What marketing terms does a founder need to know?

Written by Dante, who built Prep66, PrepAMT and Ancestorii

Twelve, and you can learn them in the order they come up. Before you launch: who the product is for, what makes it different, what it costs and how you will reach people. Once people arrive: how many of them sign up, and how many get far enough to see the point. Once people pay: how many stay, what each one cost you to find and what each one is worth. Over all of it sits one test, whether strangers want the thing at all. Each term below has a page of its own, with how to work it out and the mistakes a new founder makes with it.

Before you launch, or straight after

Ideal customer: the one kind of person who needs the product most. Every other decision leans on it.
Positioning: what the product is, who it is for and why it is different, in the words that person uses.
Pricing: what to charge, and what the price is compared with in the buyer's head.
Go to market: how the product reaches those people, through which channel and in what order.
Launch plan: what to do in the days around the launch, and what to have ready first.

Once people arrive

Conversion rate: of the people who came, the share who did the thing you wanted, such as signing up or paying.
Onboarding and activation: the first minutes inside the product, and the moment a new user gets what it is for.

Once people pay

Retention: the share of customers who are still there after a week, a month, a year.
Churn: the share who left. The other side of retention.
Customer acquisition cost: what you spent to win one paying customer.
Lifetime value: what one customer pays you before they leave.

The test over all of it

Product market fit is whether enough people want the product badly enough to pay for it and keep using it. Until it is there, the numbers above are small and noisy, and more marketing mostly buys you a faster no. Will my app make money, and when should I stop? sets out what decides it.

How these fit the channels

A term is only useful where you act on it. Positioning and the ideal customer decide which of the distribution channels is worth your time. Conversion rate and customer acquisition cost decide whether a paid channel such as Google Ads or Meta Ads can ever pay for itself. Retention and churn decide whether any channel is worth scaling. Each basics page links to the channels it matters for, and each channel page links back.

Every term on this shelf

What is an ideal customer, and how do I find mine? The five marks of a first customer, the three checks that tell a real one from a guess, and the channels it decides.
What is positioning, and how do I work out mine? Where the word comes from, the five parts in the order to answer them, and the one sentence to write at the end.
How much should I charge for my product? What a price is compared with in the buyer's head, the five common models, and how to test a price.
What is a go to market strategy, and how do I work out mine? Four decisions that fit on one page: who it is for, what it says, what it costs and the one channel to try first.
What goes in a launch plan, and in what order? What must be true before launch day, the order of the jobs, what to count, and why a launch is a day and not a strategy.
What is a conversion rate, and how do I work out mine? The share of people who did the thing you wanted, worked out one step at a time, and why a handful of visits tells you little.
What are onboarding and activation, and how do I measure mine? The first minutes inside the product, the moment a new user gets what it is for, and how to count the share who reach it.
What is retention, and how do I read mine? The share still there after a day, a week or a month, counted by cohort, and why it comes before any paid channel.
What is churn, and how do I work out my churn rate? Customer churn and revenue churn, the sum, why two formulas give two answers, and the mistakes made with small numbers.
What is customer acquisition cost, and how do I work out mine? The sum, what goes into the cost, what founders leave out, and why cost per signup is a different figure.
What is customer lifetime value, and how do I work out mine? The sum from price and churn, why profit counts and not revenue, whose rule the ratio of 3 is, and why an early figure is a guess.
What is product market fit, and how do I know if I have it? Where the definition is from, the three signs for a small product, the one survey question that measures it, and what does not count.

Questions people ask

Which marketing metric should a new founder track first?

Signups and payments, each by the source it came from. Until strangers sign up and some of them pay, the other figures have too little behind them to mean much.

Do I need to know all of these before I launch?

No. Before you launch you need to know who the product is for, what makes it different and what it costs. The rest become useful as people arrive and pay.

What is the difference between marketing and distribution?

Distribution is the route by which a stranger first meets the product: a community, a search, a store, an advert. Marketing is the wider job: deciding who it is for, what to say, what to charge and which route to use. The distribution channels shelf takes each route from its own rules.

Where do I start if I have never done marketing?

With the person. Name the one kind of customer who needs the product most, find where they already talk about the problem, and make your page say what the product does for them and what it costs. Then try one channel.