How Did Clubhouse Grow So Quickly – Marketing Strategies To Clubhouse $1B Valuation In 8 Months (8 min read)
Clubhouse – a thriving social media app that allows you to connect with strangers and talk in topic-based rooms. It’s invite-only for now.
Strategy & Tools
Clubhouse History timeline
- April 2020 - the app is released on iOS. It’s first used by VCs to talk about IPOs and other insider stuff on the US startup scene.
- May 2020 - the creators get a $12 million series A investment which gives Clubhouse a boost in popularity. The investor is the star VC, Andreessen Horowitz.
- Dec 2020 - the app has 600,000 registered users
- Jan 2021 - there are 2,000,000 users now and Clubhouse is valued at $1 billion while hiring only 10 people. Other than that, plans of launching Android app soon are unveiled
- Feb 1, 2021 - Elon Musk hosts a room in which he answers user’s questions. Robinhood’s CEO Vlad Tenev also joins the stage at some point and answers some Musk’s questions on Wall Street Bets and the crisis around them. Some say it could’ve been staged by Andreessen Horowitz, as both Robinhood and Clubhouse have been founded by them.
How did Clubhouse become so popular?
Clubhouse's popularity grew thanks to their social media architecture. Most apps want you to keep going back to them every now and then and endlessly scroll, comment, and post. Clubhouse allows you to be less active in the app and focus on what matters to you.
Here, all that matters is what you say and if you don’t feel like talking, you can just listen to what others in the room have to say. The app doesn’t use a phone camera at all, so you can just tune in and do whatever you want with your hands free, like drive a car. You can be either passive or active, but this activity requires you to only tap one button if you want to take over the mic.
A well-packaged product
Clubhouse is not a unique idea. There’s Discord, Facebook rooms, Twitter Spaces, Zoom, Houseparty, and others. The core functionality is as simple as it can get - it’s like a phone call with dozens or hundreds of people.
What is unique is the packaging of features, though. You can join anytime, but the conversation is live. It has topic-oriented rooms. And it doesn’t push you to turn your camera on, neither to stay glued to the screen. It’s 100% audio, so you can do anything while listening. It’s like an interactive podcast and this is what makes a known set of features unique.
Getting you closer to your idols
The synchronous, natural model of conversations makes the interactions more human. And it also makes celebrities more human - instead of posting staged photos with well-thought caps, you’re all right here, right now. You can meet famous people listening to conversations or join the ones they are hosting and have the opportunity to simply talk to them.
Among the users, there are Oprah Winfrey, Drake, Vlad Tenev from Robinhood, Chris Rock, or Ashton Kutcher.
Every voice counts
What makes Clubhouse so refreshing is that you don’t have to pose out-of-context snapshots of your life. It’s just your voice and what you know and have to say. That means, those who have more followers are not more important than those who don’t and everyone has similar rights to speak.
Clubhouse's growth strategy – good timing
It might have not been a part of Clubhouses growth strategy, but the app has been released early in the pandemics and lockdowns. When so many people were locked at homes and possibly had more time due to the situation on the market, they had more time to check out new apps.
At the same time, phone cameras became less and less useful while their users’ surroundings didn’t change throughout days, weeks, and months. Clubhouse built its user base by being something fresh to chat, network, exchange ideas, connect with idols, and just fight global boredom.
Clubhouse invite-only marketing strategy
Clubhouse followed exactly what Google did with Gmail. They made it invitation-only. It was great, it was free, but if you wanted to use it, you had to be invited by another user. It’s the same here, you can’t enter the app if you’re not invited. The creators say that it’s to keep the app functional and don’t get any hiccups by being overcrowded. Even if it is so, this works perfectly as a marketing tool–people from the outside just NEED to be there. They buy invitations, try to hack the system, actively look for someone who could let them in–and it happens all over the world.
It all started during the beta tests when a couple of SF startup founders were granted access. The tech industry took it to Twitter to brag who has the access, who doesn’t and what is all this buzz about. The app still opens up slowly to new users, but there’s already over 3,600 000 of them.
Why did Clubhouse go viral?
There’s very little trace to where the marketing budget was spent but one is sure why Clubhouse got viral. The answer is: through word of mouth. It happens organically on Twitter and it's enhanced by high-profile accounts. Referred customers are 18% more loyal and are 400% more likely to refer customers to the brand. That’s a long-term play from Clubhouse.
When you’re on the platform, everything is synchronous. That means you either join the conversation and hear what everyone has to say and share your opinions or you don’t and you’re missing out. This is why you can spend hours on Clubhouse - to not miss a beat.
This is also what fuels the rapid growth. Many people are praising Clubhouse but not that many can easily try it out. And what if you’re missing out on something great?
People have a strong desire to learn how to seek out the missing information. With Clubhouse, they first want to know what is so great about the platform everyone’s talking about and then look for a solution to get there. Putting so much effort in that makes you already hooked.
Humans value scarce things higher and value commodities lower. The more difficult it is to get something, the more perceived value it has. That leads to biasing the opinion on the product and is why limited products are so appealing.
With the invitation-only model, users outside the platform have a strong desire to join it–you can buy invitations that are basically free for even hundreds of dollars. The app is so in-demand in China, that people massively buy invitations, even though the app is not available in their App Store.
Window of Opportunity
Trying to convince people to use your product might be resource-consuming. Making those who use it feel a part of an exclusive community and empowering them to choose who can join the platform makes the users more likely to evangelize your product – just as they organically do for Clubhouse.
Another lesson is to follow where the market is heading. For a long time, many reports have pointed to voice devices as the technology that will grow exponentially in the upcoming years. Clubhouse has created a new type of social media that could also be designed for Alexa and other assistants. You can also think about
"oh sh*t, this might work for us!"
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