How to grow without paid marketing

Too many brands get stuck in a cycle where they absolutely need to dump more money into paid marketing to keep growing. Rising CACs, diminishing returns, saturated audiences, and picking off all the low-hanging fruit make it virtually impossible to continue to scale this way forever.

A couple times, I’ve had founders ask me what would happen if they just turned off paid marketing. It’s not a great position to be in to realize that all new customer acquisition would come to a screeching halt.

If you ask yourself this question and can name at least a handful of other means by which new customers could, and already do, find you, you’ve probably focused thoughtfully on product experience, retention, and effective organic marketing.

If you’re not the founder I just described, fear not — there’s no time like the present to focus on some of these longer tail wins. The baby formula brand Bobbie has become the model for sustainable growth that doesn’t rely solely on paid, so let’s dive in to how they did it.

First, a few caveats

The importance of paid marketing

To be clear, paid marketing is a key component of a holistic growth strategy 9 times out of 10. Paid marketing is so ubiquitously associated with growth marketing because it’s powerful, it’s scalable, and it delivers immediate results.

You can also get feedback incredibly quickly with just a little bit of spend, and I actually recommend running some paid marketing tests, especially early on, before making larger changes to your funnel, product, operational processes, etc. Some quick pressure tests on your paid channels to validate your assumptions will be much cheaper and lower-lift in the long run.

On the other hand, the trap is when you’ve gone too deep on paid marketing without focusing on more sustainable, longer time-to-value channels, leaving paid as your only avenue to more scale. Pay attention to what percentage of your new customers are attributable to paid marketing — you’ll need to start de-risking your marketing mix if this number is near or above two thirds.

The channels that won’t work on their own

Social media: Some brands think that focusing all their marketing efforts on building a relevant social presence, which is “free”, is the key. But just posting on social, even with the best strategy, isn’t going to get you far. These two things should be obvious, but often aren’t:

• Followers ≠ customers

• Going viral isn’t a strategy or a lever within your control (Please, do not tell your brand marketer that their target is to go viral, I beg you!)

Organic social media is critical for building authenticity and legitimacy, which is a worthwhile payoff even if it doesn’t directly and predictably drive customers. Where social can be a results-driver is with an influencer strategy, but that’s arguably just another form of paid.

Big offline brand bets: Out of home, TV, audio, splashy brand campaigns, and the like are going to give you sticker shock if you haven’t done them before. They’re VERY expensive — and aren’t the kinds of channels you’ll see results from with a small test. Putting resources behind these channels isn’t recommended until you’ve successfully scaled your baseline paid digital channels and are 100% confident in your funnel.

Ultimately, these types of buys come down to your risk tolerance. Things can go wrong or can take much longer to show green shoots. What’s the most you’re willing to spend to potentially learn something, but with zero immediate results?

SEO and content: A scaled content strategy can be incredibly effective, but it takes a lot of time and work to get there. All too often brands give up on SEO because it’s been a few months and they haven’t seen results. I would liken this channel to investing your money — you can’t start today and expect results tomorrow, but the sooner you start the better off your future self will be.

Ultimately, social media, big brand bets, and SEO are all important components of a well-diversified marketing mix, along with paid.

Bobbie’s approach

If you’re not familiar with Bobbie, they’re an organic baby formula brand that’s become the model for sustainable growth, particularly in the face of the crisis that was the global formula shortage in 2022.

But they wouldn’t have been able to weather this storm without making a lot of thoughtful, focused decisions from the beginning.

Building a foundational brand

On a mission to create a better baby formula, Bobbie launched mid-2020. They billed their product as the first European-style formula to hit the US market, meaning the formula contained less additives than formula produced in the US.

An excellent, differentiated product and strong product market fit were the foundational building blocks of Bobbie’s initial success. Bobbie deeply understood their market and the customers within it:

• They benefitted from having few competitors, as the formula market has exceptionally high barriers to entry

• They recognized the finite nature of their TAM — parents who have a baby who needs formula — and that people entered and exited this market every day

• They deeply understood their customers, and therefore, how to speak to them:

  • Their market is parents whose babies need formula — they weren’t convincing parents to switch from breastfeeding

  • Once parents find a formula that works for their baby, they rely on accessibility and consistency — making Bobbie’s business a perfect candidate for a subscription model, without it feeling forced

  • Parents buying formula for their babies aren’t making snap decisions or impulse purchases, and need enough information to make the right buying decisions

Bobbie also understood that the typical ecommerce playbook could only take them so far, as they were required to build a deep level of trust with parents on a very specific purchasing journey before they would buy. Understanding what parents were researching was critical to building trustworthiness into their site experience and content strategy.

Rather than thinking that their marketing channels drove growth, Bobbie thought about growth as being driven by their offer — giving parents the option to trial their formula before purchasing or subscribing — and marketing channels being the vehicle to drive to that offer.

Successful DTC growth in these early days was built on these foundations, and allowed Bobbie to diversify into retail (specifically Target, huge!) within 2 years of launch.

The formula shortage hits

In the spring of 2022, everything about Bobbie’s business model changed when they realized they would run out of stock at the rate they were growing. Their team made the decision to turn off new customer acquisition entirely so they could ensure they’d have enough supply for existing subscribers — meaning parents who relied on Bobbie to feed their babies.

In doing so, they took a step back and humanized their customers, rather than looking at them as numbers in a model. The growth team delightfully changed their name to the “slowth” team, and tactically, this meant:

• Slowing demand

• Introducing a waitlist

• Optimizing supply to serve existing customers

• Planning for the point when customer acquisition could become a focus again

Because Bobbie invested in the right foundations from launch, they already had about 70,000 subscribers at this point, and they knew they needed to take good care of these folks. Not only could this subscriber base help them weather the storm from a revenue perspective, but doing right by these parents saved them from immense stress, and created lifetime brand evangelists.

Getting the word out, beyond paid marketing

Eventually, the formula shortage subsided and Bobbie needed to transition back into growth mode. This kind of whiplash would have crushed so many other brands — so how were they positioned to survive such a crisis, and come out on the other side?

CEO Laura Modi has said in interviews that brands “shouldn’t get hooked on the drug that is performance marketing,” a sentiment most growth marketers understand all too well.

She’s also said that 60% of growth is your product and your brand, even if you do nothing else, and 40% is how you get the word out. At the time of this writing in March 2024, Bobbie does have quite a few Facebook ads live, but I’d bet they’re only a minority portion of that 40%.

Instead, Modi has touted three distinct focus areas as the most important for Bobbie: commerce, content, and community.

Tactically, this meant a few things:

• Focusing on their blog as an SEO and thought leadership play, from even before Bobbie had a product in market, even though they knew it would take a long time to turn readers into customers

• Investing in their community through events and causes, not as a way to drive direct sales, but to foster authenticity and differentiation as a brand

• Building processes for actually talking to customers, as another critical layer of data analysis

• Adjusting tried-and-true ecom growth strategies like personalized product match quizzes to fit their business — they launched with just one product, so instead, built a formula calculator to help parents answer the common “how much should I order” question

• Focusing on garnering social proof in the form of big press hits, “best of” lists, awards, and other legitimacy drivers like purchase protection and proactive objection-busting

• Finding relevant creators and communities on YouTube, TikTok, Reddit, etc. and seeding product to drive reviews and conversation

It’s worth mentioning…

…that Bobbie’s success story has been talked about so much because it’s not the norm.

• They’ve successfully raised three rounds of VC funding, totaling about $135 million

• A lot of their big bets paid off, like getting into a huge retailer early on

• They were able to capitalize on a once-in-a-generation crisis, in a way that was genuinely good for their customers AND their business

• Their product lends itself seamlessly to a subscription model, and, thus, recurring revenue

• They have somewhat of a moat, considering how difficult it would be from a resource and regulatory standpoint for a serious challenger to emerge

While some of Bobbie’s success is due to pure chance (as is true of any business outcome), they made a lot of strategic and thoughtful decisions from the jump that established them as a brand that could sustainably grow and thrive.

Note: Content in the Bobbie section of this edition of Growth Therapy was sourced from this interview with Bobbie’s previous head of growth, and this Lenny’s Podcast episode with Bobbie’s CEO. Highly recommend giving both a listen!

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