Li Jin believes it's better for you to just a handful of loyal customers?
You’d think loads of followers would be better right?
Well actually, cultivating a loyal base of true fans will serve your business better in the long run.
Followers means nothing if you can’t convert them into customers. True fans, however, are crazy about your products and services. They’ll buy everything you make and become ambassadors for your brand.
Aim to find true fans, not followers and you’ll be on the way to business success.
But how do you do that?
We’ll be asking our guest Li Jin what strategies she’d use to guarantee growing a client list filled with true fans, not followers. Li is an advocate of the Passion Economy and an investor in early-stage startups. You can read her full bio below.
Li also writes an email newsletter which you can subscribe to at li.substack.com
Li Jin Guest Profile
Li Jin is the founder and GP of Atelier Ventures, which seeks to back early-stage consumer companies in the passion economy: New platforms that help people transform their passions into professions.
She's interested in marketplaces and technology that helps open up economic opportunity and access. Previously, she was a partner at Andreessen Horowitz focused on early-stage consumer investments.
She has held board observer positions at Substack, Sandbox VR, Imgur, Dialpad, OpenGov, Honor, and Virtual Kitchen Co.
Prior to joining a16z, Li was a product manager at Shopkick, a VC-backed startup in the loyalty and rewards space.
Transcribed highlights from the show
Dan: You wrote an article that I absolutely loved around the idea of 100 true fans. I’d love to dive into that in more detail. Can you explain the difference between 100 true fans and 1000? Let’s start with the 1000 true fans model then move onto the 100 true fans one.
Li: Yeah absolutely, I think I was inspired by, and I think a lot of people are inspired by, the article published a decade ago called ‘1000 true fans’ that wired editor Kevin Kelly wrote and published on his blog.
I think this was one of the earliest blog posts that concerned itself with how to make a living on the internet as a content creator. Basically in this post he says that to be a successful creator, whether that’s as an artist, musician or teacher you don’t need to have a massive following or be a huge celebrity with millions of followers.
Instead he argues all you need is 1000 true fans who are willing to support you to the tune of 100 dollars per year in order to make a sustainable living.
The math comes out that you’ll be on $100,000 a year with the above model. He believed the critical change that enabled many people to make this work was that the internet removed middle men.
So instead of being signed to a record label you can release your own music. Instead of being represented by a gallery owner you can sell your own art. The internet empowers creators to go directly to consumers and earn the entire amount they want for their work.
So the internet really unlocked the 1000 true fans model.
And my piece that you’re referring to argues we can actually scale down to 100 true fans.
It basically takes Kevin Kelly’s idea one step further. I believe that you don’t even need to have 1000 true fans to be able to make a living online as a creator, you can do that with 100.
The model I propose is: if you can get 100 people to pay you $1000 a year for your product or service then you can also earn $100,000 a year and make a living as a successful creator.
So my model involves having fewer total customers, but monetizing each one much more. This blog post lays out what are the components of creating an offering that people would be willing to pay $1000 dollars for.
And I sort of decompose the article into a few major factors that I outline in the post. Which are:
- Tapping into a desired result or transformation
- Offering premium content and community that they can’t get anywhere else
- Accountability, often we’re willing to pay a higher amount if we’re kept accountable
- Access, Recognition, and Status
All these points tie back to the fact that as a customer you’re getting something highly valuable from a creator. You’re not just supporting a creator out of good will you’re getting a high value product from them.
This is the key difference between the 1000 and 100 true fans model. In the 1000 true fans model getting someone to pay you $10 a month people will probably do that as a donation without expecting anything in return.
If you’re trying to monetize someone to the tune of $1000 per year then you have to provide them with tangible value.