Startups don’t need to go viral to win customers

Getting initial customers as a startup can be one of the most grueling challenges in business. Even when companies manage to snag some early interest, there’s no guarantee those customers will stick around.

At TechCrunch Disrupt last week, Elia Wallen, founder and CEO of travel startup Engine, Gamma founder and CEO Grant Lee, and Crystal Huang, general partner at Google Ventures, shared tips on how to attract and retain customers.

In the current era — when young AI companies like Cluely and Instinct are building big audiences not just through their products but also through their founders’ colorful online presences — social media can seem like a magic bullet for reaching early customers. But founders who want heighten their business strategy with modern marketing, have to be strategic, according to Lee.

Gamma, which sells AI-powered presentation software, managed to scale its business exponentially with a social media strategy that deployed influencers through its Ambassadors (or “Gambassador”) program. The company adopted the plan before influencer-based marketing was a tried-and-true strategy for smaller companies, eventually reaching a multi-billion dollar valuation.

But simply giving influencers a platform and telling them to promote your brand online doesn’t automatically translate to sales, said Lee. There’s more to it than that.

“If you have a product that can serve many different segments or use cases, then you want to basically have creators that can target each one of those,” Lee said. “If you have folks that are in consulting versus people that do all their marketing and create all the decks for their CMO, there’s all these different segments you might want to go after.”

Lee said sometimes founders seem to treat creator marketing or influencer marketing as a sort of set it and forget it thing.

“I think you’re better served by really spending a lot of time with these creators, because if they’re not able to understand how to articulate the value of your product, it doesn’t matter how much money you spend, it’s just going to fall flat,” Lee added.

The effectiveness of social media depends largely on the type of business. Other ways of reaching customers can be just (if not more) effective.

Wallen would know. His company Engine, which manages lodging and travel bookings for midsize businesses, bootstrapped its way to $150 million in bookings before taking on any outside funding. They also had no visible social media strategy at all. For Wallen, traditional sales tactics can be far more useful than a positive TikTok video.

“We did events and we smiled and dialed,” said Wallen. “We still have a lot of people picking up the phone. A lot of people who didn’t grow up with that or don’t understand it think that it’s outdated or it doesn’t work but it does. It’s a hard thing. There are a lot of companies that just refuse to do it or don’t know how to do it well. But they’re missing out on a very big offline client base.” He added: “The phone still works.”

Wallen also shared an in-person tactic that his company deployed during its scrappy early days: hiring a magician named David to perform tricks for prospective clients at events and encourage them to visit the Engine’s booth. In short, old-fashioned personal engagement can work just as well, if not better, than the latest social media tricks.

Huang, who has managed droves of startups and shepherded them to success, said that once you have a customer, a lot of value can be derived from looking at how they use the product.

“Can you look into usage data and figure out if it’s recurring, if it’s increasing, if they are referring their friends?” Huang said. “It can come across in early usage and retention information as well. And then also, do you see some super fans, right, who even want to work at the company, promote the company, be attached to the brand?” She added: “You need to have ways to create evangelists who are really passionate about the product.”