When To Turn On The Sleaze

by Albert Chung

One of the most important issues facing an early stage startup is how to attract a user base. Thus far we’ve seen companies that have been reluctant to employ “sleazy” marketing tactics, presumably to not compromise the overall user experience. Below is a list of some sleazy marketing tactics that a startup could employ to drive early growth in both its user base and initial revenues. Some obviously register higher in sleaze factor^* than others:

1. Scam lead gen (i.e. Online quizzes turning into $9.99 monthly subscriptions without any notification). Sleaze factor: 10
2. Shill posting (a la Whole Foods). Sleaze factor: 9.5
3. Spamming people off purchased email lists. Sleaze factor: 8
4. Selling email addresses to third parties. Sleaze factor: 8
5. Installing difficult to remove adware. Sleaze factor: 7
6. Crippling functionality unless users invite X numbers of friends. Sleaze factor: 6
7. Legit lead gen (i.e. Netflix subscriptions). Sleaze factor: 5
8. Incentivizing users with extra stuff (badges, status, currency, etc.) to invite friends. Sleaze factor: 3

Certainly, some of the above practices are unethical and in some cases illegal (shill posting, scams) and there will never be a scenario where it would be recommended to employ these strategies. However, other strategies might be acceptable to an entrepreneur looking to drive early growth. (Note: from this point onward, I will not attempt to evaluate sleazy marketing tactics from a moral perspective.)

So, let’s assume your moral code allows for some measure of sleaziness. If this is the case, when is the right time and in what situations should you turn on the sleaze?

With regards to timing, the early stages of a lean startup might be exactly the right time to employ sleazy marketing tactics. One company that successfully employed sleazy marketing early on is Zynga.  Some may disagree with my calling Zynga a lean startup, but what better way is there to reduce waste and achieve product-market fit than to simply copy all the successful games and iterate them into profit maximizing skinner boxes? But, I digress.

Eventually, Zynga would end up removing all in-game offers after significant backlash and CEO Mark Pincus would admit he “did every horrible thing in the book to, just to get revenues right away.” However, Zynga today is a smashing success by any measure. The reason for this is that the mass audience simply doesn’t care. This is a real-life example of how Geoffrey Moore’s chasm can actually help startups—by giving them the ability to experiment with early adopters without affecting the majority. Thus, if you plan to be sleazy, do it early. Then, cut it out before anyone is the wiser and you’ve retained your equity because the company is that much more profitable.

In addition to lifecycle, startups should avoid sleazy marketing tactics that will detract from their core value propositions. For example, Dropbox, built on the idea that “It Just Works,” should not cripple functionality, even it is free version, in exchange for growth. On the other hand, a social game, whose value proposition is found in its content rather than performance, can afford to drastically decrease the user experience through slower or time-limited gameplay unless users pay or spam their friends. A startup’s core value-add will ultimately determine which sleazy marketing tactics it can afford to use.

At the end of the day, the decision to turn on the sleaze will be largely made by how your moral compass guides you. If you do choose to turn it on, it would be prudent to examine what stage your startup is in and what your core product offering is in crafting your sleazy marketing plan.

*Not an industry accepted metric.