How to Reach Critical Mass – Startup Marketing
A theme touched on in our discussion of network effects is that in some products, a user stands to gain more value if other people are also using that product. Examples of these products range from fax machines to operating systems to modern social web applications. Based on the model we discussed, there is in fact a “tipping point” where there is upward pressure on demand for the product. If the model is correct, passing the tipping unstable equilibrium allows for a natural push to a high user base, while failing to reach it will lead users to desert the product.
These days, many startups are based strongly on social interaction. In his article, Chris Sanfilippo discusses startup marketing, using another apt name for the “tipping point”: critical mass. One strategy he describes is “starting small”, with incremental growth. For example, Facebook initially started in universities, adding a few universities at a time. In the context of the model we developed, starting in more exclusive communities may cause the value of other people joining to be greater. He also discusses target influencers, which were mentioned in the textbook. Having particular people with strong influence join the market will also push value towards the critical mass.
The model we developed has powerful implications, but notice that the above two strategies are not based on getting the greatest number of product users but instead of increasing particular people’s value to others. A more complex model could take these factors into account.
https://medium.com/@csanfilippo01/how-to-reach-critical-mass-startup-marketing-51767b5b6dce#.yk1ktk9tm