Larry Kim is totally obsessed with unicorns.
He began his company, WordStream, with high ambitions — even though it was the middle of the 2008 recession, he had zero startup experience and was operating out of a Panera Bread restaurant.
Still, the first-time entrepreneur was determined to make a unicorn (a privately held startup company valued at over $1 billion), and over time he would accomplish just that.
Today, WordStream employs 300 people. Collectively, they manage over a billion dollars in advertising spending on behalf of thousands of customers around the world. This past July, the company was acquired for $150 million.
Now that he’s reached unicorn status, Kim was kind enough to share his top three growth marketing principals with the crowd at the recent Web Summit technology conference in Lisbon, Portugal.
1. Be somewhat delusional
Kim began his career as an entrepreneur with lofty goals, and refused to compromise, even when he was still working out of a bakery-café chain location.
“There is tremendous power in intentionally projecting a somewhat delusional plan or proposal,” explained Kim. For example, when Kim drafted his business plan at that Panera Bread location, he projected tens of millions of dollars in revenue within his first three years.
“Yet the plan actually worked. It’s amazing,” said Kim. “We do much more in revenues and earnings than I ever modelled in that crazy plan, and the question is how is that possible?”
The answer, according to Kim, was delusion, or at least goals lofty enough that most others would call them delusional. He explains that 99 per cent of the potential employees and investors that he shared his projections with said he was crazy.
“One per cent of people will look at this thing and be inspired, and those are the believers. Those are the one per cent of people that you actually need, and the only people that are capable of turning this crazy vision into a reality,” he said.
2. Find your unicorn growth hack
Kim believes that most companies have or are capable of producing what he would refer to as a potential unicorn, only to abandon the idea too early, or not let it develop into a fully grown unicorn.
“When it comes to finding the unicorn, I’m not suggesting that you try to find a viral hit — that truly is a suicide mission,” he said. “You can find your unicorn by just looking at the top three per cent of your existing campaigns and seeing what three per cent is outperforming the rest.”
Kim explains that in most marketing campaigns, a small percentage of email marketing subject lines, blog post topics, social media posts and other content generates a vast majority of engagements and conversions.
“Most of the value you create in marketing is coming from a tiny fraction of the campaign, so when it comes to finding your unicorn growth hack look to the past — it’s probably related to something that did well previously,” he said.
Furthermore, Kim believes too many companies get tied up in minor tweaks, A/B testing and making small changes to uninspired ideas in the hopes of seeing a significant change.
“What you really want is to have a better, bolder product or strategy,” he said. “When I’m talking about finding your unicorn growth hack, I’m not talking about getting a slightly better B2B white paper offering. I’m talking about finding a truly remarkable differentiated offer that drives insanely high conversion rates.”
3. Make unicorn babies
Once you’ve identified the unicorn growth hack hiding somewhere amongst your top performing content, the next step is to replicate it and build on it as much as possible.
“If things worked before in the past, it will probably work again in the future,” said Kim. “This may seem like a pretty obvious statement but I’ve found that 95 per cent of marketers favour new, unproven ideas over older, proven ideas.”
For example, Kim says that many are a slave to what he calls the “dumb marketing calendar.” By that, he means that they’re often willing to drop something that works simply because the calendar says its now time to do something else, such as holiday-themed marketing.
“When you find a unicorn, because they are so rare and so special, you need to jump off of the marketing treadmill of death and instead make unicorn babies,” he said, explaining that “making unicorn babies” is a metaphor for cloning or replicating the most successful ideas.
Rather than tinkering with non-unicorn or “donkey” ideas, Kim’s advice is to keep trying new and bold ideas until one of them proves to be a winner, and then go all in.
“There are so many unremarkable companies and so many unremarkable campaigns out there,” he said. “Take a chance, stick your neck out there a little bit, come up with something a little bit kookier and be a unicorn in a sea of donkeys.”