Think of it as part marketing, part market research. Here's why a launching a contest for other start-ups is a smart business move.
Want to build buzz, increase your visibility, and bring in new customers all at the same time? Try running a contest.
That's what Bandwidth, a VoIP solutions provider did to raise interest in its services among start-up companies using telecommunications. In its recently completed contest, the prize is up to $600,000 worth of Bandwidth's product. "What they're getting from us are telephone numbers, SMS messages, and minutes on a network," says Steve Leonard, executive vice president and general manager at Bandwidth. And the company is offering these through APIs (application programming interfaces) that allow other software to integrate with the service. "So software start-ups don't have to worry about the complexity of telecom. All they have to worry about is writing code," Leonard explains.
The contest ran for two months. The winner was Voxeet, a company that improves the conference call experience by providing clearer sound, 3D sound and visual cues to help participants identify who's speaking, and the ability to transfer a conference call from a computer to a smartphone so that participants aren't trapped at their desks. Running a contest takes a lot of work, more than the Bandwidth folks anticipated, Leonard says. But the effort was well worth it. Here's what Bandwidth got out of running its contest:
1. Brand Awareness
"It was one of the first times we really reached out with the Bandwidth brand to the start-up community," Leonard says. Until then, start-ups only learned about Bandwidth by word of mouth. "We learned that there was a lot of interest in our service within that community, but it's such a hard community to reach. You've got to do something like the contest that is open to a breadth of people."
2. Potentially Large Customers
This is the first time Bandwidth has run a formal contest, but in past years, it has worked informally with several communications start-ups. "We've been partnering with companies launching brand-new services," Leonard says. And these partnerships have tended to pay off. "Over and over, as these companies have become successful and scaled, we've scaled with them. Many of these start-ups have become very large customers."
3. A First Look at the Newest New Ideas
"By enabling some start-up companies to launch their services, we learn what people are doing in this space, where the new ideas are, and how people are changing telecommunications," Leonard says.
For instance, the runner-up CallSharing.com will provide each user with a unique conference call number that he or she always uses for every conference call, so that "conference call" could become just another contact in one's contact list. Another entrant, Sidecar, lets users share contacts, locations, photos, or "see what I see" video during a call.
"We learned there's an amazing amount of innovation going on in the communication space," Leonard says.