Zoom Becomes Video Conferencing Leader During COVID-19. Why?

“We do not want to grow too fast,” said Eric Yuan, CEO of Zoom, in a 2017 interview with Saastr.

His reasoning?

“Our philosophy is we really focus on making our existing customer happy. We do not aggressively pursue the new prospect.” 

The company hasn’t had to do too much pursuing as of late, given that the pandemic—and the worldwide corporate transition to working from home that has accompanied it—has supercharged the demand for what Zoom sells: web conferencing software. 

Most recently, ZoomInfo (don’t let the name confuse you – we’re different companies) took a look at how the transition to working-from-home has caused a significant increase in the adoption rates of all collaboration software among businesses, including electronic signature, HR management, file sharing.

In the web conferencing category, though, the numbers are especially jarring.

Chart showing grown of web conferencing tools
Web conferencing has grown 87% since the beginning of 2020.

ZoomInfo’s data reveals that, as of March 31st, the adoption rates for web conferencing have jumped by a staggering 84.82% from January through April. 

What’s even more interesting, though, is that one company alone—Zoom—is responsible for the bulk of this increase, which, according to our data, saw a 418% growth in adoption rate in just two months.

This turn of events feels slightly ironic (and maybe even somewhat eerie) considering Yuan’s statements about the company’s commitment to sustainable growth back in 2017.

With this growth, Zoom’s adoption rates have surpassed previous industry frontrunners GoToWebinar and Cisco, the latter of which employed Yuan back in 1997.

Zoom’s share of the video conferencing space has outpaced adoption of the technology in general.

In fact, not only was he employed at Cisco, he also spent his last full year there working as the Corporate VP of Engineering, “pestering his bosses to let him rebuild Webex” after learning how dissatisfied customers were (not just with Cisco’s product, but with all the web conferencing tools in the market at the time).

When his suggestions were ignored, Yuan left Cisco and set out to start his own company.

So how, years later—when there was a massive surge in demand  web conferencing software—did Zoom manage to surpass Yuan’s former employer, now competitor, along with other industry frontrunners? 

Was it the Marketing? 

Has Zoom’s marketing just been that inventive? Did the company unleash some sort of elaborate strategy, especially designed to capitalize on the recent working-from-home transition?

One quick look into Zoom’s marketing history would suggest not. According to this Drift article, Zoom’s go-to-market approach has always been fairly straightforward: Target early adopters; invest in billboards on Silicon Valley highways; and, at conferences or events–do not deck out the vendor booth or attempt to attract a crowd–simply set up the product and let people interact with it.

The simplicity of the company’s strategy does not seem to be due to lack of resources, though. Instead, it comes from that same principle of putting customers before prospects which Yuan has always promoted: 

“We always prioritize the features requested by our existing customers.”

Was it the Product?

Many have suggested a simpler reason for Zoom’s growth: the product, which does offer several perks in comparison to its competitors. 

In addition to its free forty minute call service (which can be easily restarted once the forty minutes is up), Zoom is known for its customizable backgrounds, allowing users to virtually appear in a more professional or fun setting–a feature that may not seem particularly noteworthy, but was noteworthy enough for Microsoft to add it to their own platform last month.

One associate who works in video game development told Business Insider, “You can stream much higher quality video via Zoom than Hangouts. Trying to view a video clip (or live gameplay) over Hangouts was impossible. Zoom is much higher quality than Hangouts by a long shot.” 

Or Was it the Company’s Core Values?

Overall, the general consensus is that Zoom is easy to use and works well, which seems reason enough for its recent leap to the top of its industry, but Eric Yuan’s personal background provides a deeper insight into the company’s success.

In college, Yuan used to regularly take a ten-hour train ride to visit his girlfriend (now wife), which he detested. It was his frustration with this train ride that first led him to ideate about alternative, more efficient means of communication.

When Yuan founded Zoom, he did it as someone who had been, first, a frustrated consumer who had been looking to fix his own problem, and, second—from the time he spent working for Cisco—someone who knew the industry, its market, and its customers intimately well. He continued to pursue knowledge on customers’ pain points long after leaving Cisco, even taking up the practice of personally emailing anyone who was thinking of cancelling or had cancelled Zoom’s service (some of whom became longtime customers from then on). 

With all this in mind, Zoom’s sudden growth doesn’t seem all that surprising—or all that sudden. Eric Yuan built a company that was customer and employee-centric, and his team built a product that sells itself. The huge increase in demand spurred by the pandemic was a fleeting opportunity, but it’s one that Zoom has been preparing to take for many years.

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