Product design takes place in two phases: the “Builder” and the “Accelerator”
By Saksham Mendiratta
Product design happens in two phases: I call them the “Builder” and the “Accelerator”
“Builder” is when you build a new product/site. You need the basics of your product roadmap, MVPs, wireframes, and a design that gets the job done. This is where you spend less time on the details and more on the overall construction of your product.
Most products (e-commerce or apps) start their operations this way.
“Accelerator” is when you have some traction, some growth, numbers (data) and customers who have given you feedback. In a good scenario, some financing too. This is where you begin to ruthlessly deconstruct your product and rebuild it. All while the MVP is still generating revenue/traction for you in the meantime.
Now that we’ve defined what the two phases mean, let’s see how “branding” fits into each of these phases.
I can go on a limb to say that the product and the brand are two sides of the same coin. They must be tackled together and not in isolation.
Brand is everything, from your positioning to your punches, your heartwarming or actionable CTAs (call-to-action buttons), your images, your product shots and of course your campaigns. launch. But for the benefit of this discussion, we’ll stick to all aspects of branding that impact your product.
Ideally, a brand should integrate seamlessly with your product.
Accelerator mode: reality check
The key differentiator between builder and accelerator is “traction”. And traction is the result of two aspects: organic acquisition and inorganic acquisition.
As brands grow, ad spend begins to deliver results. Your ad sets are working, new customers are starting to use your product, you’re launching new ad campaigns across multiple platforms, and you’ve finally made it work. The product is in place and kicking. The CAC (customer acquisition cost) goes up, but you have the funding, whatever. All you care about is customer acquisition.
It goes on for a few months, new agencies are hired, you try programmatic, more ad dollars are spent on marketing to acquire new clients. Superior CAC. And you don’t even realize but you’re addicted to paid acquisition. It’s a trap that most companies fall into, funding is drying up. At your next investor meeting, the acquisition is successful, but the CAC is disabled. There are no signs of retention, community or LTV. The CAC/LTV ratios are negative. And that’s the end of your grand tour.
You are now struck with a double-edged sword: should you focus on retention (with the same budget, but not sure how?) or should you focus on the new acquisition. The drop in the number of acquisitions here will worry investors. It’s a chicken-and-egg problem you’ve found yourself in.
Well, read the story above again. If this is your story, it’s because you haven’t focused on building the brand alongside your product.
Scale doesn’t always mean durability.
Accelerator mode: Ideal scenario:
Let’s understand where you went wrong in the scenario above:
- The first mistake is when you start thinking of everything as a mixed CAC – dividing all your acquisitions by the dollars spent – instead of understanding the CAC of each channel (Facebook, Display, AdWords, etc.). The first is misleading.
- Because your initial organic users are your biggest fans, your blended CAC and CAC per channel can often be off by 2-5x. As you scale your paid marketing, your organic will not follow in the same ratio. So, as you grow, your “mixed CAC”
present the CAC of your dominant channel.
Scale effects mainly work against you in paid marketing.
The longer your campaigns run, the less effective they become – people start seeing your ads too often. Messaging is becoming obsolete and the novelty effects are real. Market performance has mean reversion. The competitive dynamic is real. They will come to copy not only your product but also the ad messaging and creative.
Your focus on organic marketing keeps you focused on building a brand:
Enter: Brand Strategy
The brand is a mix of a lot of things. I’m by no means a branding guru, but for the benefit of this discussion, I’ll define it in contrast to your product design.
Brand = organic growth
Organic growth = retention + community development
Retention = Customers who stay
Customers who stay = customers who resonate with the product/offer/message
And the answer to attracting customers who resonate with your product is: branding. Right from the copy that goes on your CTAs, to your core positioning, this is what attracts the “right” demographic, who are more likely to stick around.
Not only that, they are also more likely to evangelize.
The hidden truth:
Build a brand during your business builder days. Start formulating your positioning statements, communication guidelines and evolve them over time.
Branding is more than marketing campaigns. And certainly important for your product-market fit.
Reliance on paid marketing can give you instant results, but at the expense of profitability or LTV. What’s more important is solving the underlying growth issues – creating real moats, product differentiation, user experience, better integrations.
Create new channels. Fixed churn rate and frequency. Focus on retention. Build a brand. Have real conversations with customers. And optimize your UX to evolve your CX (customer experience).
The thing is, knowing that paid marketing is highly addictive and hard to cut, all of us in the industry should always be thinking about what, beyond paid ads, drives long-term value.
To do this, you will need to empower your creative team to attack the problem from all angles – new viral product features, better design and real investment in your referral and community programs, building your strategy of content/SEO even if it takes years. It is worth the investment.
The author is co-founder, Lights Out Studio
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