It’s often said that distribution beats product. In other words, the quality of the product and its features is less important than how it can get into - and stay in - people’s hands. [1] Distribution isn’t just about marketing, but I suppose marketing plays a part in terms of gaining access to users.
Product marketing is continuously evolving, and there are constantly newer ways to get products in front of potential users. As certain channels become more popular, there are more tools to make the processes easier. The increasing popularity of user-generated content (UGC), for example, has birthed the likes of Archive, Hootsuite, Passionfroot, and more. I suppose the good thing is these tools are easily accessible and with shallow learning curves, therefore virtually any startup can use various channels to reach users. But, it also means anyone can use these tools. [2]
Distribution in its traditional sense refers to business model - B2B, B2C, etc. However, a conventional understanding of distribution involves considering a) how people discover the product and b) how this enables widespread adoption. [3] The former requires marketing and/or sales, but the latter involves establishing moats and/or network effects where possible.[4] On moats, Zoom/Slack vs Microsoft Teams is a frequently-referenced example on this point.
Regardless of the business model, a strong distribution strategy is ideal. At the core, better distribution = more users = more revenue = more long-term leverage. So, marketing is easier, but also only one part of the puzzle. Perhaps there is another component to be considered.
I’m trying to imbibe a simpler approach to things these days, and I find that word-of-mouth is a really underrated lever. On paper, word-of-mouth seems archaic compared to social media, partnerships, and SEO. I understand why: on paper the alternatives are far more scalable. Technically, yes. You can reach millions of users with a brilliant social media strategy. You can probably reach thousands with effective SEO. But, we’re fundamentally trying to get users to A) learn about the product, B) use & pay for the product, and C) hopefully enjoy it to the point of innumerable subsequent recommendations. It’s a solid principle regardless of whether one is running a restaurant or startup. Other marketing channels can help, but the basic network effects can’t be beaten. [5]
Prioritising word-of-mouth doesn’t mean neglecting the other channels. If anything, quite the opposite. It’s not an either/or situation, but word-of-mouth optimisation (WOMO) ensures all channels are being directed towards the goal of getting people to point C: not being able to shut up about it. [6]
Earlier in the year, I read Contagious by Jonah Berger, an Associate Professor of Marketing at Wharton. As the title suggests, Berger discusses the psychology of recommendations and the value of word-of-mouth in helping things catch on. Case in point: 20+ note-taking apps can use all the same marketing channels, but it’s possible only ~10% may leave users raving to others. Then, those users rave on, and so on. It’s also worth noting that WOMO can draw in users from other competitors.
Word-of-mouth is not new, nor is it groundbreaking. But, it is an often overlooked consideration - perhaps because virality is primarily associated with consumer (social) apps.
The WOMO approach is slightly circular in how it informs the entire product and adjacent functions. With the aim of user recommendations at the centre of the product, design suddenly demands greater detail, branding requires more consideration, and it’s possible even customer support becomes more sensitive. Why? So users can love the product more than existing alternatives. I’ve recommended Perplexity, Claude and Persona to all who’ll listen - if I had to guess, I would imagine I’ve told >50 people about each one.
On that note, word-of-mouth isn’t unscalable. In fact, it’s potentially more scalable than content marketing: one involves showing, and the other involves telling. [7] In an age where products are inorganically presented through engineered algorithms, honest recommendations from other users weigh far more. At the risk of sounding cliché, getting the product into users’ ears beats placing it front of their eyes.
P.S. This was initially meant to touch on the benefit in choosing names that stick within word-of-mouth. Slack, Beli, Soundcloud and Doordash nailed it.
[1] Ideally, the distribution channels would be scalable as well.
[2] I expect it’s clear that marketing & user acquisition discussed here applies to most, but not all, industries. The average medtech startup needn’t use influencer or content marketing.
[3] The underlying assumption being it’s something already desired, but perhaps not yet discovered by the user.
[4] On moats, Zoom vs Microsoft Teams is a frequently-referenced example on this point. However, not all moats can be eroded.
[5] Positive and negative network effects exist. It’s clear why we only witness the positive cases.
[6] I should add: this doesn’t apply to products that ‘solve problems’. In many cases, people also rave about things they simply enjoy using.
[7] Perhaps one of the few cases where telling is better than showing.