Marketing Your Startup

by Simona Covel

  • How much can you really afford? Don’t spend yourself into a hole that you can’t dig out of.

  How I’d Spend It—What Five CEOs Would Do with a $10,000 Marketing Budget

  “I would hire a social-media marketing consultant to develop a strategy and fine-tune our brand on the residential side of our business. I’d train a couple of people on how to manage that ourselves, so we’re not relying on a consultant to do that work. I’d also hire, on a part-time basis, a graphic designer, just to spice up our photos and the content we post.”

  —Michael Parnell, MP Consulting

  “Direct mail—it’s a hidden gem. Everybody thinks it’s old school; nobody focuses on it anymore, which provides more opportunity for those of us who do. People who open up mail are a specific demographic. If your product fits in with the responsible, middle-aged group who typically open their mail, direct mail can be huge.”

  —Jim Carlson, Zurixx

  “First, look at internal data about your customers. Using that, develop specific customer identities. One we’ve used is ‘head of a regional media agency seeking a competitive advantage but who lacks resources for a video team to serve his customers.’ Second, ask if you are communicating to your customers what you do in a non-confusing way. Third, spend money on the basis of what you found out in the first two steps. Figure out where your customers are when they have their buying hats on: events or social networks? Then create content that fits each particular environment. For YouTube, video; for events, a special kind of talk that is geared toward informing the customers you’re looking for.”

  —Bettina Hein, Pixability

  “I’d go to all of our partners, whether they’re sponsors or the mayor’s office, and I’d look at co-op marketing. To the city, I’d say, ‘Let’s run a joint ad for the festival and the city and try to double or triple that marketing budget and create some social media.’ It’s all about stretching the dollars.”

  —Danny Hayes, Danny Wimmer Presents

  “If I was a new lifestyle company, I’d spend it on branding. Having a strong creative with a really crisp point of view that is timeless and stands out, and that you feel reflects who you are as a company, provides huge bang for the buck. You’re going to live with your logo for a long time.”

  —Amanda Hesser, Food52

  MAKE IT IRON-CLAD

  When you’re in the weeds executing your marketing plan, it’s easy to experience creep—making on-the-fly decisions that result in increased spending on a campaign or initiative. That’s why your marketing budget needs to be set in stone. That will help you make decisions with discipline, making sure every dollar counts and you’re making appropriate tradeoffs.

  To help you stick to your marketing budget, try these steps:

  Create a Main Budget Made Up of Smaller Budgets

  Your overall headline number is how much you want to spend on all marketing initiatives. But beyond that, it’s important to have a smaller picture of how you want to dole out the funds. If, as you measure, you find that a particular tactic is underperforming, you can reallocate your buckets.

  Plus, having specific buckets will allow you to get granular when it comes to tactics like social media campaigns, where you’re paying for clicks or impressions and it’s easy to get carried away.

  Get Specific

  Try not to rely on ballpark figures, but really home in on a specific amount you want to spend on each of your tactics or initiatives. That will give you a hard line when you’re negotiating with advertising providers or agencies. Plus, when you have an exact dollar figure for each campaign, you tend to follow it more closely than if you’re less specific.

  Since marketing often comes with hidden costs, such as research, message testing, or further click purchases, being specific will force you to calculate the possibility of unforeseen costs into each plan and prioritize which ones are essential.

  Track Your Spending

  Just because you said you would only spend x amount of dollars on a campaign does not mean you actually did—those unexpected costs can stack up quickly, and all of a sudden you’re thousands of dollars over what you planned for. If you’re tracking as you go, you can make sure there is no overspending.

  Be Ruthless

  As you monitor your tactics, you will notice patterns that tell you which ones are working and which are underperforming. If you can, take the opportunity to tweak your campaigns. But don’t hang on for months. If something isn’t working, you want to avoid throwing good money after bad—something that can be tough if you’ve been planning a certain tactic for months or even years. If you can quickly identify the underperforming platforms, you can remove them and save that money, maintaining your budget target.

  Many high-growth small businesses spend more than just a few percentage points on marketing because they know the outsized impact it can have when you’re establishing a brand or gaining traction for a new product. But not everyone has the cash flow to do that. A small business with a small marketing budget needs to get attention and drive sales on a shoestring. This means getting creative.

  BUT I HAVE NO MONEY

  Businesses that are very good at marketing themselves with very little money tend to do a few things very well. First, they focus on building a large network of fans and followers to promote their business via social media. They put a lot of time and energy into engaging their fans and keeping them engaged, day in and day out. But they don’t stop with social media—they harness energy for real-life connections, too. Depending on the business, that may mean knocking on doors, chasing referrals, or attending industry events. They build and maintain relationships with decisionmakers.

  Successful low-cost marketers also never forget the value of current customers. They look after their existing customers extremely well, every day, all the time. That means constantly engaging with them to make sure they’re happy and the products are working for them. When they can, they tap those customers for referrals.

  They also may partner with other businesses that share similar customers and cross-promote. Think guest blogs, shared webinars or events, promoting each other on email and social media, etc. When you align with others, you get double the audience. If you’re a retail store and it’s Small Business Saturday, for example, find another small store in the area with a complementary product and consider doing a cross-promotion of each other for the day. Thinking this way reduces the cost of marketing for new businesses and accelerates the speed at which new customers come on board due to the existing credibility with the referring partner business.

  Most of all, these founders and company presidents market all the time, regardless of how busy they may be. It’s just a part of who they are.

  10

  WHEN TO MIX IT UP

  WHEN IT COMES TO marketing, the world moves fast. On average, marketing leaders today say 34 percent of their budget is spent on channels they didn’t know existed five years ago—and they expect that to reach 40 percent by 2019, according to the 2017 Salesforce State of Marketing report.

  So how do you know when it’s time to rethink your marketing strategy? The most obvious way to tell is when a strategy that worked without fail two years ago suddenly is falling flat—or your results have been gradually trending downward. It’s particularly common these days in a universe of rapidly evolving social media. If you find that a tactic that worked like gangbusters is suddenly failing to convert, or you hear customers talking about a new social media site they’re using all the time, it may be time to reconsider your marketing strategy.

  That’s not the only time you’ll want to revisit your strategy. If you’ve introduced a new product or added new features, that’s a great time to evaluate whether your marketing needs a bit of evolution. Plus, even if everything’s going well with your marketing, you’ll probably want to take time out once a year or so to dive deeply into your strategy and see if any tweaks make sense. Maybe you’ve had shifts in revenue, or you’ve found traction wit
h one segment and not with another—taking time to dive deeply into your marketing and sales data may give you insights that lead to fresh takes on your marketing strategy.

  BACK TO THE BEGINNING

  You can start by going back to your personas. Has your audience changed at all? Have you discovered that your actual customers are a bit different than what you expected—a different age, concentrated in a different location, or at a different point in their lives? What’s driving your customers to make the purchasing decision? Just as important—are there personas who aren’t buying from you, but should be? Once you align your personas to actual behavior, you may notice trends or subtleties that you didn’t anticipate—that many of your customers are moms who are on social media when their kids are in school, or that your marketing is performing particularly well in urban locations.

  Once you have updated personas, go through the same exercise you did at the outset. Make some educated guesses about how each one is likely to react to different things you might try. For instance, if one of your personas lives in the suburbs and commutes to work, you might think that radio advertising during morning and evening drive times is an effective way to reach that person. If another persona is very focused on family, then tying your marketing efforts to holidays might be a smart approach.

  When you’re revisiting your strategy, you have the advantage of data that you didn’t have when you were first starting up. You likely have detailed sales records and know which times you did better and worse. You also should have detailed records of promotions you tried and what advertising you ran when. You should know when you adjusted prices up or down and what impact that had on sales.

  Next, test your hypothesis in the real world. Does your data suggest that a slight price drop will lead to a sharp sales upturn? Then try dropping prices in a limited-time offer without changing anything else, and see if that idea holds true. If it does, you’ve learned a valuable lesson about how price-sensitive your market is. Same goes for marketing shifts. If you see a spike in social media activity in the pre-bedtime hours, try targeted ads that reference bedtime, or post links to your content then.

  The more you create and test hypotheses this way, the closer you’ll be to your customers’ actual behavior, giving you an actionable understanding to make changes.

  LISTEN TO YOUR SALES TEAM

  You have a critical source of data within your walls—your sales team. Feedback from those feet on the street can help you determine if your messages are reaching your target. Formally or informally, your salespeople are collecting data every single day. Do certain blog topics or titles glean more qualified leads than others? Do certain video topics bring in very few qualified leads while others are immensely popular with prospects? Lead number and quality data can help to optimize content and attract not only more leads but a higher percentage from the ideal audience—those who are more likely to convert into paying customers.

  It’s a great idea to bring your sales and marketing teams together weekly to review results from your current marketing initiatives. You want to ensure that your marketing is optimized to reach your target audience—the audience your sales team is connecting with every single day. A simple collaboration—even as informal as a weekly lunch—will align marketing and sales efforts, creating open communication and generating creative ideas for new marketing tactics or deployment to attract qualified leads.

  When you’re talking to your sales team, think in terms of audience need—the bedrock of contemporary marketing. Ask your sales team what kinds of questions prospects ask and what their true needs are. If your product is financial software and your key audience is struggling with keeping certain financial records in the cloud, maybe you want to publish an article or video series about archiving financial records. When sales teams are conditioned to have an ear to the ground for customer problems—and marketing teams are set up to hear that feedback and act on it—your customers and prospects get great value and you get closer to the results you want.

  No matter what your industry is and what marketing tactics you’re using, take a test and learn approach. Go back to the KPIs you set when you outlined your marketing strategy. Different channels and tactics will take different amounts of time to gain traction, of course, but after a few months you should see trend lines you can act on. If you use mostly content marketing, for example, your traffic should be steadily increasing, people should be linking to your content, and you should be converting on your site from your content. If you use Instagram, you should have steadily growing numbers of followers, and after a few months, those followers should be converting into fans who are visiting your website or coming into your store.

  One of the hardest lessons for any marketing team—but especially one that’s scrappy and young—is knowing when to cut bait. Not everything you try is going to work. Just because Instagram marketing is on the cover of magazines or everyone’s talking about content marketing at conferences doesn’t mean it’s the best tactic for your company, your products, or your target audience. If you’ve worked iteratively and tweaked the execution a few times over a few months, and you’re still not seeing meaningful results, it’s time to dig into the data and rethink the strategy.

  Creating Sales Collateral Your Sales Team Actually Uses

  In almost every industry, the discipline of sales has changed dramatically in the last decade. While deals are still done on golf courses and over three-course lunches, today’s consumers are hyper-informed coming into the sales process in just about every industry, changing the role of the sales professional. They no longer lean on salespeople for all of the product information. Instead, they want context and problem solving.

  Marketing teams think they’ve taken steps toward solving for this shift. They’re commissioning white papers and publishing audience-first content. But salespeople don’t always use what marketing is creating. In many organizations there’s a disconnect. Prospects aren’t picking up the phone after reading a white paper, or the sales team doesn’t find the materials marketing creates to be very helpful, and they don’t even use them as part of their sales process.

  It’s a problem across industries and company sizes. In a 2017 Forrester study, 44 percent of B2B companies said that marketing and sales departments had a weak relationship when it comes to sharing knowledge about customers’ buying process.1 What a waste. Marketing and sales should be the most symbiotic of business relationships—particularly now, when customers are clamoring for solutions and marketing is better equipped than ever to provide them, rather than just pushing out messaging.

  Fixing this problem starts simply: by talking. We already beat the drum of marketing and sales sitting down together periodically, and we’ll reemphasize that here. Just getting together periodically and running through what’s working and what’s not, and what kind of product and marketing plans are in the pipeline, will start getting the two teams on the right, shared path.

  But don’t stop there. For marketing to generate high-quality leads for sales—and isn’t that the whole point?—the two teams need to agree on the target markets, decisionmakers, and influencers, and have a shared appreciation of the buyer needs, buying process, and budget. They need to work together on the competitive advantages.

  Then, the teams should analyze what they’ve been producing and working with. How do customers and prospects respond to different types of content or messaging? What does the sales team really think about the content, tools, and resources provided? What is working for them? How can these tools be made more useful? What’s missing? What will help the most with closing deals?

  Once the teams do that, marketing will have a better understanding of how sales is approaching the market—and sales will be better positioned to articulate the type of marketing collateral that will land in prospects’ hands, instead of in the garbage.

  11

  FINDING OUTSIDE HELP

  THE MAD MEN ERA ended a long time ago. Shopping for an advertising agency is
no longer done in smoke-filled boardrooms and martini bars—and the industry is vastly more diverse and splintered. Today, thousands of wildly different agencies exist, from five-person startups in Brooklyn to enormous traditional firms with a global reach, and everything in between.

  The idea of expertise has changed, too. While having a great tag-line or a slick TV ad may still be important considerations to some, for smaller companies a more focused expertise on social media, or content marketing, or experiential marketing may make more sense.

  No doubt, in the beginning you’ll probably bootstrap your own marketing, reading books like this, scheduling lunches with friends who are marketing types, and to some degree, winging it on gut feeling. Most startups have been there. But for most emergent companies, a partnership with an advertising agency is an unavoidable step in the growth process.

  “The likely path for entrepreneurs is to experiment to some degree with advertising,” says Tom Finneran of the American Association of Advertising Agencies (4A). “But entrepreneurs have such a full plate that they recognize that while they can do certain experiments themselves, when they start encountering significant investments, they need to have affiliations with experts. Just as that might be true for working with technology partners or manufacturing advisors, it’s also true for advertising services.”

  Of course, simply deciding you need an advertising agency doesn’t mean the search will unfold effortlessly before you. While agencies maintain the ultimate responsibility of winning your business, a large part of the search process—from understanding the best advertising options for your audience to choosing appropriate agencies for your business—falls squarely on your shoulders.