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I post all the time in HN ad threads that most companies grow very slowly if at all from word of mouth, and need to use ads to grow (beyond a local level). Say
by cm2012 7y ago
I post all the time in HN ad threads that most companies grow very slowly if at all from word of mouth, and need to use ads to grow (beyond a local level).
Say you make an app that helps plumbers do their job well. If every plumber used it, plumber productivity would go up 50%, making life easier for all. It cost you years of your time and lots of money to make this great app, and you need a lot of plumbers to buy it to afford to continue working on it.
There's a big plumber app on the market already, but yours is way better.
How do you get plumbers to hear about your product?
1) The press? Uninterested. Plumber magazines or sites? Very low traffic - no way to scale.
2) Call or knock on doors of every plumber near you? If everyone did this, the spam would be unreal. Also inefficient and not scalable.
3) Referrals? You get some, but most plumbers aren't chomping at the bit to help their competitors. And because you started with so few, referrals are a snails pace and by no means exponential.
4) Organic postings and SEO? The big plumber app is way ahead of you. And 100 other worse apps clog up the listings. No one sees your posts.
See the problem? Without ads, you can't grow many many categories of genuinely valuable products. Even if no one else is advertising, you can't really grow without them.
This is barely a hypothetical by the way. I've worked with a dozen companies with similar situations.
Here's a real life example:
I was just hired to scale marketing for a particular app.
This app currently has over 100 real reviews online, averaging 4.9 stars out of 5. Retention is nuts - 98% of people who ever started using the product (which has a monthly fee) are still using it. The company is three years old.
Perfect to take off, right? But few industries are actually viral. We just doubled the number of new customers per month using FB ads in the first two months of scaling it out, and we'll scale much further over the next 3.
Anyone who works in start-up growth will tell you the same things I am.
- anoncake 7y agoIf plumbers don't want to hear about your damn app, leave them alone instead of spamming them. You are not entitled to customers. The only valid reason for a business to exist, including yours, is to produce things people want. If no one wants your product, your business should not grow. Useless businesses not growing is a good thing. > Anyone who works in start-up growth will tell you the same things I am. I know that advertising is useful to companies that do it. But I don't care. What matters are not the individual interests of your company but the collective interests of society as a whole.
- andrenth 7y agoHow do you know what are the collective interests of society? If you don’t know, who does?
- nickjj 7y ago> 4) Organic postings and SEO? The big plumber app is way ahead of you. And 100 other worse apps clog up the listings. No one sees your posts. This is especially interesting in the world of tech. Because sites like digitalocean post a massive amount of really in depth tutorials. Much more than any single person can churn out. So as a tech person interested in even giving away free tech info, it's a really uphill SEO battle. You can't compete with 65,000+ articles (based on Googling for this: site:digitalocean.com/community).
- jacquesm 7y agoIf you are giving your tech info away you are not competing with anybody.
- nickjj 7y agoI think it's still competition because other sites take away potential traffic from your site. That's just the nature of how search engines work, but search engines also favor big sites with many pages and tons of quality back links. I'm not saying sites like digitalocean or stackoverflow are bad, but from an SEO perspective it's not going to be easy to out rank them in most topics where you're writing about the same or similar things -- especially not in the case of digitalocean because they are selling something, and they have a ton of $ to promote their site everywhere.
- icebraining 7y agoOk, let's assume that's true: a large number of new companies like makers of apps for plumbers couldn't scale as fast if not for ads. Besides that being sad for the founders of such company, why is that a problem?
- SerLava 7y agoImagine that almost everything made by a new company never existed. That would be a problem. Groups of people who make things that only benefit themselves generally aren't called businesses. The poster above explained that the new product might, say, increase the productivity of plumbers by 50%, and all other apps on the market are far worse.
- icebraining 7y ago> Imagine that almost everything made by a new company never existed. That would be a problem. Yeah, I'm not sure. Very little new stuff is actually better, and the constant churn has problems of its own. I'd need some evidence to show this would actually be a problem.
- SerLava 7y agoIf your position here is that invention itself has created negative value overall, we really can't have any conversation about the world. I mean,
- anoncake 7y agoInventions probably[1] have created positive value. It's certainly possible to derive positive value from them by just not using harmful inventions. That is basically what the Amish are trying to do. That doesn't mean that most inventions are beneficial. It's very much possible that only 5% are beneficial but their benefits outweigh the harm done by the other 95%. Useful inventions don't need advertising to spread. They even did so during the middle ages. No one ran adverts to sell crop rotation. It spread because it's a good idea. It took a while but that's because compared to today, information and transportation networks basically didn't exist. Advertising as we know it today isn't even helpful for spreading useful inventions. Yes, there are ads for them, but they are crowded out by useless ones. If the message we get from advertising is > DRINK SUGARY WATER. KYS WITH CIGARETTES. YOU'RE WORTHLESS WITHOUT CARBON CRYSTALS. DRINK SUGARY WATER. KYS WITH CIGARETTES. YOU'RE WORTHLESS WITHOUT CARBON CRYSTALS. ELECTRIC LIGHT IS GREAT. DRINK SUGARY WATER. KYS WITH CIGARETTES. YOU'RE WORTHLESS WITHOUT CARBON CRYSTALS. DRINK SUGARY WATER. KYS WITH CIGARETTES. YOU'RE WORTHLESS WITHOUT CARBON CRYSTALS. you could argue that speeding up the spread of electric light is worth the damage done by advertising. But what happens here is that garbage ads crowd out the actual useful information. It's hidden like a needle is haystack. Information overload and the associated stress reduces people's ability to find the useful information and to actually think about what they need and want. The alternative is not to abolish communication. You don't need ads for people to learn about products that are useful to them. That's in their interests so they will seek out newspapers, magazines etc. that report about new products — aiming to serve and inform the customers that buy them rather than the producers that want to sell their products whether they someone needs them or not. The above wall of text would not be replaced by nothing but by "FYI: electric light exists. Its advantages are.... but keep in mind that...." — information rather than spam. [1] Are we really happier than hunters and gatherers?
- analog31 7y ago5) Advertising? People are flooded with ads, most of which are vile and dishonest, and have installed technology to block them.
- cm2012 7y agoExcept it provably works, if you read my post.
- bulditand 7y agoThe point is not if it works, is if you should do it. A lot of people don't want this to be done to them, even if it works for you. We outlawed slavery, human trafficking, rape, fraud, theft etc even if it worked for some, because working was not the point.
- analog31 7y agoI wasn't able to interpret your post in terms of results, i.e., in dollars or ROI, and I don't know if your results are representative of advertising overall.
- petra 7y agoInnovative businesses are a small part of the market. Most(90%+) of businesses sell commodities, or near-commodities, or products that could be compared by a spec. Marketplaces and parametric search seem like a fair way for them to get customers.
- taffer 7y ago> Most(90%+) of businesses sell commodities, or near-commodities, or products that could be compared by a spec. Do you have a source for this number you can link to?
- Barrin92 7y agoI'm not sure all these needs require advertisement in the socially detrimental sense that the article talks about. If we simply want information about services to go to users we have discovery platforms for plumbers were people can search and find them, see them rated by customers and evaluated in an objective fashion and so on. Advertisements don't fill the niche any more of informing people in factual manner about products. The modern advertisement is the 'axe effect' or instagram influencing, which is purely emotional, tying personal success or celebrity culture to products in an attempt to manipulate audiences. Creating 'stories' about products that personalise them or as the article points out, signal social status and class segregation.
- cm2012 7y agoProbably 5% of ad spend is for axe effect type stuff. I am on mobile but you can google industry ad breakdown.