Marketing Basics for Startups
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An introduction to the basics of marketing for first-time entrepreneurs and new businesses.
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Marketing Basics for Startups
- 1. for a business not to advertise is like winking at a girl in the dark. You know what you are doing but no one else does- Stuart H. BrittUS advertising consultantMarketing Basics for Startups by Kameel Vohra www.kameelvohra.com
- 2. Overview What is sales? What is marketing? Budgeting for Marketing Sales/Marketing Knowing your customers Identify customer Identify decision making process Phases of Marketing Experimentation Measuring & Metrics Marketing at it’s most basic (4P’s) The nuts & bolts Print Digital Mass Media (Advertising & Sales) Best Practices
- 3. Does anybody remember Pepsi Blue? Blue was launched in mid-2002 and discontinued in Canada and the United States in 2004, It was endorsed by Brittany Spears! Shoma & Sangita started Empower Research, in Evoma, as two house wives in 2004. Today they have their own building in Indirinagar, Bangalore, with 400 people. That’s not including their US offices. An idea, no matter how great, is just an idea, if nobody buys it
- 4. What is Sales ? Wikipedia: A sale is the act of selling products/services in return for money or other compensation. It is an act of completion of a commercial activity. Real Life: Converting customer interest to compensation. Compensation: Preferably cash, possibly a barter for advertising, or other products/services (accounting, server space, etc.)
- 5. What is Marketing? Tools for sales (brochures, flyers, etc.) Building competitive advantage/edge Brand positioning Creating awareness Creating product demand Creating interest/lead generation Driving sales If you don’t have sales/marketing experience Buy It ! This should be one of your CORE skills! You need this before you need R&D
- 6. Budgeting for Sales/Marketing You can NOT close deals without Sales Marketing augments/increases sales Every organization needs to sell! Customers do not just come to your door How much should I spend on marketing? A: It varies by organisation & industry U.S. Small Business Administration (SBA) 2% - 10% of Total Revenue Personal exp., 30% of total budget (start-up)
- 7. Sales/marketing: Knowing your customer Identify your customer (Child, Choco-cereal) Identify the decision maker (Mother) Identify the influencer (Child) Identify the decision making process (Child bugs mother) Win/Loss (Feedback Analysis) You need to know what went right & wrong (It had free toys! It was cheap! It was lower calorie! It’s made from toothpaste!) Audit (Remember to be scientific)
- 8. Marketing (Phases) Phase 0 Talking, Interacting, Seeding & Selling (have no fear! Start talking well before it’s out of the box) Phase 1 Tools for sales (brochures, flyers, website, etc.) Concept (3wks), Graphic design (3wks), Printing (1wk) Phase 2 Creating interest/lead generation SEO (4wks vendor selection, 2wks analysis, 3-6 months execution) Exhibitions (4wks identification, 4wks preparation, 4wks follow-up) Phase 3 Building competitive advantage/edge Brand positioning Creating awareness Creating product demand Driving sales Ongoing Efforts (forever!)
- 9. Experimentation You miss all the shots you don’t take Wayne Gretzky, A really famous hockey player Evolve Scientifically Be flexible Be prepared for disappointment You’ll find gems where you least expect them
- 10. Measure Everything Remember your school science class? You can’t manage what you can’t measure Somebody I can’t remember SMS, Email, flyers, brochures, promo’s Add tracking/redemption codes to everything Track how many are sent, where, when, volume of responses – even field sales calls!
- 12. Marketing at it’s most basic Everything boils down to this. It is always true! Read: http://www.netmba.com/marketing/mix/
- 13. The nuts & bolts Offline Mission & Value Proposition Your People: Who we are, what the benefits are, who my competitors are, etc. Print BS cards Letterheads Envelopes Brochure T-Shirts / Shirts Digital Logo Email signatures Website, Wikipedia, Free Directories (Dmoz.org) Presentation (spend money on this) Blogs, yours & everyone else’s Social Media SEO (spend money on this – if you think your customers use the internet) Advertising & Sales Email, SMS Mass Media !? (Newspapers, Magazines, Radio, TV, SEM)
- 14. Is Mass Media for me ? Which medium actually reaches your audience? How many people and what percentage of conversion do you expect? How much is it going to cost you? Can you afford it? For how long can you sustain it? What is the point? Is it going to be worthwhile? Can you use multiple mediums for brand reinforcement Would PR achieve the same thing & cost less?
- 15. Example Radio Costs * All rates are per 10 seconds of air time * SPTB will attract a 25% premium on existing rates. * All rates are in Indian Rupees * Corporate rates can be upto 50% lower than this * Estimated monthly spend for a decent campaign is 1,30,000 RsPT Prime Time SPT Super Prime Time APT Afternoon Prime Time LNPT Late Night Prime Time
- 16. Example TV costs
- 17. Best Practices Save everything online (dropbox, etc.) Insist on standards & formats (AI,CDR,PDF,etc.) Measure everything Be Flexible Continually Evolve
Editor's Notes
- 1. What is the cost of marketing? (comparison of various marketing tools - like PR/TV/Radio/Print/internet etc.)2. Which tool to use for marketing my product/services? (print is suited for certain category, while internet is meant for another category - so any cases will help)3. What is the time taken in marketing? (we can illustrate using some case study)4. What are steps in marketing a product/service? (lead generation, communicating, pricing etc.)
- Phase 0) 40 people have the same good idea every 10 minutesYour idea is NOT uniqueYour business is about execution, NOT the idea itselfStart talking to real people, real customers, observe your customer!Phase 1) This is where most of your marketing time is going to be in the beginningHard core sales which are supported by good collateral Phase 2) This is tougher, soaks more time and the rewards need to be measured carefullyPhase 3) It is very hard to measure this type of marketing, so spend your money here carefully.Brand building is important but not at the expense of your sales activity.
- Start-ups and SME are about making mistakesYour success is about understanding how you’re going to deal with those mistakesReference Student Campaigns at Evoma, 25000 Students, spending power was vastly over estimated -
- Sales & marketing are as much a science as they are an art.Every aspect of it can be measured. You need to constantly be asking what contributed to my bottom line, and more importantly what didn’t.What does that mean practically, if you’re digitally marketing like VenueMirror does, every email campaign should includes a promo code or trackable links.If you’ve got real sales people, measure how many calls they make, who they called, and how many conversions you’re getting – this is part of the classic sales funnel. It’s surprising how many people don’t adhere to some of these basics. Especially in a start-up environment where everything always feels critical.
- This is an example of the sales funnel. For those of you familiar with google analytics or looking at web 2.0 businesses, what this means is that eyeballs aren’t everything. Only a percentage of those will turn into inquiries and then inquiries into sales. You need to monitor that closely, and you need to understand whats going wrong if you’re getting plenty of eyeballs but no leads or sales.
- Ok so I’ve talked about sales/marketing but I’ve not mentioned anything about actual marketing.This diagram is probably something you’ve seen before, it’s been around for about 40 years. It’s important because it’s still true.Product –physical features of your product, so a 4 star sub-urban hotel, that provides hotel rooms – the hotel room features, support & service are what we compare (wifi, breakfast, clean, amenities, etc.)Pricing decisions are very important and there’s lots of things that affect this, especially for a hotel: season, economic climate, inventory availability, agents, advance purchase, long stay, last minute deals.Place, this is your distribution system. How are your products/services going to reach your audience. In the case of a hotel, clearly the guests have to come to you. Even in a web business like VenueMirror you have to consider connection speeds, accessibility, browser compatibility, device compatibility, etc. If your customers are in the US, make sure you operate at the same time and they can access your server easily. GoDaddy still has problems being accessed in Singapore.Lastly promotion, how do you package, promote and ultimately communicate information about your product. Are you going to physically flyer people, visit them door to door, use tv ads? In the case of a hotel, you might mean using online agents like expedia, makemytrip, venere, or a travel agent in pondi? Perhaps prominent placement in a JetAirways magazine?This doesn’t apply when you’re creating a new market – that’s something a few companies like Apple do very well, but it’s out of the scope of this webinar.