Advice for Today’s Start-Ups

In our fifteen-plus years of doing business, we’ve worked with a lot of start-up companies. Some were literally birthed in a garage, and some were much better-off (I recall one that had secured funding of over $200 million.) But it’s only recently we’ve begun seeing a new and disturbing trend among start-ups. I’ll call it the Magic Marketing Wand.

In the past, start-ups knew that marketing wouldn’t be cheap or easy. And, in fact, for the better-capitalized start-ups, we worked hand in hand with management to define the foundation of the brand, key messages, and top differentiators—before they had released a single product or service. They’d come to us with goals, and we’d put together a media plan based on those goals, and they’d go back to the venture firm with those numbers.

Today, though, too many start-ups have a business plan with a Marketing section that reads something like this: “We’ll use the power of the internet, viral marketing, and social networks to fuel explosive growth, at a cost dramatically less than traditional advertising.”

Uh-huh. Sure you will.

And, you know, once in a long while, maybe. Something so new, so amazing, so useful, so immediately understandable, and so instantly compelling comes along, and it really doesn’t need to be advertised.

But, to the start-ups out there: is this your product? Be honest. If you can list your competitors, is your product or service so compellingly different than theirs that someone will immediately grasp this, and instantly make the switch? If you can’t list your competitors, will they be able to understand at a glance why they need it, and instantly buy/download/whatever?

Yeah. That’s what we thought. So, a short list of advice for today’s start-ups:

1. Don’t assume marketing is free or cheap, just because the media landscape has changed. Sorry, there is no Magic Marketing Wand. And yes, I know, we’re living in a wonderful new world with so many new kinds of media! The internet! Viral video! Social! Mobile! But the power of the internet isn’t in a one-in-a-hundred-million chance of being “discovered” and taken viral on the backs of your adoring consumers.

The power of the internet is in how it allows you to target specific audiences with rifle-shot messages, and reach aggregated audiences with wider branding campaigns. Both of these are far from free. Think tens to hundreds of thousands of dollars per month for top sites or networks. Or, if you’re going for a social play, ask a reputable firm how much they charge for “seeding” or “activation.” Mobile? Developing an app is one thing. Spreading it effectively amongst hundreds of thousands of other apps is something entirely different.

So, please: let’s be realistic. Kill the Magic Marketing Wand.

2. The most important thing to get right is your message. “But do I really have to do all that branding stuff?” you might be asking. “That can cost a fortune, too, and I’m on a limited budget.”

Well, if you’re a well-capitalized start-up that has designs on being a national or international name, I’d have to say, “Yes.” But if you’re not, the most important thing to get right is your message. If you have competitors, why are you compellingly, disruptively better? If you’re the first in your category, why does everyone clearly need your product or service?

As you’re scribbling down the answers, lose the bullshit. Can the buzzwords. Eliminate anything an eighth-grader can’t understand. Cut the number of words mercilessly.

Then, when you think you’re done, imagine this scenario: You’ve just stepped into an elevator with your biggest possible prospect, or most ideal customer. He or she presses the button for the next floor. You don’t have time for a 30-second elevator speech. You have time to tell them one thing. One sentence. What is it?

Maybe you can do it yourself. Maybe you need an agency (like us!) to help with that.

3. If you’re budget-limited, target a niche or single location first. Okay, you said you are budget-limited. It’s likely the cost of a national or international campaign will make you go gray. We understand. And this is the perfect time to consider a niche or regional launch.

Instead of targeting “all computer users,” maybe you should redefine to say, “all Ubuntu Linux users” instead. Instead of “iPod users,” maybe it’s “FLAC-using audiophiles.” You get the picture. The more clearly you can define a niche, the more likely you’ll be able to find a tight-knit user community, discover where they hang out online, and build a campaign to speak directly to them. Create an effective campaign to a niche, then use the success of that campaign to get more marketing investment to go after broader swathes of your public.

Or, instead of “everyone, everywhere,” maybe it’s only “people who live in Los Angeles,” or “loft-dwellers in Boston.” Segmenting geographically allows you to take over an area and communicate more relevantly. Again, you can use the success of a geotargeted launch to expand across the nation (or world.)

4. Take maximum advantage of PR. Yes, we’ve all read about how PR has been gutted by blogs, online media, social, etc. But guess what? It hasn’t. Not if your PR firm embraces all the new media.

Your PR firm should be getting you on the prominent blogs, placing articles in online media, and even reaching out to potential fans in the social spaces. And PR still functions the same way it has through the decades: providing you with cost-effective, highly credible outreach that can far outstrip advertising results.

And, full disclosure: we don’t do PR. But it would be criminal to talk about start-ups and not mention it.

5. Buckle up if you’re looking at mass outreach. “But, but,” you say. “Isn’t there something we can do to get huge exposure? Some wonderful way to market that you’re hiding from us? It can’t be that every national campaign costs millions of dollars!”

Um, yes. National campaigns cost millions, tens of millions, hundreds of millions. Yes, even if it’s only online. Yes, even if you know the secret code word. Yes, even if you still believe in the Magic Marketing Wand.

What an agency can help your start-up do is use the media mix most effectively, and get the maximum return on your marketing dollar. But that’s a subject for another post . . .

Posted by May 27th, 2010 | by Jason | Permalink