May 5, 2016
Faster! Faster! Online marketing enables entrepreneurs to grow faster than ever.
A recent report on startup growth shows some exciting news; U.S. startups today are growing faster than they have in the past. In 2014 venture capital backed startups grew revenue an average of 85%, up from 63% in 1998.
These increasing growth rates are fueled by three key trends.First, online marketing tactics have enabled far more cost effective marketing with far greater reach. Second, purchasers of products, both consumers and enterprises, are more inclined to purchase products from startups than ever before. Third, these faster growth rates have also certainly contributed to an increased volume of startup investment, particularly for entrepreneurs who can show real revenue growth and advantageous customer acquisition costs.
These days it’s not uncommon to hear about acquiring customers online for a few dollars. The vast range of options enables entrepreneurs to experiment and optimize marketing plans with a measurable acquisition cost before scaling up to capture customers nationally and even globally. Scaling up is faster and easier than ever, startups can reach and acquire millions, if not hundreds of millions of customers with a single acquisition channel. In addition to Facebook, there’s LinkedIn, Instagram, Snapchat, mobile app stores, enterprise app stores, content marketing, and a host of other customer acquisition techniques not employed 20 years ago.
It also seems that customers today are increasingly predisposed to try new products, demonstrated by increases in return rates of marketing investments for new products and services. In addition, a direct online connection between companies and customers has enabled subscription revenue models to become broadly adopted in both enterprise and consumer segments, providing revenue predictability. So, a startup can invest a lot of money today to generate 3x or 5x as much revenue over the customer lifetime in the next few years.
As a consequence of these three trends, entrepreneurs are able to grow faster than ever before. It’s an exciting time to be an entrepreneur, with an open road of opportunity in front of you and the tools to speed down that road.