At this week’s Speaker Series at the University of Pittsburgh’s student accelerator, The Blast Furnace was one of the most important subjects a startup faces: what lies beyond the ‘idea,’ past ‘customer discovery’ – going to market. One of the biggest mistakes an entrepreneur can make is underestimating their go-to-market costs, or assuming the ‘product will sell itself.’ Unfortunately for most businesses, the ‘build it and they will come’ is not reality.
Lets start with some key points from my discussion.
What’s the goal? When thinking about your startup, you need to know your goals. What you want to achieve is repeatability, scalability and profitability with your go-to-market strategy. Whether building a direct sales model or leveraging channel partners, startups tend to underestimate the true costs of acquisition by not factoring in expenses such as marketing, lead generation, pre- and post-sales training and customer support. You need to understand these customer acquisition costs, and, if you don’t know them, look at your competitors and see how they do it and how much it costs.
Marketing vs. Sales. Key to marketing communications success is first understanding that marketing is not sales. They are different. One is ‘the air war’ and the other ‘the ground war.’ If we broke it down to the basics, marketing is everything that you do to reach and persuade prospects, and sales is everything that you do to close the sale and get a signed agreement or contract. Understand that these two efforts are complementary but they also can be at odds with each other. Whether you have dedicated resources for these efforts at an early stage or not, it’s good to think through the processes and the handoffs so as you scale and staff, you can appropriately put the responsibilities in the hands of the right professionals
Process, Process Process. Selling is not about talking or a great personality. It’s as much a process as is your development structure in building your product. Get your process in place, defined and tested. Put in place the right tools for your size and structure (CRM, marketing automation, etc.) as you get started so you can measure the results and adjust to meet your goals.
Next speaker was Meghan Skiff, an expert in inbound marketing and founder of her own company, MixyMarketing. She shared with us not only her experiences about building her company but some marketing secrets to getting a startup off the ground:
Underestimating. Meghan told her story of underestimating everything about building her business through the Confucius quote ‘True wisdom is knowing what you don’t know.’ Meghan shared the nine items she underestimated in building MixyMarketing including time, sales, talent, focus, myself, energy, clients, fulfillment, and the ‘awesomeness’. A key takeaway? It always takes twice as long and costs twice as much. How true.
90%. In today’s world, according to industry analyst Forrester, the buyer spends 90% of their journey in the pipeline before wanting to speak to a sales rep. That number is up from 57% just a few years ago. That’s a sea change in behavior that affects anyone trying to sell anything in any market. And pinpoints why inbound marketing is important and essential.
Marketing Mistakes Startups Make. Some terrific wisdom that Meghan shared was a list of issues she has learned from helping startups and small businesses:
- Mistake #1: they don’t know their buyer.
- Mistake #2: They do ‘one off’ marketing activities.
- Mistake #3: They aren’t solving anything.
- Mistake #4: Not enough time to achieve their goals.
Finally, we had some words of wisdom from someone who is in the game and in the seat, running a startup’s marketing: Scott Morley. Scott has been with ALung for 12 years, starting as an intern. He has seen it all, the ups and downs, the pivots, the successes and the failures. Through it all, Scott remains a committed entrepreneur, relaying that he was not a cofounder of ALung, but was ’only’ employee #4.
Scott, being a veteran of the medical device marketplace, also had some words of caution about the latest in product development techniques and marketing tactics:
- Know your audience. Scott also was a big proponent of singing the latest in web and inbound marketing, but also cautioned against using all the tools and techniques available. He felt some of his target audience, such as doctors, would shy away from divulging information in order to get information from his company. So, back to basics: know your audience and how you can build a relationship with them.
It was a ‘blast’ in the Blast Furnace with this Speaker Series event. Lots of wisdom shared about the entire ‘go to market’ process. As Eric Ries states, “The only way to win is to learn faster than everyone else.” And so it is in sales & marketing in startup land.