The first stumbling point for many new businesses isn’t the development of the product, it’s marketing. Many new business owners confuse marketing with sales. Marketing tells people about your product, service, and company early and often. Marketing generates demand and leads. The sales teams reach out to those leads and convert them into paying customers.
Early marketing strategies often center on creating awareness as well as lead generation. Building awareness for the product and the company before, during, and after the development process ensures the sales and revenue plans to be attained. So when should marketing begin – as soon as possible. It’s absolutely imperative that a start-up know how, where, and to whom to sell their products or services.
These relationships and leads enable the sales team to make deals and capture revenue after the product is available. People buy what’s most familiar to them. One of the early missteps is to underestimate the effort required to market a product. It’s is often more expensive and it takes longer than expected. For a start-up with no reputation at all, marketing can be 2 to 3 times that of development, in terms of both expenses and time.
One question is how do you do marketing when it will be some time before your product is ready for customers. What do you promote? One way is to start talking about the problem. If your product solves someone’s problem, they will be looking for a solution. Another way is to establish yourself as an expert or go-to company in the industry. It’s a lot easier for a prospect to believe your first product will perform as expected if you are viewed as a subject matter expert in the field. It won’t eliminate all the objections but it will reduce them.
The marketing plan, like every aspect of a business plan, is based on assumptions. Reaching out to the customers is vital because a start-up needs to prove or disprove customer assumptions as soon as possible. Before jumping into a full blown product development and marketing effort, it’s important to make sure the problem is real and customers are urgently seeking a solution.
The initial marketing effort focuses on gaining a better understanding of the customers and their needs, planting the seeds to build customer relationships, and beginning a pre-launch awareness program. It is not the go-to-market plan. It is a search plan. It means knowing how customers conduct their business and how the product or service can add value to their business model. It also includes knowing your customers’ habits and media preferences. This feedback is critical to refine and prioritize product features as well as gain insight into the correct pricing model. Early customer discussions will facilitate long-term relationships.
It’s important to build a compelling story line by keeping the following questions in mind. Why would a customer buy the product? Why wouldn’t a customer simply continue doing what they do today? Why would a customer buy from your startup instead of one of your competitors? What compels your customer to buy now and not wait? The first step in answering these questions is to identify the people who are the most desperate to solve this problem. Focus on customers who absolutely must have the product. The second step is to find as many places as possible where you can access these customers and build awareness, places where they already gather.
Marketing interacts with customers to prep the market for the product before it has even completed development. It should not be an afterthought. Ultimately, what the customer needs and is willing to pay for rules a start-up; marketing is the spyglass into the customer’s perspective.
About the Author
Cynthia Kocialski is the founder of three tech start-ups companies. In the past 15 years, she has been involved in dozens of start-ups. Cynthia writes the Start-up Entrepreneurs’ Blog (www.cynthiakocialski.com) and has written the book, “Startup From The Ground Up – Practical Insights for Entrepreneurs, How to Go from an Idea to New Business” (www.startupfromthegroundup.com).