Growth Plateaus

The mighty plateau. One of natures finest geographic features. Steep cliff sides that lead up to a mostly flat top. While this is a sight to see in nature, it’s less-than desirable to see when looking at your startup’s growth.

Growth here can be anything in terms of, but not limited to, site visitors, marketing leads, sales leads, or new customers. You don’t want to plateau in these areas, or at least for long.

I hate to break it to you, but plateauing tends to be a naturally occurring event in startups. Marketing can often be both the cause and solution to curing your tendency to plateau.

If you don’t have a totally figured out marketing program, then you likely have one or two marketing channels that seem to dominate in terms of driving growth. Many founders, especially early on, only focus on one or two because they can see the direct results of their efforts. And that’s the right thing to do.

But what happens when those channels stop producing beautiful charts showing continued progress?

Common Early-Stage Marketing Channels Used Get Traction

It’s not that there’s only a few ways to get traction early on, it’s just that startups tends to follow two patterns. One is founders put into motion tactics they’ve seen or heard others do. The second is to take the path of least resistance (which is likely what others did that they had heard about).

To help illustrate, we’ll work through some common channels that are often used early on and detail why they plateau below.

Common early-stage marketing channels to get traction:

• Word of Mouth

• Business Development

• Email (cold outreach, specifically)

• Paid Search Ads

Invariably, each of these channels have their own challenges in continued growth.

Word of Mouth can be great and is very cost-effective, but most products and services are not inherently viral. And so, they lack a viral coefficient (customer referral Xs conversion = viral coefficient) sufficient enough to drive growth. So relying on this channel can be at best, unpredictable, and worst, unreliable.

Business Development is an obvious channel. As founders or those in charge of business development early on, you’re reaching out to your network of investors, their friends, and your LinkedIn network. But those connections can’t scale on their own. And if you’re not offering a high-ticket product or service, you may find yourself spending more than you’re bringing in at an unsustainable rate. And for those with a high-ticket or enterprise product, then the lead time to close tends to be your barrier in relying on this channel alone.

Cold Email outreach could be the tactic out of your slump. After all, it can be automated so that you’re hitting 30-40 prospects daily. Each contact gets its own 3-6 email follow up sequence, making you appear super-human in your follow up game. But this channel has been abused by so many over the years, that it’s incredibly difficult to breakthrough the noise. You know you get these horrible emails—why would you want to send them yourself!? You’re more likely to burn up IPs faster than you’re closing new deals.

Paid Search Ads—ahh, the holy grail! Or is it? 🤔 As a self-professed paid-media guy, I’ll be the first to tell you there are many traps and pitfalls in search ads. Namely, it seems the more you spend to scale, the more each lead costs. Sure, your first 1,000 leads came in at an acceptable cost, but now scaling to 2,000 leads, the cost has doubled per lead. Worse yet, the conversion rate from lead to customer has remained the same.

Each of the above scenarios are common and, to some degree, to be expected. This doesn’t mean you’re screwed—there is light ahead.

Is it OK to plateau?

Plateauing is the outcome of reduced efficiency. It’s not that marketing isn’t working anymore or that “tHe AlGO Haz CH@nGed”. Without a high-functioning flywheel, your marketing efforts are unlikely unbalanced. And so each channel is only effective up to a point—which is why you’re experiencing a plateau of growth.

To plateau isn’t necessarily a bad thing because it tells you more about your strategy and is an indicator you need to make a change if you desire maintain or accelerate your growth rate. Don’t ignore the signals that you’re headed for flat growth.

Pushing Passed Plateaus

Here’s a few questions to consider to determine how to keep growing.

• When your traffic growth slows

  • Have you invested in content and on-page SEO?

  • Are you linking to (and getting links from) other industry websites?

  • Are you getting mentions in forums and online groups?

• When your marketing leads slow

  • Are you promising and delivering value to every marketing lead?

  • Have you maximized capturing existing demand in the market?

  • Are you lead gen pages showing strong core web vitals?

• When your sales leads slow

  • Is your funnel built to solve problems for leads before qualifying for demos?

  • Is your affiliate offering strong and are affiliates promoting it?

  • Are you sales comms automation metrics healthy?

• When your new customer count slows

  • Is your product positioning convincingly better than others on the market?

  • Have you maximized collecting and leveraging customer testimonials in your marketing materials?

  • Have you addressed all most common objections and conditionals in your marketing materials or sales demos?

Of course, the above is just a sampling on determining how to solve for growth plateaus. This will not solve all your problems. Product, operations, customer support, or customer success problems are not solved with more marketing.

When plateauing is caused by marketing, it can be solved with marketing. It often means your marketing program is out of balance and it needs adjustments and/or additions. Your marketing program should work in harmony. When the harmony is broken, growth will slow. Find the harmony and you’ll rediscover the growth.

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Paul Kromidas, CEO and Founder of Summer joins Tech Nest to discuss these topics and more. Summer is working to create a better path to ownership of vacation homes. Homes that owners can use when they want, and rent out the rest of the year. One unique concept Summer is bringing to market is a gradual ownership model—a totally unique offering in the vacation or second homes market.

Vacation rentals have been all the hubbub this year. Listen in to Paul as he'll shed light on where the industry is and where it has room to grow.

Listen in here.