Startups rarely have it easy, especially at the beginning. To prevail against established companies with a limited budget is a major task that not all are up to. Especially in technology-intensive companies, the average investment in the founding year is up to 100,000 euros. Of course, bootstrap startups with a startup capital of perhaps only 1,000 euros are not an absolute rarity. But a startup that aims to scale to a unicorn as quickly as possible should expect high investment expenditures.
A young startup has to pay thousands of Euros every month in bills, wages, and operational costs. This quickly leads to cutting corners. Quickly it has to be distinguished which branches of the company and investments are essential for survival, and which are perhaps dispensable. The right decisions are not always made. Often expenses for a marketing strategy are considered superfluous and “postponed” to a later start-up phase.
But in the crucial early start-up phases, the most important thing is to generate sales in order to cover the high investments. The most efficient way to do this is to invest in advertising to attract as many customers as possible to the company. The marketing investments do not even have to be large. Even low-cost but highly efficient strategies can drive up traffic and conversion rates.
Numerous startups, as well as established companies, are competing for the favor and attention of their common audiences. In 2020 alone, even in a year of a global pandemic, 542,200 new companies were founded. To stand out from this seemingly endless crowd, an innovative product alone is usually not enough.
Even if your startup has achieved the ideal product-market fit and offers a disruptive solution to a burning problem, it’s all for naught if your target audience doesn’t know about it.
With a customized marketing strategy, a startup can stand out from its competitors even in the sensitive early stages, and thus gain a decisive market advantage. The selection of the individual elements of the marketing mix is particularly crucial here, so as not to waste precious resources.
Investments in various advertising media alone are not enough. The expertise of the entrepreneur or marketing manager in the area of monitoring, targeting, and reporting is also crucial.
Before we look at the individual advertising tools, it is important to reiterate how to build and develop a marketing strategy. Basically, the strategy is based on these five components: the diagnosis, which states the current state, the environment in which the startup operates, the marketing goals, the audience targeting, and the branding.
Young companies, in particular, should be able to check off this step very quickly, depending on whether the company has already presented itself to the public or even existed at all.
The most important thing in this step is to create a holistic picture of the startup and to determine its strengths and weaknesses, for example by means of a SWOT analysis. In this phase, essential cornerstones of branding are also laid: the company’s mission, vision, and values. You should take sufficient time to make a final commitment to this.
The corporate philosophy and thus the mission, vision, and values are not only of great importance for marketing and external communication; the three components are also crucial for the internal corporate climate.
Of course, it is particularly important to understand the market first in order to achieve a perfect product-market fit with one’s own startup. Therefore, as a second step, comprehensive macro- and microenvironment, as well as competitor analyses should be made. Do not underestimate the threat of direct as well as indirect competitors. Especially in the case of promising business models, you must also expect new competitors to enter the market.
In this step, you can already tell a lot about the success of the respective startup and its product. A niche that is too small or the wrong positioning can be identified early on, and thus countermeasures can still be taken before the startup fails due to lack of demand.
Researching other products on the market also helps startups to assess the interest and demand of potential customers.
Business goals change constantly depending on environmental influences. But the classic startup, on its way to rapid scaling, has two main goals: to increase brand awareness and to acquire more customers. These two are closely related, yet it makes sense to focus one’s marketing mix on one goal.
Increasing brand awareness is about getting the general public to know about the name, logo, and products. Even though this goal is not about attracting buyers, brand awareness is still one of the most important factors in the buying decision.
The investment in brand awareness is therefore worthwhile, especially in the long term. Typical marketing measures for brand awareness include content marketing, a website with a good ranking, and above all PR and public relations.
Customer acquisition, on the other hand, emphasizes the economic aspect. The goal is to convert potential prospects into paying, and preferably loyal, customers. An important tool for this is the use of CTAs (Call to Action). They set impulses that encourage the customer to act.
To use the marketing budget as efficiently as possible, it is necessary to address the right target group as precisely as possible in order to avoid wastage. The simplest differentiation is, of course, whether it is a B2B or a B2C startup. This differentiation already eliminates a large segment that is not worth addressing. It also has a far-reaching effect on the marketing strategy and the choice of the communication channel.
Subsequently, different potential target groups should be divided into so-called segments. These are compared on the basis of various criteria (such as location, marital status, or income). In the next step, the actual targeting, a decision must be made for one or more of these target groups. This usually involves the profitability of the target groups.
With the help of target group personas, startups can visualize their target groups and better understand their needs.
Now it’s time to create a brand. Think about what should be the DNA, the essence of your startup. The attributes, values, advantages, and personality of the startup ideally compose a holistic, harmonious image of the brand.
Startups have a decisive advantage over established companies when it comes to branding. You start your external communication as a blank slate and can create a self-chosen image in the minds of unbiased customers. The goal is to make the unique selling proposition (USP) the central core of the brand, which customers immediately associate with the messages chosen by the startup.
From all the previous findings and analysis, the all-encompassing marketing strategy is finally derived. This has three aspirations:
To do this, the main messages must be developed, i.e. the most central statements of a campaign that absolutely must be communicated to the audience. In addition, a media plan must be included, which is able to reach the target audience as effectively as possible with different channels.
In the course of this, budget planning is also carried out, which is a particularly sensitive topic for startups. Therefore, a few central goals and target groups should be defined. As soon as the startup and thus the budget grows, more money can be invested and more target groups can be reached.
As a last, and according to many also the most important step, the startup has to evaluate the results of the respective campaign, evaluate Key Performance Indicators, and put down learnings. Based on the respective results, the campaign is optimized to acquire even more customers or to increase brand awareness.
A further step in the communication plan is media planning. Based on the knowledge of the respective market, the company itself, and its target group, decisions on media selection and content planning can be derived.
Finding the optimal advertising media is not so easy in view of the diverse media landscape. Startups face a limitless choice of online and offline media channels.
To reach customers as efficiently as possible, companies choose from above-the-line media (ATL) and below-the-line media (BTL), or a mix of both.
ATL refers to “classic, traditional” advertising, such as radio, TV, or print advertising.
BTL represents a more sensitive and targeted form of advertising. Newsletters, guerrilla marketing, or affiliate programs attract potential customers in a subtle and creative way.
BTL enjoys great popularity, especially in the startup industry. Yet the power of ATL to reach large masses should not be underestimated. The well-considered combination of both supports an effective marketing strategy. The optimal advertising channel should convey the startup’s advertising messages, fit its public perception, and, of course, be used by the respective target group.
On the way to the publication of the campaign, the design of the advertising material, as well as the temporal and spatial planning of the content also follow.
These five channels are the basic elements of a successful startup marketing strategy. Depending on the target groups, market, and marketing goals, these must be adapted and expanded.
Developing a website can do much more for your customers than provide information and offer products for sale. Startups can use it to spread their corporate philosophy, increase their brand awareness, promote customer contact, generate new leads, and cultivate their image.
In combination with Google Ads, traffic, as well as website sales, can be increased and new target groups can be made aware of the startup.
However, free strategies also improve the ranking and thus the visibility of a company website. Search Engine Optimization (SEO) is the cornerstone of a website, for positive customer experiences and a high search engine ranking. Keywords, meta descriptions, quality content, fast loading times and an optimized URL lead more visitors to the website. And at the same time they increase the performance of your Google Ads campaigns.
Building a website is definitely a sustainable investment, which has a huge impact on the public’s image of your startup. Even if your startup doesn’t have enough capital for an elaborate website or online store in the early stages, a simple landing page is perfectly sufficient to get in touch with your customers and give an overview of the startup and its products.
Effective content marketing goes hand in hand with building a search-engine-optimized website. Creating informative and relevant content is a simple and cost-effective strategy to attract more online users to your startup. Appealing and unique infographics, blogs, freebies, or guides establishes the startup as an expert in the respective industry and transform prospects into customers.
Content marketing is not only cost-effective, but it continues to market itself. Helpful content that solves your target audience’s questions and problems achieves high engagement and is shared widely.
Ideally, the content further increases the startup’s reach and complements content from other marketing strategies.
With the continuously increasing use of social media, the importance of presence on social media for businesses is also steadily increasing. Public presence on social media increases the trustworthiness of the startup and is a great way to interact closely with your community.
Although practically everyone already uses social media in everyday life, the effort of a professional online presence and content creation should not be underestimated. This is why it makes sense to select suitable platforms instead of randomly adding content to all of them.
A consistent image is particularly important for your social media presence, as well as for your overall marketing strategy. So check in advance whether the matching usernames are available and use the same profile picture. The content should also be coordinated.
With the help of e-mail marketing, startups can acquire new customers. And at the same time, they are able to expand and consolidate contact with existing customers. Since the ROI (return on investment) is particularly high for email marketing measures, this advertising channel is especially suitable for using the advertising budget cost-effectively.
Companies collect the e-mail addresses of website visitors by adding a corresponding form to the website. Based on this, mailing lists are created to which updates, information on services and products, and special offers are sent.
When designing the email content, startups should make sure to tailor the messages to the recipient’s preferences and demographic characteristics.
To appear reputable, it is essential to comply with data protection rules.
Adhere to three rules
Classic PR work still has a high priority in 2021. Public relations involves a lot of work and stamina. But it presents an opportunity to be present in the media and the public and help shape the brand image.
“Advertising is saying you’re good. PR is getting someone else to say you’re good.”
Press releases are a cost-effective way to get your brand mentioned in a relevant publication and gain some inbound links at the same time, further building your SEO.
Professional PR agencies can do the work for you of creating content, contacting journalists, creating a press distribution list, etc. But even here, your startup can save costs by finding and writing to the publication’s journalists yourself.
There is no one, universally valid marketing strategy. Ultimately, it makes sense for startups to pursue the most precise goals possible and to specifically address individual target groups and markets in order to avoid excessive wastage.
A marketing mix of classic, modern and digital strategies promises the greatest success.