Marketing and the Early Stage Company

“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” – John Wannamaker, US department store merchant (1838 – 1922)

One of my clients, a CEO who runs a solid, successful, SAAS company, after I had described a simple content-based email marketing campaign, said: “Sure, but does it work?”  He has grown his sales over the last 10 years organically and now dominates the vertical that he sells into with very limited marketing spend.

A Good Question

A good question: you could ask this about all things marketing related: emailing, content, SEO (Search Engine Optimization), trade shows, PR, direct mail (Wow, that sounds retro).  It is a question that is especially germane to an early stage technology company.  Money and time are limited, often it it is less the opportunity (“Spend $10,000 and get published in this trade magazine.” than the opportunity cost (What could I have done with the time and money I put into making that publishing event happen.) that is more important.

As an early stage company, you are unlikely to have the resources to be able to build a brand – marketing folks get all starry-eyed as they talk about beefing up your brand as if you have the marketing budget of Coca Cola or Frito Lay.

As well, the B2B sale doesn’t drive an instant purchase decision (“Buy one, get one free.”), so a lot of the wisdom dispensed by marketing blogs about email marketing (A/B testing, open rates, yields) isn’t all that helpful when you are trying to engage prospects in a long-cycle solution sale.

Based on my experience with early stage companies over the last 10 years, I have developed the following unscientific opinions:

Email Marketing

It’s inexpensive and, if coupled with relevant content (see # 2 below), is an excellent way for a small company with limited resources to leverage its marketing spend.  The keys are consistency, repetition, content and a targeted email list.

Content

In an age where most information about products services is collected via web research and referrals, focused, thoughtful, valuable content is essential.  Every piece of content that you develop that establishes you as a subject matter expert can be used multiple times in multiple ways.  The key is to make it meaningful; I receive blog posts from sales consultants that sound like they are taken right out of a Tony Robbins Personal Power seminar – a lot of hype but nothing that is going to help me do my job better.  If it can’t be meaningful, at least make it interesting.

Social Media

It is hard to say no to the siren song of social media: I think that its actual impact on the sales efforts of early stage B2B software companies is  unclear.  Twitter seems to me to be mostly a large echo chamber, with folks retweeting endless amounts of retweeted information (“Apple to release iPhone 5 in Fall.”  Wow, I couldn’t have learned that anywhere else.).  But, done right, you can leverage LinkedIn and Facebook and use content you generate judiciously in these places.  A couple of years ago, one of my clients, who admittedly was spending real money on marketing, stopped their SEO and adword efforts because they generating leads more efficiently through LinkedIn discussions.  And, do it yourself – you will learn quickly about what will and will not work.

Public Relations

I love public relations: a number of years ago, I worked with small French start up that came to America and wanted to make a big splash.  They did so by pouring money into PR and landed the CEO with interviews at some major magazines and papers.  It was expensive, way beyond the reach of any of the companies I have work with.

Trade Shows

Trade shows are expensive, tie folks up and generate a limited number of leads, but it may be important to have folks a the one or two shows that the vertical you are targeting considers essential.  Pick one or two key trade shows to attend and display at and avoid the rest.

Direct Mail

I added this to the list because it seems, frankly, quaint.  I haven’t used direct mail with a technology company for about five years.  It is just too expensive – even a simple post card will cost more than $1.00 per lead, on a 10,000 name list, you can do a lot of emailing for $10 K.  A couple of the non profits whose boards I sit on use direct mail quite effectively, but their target audiences are: 1. consumers and 2. not particularly tech savvy.

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