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Where does this idea of glorifying not spending on marketing come from? I think it involves a fundamental misalignment of the point of building a business. I v
by davemel37 11y ago
Where does this idea of glorifying not spending on marketing come from? I think it involves a fundamental misalignment of the point of building a business.
I view a business as an investment vehicle and marketing is how you turn over that investment. I would be much more impressed with a business that can consistently arbitrage advertising into profits at scale.
In reality anything that touches a prospect, customer or user is marketing!
A better question is... how much further would duolingo be if they invested in advertising and focused more on marketing? Would they have billions of users instead of 110M ?
Further, how many of those 110M are like me that downloaded the app, used it once or twice and than never opened it again? How many users like me would use it much more if they did invest in communicating its value to me at ideal times. (i.e. when it sees I am visiting Cabo, or Cancun, two trips I took with the app on my phone and never touched it?)
- dhbradshaw 11y agoI think that saying that something does well without marketing is making an implicit argument that it's doing well for some other reason. A basic model might be success = (value + delta) * ( marketing + epsilon). If you give success a large number and say that marketing was zero then the model leads you to guess that there is substantial value in the product itself.
- encoderer 11y agoTo your first point, I do think leanness is a virtue. Especially in a young company where product market fit isn't yet targeted it can be easy to burn investor money without roi.
- davemel37 11y agoIf you view marketing as an expense, you have a valid point. I view marketing as an investment and in that context, if you need to be lean, investing intelligently in marketing is one of the most important things you can do to increase cashflow.
- jsonne 11y agoWhat it comes down to is this. Spend money on marketing, or don't, but always focus on ROI.
- soared 11y ago> Where does this idea of glorifying not spending on marketing come from? Its probably playing on some peoples notions that marketing is evil, and therefore money shouldn't be spent on it. Obviously not true, but there is a general dislike for marketing.
- Trundle 11y agoI think soared's answer mostly explains it but also I think the demographic/general theme of this particular site has something to do with it. Tales of growth hacking and doing much with little are more interesting and relevant to people interested in starting their own businesses or having success with their own projects than tales of big marketing spends are. I'm highly unlikely to find myself in a position any time soon where I've got a $500m marketing budget. So someone turning that in to $1b+ is of less interest to me than the guy who went from 0 to whatever cheaply.
- davemel37 11y agoIf your $500m budget is only returning $1b you are probably losing money and are wasting a ton of your budget. For what it's worth, Duolingo raised $83.3M , so it's not like they bootstrapped to that growth. The growth hacking you are referring to has a large cost too. You need disciplined and very creative engineers, copywriters, analysts, a culture of testing, social psychologists, marketing experts, directors, etc... I bet Duolingo's marketing costs are well into the millions a year in Human Capital. The stories of guys going from 0 to whatever cheaply are not the same stories as a company with 83 million in funding.
- Trundle 11y agoI mean, I didn't actually get anything out of this particular article at all or upvote it, but there was at least potential of hearing how they got to the point where they could get that funding and afford those experts, so I clicked it. It had a chance. Can't say the same if I saw "How Coca Cola increased ROI on their $2 billion advertising spend by 3%!"