Let’s say you’ve come up with a cure for baldness. You’ve patented your formula, written a business plan, lined up investors, hired staff and set up production. Ready for liftoff, right? Nope. Your startup would crash for want of marketing.
You can’t sell something, even the cure for baldness, unless people know it exists. Lots of people. Marketing is how you let them know your product exists, and also how you make it appealing. Product design, consumer research and advertising all come under marketing’s umbrella. Pricing strategy–or at least, the case you make to the consumer that the price is right–comes under marketing, too.
The elements are many, and your business needs an approach that incorporates some or all of them. The best strategy for any given business usually includes a mix. For example, logo development, media outreach, paid advertising and trade shows. Here are tips for deciding what marketing strategies might work for your startup and ways to get started.
Add on a short description of your ideal prospective customer and their earnings, gender, age, family composition and consumer habits. Also Include the type of media this hypothetical person likes to consume–internet, newspapers, television, radio, podcasts, etc.. A person over 65, for example, is less likely to use Instagram than a person in their early 20s. This section will require you to do a bit of research, but it will bear fruit.
Next, list some very specific, measurable goals you want to reach, such as a 10 percent increase in sales in your second year of operations. You want your goals to be measurable so you’ll know if you reached them.
And of course, you need to list your tactics for spreading the word about your product so that it reaches prospective customers. Take into account the different stage of the sales cycle and determine how you plan to reach cold prospects and how you want to reach existing customers, whether its through radio advertising or loyalty programs. Options are many, from banner ads online to banners pulled by planes; from chatty blogs to the sparse wording on a billboard.
Be prepared: marketing can be costly. Most startups decide on a marketing budget that’s a percentage of their projected revenue. But the recommended ratio varies by industry, so it would be wise to seek advice from your industry’s trade association.
Some companies spend up to half of their sales revenue on marketing in their first year and 30 percent of that revenue thereafter. One school of thought holds that companies in their first five years of business should allocate 12 to 20 percent of their gross or projected revenue for marketing every year while older companies should allocate up to 10 percent. One tool that might be helpful is the National Australia Bank’s marketing budget forecast template.
Unless you measure the results of your marketing efforts, it’s hardly worth drawing up a plan in the first place. Measurement helps you fine-tune your tactics so they’re better at reaching your intended audience. It lets you know when an approach isn’t working so you can regroup and try something else. Your metrics will hinge on your tactics. Print advertising could direct people to a designated phone number or internet domain and you could count how many calls or views it gets. Online promotions and clicks can be measured using internet analytics. If you use billboard advertising, the billboard company will have a way to measure the number of cars and pedestrians who walk past every day.
Planning backed up by careful research; budgeting that’s realistic; and measuring that tracks results are cornerstones of effective marketing. If you market your product well, potential customers will recognize your brand, distinguish it from your competitors and favor it.