5 Steps To Acquire Customers For Your Startup On a Bootstrapped Budget
You’ve finally decided to roll the dice on your dream of starting a business. You're even funding it yourself by taking the bootstrapping route. And what better time to do so than now? With all of the technology at your disposal—as well as the access to others in every industry at your fingertips via social media—there’s never been an era more advantageous for one to become an entrepreneur than the present.
But as with many great things that seem too good to be true—there is a potential downside to having such an easily accessible market. And that downside is market congestion.
With an estimated 5.4 million new businesses created in 2021—the question that you've probably asked yourself an innumerable amount of times is, “How can I acquire customers and compete with other startups in my industry that have bigger marketing budgets than mine?”
Well, unfortunately—for your competitors that is, after reading this article—you’ll no longer have to ask yourself that question. These are five steps to take that will help you acquire customers for your startup on a minimal marketing budget.
1. Only target your ideal audience (narrowcast)
One of the worst mistakes made by founders of startups—especially those with small marketing budgets—is net targeting. Net targeting occurs when a brand markets towards a mass market in hopes of reaching a vast amount of people. In theory, mass marketing is actually a great idea…for brands that could afford to do so. But if you’re working with a small marketing budget—it’s not the best option to take.
Instead, it would be far more advantageous for you to narrowcast—by only targeting consumers that are most likely to purchase what your brand has to offer. Think of narrowcasting along these lines:
Let’s say that you were fishing for salmon in the ocean so you could sell them to a local market—and you wanted to use a net to catch the most amount of salmon possible. But with so many fish besides salmon in the ocean—you’d inevitably catch other fish besides salmon in the net. But here’s the catch (no pun intended), for every fish that you caught in the net that wasn’t a salmon—you had to pay a fine.
Sure, you’d probably catch plenty of salmon in the net—however, you’d be fined so much for catching the other fish—it would defeat the purpose of catching the salmon.
The far better alternative would be to fish in a shallow river with water so clear that you could literally see the salmon in the water and place your bait right in front of them. That way, you could easily catch salmon without having to worry about being fined for catching the other fish. And the only money that you’d have to spend would be on getting to the river (and maybe the bait).
A great example of a founder that took the narrowcasting approach to build his startup is Daniel “D” Katz, founder and CEO of the vegan protein bar brand No Cow. When Katz first created No Cow, he had two options to choose from to build his brand:
1. He could either try to sell his products at crowded farmer’s markets full of people that were more likely to be interested in purchasing produce than a protein bar.
2. Or, he could go straight to the source by contacting national retailers and placing his products in front of them so they could feature them in their stores (which he did).
“For a business like No Cow, I'd suggest bootstrapping until you’re ready.” Said Katz, in an interview with Authority Magazine. “I sold into national retailers by cold calling and taking bar samples to them in plastic baggies.”
By going straight to national retailers like Target, GNC, and The Vitamin Shoppe—Katz was able to save time and money by going directly to the places that ideal consumers of his product frequent—as opposed to wasting money on mass marketing in other areas trying to appeal to consumers more interested in other items.
You can grow your business similarly to the way that Katz built No Cow—by only targeting consumers and retailers that would be most interested in purchasing your products or services. Whether it’s purchasing ads on Google, Facebook, Instagram, LinkedIn, or Twitter—only target people that fit the consumer avatar of your ideal customer (here’s how to find your ideal customer).
Since every dollar that your business spends on marketing towards people that are unlikely to become customers would cost your business money—think of marketing towards every person outside of your consumer avatar as a fine—and you’ll be just fine.
2. Avoid the inessentials
A huge reason why more startups fail than succeed is due to inessential spending disproportionate to revenue. In other words—they spend more money than they should on things that don't have a positive impact on generating revenue for the business.
One of the things that startup founders spend a huge amount of money on is advertising—which isn’t a bad thing when done responsibly. The problem is when startups on a limited budget spend precious dollars on advertising to create brand awareness—as opposed to advertising that attracts sales.
“Spend as little money as possible and make as much money as you can.” Says author Chris Guillebeau in his book, The $100 Startup. “Spend only on things that have a direct relationship to sales.”
Don’t get me wrong—there’s nothing wrong with spending money on advertising to create awareness of your brand—if you have the revenue or capital to do so. But if you’re reading this article—I think that there’s a pretty good chance that you want answers on how to get the most for your startup’s limited-bootstrapped bucks.
The way to do that is by approaching any advertising done by your business as an offer for a direct sale. Until your business generates sufficient revenue—only pay for advertising that presents an offer to your audience that would lead directly towards a sale.
Those ads could consist of:
A new product or service
A discount offer
A limited time sale
A sweepstakes tied to a sale
A special offer
Whether it’s spending money on digital marketing, media buying, or indoor/outdoor advertising—make sure that it’s directly tied to offering your ideal audience the opportunity to make a purchase from your business. And as your business generates revenue—you can focus on scaling it through paid awareness advertising.
But for now, focus all advertising efforts on simply offering benefits to consumers that would lead to a sale. You could still create awareness—just do it for free (here’s five ways to do just that). As Guillebeau says, “Keep costs low. By investing sweat equity instead of money in your project, you’ll avoid going into debt and minimize the impact of failure if it doesn’t work out.”
3. Be personable, be a guerrilla
If you played sports as a kid—you probably had a few athletes that you watched growing up and studied closely so that you could learn some of their moves because they were just so great. As a marketer, there’s a few great marketers whose teachings I’ve studied closely because of their brilliance.
Luckily for me and many others—two of those marketers that I studied once got together and wrote a book titled, Guerrilla Marketing For The Home-Based Business—written by two icons in the industry, Seth Godin and the late Jay Levinson.
And while the book has plenty of gems on how to grow a business on a small budget—one of my favorite lessons from the book pertains to the biggest advantage that smaller startups have over bigger businesses—which is the ability to cultivate personal relationships.
“The guerrilla’s whole advantage in marketing lies in the ability to create and pursue personal relationships.” Said the duo.
As the owner of a smaller business—you have the advantage of accessibility on your side. For example, it would be extremely difficult for a Walmart customer to be able to get on the phone with Doug McMillon, the company’s president and CEO. It would also be just as unlikely for a COO of a small manufacturing company to be able to have a power lunch with Tim Cook, Apple’s chief executive officer.
However, that customer could get on the phone with you. And you could discuss business over a couple of burgers with that COO of the small manufacturing company. By cultivating personal relationships and networking—as the owner of a smaller business—you could create bonds with others that would be mutually beneficial.
You can do that by doing thing like:
Going the extra mile with your customer service
Collaborating with others in related industries
Reaching out to peers in your industry
Building a rapport with vendors
Making personal guarantees
Sending hand-written thank you notes to potential clients
The essence of guerrilla marketing is to get conventional results by utilizing unconventional means. Even if your brand has a small marketing budget—you could still cultivate personal relationships that’ll help you get conventional results—without having to spend money.
4. Turn on the generators
One of the things that has made entrepreneurship in this day and age so advantageous for those bold enough to bet on themselves is the prevalence of social media—which is a great tool for generating leads.
Social media is the ultimate equalizer due to the fact that it’s practically free—which puts you on equal footing with brands larger than yours.
Utilize social media to your brand’s advantage by: educating, entertaining, and engaging your audience on a regular basis. The key here is to provide enough value to your audience for free—they'll happily give you their name and email address—which is where you'll build a bond with your leads by providing even more value through drip campaigns—while also offering your products or services to them.
Your brand doesn't have to have an account on every social media platform. But your brand should have active accounts on at least the top three platforms that your ideal audience frequent.
5. Represent remarkability
The only reason that this one is last on the list is because it’s the one that you should remember first. With so many startups already in the market—and more being created every hour—it’s paramount for your brand to capture the attention of your audience by being remarkable.
The best way that you can do that is by being distinctive and beneficial.
If your brand is remarkably different and provides at least one relevant benefit to your ideal audience—not only will it attract customers—others who could help grow your brand would also be more likely to embrace it.