The question is asked as to whether a firm can survive on inbound marketing alone.
My response beings with a question: is survival merely enough?
Survival implies maintaining a status quo; just barely staying afloat. But as any investor will tell you, growth is the lifeblood of any firm, and a firm that is not growing is dying.
So perhaps a more fitting question is, 'can a firm grow on inbound marketing alone?' To which the answer is, 'it depends.'
In the case of small businesses which are financed with equity in the form of venture capital, the driving financial goal of the business should be to realize returns which are in line with the expectations of the investors. and any kind of decision which could conceivably inhibit your ability to deliver those returns should definitely be considered a Bad Thing, and inadvisable. An explicit reliance on inbound marketing, which places an emphasis on organic growth and is very resource-intensive, could conceivably handicap a small business.
That said, if a firm's hurdle rate is low, and they have enough cash to not have to worry about a runway, sticking to your guns becomes much more doable, and in the long ron can even be a strategy for growth, if you are in a market which places a premium or corporate branding and integrity.
Relying solely on inbound marketing as a growth strategy is inherently risky, because the yields on inbound marketing increase as a firm, product or service's user base increases, and the venture must reach a certain 'critical mass' in order for the firm to see any significant returns.
Now that said, every once in a while firms get lucky, and the right combination of product, placement and price causes a firm to see significant organic growth based solely off inbound marketing and superior product design. But these firms are the exception rather than the rule, and while it may be tempting to idealize their successes and believe we can apply the same formula, it is as often as not chance as much as anything else... even Apple, one of the largest and by any measure most successful firms, employs extensive outbound marketing to raise awareness about new products and their features.
So perhaps the question should be 'if Apple doesn't rely solely on inbound marketing, why should you?'
Stephan, you make some great points about the risks associated with depending solely on inbound marketing. I would, however, argue that inbound marketing is less resource intensive and have the potential for inorganic, or viral, growth. I believe that these two factors make inbound marketing a more appropriate risk for start-ups or small businesses to take. I agree that Apple sets a good standard, but Apple has reached the point where they are looking to expand their market share. For start-ups who are just trying to build a initial or moderate customer base, inbound may provide enough to "survive" the early stages. Once established, these companies can then look to outbound to expand their market segment, much like Apple has done to become a "Big Player".
ReplyDeleteInbound marketing only works if someone is "following", "liking", or "connecting". If no one is listening or searching for your inbound marketing content it will yield nothing. Outbound will feed the inbound. (contrary to what I posted in Jim Daves blogs). A outbound marketing campaign can drive potential customers to your website and social media outlets.
ReplyDeleteI disagree with Jnolan that "For start-ups who are just trying to build an initial or moderate customer base, inbound may provide enough to 'survive' the early stages." I would not count on getting lucky, as you say, having the right combination of product, placement and price. A company must take responsibility for its success and do whatever is necessary to make a statement and get the attention of its target market. Inbound marketing will provide more qualified leads, when you get them. But how long can a company afford to wait for people to take notice?
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