Dear Nigerian founder, crushing marketing is way more important than product development

So, I had a big argument with some friends who recently got bitten by the entrepreneurship bug and have been building their product for the past 5 months. I asked if they had sealed any deals yet (“nope”) or if they had done marketing for a previous MVP (“not really but we are sure this is what the market wants”). I also asked if they had been having delays or issues with their developers to have taken so long. According to them, the reason it was taking a while because they were building the best product available in the market for that purpose.  They went on to give me a list and advanced sophisticated features they had.

*sigh*

I told them; in the Nigeria of today, the guys with better marketing, better lobbying, better distribution will beat your better product hands down. They went on to talk about what they read on TechCrunch. Obviously these guys have been brainwashed by Silicon Valley. The African market is a jungle. It’s a place where fancy misinformed dreams come to die. You can’t survive on Silicon Valley advice here, the market is chaos. Why? First, for the internet entrepreneur, the Nigerian market is largely naive.

Ever wondered why Nairaland and Linda Ikeji’s blog haven’t changed over the years to implement better layouts and new features and yet awesome new websites and forums are nowhere close to them even with their great UI? It’s simple – the market doesn’t care. For what it’s worth, your amazing features might just be you “stressing” them. So if they just want X, give them X.

facebook-fan-page-marketing

At Prepclass, a lot of our requests – about 60% actually – come from outside our request form (via phone calls, emails, Facebook) and I can say authoritatively that the same holds for some big-name companies that I have personally interacted with. We all have a significant amount of “off-the-website” processes and this is where a lot of clients come from.

Dear Internet Entrepreneur, marketing/distribution/lobbying is way more important than product development in the Nigeria of today. Period.

I really enjoy convos on TechCabal’s Radar and on the Silicon Africa Facebook group. Sometimes I hear people eulogize product development in typical Silicon Valley style, and underplay marketing, lobbying and distribution. Either that or they make it sound like virtually anyone can figure those out. I’m like, “are you kidding?”

Let’s Talk About Marketing

I’ve found that most businesses have a bullseye marketing channel. For some businesses, it’s obvious, and for others, it’s quite tricky. Discovering your bullseye channel early is crucial. Two similar businesses using the same channel might achieve different results based on how they use the channel.

At Prepclass, we use Linda a lot for marketing. The results from banner ads and sponsored posts can be extremely different even if you are marketing the same product. We noticed this when we had banners on Linda through AdDynamo. Even for banner ads, the result for remarketing banner ads may be very different from that of normal GDN campaigns.

Figuring out a form of marketing that works is tough; you have to experiment, experiment and experiment till it (almost) drives you crazy. The only data you should use to make assumptions about channels is empirical data or suggestions from someone who you know has extensively tried it. Otherwise, you should have a priority listing of channels you want to try with the minimum possible budget and leverage on the unique strengths of the channel as you experiment.

One formula does not work for all

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Not True! Very misleading.

We’ve done quite a bit of marketing on Linda, so I know. Linda may not work for every business but it works for some depending on your target audience. For example, things like slimming tea, weight pills, fertility, baby products and supplements (do you see the trend here? These are products with focus on women and lifestyle). Linda is BAE for some things, and maybe average or poor for most other stuff. While some people are just following the ladder, some folks are cashing out on marketing there so don’t throw the baby away with the bad water.

Another channel of interest is SEM (search engine marketing). Recently, we waged a war to occupy the top spot whenever anyone googles the keyword, “Home tutor in Lagos” and after 20 days of occupying what we had assumed should be a hot keyword, we haven’t gotten any conversion from it. Unbelievable!

For a hotels or bulk sms business, the story would have been very different (and fantastic) if they were sitting atop Google search for the hottest keywords in their industry. This is because for them, search engine is the bull’s eye.

Lesson: The nature of the business affects what channels work. What hustle are you pushing?

Linda might not work for an SEM/SEO driven business like hotels or bulk sms but if you want to do a service business like Wesabi, or a makeup-artists-on-demand hustle, you want to at least try it once. From our findings so far, Nigerians hardly search for service providers online. If you will be providing a physical service, you definitely want to explore push channels.

I am strongly of the opinion that the difference between the success of 2 companies in Nigeria with the same cash in hand and workable products will more likely be the ingenuity of their marketing (specifically their customer acquisition strategies) than the difference in their product sophistication. Feel free to disagree but please come with examples in Nigeria.

Data driven marketing

Determining your CAC, ROI on marketing spend, conversion rates per channel, and conversion funnel, or running a Cohort analysis on clients acquired through different channels to determine which channels bring more premium clients and which channels bring clients with higher LTV is crucial.

I spent a year at Jumia and managed the spend of over $800K on channels I was in charge of. A lot of guys think Jumia spent a lot of money marketing online (and yes they did) but Jumia was an extremely metrics conscious beast. They even had this concept of PC1, PC2, PC3 where at PC3, they could tell the net profit or loss percentage per product sold (i.e. the percentage profit on each and every product after removing cost price, marketing cost, logistics cost, salaries, rent and all other costs per product). They were crazy about the data the business created. They also had deep insight into the marketing channels they used, and if they “wasted” money, it was largely on purpose.

I always say marketing goes far beyond throwing money all over the place. It’s a deep science that many “startuppers” trivialize or sacrifice on the altar of product development. Instead of “build, build, launch”, before you start marketing and tweaking your product, what works better is: market an mvp, launch, market (acquire a lot of customers), study usage patterns, build according to data and market all over again.

Am I saying never ever build a great product? NOPE! I am saying there’s a time to build a great product and it’s not at the beginning. Instead, here’s when to elaborate an online product in Nigeria:

  • When you have a strong enough user base to guide you.
  • When there is potential for your product change to improve your conversion rates (this, for me is the biggest reason).
  • If you are pivoting (obviously).
  • If you already have a significant user base and having new product with a wider service range might significantly increase revenue per customer or your revenue retention rate.

There is an important exception to this. If your product is the actual value you are selling (e.g an enterprise platform or solution), you are selling at premium prices (probably $100 or more), or your potential clients are few but have a lot of money to spend on your solution, then please, a lot of what I’ve said is not for you. Kindly respect yourself and invest in product development.

Outside of that, my surmise is building an extensive product for the Nigerian market is BS. No offence, but the market just won’t reward you for awesomeness. Build the barest, leanest MVP that you can, figure out your best marketing/sales channels and sell it. If you are B2C, figure out your distribution and revenue collection mechanisms as well. If you are doing a B2B, figure out the shortest sales cycle path. Tweak your product only when it promises a significant and incremental reflection in revenue.

I’ll lift this quote from Mark cos I thought it was absolutely super spot on – “You can get every other thing wrong, but if you get your user acquisition strategy right, you survive.”

Written by Obanor Wezam, Prepclass CEO.

Wezam is a strategy games enthusiast with a passion for people and an insatiable zest for experimenting with viable ideas and building profitable businesses. He enjoys conversations around business and speaking at events.