“…When it came down to hiring a programmer or spending money on marketing, we hired the programmer because we viewed them as critical to our business. The marketing we did do was ‘helter-skelter,’ and as a result, we weren’t as successful as we could have been and eventually closed the business.”Bob Maiden, founder, The Maxwell Group, Ready, Launch, Brand: The Lean Marketing Guide for Startups
A common marketing myth is that a startup must wait years before it can spend money on marketing. I call it the “Nike Syndrome,” and I devote an entire chapter to it in my book, Ready, Launch, Brand. The thinking goes like this: “…it’s easy to market when you’re Nike. They’re the #1 sports brand in the world and they have deep pockets. I’m just a little company.”
What’s surprising is that this line of thinking doesn’t apply to expenses such as IT, legal and accounting. They are seen as investments in the success of their business. If you’re no longer able to upgrade your software and hardware, you know your business is in trouble. Since most startup founders think of marketing as an expense, it’s typically the first item that gets cut when business is slow.
The data tells a different story. It turns out that companies that invest in marketing do better in lean economic times than the ones that don’t. And when you cut marketing, it takes much more time to rebuild your content. In the meantime, you’ll have lost the momentum you built. Marketing is the engine to sales, and therefore critical to business growth and success.
Traditional marketing vs. lean marketing
When most people hear the word marketing, they think of “traditional marketing” with a primary focus on advertising and PR. Anyone who’s ever considered running a TV spot during the Super Bowl knows that they’ll need deep pockets to play. According to NBC Sports, a 30-second ad in the 2022 Super Bowl sold for roughly $6.5M.
At the start of your business, advertising is not only expensive but a waste of money. Advertising is critical when you’re a mega-brand like Nike because it reminds consumers why they buy their products. Imagine if Nike suddenly stopped advertising. You’d wonder if they were still in business. Startups don’t have a reputation to uphold. They’re an unknown entity and are still trying to figure out who they are. In my book, I define a startup as “flying a plane, while you’re building it, booking passengers, marketing the airline, interviewing co-pilots and serving coffee.”
The first step in building a lean marketing strategy is to figure out what kind of plane you’ve built — and most importantly, who needs it and is willing to pay for it. You don’t have customers; you have early adopters. Your job as a founder is to figure out who they are and then make sure you’ve built the right plane. Start with an MVP, a minimum viable product, and ask your early adopters what they think. This is an essential step to ensure that you haven’t built an ugly baby. So how do you know if you’ve correctly identified your early adopters?
Three key rules of lean marketing
1) Get clear on your value proposition
A value proposition identifies what you offer, the specific benefits it delivers and why customers should buy from you and not from your competition. Make sure that your solution is solving a real pain point.
2) Get clear on your ideal customer
At the start of a business, everyone could be a customer, but that doesn’t mean they should be. Identify those early adopters who will love your solution and don’t be afraid to check in with them every so often for feedback on how you can make things better for them. This will help you stay top of mind and build brand loyalty.
3) Does anyone need this?
The number one reason why startups fail is no market need. Make sure you’ve built something that enough people want and are willing to pay for. Just remember, a target market is not your mom and a few close friends.
The ROI of marketing
We live in a bottom-line-focused culture. CEOs often expect their CMO (Chief Marketing Officer) to take a modest marketing budget and magically turn it into new customer sales and recurring revenue. But marketing is not a widget. It doesn’t live on a balance sheet. Marketing is an investment in the future growth and success of your company. It takes time, patience and a strategy.
Marketing is a marathon, not a sprint
Instead of waiting until you have money for marketing, startup founders should use lean marketing principles to build a content strategy. This is how you attract your ideal customers and grow revenue. Start by following the social media feeds of the customers you want to connect with. Do this for two-three months to see how they engage with their current brands. Social media is a great tool for building brand awareness, but the proof is in the numbers. If you have less than 100 followers on any platform, it’s time to re-evaluate your content and the platform.
A note of caution: don’t quit too early. Multiple and inconsistent marketing can backfire and make you look unprofessional and indecisive. The goal is to build a solid brand reputation, to be known for the one thing that you do well. Focus on communicating that, not on trying to be everything for everyone.
Word-of-mouth is not marketing
Startup founders often say that they don’t need marketing because all their work comes from referrals. But how do you build a consistent sales funnel when you’re first starting out? Word-of-mouth referrals take time, and you get more clients like the ones who refer you. If you don’t take the time to identify your ideal customer, referrals may bog you down with tire kickers who won’t help you grow your business.
More importantly, without a clear value proposition, you become a solution looking for a problem. Instead, be the solution to a problem you’ve defined for the customer who struggles with it. Startups that grow into successful companies know who their ideal customer is and understand what keeps them up at night. They also know that their product or service is not for everyone. They invest in marketing and start by building a content strategy to engage with their early adopters. They continually improve on and clearly communicate their unique solution. If you build that plane, they will come.
Read more insights from Zeewy in Marketing is The Engine That Helps Your Startup Scale.