Strategic Marketing: Lessons from the start-up world, with Aterlo Networks

“Do funnel analysis! The drop-off may not be where you think it is.” – Dan Siemon, VP of Product Management, Aterlo Networks

The last Strategic Marketing P2P of the season focused on marketing lessons from the start-up world. We had the pleasure of hearing about the experiences of two local start-ups: Aterlo Networks and Thalmic Labs. This post focuses on Aterlo; you can read about the Thalmic session here.

In August 2014, four of my colleagues left Sandvine to start Aterlo Networks. Aterlo’s founders all have technical backgrounds – product management, architecture, software development and engineering – so this whole marketing thing is new to them. They’re smart guys, though, and are attacking marketing with a very agile/corrective and data-driven approach, and are willing to learn from the experiences of others.

Hey – I know that guy!

Dan Siemon, VP of Product Management, talked to us about marketing as a startup, from tactics on creating demand and educating the market to stories on what’s worked for them and what they’ve learned so far.

Dan provided a fairly unique perspective on marketing, as an outsider who’s looking in and learning it on-the-fly. As someone who’s worked in high-tech marketing for more than a decade, I found this perspective tremendously interesting.

I had the pleasure of working with Dan for almost seven years at Sandvine; Dan joined the Consulting Systems team in 2007, and later moved into Product Management. He formerly owned an operated his own Internet service provider, and he sits on the board of the Mornington Communications Co-operative.

“I’m going to tell you what we’ve done with marketing at Aterlo – I’m not saying it’s the right thing do to.”

In typically humble Dan fashion, he prefaced his presentation by saying “I’m going to tell you what we’ve done with marketing at Aterlo – I’m not saying it’s the right thing do to.”

Aterlo’s first product (NightShift) helps people with slower Internet connections and low data caps enjoy high-quality streaming video. Perhaps surprisingly, this is not a problem that’s going away: demand is growing faster than capacity, and in the United States alone there are more than 30 million households who don’t have sufficient Internet capacity to stream high-definition video. Globally, the figure approaches 200 million.

Initially, Aterlo’s primary target market are consumers who are on satellite Internet connections. Their secondary market is anyone with bandwidth/usage-limited Internet (e.g., a monthly usage cap). In both of these markets, consumers are unable to enjoy high-definition video either because the bandwidth of the connection is insufficient (that is, you can’t smoothly stream a 5 Mbps video on a 2 Mbps connection) or for fear of blowing past a data cap.

NightShift is a predictive cache that downloads – in advance and overnight – episodes of the Netflix shows you watch, so you can enjoy them in all their high-definition glory when you feel like watching them. By creating partnerships with Internet providers, NightShift can get around data caps because the Internet provider will allow ‘free’ usage during the overnight hours when network demand is low.

Got it? Cool.

Aterlo’s first challenge is building awareness and, subsequently, demand.

Satellite Internet is typically sold through dealers; these range from large operations to mom and pop computer shops. Aterlo needs to get on their radar in order to access current and future satellite Internet customers. Selling NightShift through a dealer is essentially a business-to-business-to-consumer (B2B2C) sale.

Dan explained his two demand generation goals:

1. Get the dealers to talk to new satellite Internet customers about NightShift
2. Get access to the dealers’ existing library of customers

Initially, Aterlo set about building a dealer network. Dan admits that this model doesn’t scale particularly well, but it really helped Aterlo to learn what messages motivate the dealers. As Dan says, “People say you need to talk to your market”.

Outside-in thinking, I like it!

With the dealer network being built, Aterlo now had a budding list of contacts who were interested in what they had to say. Next up: email marketing!

They adopted a Hubspot-driven email workflow and initiated a series of emails with different topics to increase awareness and explain the benefits to the dealers.

“This is the first time I’ve done any email marketing, and it can be depressing.”

How did it go? “This is the first time I’ve done any email marketing, and it can be depressing: you know you have a product that will help them*, you know the end consumers like the product, you’re using a very targeted list of people who actually signed up…and you still get low engagement.”

[*What’s in it for the dealer? A couple of things, but one that’s really compelling is a reduction in churn/cancellations. Satellite Internet providers have a real problem with churn before the service is even installed. Many users sign up, but then learn that high-definition video streaming will be difficult or impossible, so they cancel before the service is even initiated. NightShift is a built-in solution to this problem, so there’s an enormous incentive for the satellite dealers to promote the product or even include it with the service.]

So, despite the focused list and relevant message, results were still modest initially.

What about the landing page linked within the emails?

Dan and the team rely on Mixpanel for their landing page analytics (“It takes some work to get it set up by instrumenting your landing page; it’s not the beast that Google Analytics is”). Funnel analysis let them zero in on where the drop-off was happening (“Do funnel analysis! The drop-off may not be where you think it is.”).

While performing analysis into their early marketing efforts, Dan and the team found themselves doing some coding, saying, “Sometimes you need to build your own marketing tools.” They’re all technical, so it didn’t take much time at all for them to integrate different marketing systems into their own clear, focused dashboards.

“Sometimes you need to build your own marketing tools.”

At this point, I found myself wondering if I was witnessing the beginning of a creation story; like, years from now Dan and team will have a billion-dollar marketing company that started when they found themselves building their own tools to fill gaps in the marketplace…You read it here first!

One early lesson that came out of the data analysis was that they had a branding problem. One of the first emails had the Aterlo Networks logo and the NightShift logo, and this was really confusing for readers. As of June 22nd 2015, they moved all of their consumer messaging to gonightshift.com, so consumers are only exposed to the consumer brand.

The data also pointed to a few more tweaks that could be made, so the Aterlo folks obligingly did so and have seen their campaign results improve.

With the story of his initial foray into marketing told (but very much still developing), Dan wrapped up by summarizing his lessons learned so far.

Dan’s Lessons Learned

Dan shared with us a number of valuable lessons:

• Marketing is hard
• Don’t let a bunch of programmers do graphics
• Figure out your branding: don’t confuse your audiences
• There’s no substitute for talking to the market
• Tools, tools, tools! Marketing automation + lots of analytics + custom stuff to tie it all together
• Articulate goals, and…
• Track everything: “We track 24 marketing metrics on a weekly basis”
• Favourite tools: Hubspot, Sidekick, MailChimp, Mixpanel, and WordPress

My thanks to Communitech and to Dan, and my best wishes to the whole Aterlo Networks team: keep up the great work, guys!

About Lee Brooks

Lee Brooks is the founder of Cromulent Marketing, a boutique marketing agency specializing in crafting messaging, creating content, and managing public relations for B2B technology companies.