I grew up in the old Hyderabad (India), which is far less sophisticated than what you see in most developed parts of Hyderabad today. Back in my late teens, we didn’t have a 4-wheeler at our disposal. Whenever we wanted to travel to a distant place, particularly to a famous temple on the outskirts of Hyderabad, we used public transport or hired a taxi if our destination was not too far away. We had several taxi services in our neighbourhood, but we mostly ended up hiring the same person every time. Having used his services quite often, we know the taxi guy personally. He is a friendly and cheerful uncle, and let’s call him Shyam Ji.
Shyam ji owns a small transport business and often faces challenges from competing taxi services in the neighborhood. Taxi services charge higher fares, which is understandable, as they need to cover their expenses and make a profit to operate their businesses successfully. As a result, it can be challenging to keep his vehicles occupied daily.
In the pursuit of keeping himself alive in the business, he tried his hand at different marketing avenues to increase his visibility in the neighborhood and establish his company as a go-to taxi service. With the limited budget he had, he handed out paper flyers at neighborhood community events, partially sponsored community festivals, and built a network with neighboring schools, residents, and senior citizens.
He started generating business from some of these avenues. Over time, his efforts to network with senior citizens proved more successful than his other marketing expenditures. They trusted him for weddings, long trips, and hospital visits, making him their go-to taxi guy. Realizing this, Shyam Ji shifted his focus from spending resources on flyers and events to bonding with seniors. He attended their park chats and remembered the names of the senior citizens’ grandkids. He has become a household name in my community; my dad is a massive supporter of this guy, enabling him to offer his services multiple times over the last few years. Soon, he became a household name in the neighborhood for long trips, and his taxi services were always in full swing. Well, so far the story seems non-technical and straightforward, isn’t it?
Let’s explore the interesting marketing concepts hidden in this powerful, simple story. Let’s wear the hat and think through the lens of a product enthusiast. If we carefully analyze what Shyam ji had fundamentally done to get the leads for his small business steadily, he tested some of the customer acquisition channels and segments, narrowed down to a few, found what worked, and doubled down his time and investments on what’s working for him (networking with senior citizens), didn’t he? We discussed how he had started networking deeply with senior citizens (acquisition channel & segment), becoming closer to them over time. That’s essentially the marketing funnel for this channel (Awareness, Generate Interest, Trial, Convert). He figured out what works best for this demographic, that is, the older crowd. To acquire them as loyal customers, he deployed two of the most fruitful marketing strategies: word-of-mouth and goodwill. They believe in knowing something well even before putting it to the test, unlike other generations. Shyam ji, after experimenting with multiple channels, found the one that worked best for him. Sean Ellis, a renowned author and growth hacker, in his book ‘Hacking Growth’, beautifully calls this phenomenon ‘Channel Fitment’ – Identifying the channel that works effectively for the business.In the words of Peter Thiel, Cofounder of PayPal, “ If you can get even a single distribution channel to work, you have a great business.” So we can imagine how important it is to find the channel fitment early for the business.