4 Myths About Successful Startups – Part II: Building the Right Foundation for Startup Companies

Business Leadership and Strategy

Last week, we talked startup success and addressed a couple myths surrounding success and effectively employing a lean approach. Here, we pick up where we left off and tackle 2.5 more myths that can impact success for startup companies. Finally, we’ll offer three tips for changing your startup reality to steer the ship in the right direction.

Myth #3: Competition is non-existent

 

Another common mistake is to believe the fallacy that there is no competition, or fail to adequately identify your real competition. Even with a blue ocean solution there is competition – i.e., it might be that a “status quo” is your strongest competitor.

Don’t underestimate the importance of understanding your target customer’s view of the competition. If your potential customers are looking for a solution, their definition of who is your competition is more relevant than yours.

Conversely, basic competitive research (in conjunction with customer and market research) that helps to inform brand positioning decisions can save development time, help you to more effectively determine your Minimum Viable Product (MVP), and enable you to differentiate in your target markets.

Myth #4: “Our product is SO great we just need social media. It will go viral, and everyone will buy it”

Myth buster: Social media marketing is NOT free if you want it to be effective for your business. Social media is just one tactic in your marketing arsenal, and its effectiveness is dependent on your potential customer usage and engagement.

As Peter F. Drucker, the Father of Modern Management, said, “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” When it comes to promoting a product or service, most companies spend an exorbitant amount of energy figuratively throwing spaghetti at the fridge and waiting to see what sticks with fingers crossed.

Quote by marketing guru Peter Drucker and image of his face talking (related to startup companies)

What we see with startup companies (and established companies) is a tremendous amount of money being wasted in creating positioning, messaging, and marketing or sales tools that miss the mark.

Instead of spending that money over and over again trying to get it right, startups can use customer, market, and competitive research to help shape a go-to-market strategy that works from the start.

Myth #4.5: We can go to market on a shoestring and duct tape

The companion mistake for startup companies is in underestimating what it takes to get a product to market (which can be especially true for tech startups). With higher development costs, startups ultimately find themselves out of funds and unable to spend on critical marketing and sales strategy, lacking the resources it takes to effectively launch and gain traction.

Marketing starts before product development, not after. To ensure success, be sure you have the right marketing and sales expertise on board very early in the process, and the financial resources to keep going while building a revenue pipeline.

3 Ways to Change Your Startup Reality

To follow Peter Drucker’s sage advice, keeping your eyes on the customer will help you avoid the calamities other startup companies have experienced. Start the process of gathering resources and research early and make sure you have adequate resources to get your product to market and the staying power to grow. Here are three essential tips to ensure success:

Group of three business people at startup companies talking while consulting a computer screen

  1. Base your strategy on substantiated confidence vs. your gut - Arm yourself with realistic data to demonstrate that your product or service provides a solution to what your customer perceives as a real problem. This data will show what motivates them enough to buy.
  2. Focus on the product & market fit and be open to change – Personally talking to real potential customers may be out of your comfort zone, but it’s consistently proven to be priceless. Taking the time for personalized customer/market research pays off. Use third-party or other unbiased resources to further validate your assumptions.
  3. Get a realistic understanding of your “competitors” – Understanding the competitive landscape can be one of your biggest assets in avoiding surprises, creating scalability, and staying on top of opportunities.

Stay in The Know About Product/Market Fit

Remember: Your product or service may be stellar, but if you aren’t reaching an interested market with messaging they care about, you’re just adding to the noise.

Researching the “real customers,” the marketplace, and your competition alleviates the guessing game and wasted resources often seen during development. Plus, your new knowledge of customers will keep you focused on product/market fit as you create your go-to-market strategy.

Need help with your startup marketing strategy? Schedule a complimentary strategy session with one of our experts today!