Tech startups are generally innovators. But whether bootstrapped or venture funded, they are burning cash and have significant milestones to meet in order to get to the next level – namely, increasing sales. The irony of many startups, even ones that are selling disruptive technologies, is that many rely on the same old ways of marketing and sales that existed before the Internet came along, or the ones that are Internet-based yet don’t go far enough.
The Marketing Consigliere would like to give you some reasons why those engaged in entrepreneurship need to start from the ground up, before they even have a website, with marketing automation for their company:
1. Marketing Automation forces you to focus on processes. Chances are you have adopted some methodology for product development such as the Agile method. Once you think about it, “leads” are a product that you create for yourself, nurturing them over time if they’re not quite ready for your salespeople. You need to determine the processes that will help you gather, store, analyze, share, and act upon data that in the form of leads that will lead eventually translate into revenue. This disciplined approach will help you make the best out of the data you accumulate over time. Once you have done this, other processes like operations or customer support related activities will be easier to create because you will already have experience mapping out workflows and institutionalizing them.
2. You can’t just rely on “viral marketing.” During the dotcom era, many startups looking for money would say that “all we need do is to capture X% of the market” (with the “X” being one percent or a fraction of one percent). How naïve – that may be a goal, but stating the goal is not saying how you’ll get to that goal. In the eyes of investors, that was a deal killer. Now The Marketing Consigliere has heard would-be CEOs say they will get to market by “word of mouth” and viral use of social media. Once again, how naïve. That’s just a corollary of thinking that your product is so wonderful it will sell itself. You are going to have to test many channels of communication with whom you think your customers are and within those channels test multiple permutations of creative and copy. Marketing Automation can help you do that so efficiently, allowing you to determine what works best and and then enabling you to repeat it while eliminating those trials that do not bring you adequate conversions.
3. You’re not ready for a CRM platform. While Salesforce.com is a great tool and opensource CRM platforms like SugarCRM are indeed useful and generally affordable for sales organizations, don’t forget that the “C” stands for “customer,” of which you don’t have any just yet. Marketing Automation provides you with the platform for generating, nurturing, and scoring leads. When a lead is truly ready to engage with a sales person or quickly become a customer, then you can worry about integrating a marketing automation platform with a CRM platform, (from what The Marketing Consigliere has seen, Silverpop, Pardot, Marketo, and Eloqua have very robust synchronization/integration with most leading CRM platforms) which in turn can be integrated with the back office applications that are relevant to a customer when they are actually using your product or service. So don’t feel like you have to rush out and subscribe to a CRM platform just yet; and whatever you do, don’t embarass yourself in front of a potential investor and tell them you’ve bought PC fossils like ACT! and Goldmine. The Marketing Automation platform may be the horse that comes before the CRM cart.
4. A cool website alone is insufficient. It doesn’t matter if you’ve made your website in Drupal, Joomla, WordPress, or whatever CMS du jour you happen to be a fan of. Hopefully you haven’t even thought of launching a website until you’ve figured out how your startup is going to be found on the Internet, and how you are going convert leads into customers. Refer back to reason #1 which is about processes. That’s where the concept of “Inbound Marketing” comes in. You really don’t know online customer behavior in the context of your industry/vertical and will have to conduct test upon test to see what content attracts and engages potential customers. Proper campaign management demands this. Furthermore, marketers are realizing that content is the sticky stuff that helps weave a huge web covering the many places your prospects will be in the Internet (pun intended). There are vendors like HubSpot, Infusionsoft, and Genoo that are creating true, very economical Inbound Marketing platforms which include websites for small businesses and can make a significant impact on how you use metrics & measurement on your lead generation and management efforts. Instead of just having a website, you need to truly create a “web” of your own and Marketing Automation will help you determine where to place the “strings” of your web. After all, customers visit many places online in various fashions, and you need to be able to take advantage of that.
5. Most salespeople can’t prospect well. How many times have you downloaded a whitepaper, and not have had the time figure out when you were going to read the darn thing when you get a call from a salesperson asking if you read it? As a startup, you cannot afford to have costly salespeople running down too many dead ends. Even if you think that “this is a numbers game,” you simply don’t have enough salespeople to cover your market. Outbound cold calls are as inefficient as buggy whips are obsolete. You need to determine, over time, the right “Digital Body Language” because one instance of engagement with a visitor to your website is no indicator of proclivity to buy – over time, however, you can be a better predictor to that. Allowing a salesperson to have a knee-jerk reaction and rabidly call an unqualified visitor is like flushing money down the tubes. And sometimes salespeople don’t ask the right questions about a buying organization that can help determine the true qualifications of a particular person. Marketing Automation allows you to process hundreds of activities and then gives the salesperson a lead that has been qualified and less likely to waste their limited time. And not to be too harsh, it’s not always the salesperson’s fault – from another angle, Salespeople which are more expensive to employ on a cost per lead basis can be inserted in to the lead process after the Marketing Automation portion of lead management has done all it can do.
6. Most salespeople have less-than-stellar contacts. If you think you’re going to make a shortcut to your goal by hiring a stable of salespeople with “fat rolodexes” (ugh, what an antiquated concept), The Marketing Consigliere thinks whoever sold you that stuff you’re smoking mixed in a little oregano with it. Many salespeople are not going to risk their relationships once they realize how hard it is to sell your wonderful product without the support of great marketing tools. Marketing Automation-enabled “drip marketing” tactics will do a better job warming up a greater number of prospects to your company than someone who may have exaggerated about how many people they know well. By the time you actually found a “perfect” salesperson with the pedigreed contacts you’re looking for, you could have set up a Marketing Automation platform that will still be working for you long after that salesperson has come and left your startup and you are again looking for a salesperson with a “fat rolodex.”
7. “Free” isn’t as good as you think it is. There’s nothing wrong with trying to optimize your efficiencies as you try to grow by using free services such as Google Analytics; but remember the adage “You get what you pay for.” As an entrepreneur, you understand risk and tradeoffs. The risk of a free tool or service is that you won’t get the support you need when something goes wrong; and things frequently go wrong in a startup environment. And there is no free tool that is as comprehensive as some of the leading solutions out there that give you turnkey Marketing Automation capabilities. Besides, The Marketing Consigliere assumes that you are not going to give your product or service away for free; why should your business plan depend on things that are “free?” Have you taken into consider the externalities of using free? “Free” also means a steep, long learning curve. Marketing Automation platforms have been created by companies that “eat their own dog food” and are ready to support with their expertise if you if you pay for their services. Monthly fees range from a few hundred dollars to thousands of dollars if you do it yourself; hiring professional services firms that specialize in Marketing Automation (like Allinio – [shameless plug]), may add additional hourly fees onto that, but you’ll quickly get past the steep, long learning curve because of it.
8. The data you gather is valuable beyond the scope of your immediate product launch. How you gather, store, analyze, share, and act upon data is important. Not just for now, but for unimagined opportunities in the future. Chances are your business direction will change in the first six months, year, and even two years. That sort of adaptation is healthy. But the business intelligence gathered via a Marketing Automation platform could possibly help you foresee trends that normally you could not have reckoned. Ultimately, however, data is a strategic asset that may make your company a more attractive acquisition; acquistion, of course, is something which most entrepreneurs include in their business plan as an desired exit strategy. A startup which understands and achieves information superiority out of the gate will be better able to survive the bloody arena of capitalism and outlive its competition, drawing top dollar from the smart acquirer who is not only buying a revenue stream of customers, but critical data that can be leveraged in the future. Marketing Automation helps you achieve such strategic positioning.