Peter Thiel, a PayPal founder and an early Facebook investor, is one of the most talked-about and revered internet business pioneers. And a billionaire.
His views on how to build a successful startup are required reading for entrepreneurs in Silicon Valley. and they can also help you come up with radical, new marketing strategies. Read on.
Peter Thiel co-founded Paypal in the 90s and was also an early investor in Facebook, Palantier, Yelp, and Quora among many other well-known startups. His ideas on how to build and market new companies are regarded as visionary and the success of his investments is often attributed to his guidance.
He’s been in the news recently because of his new book, Zero to One, which advocates creating something out of nothing (going from ‘Zero to One’) instead of just replicating an existing ‘One’ over again.
The book is about startups, of course, but after reading it, I found that his approach to building a successful startup can also be very helpful when trying to come up with fresh marketing ideas.
In the book, Thiel presents a few generally accepted truths about startups, and then offers a contrary perspective. Though his ideas may not work in every case, considering them will help you break the ice on new ways to inform, persuade, and remind your audience about your product.
Below I have listed the conventional wisdom, Thiel’s advice and then some examples to help you think about how you might use these ideas in your own campaigns.
Conventional wisdom: make incremental advances
Thiel: It is better to risk boldness than triviality
When you’re starting with a blank slate, it’s often tempting to just do something similar to what you’ve done before. And it seems less risky, as what worked before is likely to work again.
But by never pushing the envelope, you will never know if your campaigns could perform better. You may be leaving clicks – and conversions – on the table. And, in that light, doing the same thing over and over again is then the risky option!
I was trying to advertise a relatively standard banking role and so I initially picked a corporate looking fellow with the job title in the role.
The ad worked OK, but then I noticed that the News Feed has a lot of ‘linkbait’ photos these days, and they really grab attention. It definitely works on me, I thought, so why not give it a go for my ads?
The results were outstanding. From .2% CTR to 2% – a 10x improvement! Now I’m not trying to say that this result is typical, or that this is exactly what you should try.
But by being bold instead of conventional, I was able to find a strategy which had the potential to outperform.
What you should try: Test something as ‘out there’ as you can get away with. At the very least you will learn something.
Conventional wisdom: stay lean and flexible
Thiel: A bad plan is better than no plan
I like A/B testing as much as anyone. But too much testing can lead to an ad designed by a committee – and be much more boring. So, instead of playing it safe, come up with a challenging theme and see if you can develop it.
I had a relatively good campaign for a trade support officer for a top-tier client. But I was under pressure to deliver more, faster – so I needed a second, different campaign.
I tried to think of something as anti-corporate as I could – and came up with animals.
Again, the performance boost was stunning – so coming up with a new plan rather than just iterating through subtle changes gave some great results.
What you should try: Come up with an entirely new theme for a campaign. Move away from corporate fonts, colors, etc. and see what happens.
Conventional wisdom: improve on competition
Thiel: Competitive markets destroy profits
The point that Thiel makes most often in his books and lectures is that the world is much more polarized into monopolies and brutally competitive markets than people think.
So, unless your company is a monopoly, you are probably in much fiercer competition with rivals than you might realize.
So, when you’re devising a campaign, don’t leave anything to chance. Pull the big guns out straight away and make it obvious to your audience why they should be interested in what you have to say.
And not just over your competition – as we are rarely advertising near our competition – but over your target’s friends and family. That’s right – you have to be more interesting to your audience than their closest loved ones!
That’s not going to happen if you give a load of details or you’re being clever. Your audience will quickly be distracted by something else easier to understand – and leave your well-crafted copy in the dust.
Here, I was trying to get people to sign up for a job coaching service. I came up with a witty slogan and even used celebrities to catch people’s attention.
I loved it. But the little joke was confusing and conversions were crap. So I went lower – much, much lower….
And suddenly people signed up and even shared it with their friends. Acknowledging that we were in a highly competitive space forced me to come up with a very different approach.
What you should try: Create an ad which focuses entirely on one aspect of your product, make it big, and remove everything else.
Conventional wisdom: focus on product not sales
Thiel: Sales matter just as much as product
This is probably the most controversial point for advertising. Often we are told to just ‘get the message out there’ and ‘build awareness’ – much like a startup focuses on ‘creating value’. But unless you can measure the effect of your advertising, then you’re like the company who creates a great app – but never figures out how to monetize it.
So, getting more traffic, engagement, and buzz is great, but more sales is better.
I was trying to drive traffic to a jewelry and clothing site – and I knew that AdWords was a quick and cheap way to get clicks. And it worked – suddenly hundreds were visiting the site every day.
But no one was converting – we were paying to get window shoppers. So, instead of optimizing our PPC strategy, we moved instead to getting fans on Facebook and encouraging people to see the stuff at stores with daily updates.
It took a lot longer for the strategy to work – but sales eventually started picking up.
What you should try: Get some external benchmark figures – preferably sales – and try to move the needle. You’ll be surprised at how motivating it is when you can tie marketing performance to revenue.
Peter Thiel gives some great advice about what to do when building a company:
- Be bold,
- Try something completely different,
- Pull away from the competition,
- And focus on results.
Hopefully through these examples you’ve seen how I’ve applied these strategies to my campaigns and how you might do it too. Please do comment if you have other examples, though, as we can all learn from each other’s efforts – successes and mistakes!