Marketing isn’t a magic pill. It’s not a switch that you just turn on and sales start coming through. Unfortunately, many new companies don’t really understand this. They feel that with the right marketing any company can succeed. While it’s true that you can get some short-term revenue by running a clever marketing campaign, in order to attain long-term growth a few very important elements need to be in place before you even think about marketing.
A great product trumps the best marketing campaign in the world. This is such a basic idea but so often we get caught up on marketing that we forget how important having an amazing product is. But, what makes a product amazing in the first place? Two things: innovation and user feedback.
Innovation is key because people remember products and companies that are different. But so many companies are afraid of innovation. We play it too safe sometimes. We believe that in order to succeed we need to find something that works and replicate it. But when you think about it, the most successful companies in the world are the ones doing things that nobody else does. They don’t enter overcrowded markets, they create new ones.
One of the biggest fallacies about innovation is that only big companies can innovate. This isn’t true. Here in Portland there’s a doughnut shop called Voodoo Doughnut. They make doughnuts that look like voodoo dolls and they use original ingredients like bacon and M&Ms. You can find 50 people standing in line at midnight to get some of their donuts.
In Prague, Czech Republic, there’s a night club that has an ice bar. People from all over Europe go to this night club because an ice bar is something they’ve never seen before.
You don’t have to be a multi-million dollar business to innovate. It’s about willing to take risks.
Last year I was at a networking event and I met a guy who owned a company that rented servers for dedicated website hosting. He spent five minutes going over all the technical details of his servers. By the time he was done I couldn’t remember any of it.
If he had told me that websites hosted on his servers load 10x faster than websites hosted on shared servers like GoDaddy, his story would’ve been much more memorable. If I can’t re-tell his story, I can’t become an advocate for his company. Sure you know a lot about your product, but can you explain it so someone with no knowledge about your field can tell his friends about it?
Contrary to popular beliefs, marketing is NOT a numbers game. The old idea that all you have to do is reach a million people and hope that a tiny percentage of them buy your product is deeply flawed. Don’t think about audience size. Instead, think about what I call “relevance ratio.”
The relevance ratio is the percentage of potential customers within a given audience. For example, if you sell truck parts and advertise on TV during an NFL game, millions of people will watch your ad, but what percentage of them buys truck parts on a regular basis? This marketing channel has a very low relevance ratio for you. On the other hand, if you’re the main sponsor at a commercial vehicle parts trade show, you’ll be reaching a lot fewer people, but the relevance ratio will be through the roof. Likewise, if you run a search marketing campaign online and bid for keywords like “Kenworth T680 engine for sale” you know that pretty much 100% of the people searching for that part are on the market for it.
Go to where your audience is. Focus on the relevance ratio, not on the audience size.