Startup Marketing Strategies-How to select the right marketing strategy to optimize returns is always a dilemma.
Startup has limited cash resources. Marketing precedes sales and this implies you should invest first to reap the benefit of sales. This lag factor will force you to choose the right marketing strategy.
“Marketing success only comes from rigorously tying activities to revenue; otherwise marketing will always be perceived as a cost center.”- Jon Miller- Co Founder of Marketo.
For marketing its product or services, startup has a choice of using passive or active marketing strategy.
Startup has mainly two resources –money and
time and in reality more of time than money. Initially, as a startup
entrepreneur you have to spend more time on marketing activities. You may be
spending as much as 80% of your available time on acquiring customers. This should
gradually come down to 40%.
Can a startup use one marketing strategy only and get maximum return? Normally, a mix of 3-4 strategies may be required. Measure the return for each approach and choose the one that gives you maximum return.
Image Source: Getting Business come to you-Paul & Sara Edwards
Choose the marketing approach that will provide you with the easiest and least costly access to the specific people you want to reach (Right Fishing Hole).
You can study competition and understand what marketing strategies are working for them.
In modern era SMS, e-mail, blogs etc. will fall under left hand side of the matrix. These can be considered as Public Relations.
What is passive marketing? This strategy is
based on presenting the product or service before the need arises. It
anticipates customers who are looking for the product or service and catching
their attention in helping to make a
Newspaper advertisement, pamphlets, yellow pages and industry directory are some of the passive methods.
Passive method like advertisement will cost more money and one advertisement may not bring desired results.
Startup needs to have personal interaction to acquire paying customers quickly as the cash resource is limited.
Meeting potential customers face to face by
organizing a seminar, a networking event, cold calling or getting referrals
fall under active marketing. This method will be suitable for startup
entrepreneur as this will require less of cash.
Good communication skills are essential. Persistence and convincing skills are also required. Generally, technical entrepreneurs are reluctant to approach customers face to face and they perceive selling means being pushy.
Understanding human psychology helps in choosing
the appropriate marketing approach. The
following are well known sales triggers in making people to buy and the
marketing strategies can be woven around these factors.
1.Early bird registration discount (Time limit nudges people)
2. Buy one get one free (People always love the word free)
3. Refer your friend and get bonus coupon (trust factor)
4. Costco model of membership. Commits customers to buy
5. Piggybacking on popular products (Buy the burger and get coke free)
6. A free seminar to create interest and get potential customers. (Trigger- free)
A mix of passive and active marketing approach will be the key to success. Locating the right fishing hole and targeting specific groups for marketing strategies will help in getting the desired results.