4)
A marketing foundation is absolutely necessary for your success.
It is common for entrepreneurs to incorrectly believe that marketing
is not important at the early stage of a company's development.
Many view marketing as something to be done later when they are
ready to build a brand. However, the successful companies we studied
spent time and resources to carefully craft their unique value proposition
and build a foundation of sales tools before the product launched.
This did not require a full-fledged marketing organization from
day one. However, each of these companies was able to insert marketing
requirements into the DNA of their initial business plan and investor
presentations.
There remains a lot of confusion around branding. Branding does
not mean extravagant launches at the Ritz, full color ads in the
Wall Street Journal, or extensive direct marketing campaigns. These
are tactics that will undoubtedly support the brand, but they may
or may not be necessary.
Branding is all about mission, message, and living it. Successful
companies create a clear message, then repeat it, reinforce it,
and drive it home consistently in everything they do. Having a successful
marketing foundation will help ensure that every employee can and
will communicate and sell the product's value proposition, from
the CEO to engineering to human resources, to finance.
Success Factor #4: Invest early in marketing to clarify and articulate
your value proposition, key messages, and defendable points of differentiation.
Integrate this market strategy into your product development plans,
and later, your sales organization.
5) For best results, marketing and sales should work hand-in-glove.
If you look within any large business, you will likely find a polite
but adversarial relationship between marketing and sales. Turf battles
and political agendas waste time and energy and ultimately lead
to poor results. In contrast, we found that several successful startups
short-circuited this by building an integrated sales and marketing
team from the ground up, linked by common objectives.
As an example, consider a military campaign where one team defines
the strategy and another team executes it. To function at peak performance,
sales and marketing must work in a similar fashion where marketing
sets the strategy, and sales determines the field tactics and best
approach. Marketing develops the weapons (e.g. the messages, sales
tools, competitive intelligence). Sales learns to use them effectively
in each unique customer environment to win the battle.
Another common trait of successful companies is in their ability
to establish joint sales and marketing measures and metrics early,
allocating appropriate resources to let the teams function as one.
A common goal expressed by one VP of marketing is that at the end
of each day, marketing and sales must be able to conclude that their
combined efforts accelerated sales in some way. The most successful
businesses we've worked with embraced this philosophy. It led to
one startup growing its revenue stream from $100K to $3.2M in 9
months.
Success Factor #5: Regardless of organizational structure, build
a sales and marketing team with common objectives, milestones, and
measures.
6) Plan for the future.
In planning for the future, we were interested to find that successful
companies tended to juggle these three management dimensions: managing
their cash burn rate, looking for "learning" in every
corner of the organization, and embracing creative hiring practices.
Managing the cash burn rate: It's easy to not spend money and manage
a business from an income statement perspective. Unfortunately,
no company ever saved its way to profitability. Successful companies,
we found, were able and willing to make strategic investments when
appropriate, both in terms of filling out the organization as well
as executing sales and marketing programs.
While the days of Hollywood-style events and lavish press conferences
are over, important infrastructure investments are critical for
any company's ability to grow. Sales force automation tools, customer
resource management tools, sales training, a professional looking
website, and engagement with a press relations firm were all key
investments that allowed them to build a solid image and operate
their business smoothly.
Be careful with that axe: All executives would agree that terminating
weak links that don't bring continuous learning into the organization
is a necessary tactic. However, successful companies are cautious
before pulling the trigger. As an example, it is easy to terminate
a sales person for not making their numbers. But, if that sales
person is bringing the organization critical information regarding
competition, sales process, market acceptance, product utilization
and customer reaction, perhaps the weak link is somewhere else.
In this example, the weak link could be the market message, product
capabilities, positioning or services.
Embracing creative hiring practices: We also found a trend with
the more successful startups exercising greater creativity in their
approach to hiring and firing. They "beg" retired executives
to volunteer their time as part of their advisory staff. They "borrow"
expertise through consultants who become a temporary or interim
extension of their staff to add unique expertise to projects and
meet specific objectives. And, some seek to "steal" from
the best by hiring away good employees into needed positions.
Success Factor #6: Be fiscally prudent, but willing to consider
targeted investments to build a solid business infrastructure quickly.
7) It's all in the execution and learning.
In the 1980s, planning was often viewed as strictly an academic
exercise performed by folks in the "ivory tower." Nowadays,
its very common to find organizations that are measured solely on
its ability to execute programs on a daily basis where there is
no time to plan. Unfortunately, aggressive but untargeted execution
is ineffective and wastes valuable resources. A challenge for all
businesses is in their ability to balance these two extremes. A
common practice we discovered within a few companies was the development
of an architectural level plan with a three-to-five year time horizon.
They also prepared detailed objectives covering a 24-month window.
Another company established a list of the quarterly top eight business
objectives (dubbed the "Uber 8") and reviewed their progress
against this list monthly with its employees. It was common to see
this list on every employee's wall.
With a plan in place, effective execution of marketing and sales
programs can more easily be achieved. However, not every program
will be successful, despite the best-laid plans. The challenge is
to learn from the success and failure of these programs and fine-tune
them quickly while they are still in progress.
With as solid strategic foundation, some of these startups took
steps to encourage new thinking and were not afraid to make mistakes.
They seemed able to harness the creativity of each individual, encouraging
them to be part of the "extended leadership team."
Success Factor #7: Speed and ruthless execution is everything.
To maximize your ROI, identify and widely communicate business plans
and objectives throughout the organization, and encourage widespread
adoption and involvement at every level.
Mike Gospe (mikeg@kickstartall.com)
is one of the founding members of the KickStart Alliance. This paper
reflects his recent experiences and those of his colleagues: Mary
Gospe, Janet Gregory, Amy Matthews, and Mary Sullivan.
The KickStart Alliance (www.kickstartall.com)
is a team of senior marketing and sales leaders who assist startups
and emerging companies develop and execute a variety of marketing
and sales goals and objectives.
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