The fatal flaw for most start-ups is marketing

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marketing for startups

by Merav Chen, {grow} Community Member

When talking to startup founders, I’m always surprised to see how many don’t consider bringing a marketing function on board until a very late stage in the company’s and product’s life cycle. There’s much evidence suggesting that lack of marketing input is one of the main reasons startups fail. And yet …

Why do startups overlook marketing?

There are five reasons start-up chronically overlook marketing until it’s too late.

  1. The Founder’s Angle – many founders come from an engineering background, and they don’t always see the value of marketing. They don’t understand or “speak” marketing– and as a result, they don’t like dealing with it. Someone once told me it’s hard for marketers to converse with developers because it’s tough to explain the concept of a “forest” to someone who sees “tree+tree+tree+tree” (no offense to my developer friends, I’m pretty sure you feel the same way about us marketing people, perhaps even worse).
  2. The Funding Dilemma – Startups usually allocate their limited resources to make product advances (which they can show their investors) and to ensure a timely launch.  VCs, for their part, don’t push founders on the marketing front until the product launches and gets no traction. At that point, the investors suggest the founders hire a marketing person.  For budget reasons, the startup may recruit one marketing person and expect him/her to do everything single-handedly. We all know that’s nearly impossible.
  3. “Everybody’s a Marketer” – Many startups don’t see marketing as something which requires professional capabilities.  Ever heard a variation of the following before? “Hey, my neighbor has some great ideas on how we can market our product.  She watches a lot of commercials, and she’s always posting on Facebook. I think we should listen to her.”  I exaggerate, but only slightly.  It’s a perception that I’ve also encountered at bigger, more experienced and successful high-tech companies. They tend to attribute their success to the product, and rarely to marketing. Maybe that’s why some marketing people rebranded themselves as “growth hackers.”
  4. Too little too late – Some companies view marketing as something to activate once the company is ready to launch. However, marketing should be part of the product building team upfront – talking to customers, analyzing their needs and preferences, tracking competitive activity, constantly checking proof of concept, managing user feedback are only some of the functions marketing can bring to the table.
  5. This will sell itself! – Many founders truly believe a great product sells itself. Believing that “if you build it, they will come” makes the company’s already product-oriented thinking become even more so, and neglects to take into account the ever-evolving market situation and the need for customer input and dialog from the very beginning.

Tech entrepreneurs like to quote Linkedin founder Reid Hoffman who said “If you are not embarrassed by the first version of your product, you’ve launched too late.” True as that may be, your first version of the product still needs to reach potential customers and get their feedback if you want to have a better second version. If you don;t have customers, you don’t have a company!

The most effective way to do that is to include marketing at each step in the journey and devise a marketing strategy from the moment you start working on that great idea.

Merav ChenMerav Chen is an experienced marketer and the co-founder of markitdigital.com, a digital marketing firm, shouting out to the world from Tel-Aviv, Israel.  Find her on twitter @meravchen

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  • Hi Merav, this is soooo true!!!!!! And you comment “talking to customers ….. etc.” is absolutely crucial for people to understand. I believe the real problem is that most people have no real understanding about what true “Marketing” really is and therefore fail to understand its value. Marketing is so so much more than Advertising and Promotion but that is what is most recognized as and why it tends to be pushed aside during the initial stages of a company’s life-cycle. I also believe that a contributing reason for this is that Marketing, as a distinct business discipline, has “done it too itself” by failing to leverage its own fundamental skills to ensure business people truly understand the value it provides.

    How many times do we see (even in Social Media Marketing discussions) Promotion and Advertising being the primary “Marketing” topics? Where are the case studies that show that the marketing fundamentals you discuss here were a core contributor to success in Promotion/Advertising/Customer Satisfaction and Sales?

  • Merav Chen

    Thanks Steve! You’re right, it’s the visible, outward-facing aspects of marketing – Advertising, PR and Promotion – that get all the hype. Research, positioning, user feedback, etc. usually take the back seat.

  • All good points. Another that I’ve found throughout my career is that there is a gross misunderstanding between marketing and advertising. It’s common for a business to say, “We’re not ready to market.” When really what they mean is that they aren’t ready to spend money on outbound advertising channels.

    If businesses had a greater understanding about the holistic function of marketing – and how integral it is in business and product development – I think they would bring Marketing into the equation much sooner.

  • Having worked for a startup for almost a year I can attest: very true! It takes quite another form of marketing to succeed and it’s VITAL to know your stuff in terms of marketing of innovations (“crossing the chasm” etc) 🙂

    Very good read 🙂

  • In my experience in working with startup founders, there is a pervasive belief that “if you build it, it will come”.

    Part of the problem is that a lot of founders are technical people. Marketing doesn’t come naturally to them.

    Another problem is that plenty have easy access to venture capital. This fosters and attitude that you can solve the marketing problem by throwing money at it.

    Problem is, unless your startup has marketing and growth in its DNA, you will struggle to solve the marketing problem, even with millions of venture money. This is why YCombinator focuses so heavily on founders who know how to ‘hack’ the system (they even have a question about this in their application) – it shows how ‘marketing inclined’ founders are and predicts future growth.

  • Merav Chen

    I did not know this about the YCombinator’s process. My sense has been that VCs usually look for the technology background and the “entrepreneur” type of personality as part of the investment decision, but not at the marketing-orientation of the founders. Encouraging piece of information, thanks!

  • Merav Chen

    Thanks Mael! One of my favorite books too:)

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  • Merav Chen

    Good point Jacqui. If we put aside the resources issue, wouldn’t startups be the perfect place to have marketing as an integral team member from the beginning, together with product, dev. and business? Small company, easy communication, fast iterations – it’s a large-tech.-organization’s dream come true.

  • YC looks for the hacker mindset and not necessarily those good with computers. If you’ve ‘hacked’ your way into a job, a college, or heck, even a relationship, YC will be interested in you.

    Essentially, YC wants people who know how to get things done using the least amount of resources and effort as possible.

    (Or you can be just Elon Musk-level smart)

  • Hi Merav,

    While all your points are right, I would suggest that in addition they are simply not business people, yet.

    You have to build a foundation for your business and that foundation is heavily focused on marketing and learning to answer the right questions is paramount:

    * What tangible values will my customers experience and how will they feel after having bought from us?

    * What specific problems do we solve through each tangible value?

    * How are we “specifically” solving the problems for?

    * Who is the product or service “a” part of “a” solution?

    All of that leads us to understand what business we are “really” in.

    It’s at that point that the business really comes together. For many, creating the product is easy, messaging and marketing it as you said is the challenge.

    We live in an entrepreneurial world where 80% of all startups will fail in 60 months and of them 70% will fail within 24 months.

    Cashflow is the main culprit and the truth is cashflow is tied to marketing, not VC.

    By asking these questions and incorporating them into the startup process early on it actually helps the business significantly in the short and long-term and as Puranjay said should happen is you inject the marketing into the DNA of the business.

    Great post Merav!!! I enjoyed it very much.

    ~ Don Purdum

  • Merav Chen

    Thank you Don, and you are right – the business building aspect is often neglected, with Product being the main orientation. It is also related to the perception that startup founders should be “left alone” to do things freely, so as not to interrupt the entrepreneurial spirit. VCs could play an important role here, by pushing the founders to manage the business and marketing aspects from the start.

  • What a nice, succinct explanation about why my job drives me crazy sometimes. The only other point I’ve noticed is that entrepreneurs are pretty hardheaded – they often don’t believe what you tell them and have to find out for themselves.

  • Merav Chen

    Thank you Waxgirl333! To the point you raise, I find that entrepreneurs tend to take another entrepreneur’s advice about marketing over a marketing person’s one. The reason may be that they view the entrepreneur’s journey as a unique and differentiated experience, not something that a marketing professional working with more mainstream, or bigger companies would deeply understand.

  • Interesting article. I see #5 all too often. Entrepreneurs typically become so enamored with their idea that they forget to validate if their solution, or the pain point they are solving, is common enough across the board. I recently consulted with a start-up who had when asked how many people in his target market he had validated his solution against stated he had talked to three other people.

    There is another side to this though. Often times it can be too early to bring a qualified Marketer in as a founding partner or on a retainer. Depending on the idea it can be years before release. Here I suggest adding a qualified Marketer to your advisory Board.

    Lastly, not all Marketers are made the same and Marketing a start-up is vastly different than promoting an existing business.

    Regardless, I agree that Marketing is often overlooked.

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  • Merav Chen

    True Jonathan, and then there’s always the question of balancing time to market vs. product/market validation.

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