“Hire a data analyst before you hire a social media manager”
Tom Hares is the co-founder of Buzzbike, the “Netflix of bikes”. The business he founded with Andy Nunn is disrupting bike ownership; instead of buying a bike, Londoners can now subscribe to a bike in the same way that you can with say, Spotify, with a month-to-month subscription that can be cancelled any time.
Here, Tom tells us how marketing output has changed as Buzzbike scaled.
Q. Talk us through how (when you introduced your subscription service) you initially set about acquiring new customers.
In the very early stages, we were focussed on getting to our first hundred customers to prove the business model to investors. So our tactics were really hacky - targeted flyering at tube stations, saddle covers to free ads on Facebook Marketplace and Gumtree. And of course, emailing existing databases.
Q. How have the tactics for customer acquisition changed over time, and what informed those changes?
We moved on to a second phase, where we started to spend more on Facebook and Google Ads, using lookalike audiences to target audiences similar to our existing customers.
The issue there is that relying on these tactics increases cost per acquisition. If Facebook changes how it operates, such as the recent changes to iOS which made targeting much harder, it makes it more difficult to acquire customers as a reasonable price. So we started to diversify into channels like Gmail ads, and developed a referral scheme, which worked well for us.
What’s important has been to always experiment. We’ve created a partnership with City Mapper which has been really successful, we’re trialling platforms like Pinterest and of course PR. We continue to experiment to reduce reliance on Facebook and Google and to increase organic conversion.
Q. Buzzbike was a first-mover in bike subscription in London. What steps have you taken as other competitors seek to emulate your success in the market?
In a nutshell, brand plays a really big role here. We can defend ourselves through differentiated services and who we are as a brand.
Brand has also helped us increase our conversion rate and decrease customer churn, too. We believe there is very much a Buzzbike person and a Swapfiets one (our biggest competitor).
Q. When it comes to marketing success, what has surprised you most?
I come from a brand background. And what surprised me is how small a role brand and creative plays in an early acquisition strategy. Rather than agonising over catchy slogans, find out what problem you solve for your customers and play it back to them, then use technology and data to efficiently target them.
I’d urge founders to read this article about Language/Market Fit. It debunks some of the myths around branding for an early stage business.
Q. How do you feel that customer acquisition will change at Buzzbike? And what will be the most vital tools you’ll need in future?
We know there’s going to be some regulation to curb the advertising power of Facebook and Google. As a result, there will be a need to get back to how you acquire customers in more innovative ways. But there will always be a place for brand and content.
Q. What advice would you give to marketers working on other subscription-based businesses?
Get your product, tech and data teams involved in marketing as soon as you can. And hire a junior data analyst before you hire a social media manager. They’ll make a bigger impact on customer acquisition.