This episode is on a brand that redefined video calls, revolutionized collaboration, had a successful IPO filing and went public like a boss. Yes, we are going to talk about the one true silicon valley underdog - Zoom!
Before Zoom went IPO, not many people spoke about the company and not many knew of their story.
Zoom which was exclusively known for its video communication product, struck the most successful public offering. Launching at 36$, currently valued at 92.53 USD as of today. Zoom is leading the IPO race against Pinterest, Uber, Slack, Fiverr and the lot.
So, what is Zoom’s story?
Rolling back to 1987 in China.
Eric, who is currently the CEO of zoom, had a girlfriend who stayed miles away from him. Eric had to take a train to meet her and it used to take him 10 hours for this.
He used to think to himself how great it would be if he had a device that let him talk to her and also in a sense be with her without traveling so far. Little did he know that those daydreams would eventually become the basis for Zoom.
Anyway, fast forward 10 years from his days in China, he moved to Silicon Valley and joined Webex, a video communications company.
Eric was quite happy in WebEx working on something that he was truly passionate about. This continued for a while. Then came a day when Webex got acquired by Cisco.
Eric became the VP of engineering in Cisco taking care of WebEx. He felt the tool to be complex and outdated. Just clunky and difficult to use.
Being the VP of Engineering, he took that opportunity to interact with customers on a regular basis and got to know that the customers never really liked the product as much. He was not happy about this. According to Eric, customer happiness was the most important goal to go behind and they were failing to do that.
Eric thought that webex at that time was not solving newer problems faced by the customers and were penalizing customers who used their software.
He wanted to build a software that customers would enjoy using! That would make the customers happy. He quickly moved out of Cisco and started Zoom in 2011. Mostly out of the sheer motive to bring joy to customers.
As much as we love the story of how Zoom started, owing to the theme of Mind the Gap, let’s move along and look at growth, marketing and customer experience learnings from Zoom’s story. And don’t worry even though there is a LOT to learn from Zoom, we have condensed our learnings into three most important lessons to make it snackable. Let’s zoom right in.
Number one. Product led growth - One thing different about Zoom is how much they chose to stick to things that worked for them without following trends and fads. When Eric first decided to launch Zoom, he had his team work on the product for two full years before getting out to the market. In a world where startups talk about launching first and failing fast, Zoom has been pretty old school in terms of doing one thing extremely well and getting it right the first time.
Also, an interesting observation is that Eric decided to disrupt an already noisy industry. The video collaboration domain was filled with enterprise players like WebEx, Skype, Go to meetings etc. Zoom not only launched a product in a crowded market but did a damn good job at outperforming existing players. They were able to achieve all of this because they put their bucks on the product.
Zoom launched as a product that was ready to grow. Scalability, stability and performance were things that the company focused on. Zoom was a product that did not spend a lot of money on paid advertising and let the product walk the talk. Most of their traffic is organic, through word of mouth, through their content, and through their hardware integrations. The only time they actually spent money was to set up a billboard. That too because Eric liked the attention it created when his neighbours came and told him that they spotted his company’s billboard on the way and that it was pretty cool.
The second strategy might seem trivial but I feel it’s the most important takeaway - “Listening”. The two years that Eric’s team spent on creating a product, they made sure that they spoke to more and more people to understand their pain points, their preferences, and their feedback on whatever tool they were already using. Most importantly they “heard them out”. After all, this is a company that cared the most about customer happiness over anything else. Interestingly, in one of Bloomerg’s interview with Eric, when they asked him about Cisco catching up in terms of features and what Eric is planning to do in terms of dealing with competition, this is what he had to say.
They don’t have any strategy against competitors. As long as they listen to customers and make them happy, they don’t have to worry about anything.
The third and final strategy of Zoom’s was the same as Airbnb’s. We already made an episode on Airbnb’s story. Don’t forget to tune in to that episode after this one.
Now, back to the story — Zoom’s strategy was to go behind making their existing customers happy instead of going behind new customers. Retention over acquisition — classic but brave move.
For zoom, their customer support team forms the main pillar of the company. As I mentioned previously, feedback and feature suggestions are taken extremely seriously at Zoom. Their philosophy is to make the existing customers happy first. So happy that they would want to spread the love through word of mouth. A mutual setup, the more happy your customers are, the more happy you get, you know, even in terms of bottom line.
Zoom’s story is quite different from every other brand story we’ve ever heard. When every other brand wants to prove itself as a misfit or a rule breaker and a challenger of the status quo, Zoom was a little different. When Eric was asked about rules, he jokingly said, oh no. We love rules and we make sure that we follow them.
Slowly and truly, Zoom grew to become different in its own way by embracing what worked for them and not following trends. Not just that, there have been a lot of talks around how Zoom’s philosophy is not about growing fast but to stay as a company that meets customer needs constantly. Ironically this is what led to their fast growth. Zoom is a living proof that when you strive for customer happiness, you are never going to be disappointed at the returns.
Currently, there are about half a million unique business domains, millions of individuals, spending 18 billion minutes annually on Zoom. That’s 18 billion minutes of happiness sold.
Reference -
https://www.youtube.com/watch?v=ICgehQ1xd24
https://www.youtube.com/watch?v=Xqog63KOANc
https://www.youtube.com/watch?v=8H-TsqT1GUk
https://www.youtube.com/watch?v=ja9VMe18sh8