In the ever-evolving landscape of online marketplaces, growth hacking has emerged as a pivotal strategy for companies aiming to scale rapidly and efficiently. The term ‘growth hacking’ itself is a testament to the ingenuity and resourcefulness required to navigate the competitive terrain of digital commerce. This article delves into the growth hacking journey of a marketplace that has achieved an astonishing valuation of $1 billion, as discussed in a recent podcast featuring insights from industry experts and the company’s founders.
The podcast begins with a look back at the first five launches of the company, a critical period that laid the foundation for its exponential growth. Anu Hariharan, a managing director at Y Combinator, hosts the discussion with Grant LaFontaine, co-founder and CEO of Whatnot, a live stream shopping platform and marketplace. Whatnot’s inclusion in Y Combinator’s Winter 2020 cohort marked the beginning of a journey characterized by strategic experimentation and bold decision-making.
(00:40) Launch #1 Takeaway: Build the buyer side of the marketplace – even if you have to hack your way there.
The initial focus was on building the buyer side of the marketplace. The founders recognized the classic chicken-and-egg problem faced by many marketplaces: the need for a balance between buyers and sellers. In the early stages, Whatnot resorted to listing tens of thousands of authenticated Funko pops, many of which were not physically in stock. Instead, they would purchase the items from eBay upon sale and authenticate them before shipping to customers. This approach, while unconventional, was a necessary step to catalyze the marketplace’s growth.
(04:26) Launch #2 Takeaway: Increase your returning visitor rate through creative marketing campaigns.
Creative marketing campaigns played a significant role in increasing the returning visitor rate. The company’s ability to engage and retain customers through innovative strategies was crucial in establishing a loyal user base.
(06:17) Launch #3 Takeaway: Work with trusted influencers in the community.
Partnering with trusted influencers within the community helped the company gain credibility and expand its reach. Influencers served as a bridge, connecting the marketplace with a broader audience and instilling trust in the platform.
(07:19) Launch #4 Takeaway: Build the seller side of the marketplace by encouraging high sell-through rates.
To build the seller side, the company focused on encouraging high sell-through rates. This involved creating tools and features that made it easier for sellers to list and sell their products, thereby enhancing the overall marketplace liquidity.
(10:26) Launch #5 Takeaway: Experiment with new content formats to drive traffic.
The company experimented with new content formats, such as live adverts before videos, to drive traffic and engage users. This innovation in content delivery helped differentiate the marketplace and attract a diverse user demographic.
The podcast sparked a lively discussion in the comments section, with viewers sharing their thoughts on the growth strategies employed by Whatnot. One commenter drew parallels between Whatnot’s cross-listing feature and Airbnb’s early growth hack of listing on Craigslist, suggesting that such tactics are a proven method for marketplace expansion.
However, not all feedback was positive. Some viewers expressed dissatisfaction with the video’s production quality and the interviewer’s performance. Despite these criticisms, the overall sentiment was one of appreciation for the candid insights shared by the founders.
A recurring theme in the comments was the challenge of overcoming the chicken-and-egg problem inherent to marketplace startups. Commenters were particularly interested in the strategies used by Whatnot to balance the needs of buyers and sellers. The honesty displayed by Grant LaFontaine in admitting to the initial fake listings was praised as a refreshing take on the harsh realities faced by founders in this segment.
The importance of user experience was another point of discussion. One commenter highlighted the struggle of requiring users to create accounts and publish products, emphasizing the need to test the entire experience for product-market
As we reflect on the growth hacking strategies that propelled Whatnot to its billion-dollar valuation, it’s clear that the journey of a marketplace is complex and multifaceted. For those inspired by Whatnot’s story and looking to embark on a similar path, CNXION offers white label marketplace services that can help streamline the process. With CNXION, entrepreneurs can leverage a robust platform tailored to their unique needs, enabling them to focus on growth hacking techniques without the burden of building the technology from scratch.
CNXION’s platform is designed to address the chicken-and-egg problem by providing tools that facilitate the onboarding of both buyers and sellers, creating a balanced ecosystem from the outset. Moreover, CNXION’s customizable features allow for creative marketing campaigns, influencer partnerships, and content innovation, mirroring the successful tactics employed by Whatnot.
In conclusion, the journey to building a billion-dollar marketplace is fraught with challenges and requires a blend of creativity, perseverance, and strategic risk-taking. The insights shared in the podcast and echoed by the community serve as a valuable guide for those embarking on their own entrepreneurial ventures. With the support of CNXION’s white label marketplace services, the path to marketplace success is more accessible than ever.