Key factors behind two fast-growing services & digital unicorns
The digital service sector has seen an influx of innovation and competition in recent years wither led by start-ups or organisations quick to undergo the digital transformation process. These companies, built on big ideas supported by modern technologies, have quickly captured market share from older, more established businesses.
What is it that has made these companies rise while others stumble? Today, we chart the success of some of these leading digital companies.
Canva
Goal: To enable the whole world to design.
Year founded: 2012
What they do:
Canva provides graphic design software, as a service. The collaborative platform is mostly used by businesses who do not have graphic designers in-house.
Why they matter:
Over 30 million monthly active users across 190 countries who have made over 3 billion designs.
The background:
Traditional graphic design programs like InDesign and Photoshop are difficult to learn. Even learning the basics requires some type of course or study. Co-founder, Melanie Perkins, recognised that this was a problem faced by many people, and set it out to solve it. Thus, the idea of Canva was born.
Strategies behind Canva’s growth
The product:
The interface itself is user-friendly, intuitive and easy to use. Canva offers almost limitless templates, free stock photos and fonts, empowering users to create high quality images even without formal design skills. To get to that stage took months of refinement, improvement and testing.
And these iterations were not solely based on user’s navigation of the platform, they also recognised that they had to address user’s self-belief about their design abilities and make them feel confident when using the product.
The promotion
Canva began with 50,000 subscribers on a waiting list. This group then, attracted a further 150,000 early adopters. From here , it was word of mouth and social proof that propelled the user base into envious figures. That’s right, no traditional advertising was used in the early days.
Freemium strategy
Canva allows users access to some features at no charge, with richer features only accessible via a paid subscription. The strategy to offer either free, pro and enterprise level subscriptions undoubtedly helped bolster their subscribers early on, helping to spread the word but also convert free users into paying ones.
Product innovation
Canva are constantly innovating. For example, Design school is Canva’s blog sharing resources such as tutorials and articles to further empower users. But it is also the continuous addition of new features and capabilities built as a response to consumer trends – such as promoting zoom backgrounds – that keep users coming back.
Cloud business suite
Canva uses NetSuite to manage their operations and support business innovation. This means that while their competitors may struggle to support a new product, launch pricing model or to enter a new market, Canva is agile.
By adopting cloud-based NetSuite, Canva is extremely responsive to market dynamics and customers, able to execute to outrun competition and pursue new growth opportunities.
Netflix
Goal: to entertain the world
Year founded: 1997
What they do:
Netflix is an entertainment platform offering video streaming services on a global scale.
Why they matter:
Netflix personifies the innovate or die idiom. By offering an inexpensive alternative to traditional services, Netflix left blockbuster in their dust, disrupted the television and movie industry and provided an attractive alternative to expensive cable TV services.
The background:
Originally Netflix rented DVDs by mail. Today Netflix has changed how and what we watch. Having taken a generous slice out of the profits of conventional cable TV, Netflix has caused a seismic shift in their industry and led innovations around digital streaming and machine learning algorithms.
Strategies behind Netflix’ growth
Content creators
Netflix knows what their customer wants. And that is great content. Rather than just stream shows and movies from other parties, Netflix creates its own content. In fact, approximately 85% of new spending is reserved for original content. This is one of the reasons Netflix often tops customer satisfaction surveys. Another reason, Netflix removes the irritating ads sliced into programs by providing ad-free content – a true crowd pleaser.
User experience
Just like Canva, the Netflix interface is clean, simple to navigate and full of features that appeal to the user. For example, previews play when scrolling through a title card, users can download and watch without an internet connection, accounts can be shared, and new users can enjoy a 30-day free subscription.
AI recommendations
Netflix collects user data. They know what, when and how we watch shows. Using machine learning, Netflix feeds data into their algorithms so they can learn more about each user. This information is then used to power the popular Netflix recommendation engine which ensures shows an individual’s home page are mor likely to appeal to that person.
As strategic NetSuite partners to many digital services companies, Annexa has successfully streamlined operations for a number of Australian digital services companies. And it all starts with a strong financial foundation that enables strategic initiatives and delivers:
- Agility to adapt to new business models and increase revenue and margins.
- Improved financial visibility across the value chain and partners to streamline operations.
- The ability to scale seamlessly by leveraging the cloud infrastructure.
To learn more about our customised NetSuite solutions, speak to an expert.
Annexa is a leading NetSuite partner with extensive experience designing and implementing comprehensive and customised business systems, including payroll solutions, financial management, warehouse management and ecommerce solutions.