Marketing Your Startup

by Simona Covel

  Importantly, the giveaways in Daily Glitter are decidedly not bottom-of-the-inventory items. If anything, they are coveted items with the power to excite customers, bring spenders to the store, and cement the brand’s reputation as a hip boutique stocked with hot items.

  A contest is a campaign in which effort, skill, or merit, is required to enter to win a prize. For example, you may require people to upload a photo or video in order to enter. The winner is determined by voting or other judging criteria. The element of chance must not exist in a contest.

  A lottery requires purchase, payment, or other consideration (the contestant has to buy something, such as a ticket), chance, and a prize. Private lotteries are illegal under state law. Under federal law, it is illegal for U.S. citizens to even participate in a foreign lottery. With all of these regulations—just don’t run a lottery.

  The Law Cares About Your Contest

  Lotteries aside, administering any kind of contest is more complicated than you may think. That’s because they’re governed by certain laws you’ll have to abide by, and the rules can be confusing. If you’re thinking of hosting a contest or giveaway—online or off—you’ll want to make sure you’re following the laws where you live, and the rules laid out by the platform you’re hosting it on. But that’s not all you need to be aware of.

  In the United States, companies need to make sure their Internet sweepstakes and contests don’t run afoul of regulations around online gambling. The rules get very specific—and explain all of the fine print you see when you encounter a sweepstakes or promotion. Language like “no purchase necessary” and “void where prohibited” are legal requirements, and there are many others, including rules around the descriptions of prizes, entry procedures, eligibility requirements, and judging criteria. Make sure you talk to a legal expert.

  Many states in the U.S. individually regulate promotional campaigns, especially when prizes include alcohol, tobacco, or firearms. It is important to know that promotional campaigns are governed by the laws and regulations of the state in which the contestant lives. As you write your contest rules, take note that individual states have individual legal requirements that may include registration requirements or different rules for high-value winnings. Check with an experienced attorney before conducting any promotional campaign.

  How Much Does It Cost?

  A contest can cost as little as the item you’re giving away and your time, if you’re communicating it through channels you already use, like social media. If you’d like professional help, you may pay as little as $30 a month for an automated service from a company like ShortStack, or thousands for help from a full-service agency executing a splashy branded promotion.

  Can I DIY?

  Because of the complexity around the laws and regulations, we don’t recommend it. Depending on the type of contest, a low-cost online contest administrator may be an option. There are lots of options, for example, if you want to execute the whole contest via social media—something like a simple social media photo contest.

  How Measurable Is It?

  Very—when done right. Make sure you have the infrastructure in place to capitalize on the leads that come in through the contest. You should be collecting information from everyone who enters, and putting those people into your marketing funnel. While contests and sweepstakes often produce big numbers at the time—some contest promoters will boast returns of a thousand percent or more—that rush often doesn’t last. Add participants to your distribution lists, and engage them through other channels.

  SPONSORSHIPS

  For a little-known startup, sponsoring an organization or activity can be a valuable way to boost your credibility and name recognition. It’s about cachet by association. That doesn’t mean paying millions of dollars to emblazon your name on an NFL stadium. There are lots of low-cost, low-lift ways for startups to get your name out there through sponsorship.

  Prize Donations

  Prize donations are a top sponsorship opportunity for small businesses. They only cost as much as you want them to, they get your business name out to a lot of potential winners, and they give winners the chance to try your product or service for free. If you have a service-oriented business, you can donate gift certificates and show off your valuable skills to winners.

  Try to align to an organization with lots of potential customers who may not have heard of you. For example, if you’re a meal delivery service, offer a free week as part of a fundraiser at a school or daycare. If you have a product-based company, consider donating your goods to a related nonprofit (e.g., wetsuits to an environmental organization).

  Other sponsorship options:

  Fundraisers

  Provide local meeting space

  Company day of service events

  Matching gift program

  Corporate grant program

  Nontraditional Sponsorships

  When you think of corporate sponsorships, the back of someone’s shorts probably aren’t top-of-mind, but in the world of mixed martial arts, it’s just about the only spot that’s readily visible—and clothed. For sponsors, that makes it the money spot, and, according to Bobby Harris, founder and CEO of BlueGrace Logistics, it’s worth every penny.

  Sponsoring a NASCAR team or having the company logo on the Green Monster in Fenway Park may be the dream of every sports-loving business owner. But for most, the hefty price tag for a major sports sponsorship is out of reach. Niche sports, by contrast, can offer a worthwhile marketing experience at a fraction of the price. “Dollar for dollar, you just can’t compare the value,” says Harris.

  Since it was founded in 2009, BlueGrace Logistics, based in Riverview, Florida, has sponsored more than twenty fighters. Why MMA? Harris got the idea to sponsor fighters after a chance meeting with Ultimate Fighting Championship light heavyweight Jon “Bones” Jones in a hotel lobby in Las Vegas. Not yet a big fan of the UFC, Harris didn’t know what to expect from someone who gets kicked in the head for a living. So he was pleasantly surprised to find that Jones was a smart, charismatic guy, who, Harris says, “holds himself like a champ.”

  That got him thinking. “I wondered how much it costs to endorse someone in the UFC,” he says. As it turns out, not all that much—at least compared with other sports. According to Jones’s agent, Malki Kawa, CEO of First Round Management in Doral, Florida, it can cost as little as $10,000 to sponsor a fighter for one night, and an annual contract starts in the low six figures. That’s not pocket change, but it’s a fraction of what a Nascar deal would cost.

  For BlueGrace, which manages freight hauling and shipping for companies, MMA was a perfect fit. The company’s marketing department did some research and learned not only that UFC fans are predominantly male, like BlueGrace’s clients, but also that shipping managers in particular are highly likely to be UFC fans. What’s more, UFC fighters’ bonuses depend on their social media activity, which makes them some of the most Facebook- and Twitter-savvy athletes around—and great ambassadors for your brand.

  Beyond guaranteed logo placement during fights, there are other advantages: BlueGrace’s fighters, for example, have appeared on Fox and in the pages of Maxim magazine, all while sporting the company’s logo. “That secondary marketing was completely unexpected,” Harris says.

  A Cautionary Note

  Nontraditional sponsorships aren’t for every business. UFC fights can be shockingly violent and may not project an image that businesses want to be associated with. Larry Rothstein, president of the New York City–based sports marketing firm Source Communications, says business owners need to consider worst-case scenarios.

  For instance, when Rothstein took over Amtrak’s sports sponsorships, he pulled the company’s Nascar deal. “I never wanted to see a crash happen with Amtrak’s name on it,” he says. “MMA sponsorships are for companies with the ability to tolerate the violence.”

  There are lots of nontraditional sports to consider when it comes to sponsorships—from bowling, to surfing. S
ponsoring these kinds of lower-profile sports may cost as little as $20,000 per event—not cheap, but a far cry from most professional athletics.

  How Much Does It Cost?

  Donating your space as an organization’s sponsor, buying Little League uniforms or providing food or a giveaway can be a very low-cost commitment. Once you get into the realm of larger-scale sponsorships, particularly those with national reach, you’ll likely move into the tens of thousands.

  How Measurable Is It?

  Measuring a sponsorship’s return on investment is a challenge. However, because your key goals are to increase brand awareness and generate positive publicity, you’ll get a sense when the initiative becomes a marketing success—or if it doesn’t. As with all marketing, you’ll want to identify the key performance indicators upfront, whether that’s a survey to assess brand lift or a sales boost after an event.

  PUBLIC RELATIONS

  “ A good PR story is infinitely more effective than a front page ad.”

  RICHARD BRANSON,

  Virgin Rebel: Richard Branson in His Own Words

  Public relations is all about getting earned media—that is, earning free placements, as opposed to paid media. While there’s no question that traditional media doesn’t have the monopoly on clout and influence that it used to, there’s still no substitute for a mention in the press, particularly in big national media, which tend to elevate the perception of your brand. For many companies, local publications or industry pubs may also be extremely valuable.

  Similar to influencer marketing, with PR, you don’t get to control your message. How your message is conveyed is up to the reporter or editor managing the story. PR always includes the risk that a reporter will decide to take an entirely different tack on the message you provided—and that’s a risk that makes some businesses nervous.

  While there’s no question PR is great for spreading the word about a company—especially a young company that’s trying to raise its profile—that doesn’t mean that every press mention will translate directly to sales. It’s often not that simple or direct. Because the media is established, much of PR’s power is its ability to cement your company’s reputation as “legit,” and to lend credence to your brand.

  So How Do I Get a Profile in The Wall Street Journal?

  Every PR professional has been asked this probably a thousand times. If your goal is media placement, you can start by learning a bit about how reporters think and work. Just that knowledge alone will put you light-years ahead of your competition.

  First, understand that while to you, your business is the most innovative and the greatest, reporters hear that dozens of times each day. Really. That’s not an exaggeration. Reporters at big media outlets can receive two hundred pitches a day or more. So just saying you’re the best isn’t going to cut it.

  Also understand that what you think is a story is different than what constitutes a story to a member of the press. Very few companies warrant dedicated profiles devoted to them. Reporters look for trends to talk about, or shifts in a marketplace, or a link to timely news. If you can plant a seed about how your company is representative of something new or shifting, or why you’re qualified to talk about something in the news, you’re starting to think like a reporter.

  Connecting with the Press

  Start by finding the right reporters to connect with. If you already know a reporter, maybe someone who has interviewed you before, start there. He may be willing to pass your name on to colleagues if he isn’t interested. If you don’t know a reporter, they’re pretty easy to track down. Most reporters have “beats,” or areas that they typically report on. Simply look at the bylines for articles about your industry. You’re likely to see the same name or names pop up over and over. Then you simply send them a personal email explaining why you contacted them. Once you have a feel for a reporter’s beat, you can tailor your message to that person.

  Another approach to consider is the use of the “Help a Reporter Out” website—it’s a network that pairs reporters with sources for their stories. In this case, you don’t get to choose the story. Instead, after you sign up, you’ll receive emails listing all of the stories journalists who use the service are working on. If you feel like you have the ability to comment, you reach out to the reporter directly.

  If you’re interested in a specific publication, take some time to study it. Look for the reporters who routinely have bylines about your industry or sector. If they can’t help you, they may be willing to point you in the right direction.

  If you’re trying to connect with a reporter, first, consider what makes a story worth writing about. Remember, reporters are not customers. A sales message like “we can save you 25 percent on purchasing costs” isn’t going to pique the interest of the media. Instead, a media-ready story needs a “hook” that makes it newsworthy, usually by attaching itself to whatever news stories have recently been gaining a lot of media attention. There’s some art involved in figuring out story angles—it’s not a natural skill for most business owners, and even for some PR professionals. You may consider hiring an out-of-work newspaper reporter, who can help you craft timely pitches. Sadly, there are plenty to go around.

  Once you’ve defined a newsworthy story, you can figure out how your message might fit into that story. Remember, just because you pitch a certain angle doesn’t mean a reporter is under any obligation to take it.

  How Much Does It Cost?

  Freelance PR help can be found for as little as around $50 an hour, whereas working with a large, full-service agency can exceed hundreds of dollars per billable hour. Project-based agencies offer a “one price for all” payment structure that may cost as much as $10,000 a month, depending on the scope. Some PR pros (though not many), offer “pay for performance” options, where you only pay if they make a media placement for you—anywhere from a few hundred to thousands of dollars, depending on the outlet and the placement.

  While it can get pricey, PR professionals have established networks of reporters and editors they work with, and they craft pitches for a living. If you know that press coverage is your objective, it can be worth the investment.

  No matter what type of practitioner you select, be upfront about how much money you can spend and don’t hand over money without seeing regular results. Establish a reporting schedule, request regular updates from a singular point of contact (if you’re working with an agency), and offer enough direction to allow the PR pro to get the job done without micromanaging every detail.

  Can I DIY?

  In many cases, it’s worth a try. Unlike other forms of marketing, virtually the only cost is your time, and the rewards can be huge. Many business owners who go the DIY route find they’re most successful when they cultivate relationships with the right beat reporters, offering to help with stories. Then it may take some time to find the right way to work something in about your product or growth. But when you do, the dividends can be enormous.

  CASE STUDY

  Corcoran Invents Data—and The New York Times Bites

  YOU DON’T HAVE TO be a big name to get high profile press coverage. Just ask real estate mogul—and Shark Tank star—Barbara Corcoran. Early in her career, she invented a data-driven report she called The Corcoran Report. The report calculated the average real estate sales price in Manhattan—but at the time, it was based on just seven total sales, because that’s all the company had done. She crafted some introductory copy about conditions in the marketplace—“It sounded fancy,” she says—and mailed the report to reporters at The New York Times.

  Two weeks later, she says, she opened the paper and a story on the front of the real estate section trumpeted “New York City Prices Hit All-Time Low.” And in the first sentence of the story—the “lede,” in journalism parlance—the reporter wrote, “according to Barbara Corcoran.”

  She was stunned, she says. “I started churning out reports for the entire rest of my career,” Corcoran recalls. Media members soon started turni
ng to her whenever they needed a quote or statistic on the real estate market in New York. “When you’re constantly quoted as the expert in your field,” Corcoran says, “everybody believes that you are.”

  7

  CUSTOMER MARKETING

  HANGING ONTO CUSTOMERS IS harder than it’s ever been. Consumers are bombarded with choices—they’re savvier and more demanding—and loyalty is fragmented. Study after study has shown that consumers—particularly younger ones—are more willing than ever to abandon a brand in favor of another if they’re offered something shinier or cheaper.

  It’s a well-worn truism that acquiring a new customer is harder and more expensive than hanging on to the ones you’ve got. So how can you do that, in a fragmented marketplace where loyalty isn’t top-of-mind? Even if you’re not in the customer service business, there’s one clear way to please your customers: Act like serving them is your first priority.

  Start with the basics. Stand in your customer’s shoes. Look beyond your own business and understand your customer’s full range of choices for everything that you sell. Take the time to really dig in, imagining the full ecosystem of options for your customers. This exercise will also deepen your understanding of competitors and help you better anticipate their moves.