There are many entrepreneurs (or wantrepreneurs) who believe the myth that building a startup is a piece of cake. Many fall prey to the “if you build it they will come” mentality, and don’t realize only a fraction of startups actually lift off the ground.
I read an insightful article the other day on why the freemium model of marketing fails for startup companies. Good stuff by fellow partner at Copyblogger Media, Brian Clark.
What is Content Marketing?
Up until a few years ago, I asked myself this question and could only take stabs at what I thought it meant. Truth be told, I had actually no idea what content marketing was.
Or more importantly how vital content marketing is to the success of a business.
Below you’ll see a brief explanation, but if you’re looking for a more comprehensive one, go ahead and check out our Content Marketing 101 page.
Content Marketing means creating and sharing valuable free content to attract and convert prospects into customers, and customers into repeat buyers.
What is the Freemium Model?
In the freemium model of marketing, businesses offer up something to a user at no cost – with the hopes that down the road they can offer a “premium” (or more enhanced) version of that product which people will pay money for.
One of the best examples of this are apps that you’d find in Apple’s store. Most notably this concept can be recognized when you see something like “get the X Product Lite version for free” or “upgrade to the X Product Pro version for $$$”.
How the Freemium Model Can Go Wrong
In Brian’s article, he uses the popular 80′s rock band New Order to illustrate his point. Back in the day, New Order partnered with Factory Records and Tony Wilson to establish a nightclub called the Haçienda.
All was well when they kicked things off, until the rave and ecstasy scene ignited which resulted in a huge money pit for those involved.
So what was the problem? Here’s how Brian explains it:
Well, clubs rely on alcohol sales for profits. At the Haçienda, people didn’t want alcohol, they wanted other drugs … with maybe an occasional water or juice from the bar. The dealers got rich, while the Haçienda provided the marketplace and carried the overhead.
In some cases, the freemium model can backfire on you. People get used to something for nothing, and you might have a product or service that they are unwilling to pay for.
In Brian’s article, his first lesson is to ensure that you are offering something of extreme value and that you’ll be able to (successfully) charge for it. Otherwise, he says, you could end up alone at the bar, lining up the occasional juice or water.
I’m Not Saying…
That the freemium model can’t work, just that it’s sometimes tougher (and requires more time) to get it to work. There are plenty of examples nowadays which prove that it can work, so don’t get me wrong.
What I am saying is that, personally, I believe that content marketing is the way to go.
Based on what I see in my blog comments and the keyword searches that bring folks here, it’s safe for me to assume that my visitors don’t build apps for mobile devices.
When I see are people looking for “how to become a successful realtor online” and “why should companies use a blog”, I realize that it’s my responsibility to provide them answers based on what has worked for me.
So let’s dive into why content marketing works.
1. People trust you when you provide them free content.
Here’s were content marketing and the freemium model of marketing somewhat overlap. Earlier in the post when I referred to the freemium model, I was primarily speaking about products. (Software, apps, and the like.)
Content, however, in it’s native sense is a much different story. Remember, content marketing is offerring free and valuable information in the hopes that you convert prospects into customers, and customers into repeat buyers.
When you dole out information (free of charge), it helps establish you as a credible source. More importantly, it creates a trust factor as well.
2. People share your content to others who might benefit.
Nowadays it’s extremely simple to share content – especially with all of the social sharing plugins that are available to embed into your site.
When people trust you, they are more likely to share your content.
Think about it, for a moment. Whose content do you share on a daily basis? For me, it’s guys like Brian Clark, Chris Brogan, Neil Patel and a few others.
Why do I share their content? Simply because I trust them, and believe what they say.
3. People will pay for your knowledge when they trust you.
I’d be willing to bet that a majority of savvy business owners understand that not everything in life is free. While content marketing brings in traffic and the trust factor, you still need to convince others why your information is worth paying for.
A few months ago I went shopping for a road bike, because I signed up to participate in a 1/2 Ironman event. While I was there, I asked many questions and was met with an overwhelming amount of information.
The guy went above and beyond the call of duty, and gave me answers to questions I hadn’t even asked yet. In a fun way, he used content marketing to lure me in.
We spoke about swimming, biking and running – I bring this up to illustrate a point.
I was graciously met with an overabundance of information, and felt that the source went above and beyond the call of duty. In essence, he established trust.
Did I purchase a bike from him? Yes.
Would I spend money if he offered an “Ironman Training” course? Yes.
Practical Applications of Content Marketing
Now you might be wondering how the content marketing strategy looks, and I’m going to use my friend as an example.
I have a good buddy who has over 30 years of experience in the real estate and mortgage industry, and recently closed his business. Not because he had none, but he was simply burnt out and needed something different.
While he entertained a number of different ideas, I encouraged him to use the information he’s collected over the years and “get online” with it.
He’s well aware of that real estate agents need social media and the internet, and that there’s a thirst for old school realtors to pull technology into their marketing plans.
What better way to utilize his knowledge than to teach agents how to use the power of the social media and the internet to build their business and create more sales?
A few weeks ago Rich launched his website Winning Agent, where he’ll use content marketing as a strategy to establish an email list and ultimately sell access to upcoming webinars and sales tools.
How’s YOUR Content Marketing Going?
So there you have it. Why you should put your efforts and resources into content marketing, and examples of how that can look.
What are your thoughts about it? Are you using content marketing as a strategy? How has it affected your business?
Let’s discuss below.
Great thoughts, Brian. I’m just learning about the trust side of blogging, so thanks for the reminder.
You betcha Chris. Speaking of, if you’re in the early stages of this and haven’t read it, I’d highly recommend checking out Chris Brogan’s book Trust Agents.
It might be right up your alley.
Great! I’ll look this up, thanks!
This is a wonderful article. I wonder if this could be applied to software business?
So far, I’ve got a great software given out for free but haven’t figured out how to capitalized it yet.
Great post Brian, really good information and examples.
I launched my own business last year as a small business advisor and have used content marketing from the start and it’s really helped me get established.
Just a couple of weeks ago I gained a new coaching client by sharing information in a LinkedIn group and pointing him towards some posts that I’d written. I didn’t have to sell to him and as you explained in your example the trust was established so he was comfortable taking the step to pay for my services.
I’m encouraging my clients to share as much useful information as they can in their niche, it really does work.
Hey Robert – that’s outstanding news, and congrats on landing a new coaching client. See, it works, doesn’t it?
In all seriousness, I think all it takes is one signup for people to realize the value in it all. The idea of spending time to create content that you give away is somewhat counter-intuitive.
It has worked for Copyblogger and also for countless others. The bottom line is whether or not you believe.
Thanks Brian
Yes, totally agree, and unlike other methods although it might take a while for you to get that first signup the content that you’ve created is always there, it can be viewed by more and more people as your audience grows. Content marketing is a great investment in a sustainable business.
“the content that you’ve created is always there”… you hit the nail on the head!
I appreciated this post and have shared it with my networks. I like the straight forward, no-nonsense argument you present in favor of content marketing, which I happen to agree with. I’m currently reading “Managing Content Marketing: The Real-World Guide for Creating Passionate Subscribers to Your Brand”, by Robert Rose and Joe Pulizzi (excellent read, btw) and incorporating many of their suggestion into my own work.
Good stuff, and thanks for sharing and mentioning the books. Will definitely have to look into them!
Brian, I think this is an excellent point, and ultimately I believe you. My stumbling block in setting up my personal business blog, however, is finding the right voice for that content. As a graphic designer marketing to small and medium-sized businesses, I’m still unsure of the best way to reach out to them that’s:
1. Not just “another design blog” that’s adding to the general noise and over-information out there, and
2. A resource they will actually USE or want to use.
These are questions I’m still grappling with before I set up a structure that doesn’t follow through with my ultimate goal of attracting online clients.
Your article is motivating, but the ultimate challenge lies in finding our distinctive voices and finding what we have to say that’s truly worthy of being said.
Great question you ask, and believe it or not I find myself in the same boat sometimes.
So instead of writing blog posts about things in general, often times I make it personal and explain through the lens of my own use.
In other words, “here’s how I designed MY logo”, rather than “here’s how to design A logo.”
Brian, thanks for the thoughtful and honest reply. I’ll definitely take this perspective into account when I start planning out and writing my own business blog.
The reality of Content Marketing is something I know little about, fascinates me, and makes me want to learn more.
Charles, you’re way ahead of the game man. You write more content than I can think of doing.
You’re such a good liar.
Super post. I especially like the example of the guy who was burned out. There are SO MANY experts that are either in a similar situation or retiring that should be sharing their wisdom through content and then mentoring or coaching or teaching. It’s a great model. Unfortunately, many get intimidated by the grind of “writing” and never get past it. Using a podcast model to generate the first draft will at least get the content out of your head. First, create a list of topics…(we’ve got a free tool for generating that list). Then…find someone to interview you about those topics. Have the recordings transcribed. Now, you can rewrite them into posts, articles, emails, ebooks and more. It’s a very good shortcut for those without the time, confidence or ideas.
All great tips and information Dave, appreciate you sharing. And if you think about it, how many college professors are “burnt out” people who wanted to leave the trenches of their industry to teach people about the skills they’ve mastered for so many years.
I don’t know? It seems to me that pushing the idea that “freemium” doesn’t work, on a blog, reigns as the ultimate dichotomy. The entire blogging platform appears to be built on the ultimate freemium model. Google is built on the freemium model. Maybe I am actually misplacing my feelings after reading Brian’s article on Forbes in your direction? That article appears to bash the freemium model?
Brian’s article (and my similar thoughts) reflect the idea that a freemium model isn’t always the best – especially when it comes to software or other related products. Content, however, is certainly something we advocate proving free of charge.
While we could offer free samples of our software, we wouldn’t see nearly the success.
I couldn’t agree more Brian. You’ve made some good points. I just learned a new thing to day – “Freemium Model of Marketing”.
Great article, Brian! For people have a hard time making the distinction between the freemium model and content marketing, maybe it will help them to think of content marketing as “expertise marketing,” and in many respects it’s not a new concept.
“Content” is you (as in the marketer) strutting your expertise. The “marketing” part of the equation is new piece, and quite simply means understanding which web tools and seo strategies will get your expertise in front of your desired audience.
Hi Brian, hope you are well
Perhaps you could help me with a little advice as i seem to be lost lately.
I’m a web designer and developer, but now concentrating on wordpress consulting and the genesis framework, as this is what i am most passionate about.
Now, everywhere i see, other web guys have a “typical business website” just like i build for my clients….But, as i am trying to get new work and establish myself in the Genesis community, perhaps it would be better to have a blog instead of a traditional website, where the home page is blog posts related to what i do and recent work. (recent work shows i’m busy, and blog posts show authority)
My goal is to actually get client work from my site. that is important.
What do you think Brian? it would be great if you could provide some thoughts on this.
Thanks so much