How Grammarly Climbed Its Way to 30 Million Daily Users Worldwide #scottsthoughts

Welcome to Success Story, the most useful podcast in the world. I'm your host Scotty Clary. The Success Story podcast is part of the HubSpot Podcast Network. The HubSpot Podcast Network is the audio destination for business professionals who seek the best education and inspiration on how to grow a business. The HubSpot Podcast Network hosts act as on-demand mentors to entrepreneurs, startups, and scale-ups through practical tips and inspirational stories. Listen, learn and grow with the HubSpot Podcast Network at HubSpot.com slash podcast network. Today I'm going to walk you through the story of Grammarly, how they went from a startup that didn't even focus on revenue to 30 million daily active users. I'm going to walk you through the origin story where the founders came from and then some of the strategies they used to build a great product, tap into the right audience and market themselves. This is a business case study. This is Grammarly's growth story. You don't have to be big to make a big impact. This is the story of Grammarly. A grammar checking software startup, they prove that they don't have to be huge to basically be one of the most successful startups in Silicon Valley. They have 30 million daily users worldwide. It's safe to say this company has been a success. Although other well-known applications have an integrated spell and grammar check, none of them seem to be providing a complete and comprehensive service to users. They Grammarly does. The people behind Grammarly saw this as a market issue. They built the company from the ground up solely with the idea of creating a one-stop shop for writers. So let's dive into the origin story and then I'm going to walk you through some of the strategy. They implemented some of the things they focused on that made them so great. So how did Grammarly grow from being a small startup to an internationally known tool? Well firstly, let's go back to the beginning. So the founders, Max, Litvin, Alex, Chevchenko, and Demetri Leiter started Grammarly at the University of California, Berkeley in 2009. Their goal was to create a device that would help people with poor grammar become better writers and excel more in their careers. Now Grammarly is not your average startup. It did not start as a freemium business as we all know now. Rather, it was monetized backwards. The journey wasn't an easy one. It took Grammarly six years to make its way out of the garage and into the mainstream market. At the time when it actually hit the market, the team finally received $110 million in investment for research development and marketing campaigns designed to attract customers worldwide. The weight was well worth it. Today, over 20 different language versions are available on Grammarly's website, including different English variations, Spanish, French, and German. However, keep in mind, for six years, it didn't have any backing whatsoever. So how the business actually prosper? How did it grow? So while Grammarly had its fair share of struggles, it did have some key strategies that helped make it successful. Let's tackle each of the strategies that contributed to the company's success. So firstly, the freemium business model. So one of their strategies was to use a freemium business model and offer free services as well as paid ones. By doing this, they could appeal to those who were serious about writing, as well as people who were just more casual about writing. Since many people see Grammar-checking software as something that you can only benefit from if you're in school or work, using a freemium business model helped ease the market into having this kind of software available for them on demand at home. Another thing that highly contributed to their success was having a growth over revenue mindset. So Grammarly focused on its growth over its revenue whenever necessary. The company invested a lot of money in research and development as well as marketing campaigns. And even though they didn't have a steady stream of revenue at the time, Grammarly still chose to invest heavily into their business because it was more critical for them to grow quickly and to worry about making an immediate profit. They wanted to get critical mass on the platform. And I'm not saying that this is easy. I'm not saying that everybody has the luxury to do this. But if you can, put a product out into the world and get people using it. Once you hit that critical mass, that's when you can monetize. And Grammarly did that very well. They also focused on user-driven user-centric functionality. Grammarly values the feedback of customers. Extremely values it. There are many different features that Grammarly provides for its users and they improve these features by getting feedback from their users. They've actually gone so far as to build a feedback loop into the actual product. So there is an integrated option in the application for a user to indicate if a suggested correction is valid or not. And they want that feedback loop built in. Now, if you cannot build it into your software, at least have some sort of feedback loop built into your customer acquisition and customer success process. So customer acquisition presale, customer success, post sale, have some sort of feedback loop built in. And don't just collect that feedback action on that feedback so that you are constantly evolving as a company. That customer feedback is the one thing a lot of businesses grew up because they think they know the best for their customer. They don't take that customer feedback and action against it all the time. Another item that really helped Grammarly was personalization. So every user has an individual style and communication goal. With this, Grammarly focused its software on providing personalization. Grammarly uses search and language statistics to provide personalized content for the user. The company has employed a data driven approach to identify which language is most appropriate in different contexts. This along with their ability to search from various sources of information makes Grammarly more reliable and more contextually relevant than any other grammar application on the market today. So again, user centric. All of this is about focusing on what the user wants not imposing what you have on the user. If you know the user functions in an individualized fashion, they write a certain way. The way to communicate is a certain way it's individualized. Then the support that you're giving has to be individualized as well. And lastly, they just had some incredibly good marketing. So marketing is vital for any business. B2B marketing sometimes lacks a little bit, but there were three main marketing strategies that Grammarly used to boost their presence globally. So number one, social media. So they were using platforms like Facebook, Twitter, Pinterest, LinkedIn. They were using these platforms to run ads on. And then of course, they were targeting user feeds based on their interests. Now, ads are great, but it's content in the ads that really resonated. So the ads posted helped increase user engagement with the software since they were in the format of jokes, tips and comics, which shows that language is fun. Again, every single piece of content that Grammarly put out be it a regular social posts or not paid or paid advertising was either educational or entertaining. And they had a little bit of a meme culture, virality piece built into it with some of the humor. So this resonates with the audience. It builds intimacy with your audience. And then of course, they look at Grammarly as a forward thinking fun company. They want to try out what Grammarly is all about. They want to go investigate more and then they end up checking it out, downloading it, using it and eventually paying for it. The second marketing strategy they really focused on was product positioning. So Grammarly focused on its audience by understanding their needs again, customer centric. They realize that there is no need to create a premium product for people who ignore grammar and spelling mistakes in the first place. They also understood that only those with deep pockets would use a premium product if they provided a paid service by positioning itself as a premium business model concept that Grammarly could attract anyone looking for help regarding writing errors, which helped them increase users and then eventually revenue through enhanced user engagement, free to upsell conversions. And of course, they had a great referral program as well. So they built a product that was capturing anyone and everyone because everybody writes and then a percentage of those people would upgrade to paid. And lastly, they used great email marketing. So to further appeal to new users, Grammarly used a lot of email marketing, a lot of sequences follow-ups. They sent out targeted emails to people who had already visited their site or purchased an account. They had strict rules as to when and how often they sent emails since most companies have restrictions due to legalities in terms of spamming or they just have spamming concerns. So they made sure that every single piece of mail that went out was highly relevant and of course was sent out in a way that was not spammy or they didn't send out too much or they didn't send mail at incorrect times. They made sure that it was highly relevant to the person who was receiving it. Again, they wanted a net positive experience with everything that represented Grammarly and all the different touch points that a potential customer could have when interacting with anything to do with Grammarly be it the actual software, social media, or an email they get from Grammarly, they wanted that to be a net positive experience. So what are some key takeaways from Grammarly success? Well, number one, they incorporated smart goals and smart as in the acronym SMART. So smart stands for specific measurable, achievable, relevant, and time bound. So these are the goals that Grammarly held themselves to. Grammarly set goals that they aim to achieve every single year. These goals have been beneficial in the progress of the business and will continue to remain vital as time goes on. But that formula for setting company goals is extremely important. Using a freemium business model to attract new users and having that growth versus revenue or overrevenue mindset. So of course, you have to be set up so that you can support a freemium model, but a freemium model not only helps you build up revenue, but it helps you build your brand because you're attracting anyone who wants to test out your software. So you get a huge amount of user base, which is great because then you can tap into those later on. You just have to weather the storm, so to speak, because you're not worried about monetizing as early on. Also, be open with feedback. Customers, loving companies, ask them questions about how they feel and what changes they would like to see. Customers feel listened to and their feedback is invaluable for your growth as an organization. Be social. The more active you are online, the better chance you have of growing your business. Grammarly took advantage of all sorts of free marketing. They also did paid. They included social posts across all mediums and blogging, making sure everything about them was available all across the internet. All in all, Grammarly has created and then dominated the market for easily accessible one-stop shop writing tools and is continuing to do so. The company's success story is inspiring because it shows that you don't need years or money. All in all, Grammarly has created and then dominated the market for easily accessible one-stop shop writing tools and is continuing to do so. The company's success story is inspiring because it shows that you don't need years of experience or money behind you for your product or idea to become successful. It takes good ideas, determination, perseverance and hard work and that's the story of Grammarly.