Part of the budget wrangling in the early stages of a start-up revolves around how to spend the available money in the most effective manner. According to The Industry Standard’s recent survey on start-ups, almost 69 percent of new companies have access to $1 million or less in cash.
So where does marketing fit in? According to The Standard’s survey, it’s in fourth place behind product development, recruiting and sales. Obviously, if the product you are going to build and sell is not yet ready, that might be a good start. You need people. You need customers. And necessities like rent, equipment, and phones also eat away at dollars (even if you are in a garage).
This, however, doesn’t make marketing any less important. I have always believed in the axiom “presence builds preference.” Being in front of your key target audience often, in a convincing fashion, is a powerful tool that when done well can build credibility and excitement for your business, even at the early stages.
But with limited financial resources, you must spend wisely to get the proverbial “bang for the buck.” Here are some commonsense tips and guerilla tactics to consider as you put together your early-stage marketing program.
Set Clear Goals and Objectives. Make sure you set goals and expectations of what you want to accomplish before you get started. For example, do you want to drive qualified traffic to your site, increase sales by 5 percent, sign up x-number of new customers, or just generate awareness? You can think big, but with a small budget you have to be realistic. Setting goals from the onset will help you determine what and how much you need to do.
Learn the media usage and business habits of your target. Before jumping into any program, you should really get to know your audience right down to what magazines they read, analysts they respect, trade shows they attend, sports they like, etc. This will help you in targeting your activities and spurring your creativity. If you can’t do a comprehensive research project with a respectable firm, you can dedicate some internal staff time to conduct a phone survey of your own.
Focus your dollars and own the channel. Once you complete your research, you will most likely find a number of communication channels that resonate with your audience. The initial reaction is to use all of them. My suggestion? Focus your dollars on what you think is the best bet and own the channel.
In a prior life, I had less than $300,000 to spend on media for a consumer product with distribution in 50,000 consumer outlets. Instead of spreading those dollars among the 25 magazines in the category with little or no effectiveness, I bought year-round advertising in just two. To the readers of those two publications, we looked like a major national brand. As the company’s sales grew, the budget expanded, and we were able to add other magazines and communications channels.
Create materials with legs. If you are creating a collateral piece on your company, design it so the copy and graphics work for a number of marketing situations. For example, brochure copy and photos can be used on the web site, which can be converted for a party invitation. These can be converted to a trade show ad, and so on and so on.
Multipurpose creative helps leverage the money it cost to create the original. By the way, the consistency of message and look will help you in building your brand.
Fish where the fish are biting. Piggybacking on major industry events and trade shows is a great way to leverage a small budget to gain exposure.
This reminds me of something that happened on my last job while hosting an event in New York where we had major cash sponsors and over 500 guests. Out of nowhere, a group of actors dressed in costumes showed up from Beenz, handing out brochures for this newly launched company. The point is, they were not one of the sponsors of our event. Regardless of the fact that I kicked them to the curb (literally, I made them leave the hotel), I had a lot of respect for their VP of marketing’s brash tactics.
Go Wild. Wild postings, the application of posters, stickers and other billboardesque materials in random, unusual and non-traditional space is a great technique that works. I know one company that for three months advertised only on the java jackets for coffee places around San Francisco. Another sponsored the adopt-a-highway sign on 101 near San Francisco.
Posters on building construction sites work. Buying a single board in the baggage claim at the site of a major convention is pretty slick. And believe it or not, you can buy advertising on hotel key cards. I think you get the point.
Email. OK, don’t spam. However, well-crafted emails to your core target audience can be effective and are incredibly inexpensive. What’s important here is to have a compelling call-to-action (a discount, gift, perk, etc.) that engages, encourages trial and creates a happy customer that will tell friends and associates about you. ClickZ has an outstanding email marketing guide and conducts conferences on email. Check it out.
Viral is a good thing. Create something that your customer can pass on that markets you at the same time. Next Monet, an online art gallery, armed customers with wonderful blank postcards of art that was featured on the site. Iconocast, an Internet industry newsletter, gave it’s customers a bounty for referring potential attendees to it’s annual Web Attack conference.
Alert the Media. Counter to the phrase “free publicity,” PR isn’t cheap but it is certainly less expensive than a broad-based advertising campaign, and it gets you a great ROI for the money spent. The third-party credibility from good press coverage will create buzz and excitement. If you can’t afford an agency, hire a competent consultant on a contract or hourly basis.
So how about you? Do you have any interesting low-cost marketing success stories? We’d love to hear from you. Just send them to me, and I’ll share them with the world in an upcoming column.