without your product, respond with “very disappointed.” Your job in the early stages, he says, is to do everything you can to increase that percentage. And in doing so, you'll be honing in on your product's must-have feature.
For a list of metrics tools, check out http://tech.co/book.
The Harsh Reality
As you've probably figured out by now, metrics are one of the more complicated ingredients of starting up a business. “Unfortunately, there are no universally relevant startup metrics. It depends what stage of development you're in, what your business model is, what your high-level goals are,” explains Shanelle Mullin, director of marketing at Onboardly.
One of the big dangers with metrics is something called vanity metrics, those feel-good numbers that almost always go up, such as total users, page views, and downloads. You'll be tempted to focus on these metrics—and tell the world about them—but they don't usually say much about the health of your business. They're the opposite of actionable metrics.
For example, you might see that 75 percent of your users are still active. That sounds great! But if you look deeper and examine how many of those users signed up within the past month, you might notice that all of them did. That means that everyone who signed up earlier has stopped using the app: you have horrible retention. Bragging that you have, say, 10,000 active users or 75 percent active users makes the situation sound much better than it is.
My cofounder and COO Jen Consalvo knows firsthand how easy it can be to get overexcited when you first launch and see an initial usage spike. When we worked at AOL, it was common to have a new product featured on the AOL Welcome Screen—also known as the firehose—and see your traffic numbers soar. “I quickly learned that it's when the firehose stopped that the real test b
egan,” Jen recalls. “Did people go back after they left? Did we create the right level of product ‘stickiness,’ as we used to call it, to get them to want to return? Or mechanisms to pull them back in or remind them? Did retention decrease or increase over the coming weeks? Who were our core users—the ones who used the product religiously—versus our casual users, and why?” If you suspect that initial traction is inflated as a result of lots of press or some other reason, remember that the number will likely drop before it stabilizes.
That's why it's really important to figure out which metrics matter and start paying attention to those instead. If you're a beginner to metrics, beware. “Vanity metrics are the metrics that make you feel good about yourself and that make you feel successful, but they just cloud your judgment,” says Mullin. “You won't know you're stagnant or worse until it's too late.”
Celebrate: Enjoy the Journey
Hooman Radfar is an expert on metrics. He's the cofounder and chairman of AddThis, which builds social plug-ins and analytics for publishers and advertisers. AddThis has grown to more than 14 million sites, reaching 1.6 billion unique users per month.
Early on, AddThis thought that celebrating too much would mean it was being complacent. But the team soon realized that celebrating metrics—such as how many users they were reaching and how much revenue they were making—could boost everyone's motivation.