ENT 460 Group Exercise 11b Customer Validation Phase 1 Get R

Ent 460 Group Exercise11b Customer Validation Phase 1 Get Ready To Se

Ent 460 Group Exercise 11b Customer Validation Phase 1: Get Ready to Sell Sales Roadmap Group _______ Basic Business Idea: A Happy Home At Homejoy we are starting a movement to make cleaning services available to a broad audience, rather than a luxury for the rich. Additionally, we’re providing thousands of work opportunities to individuals who love to clean. By creating an easy way to match homeowners with trusted, professional service providers at an affordable rate, we’re taking the first step toward our mission of creating happy homes everywhere. Homejoy’s Story Founded by sister and brother Adora and Aaron Cheung in July 2012, Homejoy started because the duo was unable to find a convenient and affordable cleaning service for their own home. Headquartered in San Francisco, CA, Homejoy had grown to over 30 cities across the US and Canada. But it closed the business in July, 2015. Homejoy’s Solution: Work flow Crossing ‘Clean my Home’ off the To Do List in 90 Seconds Booking is easy! You can book, cancel, and reschedule cleanings directly on the Homejoy website via your computer or smartphone. Just: 1. Enter your zip code and a few details about your home 2. Choose a time that’s convenient for you 3. Provide your payment information and book! If you are founders of Homejoy, how will you interact with your early customer? Answer these questions: 1/How did HomeJoy design two-sided market business model? Did this company own network effects? What kinds of these effects? What is the price structure in two sides? Why is its service entirely a recurring business? 2/ What is its acquisition and activation strategies in sales roadmap? 3/ What is its keep customer strategy? Did HomeJoy apply the lean principle in Chicago? Why did it not apply in other locations? 4/ What kind of metrics are useful here for customer validation? 5/ If you are the founders of Homejoy, how will save the company? What will be your strategy for customer growth? Could you make a “virus-like” Ice Bucket Challenge in marketing? _____________________________________________________________________ Sign the names of the group member with contributions (do not include absent member!)

Paper For Above instruction

As founders of Homejoy, a platform aimed at democratizing access to cleaning services while creating economic opportunities, our approach to customer validation, growth strategies, and network effects must be meticulously planned and executed. The company's business model was fundamentally a two-sided marketplace that connected homeowners with professional cleaners. This model inherently involved network effects, primarily same-side and cross-side effects. The more homeowners used the platform, the more attractive it became for professional cleaners to join, and vice versa. The reciprocity between these sides created positive feedback loops, essential for growth and scalability (Rochet & Tirole, 2003).

Homejoy’s revenue model was based on a differential pricing structure across the two sides. Homeowners paid for services booked through the platform, with transparent pricing, while cleaners earned a commission or fixed fee per clean. This setup encouraged volume-based growth, which is typical in service marketplaces. The service was recurring because cleaning needs are often regular, and customers tend to seek consistent cleaning services, establishing a steady revenue stream and customer retention cycle.

In developing our sales roadmap, acquisition strategies focused initially on targeted marketing campaigns through digital channels, referrals, and strategic discounts to incentivize first-time use. Activation involved simplifying the booking process—booking a cleaning required only a few steps, emphasizing ease of use, speed, and trust-building with transparent reviews and consistent service quality. These tactics aimed at reducing friction and encouraging immediate engagement.

Customer retention strategies relied heavily on delivering high-quality service, building trust, and encouraging repeat bookings. Personalization and excellent customer service helped foster loyalty, which is crucial in service industries. The lean startup principle was effectively applied in Chicago, where narrow market testing allowed rapid iteration, validated demand, and optimized the business model based on real customer feedback (Ries, 2011). However, applying the same approach in other locations was hindered by regional market differences, logistical challenges, and resource constraints, making a broader, uniform application less feasible initially.

Key metrics for customer validation included customer acquisition cost (CAC), customer lifetime value (CLTV), repeat customer rate, Net Promoter Score (NPS), and churn rate. These metrics provided insights into customer satisfaction, loyalty, and overall product-market fit. Continuous monitoring enabled iterative improvements in service delivery and marketing approaches.

To save Homejoy, we would focus on refining and scaling operations by addressing previous challenges. Implementing a stronger localized marketing strategy, emphasizing quality assurance, and leveraging technology for better service matching are critical. Additionally, diversifying revenue streams through subscription models or ancillary services could stabilize income.

For customer growth, viral marketing campaigns paralleling the Ice Bucket Challenge could be adapted. We would create a social challenge involving sharing cleaning tips and rewarding participants with discounts or free services, encouraging user-generated content and viral sharing across social platforms (Kavaratzis & Ashworth, 2005). Partnerships with influencers and community engagement initiatives would amplify reach. To further accelerate growth, referral programs incentivizing existing users to invite new users would be essential.

In conclusion, a comprehensive approach combining network effects, data-driven validation metrics, customer-centric strategies, and innovative marketing campaigns is vital to revive and scale Homejoy. Through targeted efforts to build trust, streamline the user experience, and foster community engagement, the platform can regain momentum and achieve sustainable growth.

References

• Ries, E. (2011). The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Business.
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