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The biggest marketing mistake made by startups

Time and again, I see startups create really, really bad marketing. I say this as someone that used to run big agencies and now works with a lot of startups.

Often they think that because they know how to place adwords, or use Photoshop, or use social media, or buy media, that they know how to create marketing. That is not marketing. That is mechanics.

Marketing is behavioral science, which separates the good campaigns from the bad. As an example, which will people remember more, losing fifty dollars, or finding fifty dollars? If you don't know the answer to this, you shouldn't be creating marketing campaigns. If you can edit together a video, that doesn't mean you can create a marketing campaign. A graphic designer is not a marketer. If you can place Google adwords, do you really know what triggers to use to elicit action?

The irony is I come across a lot of startups so focussed on minimising costs, they don't realise they are costing themselves far more by producing media instead of producing advertising. Marketing strategies are not just how and where you spend, but more importantly what you say when you spend. The emphasis needs to change from cost to value. And the key point: average marketing activities severely restrict growth, and it stuns me how many startups don't have a qualified (read NOT a "social media expert") marketer on their board.

So which is it, finding or losing the fifty dollars?

43 Replies

Tamika James
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Tamika James Entrepreneur
Owner and Creator at From Mother's Garden, LLC.
What are some of these marketing disasters you've seen? Could we have examples of things to never do? What are some of the most effective marketing techniques? What are some of the best tactics? Sent from the mind and IPhone of Tamika...
Carey Martell
3
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Carey Martell Entrepreneur
New Media Expert and Entrepeneur
Finding fifty dollars. People will talk about how they found money on the ground in a store, or won a big prize at a casino. But they generally won't include information about the wasteful purchases they might have made while in the store, or how much money they lots in the casino. Most marketing performed in the passive income niche is focused on how much money a person can earn with x software program or ebook, and will downplay that the promise of riches will come at a cost of $10 or something outrageously low. As soon as the purchase is made, the buyer is then presented with opportunities for an upsell on a product that costs more like $100 to $500 depending on what it is. The sales copy will focus on how since the person has already invested some small amount, they might as well invest more to improve their chances of making a bunch of money in the future using the information and/or software being offered to them. This works effectively to convert many people because they are focused on what they could earn, rather than what they have already spent. It's not necessarily wrong though the time investment necessary to recoup the investment into material and/or software being sold is and then start reaping a profit, is usually higher than the sales copy leads on.
Gloria Luna
1
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Gloria Luna Entrepreneur
VP Marketing - Brand builder and creative problem solver
Thank you for the thoughtful and direct post, Peter. As a marketer, I too have worked with a number of startups and founder-driven brands that make these same mistakes and then some.

I'm sure many of you face the same resistance to good marketing once the conversation is introduced that some $$ needs to be (judicially) spent to create awareness and engagement. In this age of social media, too many believe you can create scale by simply hiring a social media manager, as you imply in your post.

The question I have here is, has anyone made the successful argument for good marketing to a client and how did that work out? Do you simply avoid or walk away from those clients that have to be convinced or believe they can do it themselves by bootstrapping?
Rod Speelman
0
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Rod Speelman Entrepreneur
Director at TRIZ Management
Finding fifty or losing fifty?

It depends, are you a glass half full or half empty person.
Annette Tonti
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Annette Tonti Advisor
Founder, President at The Start Exchange
Peter - well said! I come across startups that are run by very smart technology driven people who do not understand marketing. The notion of getting known, getting a customer to buy once, then buy again and the key performance indicators to know they are doing this well over time. Rate of growth is another misunderstood metric.
Edward M. Yang
2
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Edward M. Yang Entrepreneur
Managing Partner at Firecracker PR
As a PR agency that works with a ton of startups, I also see the same thing that Peter sees.

The first problem is, most startups are driven by engineers. Thus, their preconceptions of marketing are usually already skewed right off the bat.

For those who do understand the value of marketing, how to execute and test the various channels is the next hurdle.

This has become more complicated by the proliferation of marketing channels, creating confusion due to the plethora of choices.

Here's a real-world example: we were working with a consumer electronics company who was launching in the US. Within 6 months we got them covered and reviewed in Engadget, Forbes, USA Today, Techrepublic and soon to be CNET, among many other places.

However they felt that their marketing dollars would be better spent creating high quality photos and videos that they then post on social media.

The problem, as I've pointed out to them, is that organic reach on social media is near zero these days. Their internal Facebook stats bear that out. Their preference is to focus on creating content which no one is really seeing at the moment.

The point of this isn't to say "PR good, social media bad". It's back to Peter's point about qualified marketers versus people who dabble with Instagram and think that qualifies them to drive an entire company's marketing strategy.
Dimitry Rotstein
0
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Dimitry Rotstein Entrepreneur
Head of R&D at SafeZone
As for me, I remember finding and losing money on the street more or less equally well.
But in the broader sense, I would say it depends on the manner of finding and losing money, and also on the exact meaning of "remembering".
On one hand, if we take lotteries or casinos, people do tend to remember their sparse winnings, while completely ignoring the fact that they've probably lost more than they've won.
On the other hand, according to research, people who "play" on the stock market feel much stronger about the stocks going down that up. So even if you break even, you'll feel bad because the bad feelings trample the good ones. In that sense, you remember losing better than you do gaining.
Josh McCormack
0
0
Josh McCormack Advisor
Owner, InteractiveQA - Marketing, Web Dev, Testing, Data & Market Analysis
Perfectly said, and so timely. I was just in a discussion about this last night. There are a lot of people with production and executions abilities but without the knowledge to listen, understand, craft messages and deliver.
Bettina Bennett
5
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Bettina Bennett Entrepreneur
CEO @whichbox® // We help you make people fall in love with your brand ... Forever! // Storytelling + Crowdsourced UGC
My 2 cents:

1. I'm with Tamika: It would be great to learn from the marketing experts in this thread, what those "mistakes" are that you are referring to, and how to avoid them. That would be really helpful.

2. Not all startup are created equal. For example: We are a (mostly) self funded/bootstrapped startup that actually runs on revenue, not a SV venture backed, millions of $$ in the bank kind of startup. Our technology is used by companies to make people fall in love with their brand. Since we have to make the $$ before we spend it, our marketing budget is kind of small. It's not that we DON'T WANT TO SPEND the $$, it's simply that they don't exist (yet). We talk with marketing agencies and experts all the time (frequently they are the ones re-selling our technology to their customers), who tell us all the things we need to do to grow from a marketing perspective, and that we need to pay them to help us get there, but they are not sharing in the risk we take.
The model is still: We pay a marketing agency or expert, and there is no shared accountability for the outcome. So maybe the solution is to offer marketing services to startups for a piece of the results? IOW: we will help you with marketing strategies to grow your revenue by X, and we'll get Y% of that growth.

Thoughts?
Peter Bray
2
2
Peter Bray Entrepreneur • Advisor
CEO at Bray & Co
Happy to compile a list of what I see as the top 5 mistakes particularly as they relate to startups, would love other people's views first.
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