This week I read a couple of blog posts on the topic of Branding for startups that bothered me. Both posts tried to make the same 2 points about startup marketing:
- Branding is THE most important facet of startup marketing
- Branding is about how your offering resonates EMOTIONALLY with the buyer NOT the benefit you provide. The example used was home cleaning products where the benefit was “cleaning the house” where the “branding” focus should have been “creating more family time”.
This a classic example of advice that would be very good for a company in an established market but disastrous for a startup.
Positioning in an established market is very different from positioning in one that isn’t. Startup prospects are starting at a different spot on the purchase path. If you are selling soap, you don’t have to worry about defining what soap is, what it does or why you might want to buy some. The biggest worry the soap seller has is differentiating themselves from the other soaps out there. Since soap is all pretty much the same it’s going to be hard to do on technical merits (although there are loads consumer products that attempt to do just that such as dishwasher soap with “breakthrough multi-chamber technology” and toilet paper that doesn’t leave little bits behind) so getting to the intangible stuff right away might be your only hope.
Most startups don’t operate in established markets – they are either breaking ground in new markets, operating at the intersection of markets, or trying to re-define a market. Selling in markets like these is a bit like trying to sell soap on a planet where nobody uses soap or really understands what it is. Selling Martians on the whole family time thing is nice but they aren’t going to buy if they can’t figure out what the heck soap is in the first place.
You can think of it like a cascading set of questions like this:
In a well-established market you can skip the first 2 or 3 questions. Startups have to start at the top.
That doesn’t mean that the focus should be on features. Coming back to the soap example, telling Martians about the percentage of phosphates isn’t going to make much sense (unless they are rather scientific, which could be true). You have to start at the beginning. What the heck is this thing? – Soap cleans things! Is this for me? – This is soap for removing Martian red dirt! If I never talk about that Martians would be left scratching their heads trying to figure out just exactly how is this stuff going to help them hang out with the family. I’ve seen the equivalent of the branding first approach used at startups and what you get is a lovely home page filled with vague platitudes that nobody understands and doesn’t convert.
I am not saying that branding isn’t useful and powerful and important for some companies at some stages of their growth. However I think early stage companies first have to figure out how to survive before they (and their markets) get established enough where branding can be an important differentiator.
9 thoughts on “Startup Branding and Selling to Martians”
Excellent post. I think in marketing there is too often the temptation to get too cute with regards to messaging forcing customers to fill in too many blanks. I love the straighforwardness of your messaging cascade.
We’ve certainly found that to be true. Good branding has even brought people to our door as a startup, but it wasn’t brand that closed the deals with our early customers – it was effective articulation of a value proposition that is largely new, it’s not replacing anything that exists. We’re slowly learning that and seeing conversions rise accordingly. That said, I will be sharing this post with our team so we can think about it more clearly and explicitly.
Great post. In the initial phase, Startups have to shoot straight about what they have to offer and clearly define what problem they solve. Branding and the other fluff can come in later. There is of course the other end, where a startup comes into existence with a great product and a story to go with it; though this is rare. As Kirk mentions in his comment, no startup can close deals with a ‘brand’ – ultimately it’s the product that sells.
Although branding is not often at the top of the list in the early start up phase, lack of proper branding can come back to haunt a business owner once the company gains traction. We’ve run into many startups that have had to completely stop and rebrand because their original niche product/service offering was so strongly tied to their identity, that as they grew and evolved (as they often do,) they then spent all their ad dollars telling customers they no longer do what their name implied. It’s almost epidemic. Like the old Burlington Coat Factory ads that said “We’re more than just coats!” And then “Not affiliated with Burlington Industries.” Identities can quickly devolve into apologetic disclaimers that prove more confusing than helpful.
So while a start up may not need expensive, high brow branding to get off the ground, it is important to consider where the company may be three to five years down the line, if the current “hot product” or service will still be the main core of the company business, and if the name is going to pigeon-hole them at some point. CompUSA was abundantly clear that they sold computers in the US, but struggled to shed the “computer only identity” as they quickly became commoditized.
We worked with one start up that was called Webtronix that was no longer involved in the web. We had another client use “bank” in their name which later turned off potential credit unions clients. So I would not consider branding fluff per se, but as a business strategy/tool that can provide both immediate clarity without creating a future bottle neck.
Personally I see a HUGE difference between branding and naming. I agree that startups should be careful not tie their name to a particular feature or delivery mechanism that might change and make it confusing for customers later. I think there are other things to consider with respect to naming like can people spell it, can it be found with a search engine, etc. But that said, I see those as naming problems, not branding problems.
The second point I want to make is that often I think startups spend way too much time worrying that they won’t get this stuff perfect, when good enough is good enough and there are other much, much more important things to spend cycles on. I might even argue that the Burlington Coat Factory name might be exactly what helped them stand out in a sea of retailers doing the same thing – they did manage to be pretty successful with that name. 90% of startups fail. Full stop. While I agree that you can mess up on naming, worrying about what you will do now that you are massive is a pretty awesome problem to have 🙂
Funny enough… it seems we’re working two sides of the same coin! I see where companies “make it” and then stall out, and you’re seeing where they don’t even get off the ground. So your point is well taken. And I DO agree that a startup entrepreneur can be too obtuse in the early stages, especially in a new category, with tag lines such as “Creating tomorrow’s future today” etc. But I do see naming as an integral part of branding. What I recommend for my start ups, (to address your point of getting on with it without driving into a branding cul-de-sac,) is to have a three part strategy…
1. A great name (memorable, spell-able, attribute-based, not tied to product)
2. A literal descriptor phrase (what you do, what you sell)
3. A tag line (how you do it, what makes you special)
So an example we all know would be years back when a little startup company called itself Apple. It’s name was officially Apple Computers and the tag line “Think Different.” So you had the name… Apple. The descriptor phrase/word “Computers.” And the tag ling (in other words, how you are unique in your niche) which was to “Think Different.”
After a brand is established, and I think this was also one of your points, the literal descriptor phrase is no longer needed, you can afford the luxury of a more expansive tag line/positioning statement. Apple got rid of computers from their name a few years back with no harm to their brand, like kicking off a booster rocket. Amazon is a brand that has grown, adapted and expanded. Books-a-million came out with a niche brand name that stalled out. Their current tag? “Books. Toys. Tech. More.” Short term survival doesn’t require proper branding, but long term survival often does.
LOL – well if you read the post above, I define branding very specifically and the whole rest of the post is about the importance of messaging so I suspect we are in total agreement.
The point of my post above is that worrying too much about an emotional connection with a buyer that doesn’t understand what you do is a waste of time.
Also – it’s a pet peeve of mine that people use examples of big companies to illustrate what startups should do. Apple did over $7 billion in revenue in 1997 when it started using “Think Different”. That’s not my definition of a “little startup”.
Truce!!! I’m in complete agreement that given the choice between 1) an incredible brand name with creative collateral and a poor/ill conceived or underfunded business model, or 2) a phenomenal business model with a truly goofy brand — the winner would most often be the latter — the one with the great idea and the goofy name. They would most likely survive long enough to get rebranded at some point (but not always!)
When we first met with a brand new startup, (now called PODS,) they had the name “Portables” which potential clients mistook for either port-a-johns, or the flimsy classroom structures. They couldn’t get past a ceiling of 80 total units rented, even with advertising. They had a great business concept but a poor brand name which created customer confusion. (If it requires several minutes to explain your brand, you are in trouble – especially if you are a startup.) After getting the branding right, PODS took off and is now global.
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