Tinder’s Co-Founder Shares B2C Marketing Strategies

Hundreds of articles provide advice to startups on the best marketing channels to prioritize each year. Searching for marketing strategies for B2C products, most startups invest in digital channels that promise to grow traffic and drive customer acquisition. But as the number of companies targeting channels to get consumer’s attention increases, so do costs. How can you save time and money yet maximize your reach when bringing your product to market, especially in a consumer-facing business?

We sat down with  Dinesh Moorjani, an entrepreneur and investor. As founder and former CEO of Hatch Labs, Moorjani incubated and built over ten early-stage companies, including the multi-billion dollar app, Tinder. In a conversation with Shikhar Ghosh, Moorjani shares his insights on marketing strategies for B2C products—a topic he’s uniquely qualified to discuss. In 2007, intuiting the revolution of wireless technology, Moorjani launched IAC’s mobile group. Under his leadership, the group saw 40 million app downloads and doubled app revenue annually. In an age where marketing options seem limitless and sometimes circuitous, Moorjani shares core tactics every consumer-focused startup can use to get their products to market more successfully.

Since B2C companies sell products and services directly to customers the most effective B2C marketing strategies find creative ways to reach your target customer. Moorjani notes, that consumers are bombarded with options for products and services and “we can only absorb so much” at any given point. Often, digital marketing tactics contribute to information overload. How can you capture customers’ attention and show them the value of your product?

Pay Attention to Signal to Noise in B2C Marketing

In the battle for customer attention, companies spend a lot of money to acquire consumers. Moorjani notes, “the cost per install for an app or the cost per acquisition of a customer through any digital channel just keeps going up and up because the number of companies that are attacking those channels to market to get consumer’s attention is significant.”

Customer Acquisition Costs (CAC)

According to Andreessen Horowitz, paid customer acquisition costs tend to go increase as you try and reach a larger audience. For instance, if the cost—per user—of obtaining your first 1,000 users was $1, the cost—per user—to acquire the next 10,000 users might raise to $5, then to $10 per user to acquire the next 100,000. Since the steady escalation of CAC per channel might hinder your ability to scale your user acquisition budget profitably, Moorjani recommends taking a step back. Instead of focusing on marketing channels, pay attention to signal to noise—especially in consumer-facing businesses.

When I look for consumer businesses and I meet entrepreneurs and they talk to me about clever ways of marketing, I say, “forget all the channels that we all know of and the brands that you can use to do pay for performance advertising.”

Dinesh Moorjani

Step back and don’t think about marketing channels. Start thinking about signal to noise. How much noise is out there and what type of signal do you have to penetrate the noise?

Dinesh Moorjani

Think about the Buyer's Journey

Before investing time and money to acquire customers through standard paid channels, Moorjani suggests thinking about the buyer’s journey—the 3-stage process by which buyers 1) become aware of, 2) consider and assess, and 3) decide to purchase—or pass on—a new product or service. Where are your consumers located? When do they think about a purchase decision or a usage decision?

How Your Customer’s Journey Can Improve B2C Marketing Strategies

Think about their story as a consumer, Moorjani suggests, “when they would need that product or service that in theory could be marketed to them?” Once you have identified times they would be receptive to your product, ask yourself, where during those circumstances, is there no noise?

Identify a Place & Time Where  Little or No Noise Exists

Then, Moorjani recommends, “find a way of introducing your signal— essentially your advertisement—where there is no noise so you can cut through what would be low signal very easily and get the attention of the consumer.” Otherwise, he notes, you risk “spending a lot of money competing with lots of other companies that have very large balance sheets [and] incumbents that are willing to spend a lot to potentially compete with you.” Those circumstances place most startups at an unnatural disadvantage to compete. But thinking about the buyer’s journey and introducing your product during a time of low noise can give you what Moorjani calls “an unnatural advantage.”

Find a way of introducing your signal—essentially your advertisement—where there is no noise so you can  get the attention of the consumer. That  makes it easy to test product market fit and determine if you really have a business or not.

Dinesh Moorjani

Seed Your Product with Guerrilla Marketing Techniques

Guerrilla marketing—a form of outbound marketing that positions your brand where your audience is, in a way that they’ll be receptive to it—provides a creative strategy for cutting through channel noise. By presenting a message in a novel or unexpected context, guerrilla marketing can generate buzz about your product that spreads organically. Implemented correctly, it can help your product stand out, as Moorjani can attest.

Get Creative

When Tinder launched in 2012, the startup famously applied guerrilla marketing techniques that became known as its “Party Strategy“—they invited attractive people to download the app, attend large parties on college campuses, and show the app to select partygoers. The technique helped Tinder spread organically. However, Moorjani notes that, while “everyone focuses on our on-campus guerrilla marketing,” they found other unique ways to market their product.

Other Ways  Tinder Cut Through Noise

Well before Instagram offered an advertising product, Tinder creatively leveraged Instagram as an informal channel to advertise. Moorjani’s team reached out to prominent Instagrammers who had a large following and asked those influencers to post about Tinder. Posts were seen as authentic, not advertisements to dismiss, and quickly spread. The social media word of mouth approach had a larger reach than the on-campus guerrilla marketing techniques. Used together, both helped Tinder go viral.

Moorjani explains, “the signal to noise was very high because it didn’t have to run through what would conventionally be seen as an advertisement on Instagram. And as a result, everyone paid attention and our click-through rates back to our product were much higher.”

Seed on Multiple Channels

In the early days, if you’re just seeding your product and trying to generate incremental demand, Moorjani notes that it’s okay to pick channels that aren’t scalable or ones that may flatten out and stop delivering more users. What matters is that you began seeding your product and, as Moorjani strategized with Tinder, seeding on multiple channels creates heightened engagement with your product. In Tinder’s case, mixing channels with large distribution footprints—like Instagram—and offline channels where the signal to noise can be higher—like the campus party strategy—created a viral effect.

Seeding on multiple channels that have signal to noise essentially creates a layered effect where people begin talking about your product.

Dinesh Moorjani

Finding channels—either in the early days that have large distribution footprints, or even offline channels where the signal to noise can be higher—can essentially yield engagement with your product. So you can  test product market fit or, if you have product market fit, begin to scale the business.

Dinesh Moorjani

 

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