Channel Diversification Before the Drought
A one-channel growth company is always a no-no — turn on the second channel while the first still works.
- Difficulty
- Moderate
- Time to result
- ~months to results
- Steps
- 4
- Confidence
- 90%
Most companies have exactly one real growth driver, and the ones built on SEO are living by a sword that a single Google update can turn against them. Lovinsky's rule is that single-channel dependence is a structural defect regardless of how well the channel is performing, and that the time to diversify is while the incumbent channel is still strong — because a strong channel is itself an asset that makes the next channel cheaper to open.
Origin
Noam Lovinsky, from rebuilding Thumbtack's growth engine after Google SEO changes cut the company's dominant channel and drove growth negative. The revived growth team included Whitney Steele (now leading marketing at Descript) and David Shine (now leading product at Hims).
Core principles
- 01One-channel growth companies are always a no-no, however well the channel performs.
- 02SEO in particular is live-by-the-sword: the platform that gave you the channel can take it back.
- 03Existing channel strength is compounding collateral — good page rank bolsters paid search and social.
- 04Go back to first principles on channels rather than resuming previously-abandoned attempts.
How to run it
- 1
Audit your channel concentration honestly
Identify the single channel that drives most of your growth and treat that concentration as a live risk, not a strength. This is the first thing that should trigger paranoia when you look at a product or team.
Pro tip Ask directly: if this channel dried up next quarter, what fraction of new demand disappears?
Watch out Companies that stopped trying paid or referral channels years ago typically have institutional memory that 'those don't work for us' — usually a memory of an under-resourced attempt, not a real result.
- 2
Rebuild the growth team as a first-principles unit
Assemble people who will reason about channels from scratch rather than reviving old playbooks, and give them the mandate to experiment their way to results across paid, organic, referral and social.
- 3
Fix the targeting altitude
Check whether you have bifurcated your growth effort too narrowly. Thumbtack is a marketplace of thousands of marketplaces (DJs in Philadelphia, contractors in Sonoma) and had assumed growth had to be pursued market-by-market — when targeting more broadly and giving aggregate data to Google and others, then optimizing from there, worked far better.
Pro tip Feed the ad platforms aggregate signal first and let their optimization find the segments, rather than pre-slicing the market yourself.
Watch out This inverts a common instinct in geo/category marketplaces. The narrow slicing feels rigorous and quietly starves every campaign of data.
- 4
Lever the strong channel into the new ones
Use the asset you already have. Thumbtack's strong SEO showing and page rank directly helped bolster SEM, and then Facebook — the incumbent channel made the new channels cheaper rather than competing with them.
Watch out This only works while the incumbent channel is still healthy — which is precisely why the diversification must happen before it dries up.
In the wild
Thumbtack was on the bleeding edge of SEO-driven growth and one of the best organizations in the world at that channel. Then Google came down on the category: triple-digit growth fell to double-digit, then to the first negative year-over-year growth in company history — while the team was simultaneously rebuilding the product and the monetization model.
→ The turnaround required standing up multiple channels from first principles — paid, referral, other organic — alongside the product rebuild. The composite result was the 'prettiest smile graph' Sequoia's Bryan Schreier had seen.
Thumbtack had been targeting growth market-by-market on the assumption that a marketplace of thousands of local marketplaces must be grown locally. The team instead targeted more broadly, supplied aggregate data to Google and other platforms, and let optimization work from there.
→ Much better results from the paid channels, with existing SEO page rank bolstering SEM and later Facebook.
Common mistakes
Waiting for the channel to break before diversifying
By the time SEO traffic collapses, you are opening new channels with negative growth, a shrinking budget and a panicking board — the worst possible conditions for the experimentation that channel discovery requires.
Slicing targeting to match your market structure
Just because the business is thousands of local marketplaces does not mean growth must be bought that way. Over-narrow targeting starves the ad platforms of the aggregate signal their optimization needs.
Treating past channel failures as settled
Thumbtack had tried and stopped paid and referral channels before. Going back to first principles — rather than trusting the abandoned attempts — is what produced the working channel mix.
Is it for you?
Best for
Growth and product leaders at companies where one channel (especially SEO) drives the majority of acquisition and is still performing well.
Not ideal for
Pre-product-market-fit startups that have not yet found their first working channel — diversifying before you have one channel is just dilution.
From the transcript
“and I think that one channel growth company is like always a no-no”
“so I mean first was you know turning on multiple channels of growth you know up until then”
“basically went back to first principles on some of those growth channels and experiment our way to much much better results”
“Let's figure out now how you start to diversify.”
From the episode
The happiness and pain of product management
Noam Lovinsky (Grammarly, Facebook, YouTube, Thumbtack)