When I launched this blog, I said that one of the primary motivations behind it was to look at what marketing can do to make a start-up successful, which is fundamentally different than marketing at larger, established companies. There are obviously similarities since the same marketing tactics can be used at both but today I want to take a high level view of the 3 main differences between marketing at a start-up versus a larger established company: the marketing mix with limited resources, establishing a brand in a new market, and finding your first customer.
Marketing mix with limited resources
While I’ve heard marketers at larger companies say they don’t have enough resources more often than I can count, this is nothing compared to a start-up where there may be one marketing person with a very low budget or, in the early days, marketing may be handled by someone with another day job. Obviously, in the later case, this start-up is not taking marketing seriously but in both cases it’s clear to see that resources are limited. The result is that careful tradeoffs need to be made where time and money is invested which impacts the marketing plan and the marketing mix.
Start-ups need to look at using a different marketing mix because they simply can’t afford certain tactics (i.e. events or advertising). Social media has leveled the playing field to some extent since a start-up can reach their audience using the same media as a larger company. However, social media is not enough and needs to be part of an overall marketing strategy that should include other tactics, which the start-up may or may not be able to afford.
Simply put, limited resources clearly make the marketing mix used by start-ups significantly different than at established companies.
Establishing a brand in a new market
This can be a double-edged sword but at a start-up you are building everything from scratch, or close to it, in terms of creating a brand and establishing it in the market. Obviously, this gives marketing much more flexibility as they don’t need to deal with the legacy of what’s been done before but don’t underestimate the effort needed to establish a brand and more importantly define a market as start-ups rarely go after an established market but tend to disrupt and redefine one.
Larger, established companies got to where they are by capturing a significant part of their market. As a result, their brand tends to be inextricably linked to that market. A start-up has neither of these but hopes to get there. In fact, a start-up may not even have a name, logo, messaging, design and the material needed to communicate this brand. Even if some of these items are in place, the start-up doesn’t have the resources (see previous point) to communicate this brand and educate the market on the need for its product.
Clearly, this is a big job that a larger, established company has already accomplished but it’s also an exciting one.
Finding your first customer
You could argue that this is more the role of sales at the start-up but as I mentioned when I launched this blog, another key motivation was to explore how marketing and sales need to work more closely together for the start-up to be successful. The bottom line is that your first customer is crucial for so many reasons as it validates your solution and become a proof point and reference for other customers.
Obviously an established company will already have customers so this has already been accomplished by them but it’s a big uphill battle for a start-up until they get one. And then, how do they leverage this first customer for references, case studies, PR and other marketing needs? Having a publicly reference-able customer can open doors to media coverage, speaking ops, more leads and help secure the second, tenth and hundredth customer.
In the early days of a start-up, I would argue this is job one while established companies are more focused on their hundredth or thousandth customer.
There are definitely other differences between marketing at a start-up and more established companies but for me these three are critical to understanding what needs to be done in the early days so that the start-up is successful. While marketing at a start-up is challenging, it’s also an extremely exciting phase that even the most successful company once had to go through. Hopefully, this blog helps to play a role in making your start-up successful.