The problem for many startups is that they focus so heavily on product development that, even though the result may be a groundbreaking product, it will never find the right customer audience. In the end, the firm burns through its resources and has to shut its doors.
Sales and marketing are the lifeblood of a successful startup in the same way as product development is. The whole product versus marketing juxtaposition is artificial. A successful startup needs to have a great product and great sales and marketing – otherwise it will soon be a former startup. So while you are developing the product, you should also start thinking and working on reaching customers through marketing and sales.
Tell the world what you are doing
Starting marketing when the product is ready (even if that feels intuitive) is a wasted chance for a startup. In most cases, a startup can start marketing from the very beginning of the process. Even if you don’t have a clear idea of the solution yet, you can start talking about the problem you are trying to solve.
By doing early marketing, a startup can raise awareness and find out which people are interested in what you are doing and which messages resonate the best. You can for example create a landing page or write blogs, newsletters or even just social media posts. When you do early marketing, it means that when the product is finally ready, you already have an audience who is interested. In addition, marketing naturally goes hand in hand with testing value propositions.
Focus on the future
Startups are underdogs and usually in the beginning nobody has heard of the company nor is interested in them. Because of this, startups often must develop sophisticated marketing efforts to get people's attention and interest.
One way is to talk about the future, which is natural as startups are in the business of creating something for the future, not securing profits now. Telling stories and making them a reality is fundamental for many startup entrepreneurs. That means in early-stage marketing you can focus on how your product will be, how it will affect the world, and how this technology in general will shape the future.
Of course, there are exceptions and one shouldn’t take it too far. Never claim something that is not true. For some, this might also sound like startup hype and create a negative response. So, think about who your audience is and for example how conservative they are.
“Fake it until you make it” is one of these much-used phrases in the startup world. It means using different ways to make the startup look more advanced and established than it is. This can mean small things such as trying to create the impression that you have a big team when in reality you have just two people, or that you have a real office address and are not using your home as the company address. In the startup world, some have taken it even further than that, for example by exaggerating how advanced their technology is. The idea is that if you get people to believe in you, you will probably be able to gather the resources you need to turn what you faked into a reality.
Applying the “fake it until you make it” attitude is controversial, but sometimes perceived as an okay thing to do. But you should then also be sure that it’s possible to realize your claims. And you should never lie to customers. A well-known example where “faking it” went too far is Theranos, which was a health technology company. They raised over 1 billion dollars in financing, but eventually it was found out that the company had been lying about their product. The technology they claimed they had created didn’t work. The company went bankrupt and management was legally charged. So be careful.
Different ways of marketing
Marketing can be roughly categorized into advertising, direct marketing, social media, traditional media, influencer marketing and partnerships.
Advertising means traditional marketing communications: buying advertising space from a magazine, TV or even on the side of the tram. Nowadays, a lot of advertising is done online, too, and it's worthwhile for every marketer who wants to jump into the startup world, for example, to look into the Google AdWords platform.
2) Direct marketing
Direct marketing has significantly changed its shape through electronic media. Modern direct marketing usually means sending email newsletters instead of mailing stuff through the post.
One of the effective methods of digital direct marketing is content marketing. For example, if your newsletter offers tips and tricks that are relevant to your target audience, your engagement with customers can dramatically increase.
3) Social media
Social media enables a new form of direct marketing. While a newsletter is a digital version of an old-fashioned mailbox, social media can precisely target advertising to the right target audience. Indeed, social marketing is more of a science than an art, where detailed metrics and demographic analyses determine the success of a product.
4) Traditional media
Traditional media is vital for many startups. Especially in the early stages, when a company may only have an early precursor to the prototype, serious gaps in the team and not even a proper office yet, positive media attention can significantly increase the startup's chances of attracting key players or good investors. When working with the media, it’s worth remembering that it’s ultimately up to the journalist to make the decision. The media cannot be controlled. Sometimes, this means that the more complex arguments you make in an interview, for example, are left out, leaving the magazine with an overly simplistic picture of what you are doing.
5) Influencer marketing
One of the newest aspects of marketing is influencer marketing. Especially if your target market is young, the power of traditional media in user acquisition may be almost non-existent. Many young people spend a lot of time for example on YouTube. So, one of the most effective marketing tools is to get some social influencer reaching millions of viewers to talk about your product. In Finland, for example, the Seriously gaming company worked closely with the world's leading gamers – resulting in over one hundred million game downloads.
You can categorize marketing in many ways and this is just one example. It’s just to give you an idea how you can start telling creating awareness of your startups in different ways. And remember that basically everything where you interact as an entrepreneur can be a marketing chance, including talking to people at events etc.
In the early days of a startup, as with the solution, the most important thing with marketing is to try different things and learn what works. Try different channels, audiences and messages, and define some metrics how you measure success.
Marketing is for raising awareness among your potential audience. Eventually, when your product is in a shape good enough, you have the chance to sell the product and generate revenue.
Most consumer and other low price-point products are sold with automated marketing funnels, but companies with B2B and other high-price products must most often have people doing sales. How sales are done depends on what kind of a product you are selling. Also the business model matters.
When thinking about how to sell the product, you should think about how the customer can buy this type of product. Think about the price point of the product and, based on that, think about how much time and money you can actually use for selling one product in order for the sale to be profitable. For some cases it’s obvious how the product is sold and you can’t change it, but in other cases you can be creative.
In the early days for a startup, sales is largely about business development. One can argue that in the beginning, it’s as equally important to receive feedback about the product as it is to generate revenue. It’s also about learning what are the best ways to sell the product. We will continue the discussion about reaching customers in the next chapter.