Starting a business is always difficult. Even when a perfect product is introduced to the market from the consumer’s point of view. In a large flow of similar offers, it risks going unnoticed and unappreciated. Many startups have a limited budget, so they try to promote their products independently, with minimal costs, hoping that a sophisticated consumer will notice their product and start buying it en masse. However, in 97% of cases, such bright ideas are crushed by the harsh reality. Unable to withstand the competition, the startup fades and a perfect product is left without a demand.
It is not enough to have a high-quality and really useful product made with the help of startup software development services, it is still necessary to present it competently to its target audience. A marketing strategy, the budget for which should be planned in advance, even at the stage of the production of its products, will help in this.
What goes into the strategy?
- Analysis of the market, where it is planned to promote the product.
- Study of the target audience.
- Identification of competitors.
- Analysis of the current state of the business.
- Determination of the startup’s development goals (creation of a business plan).
- Development of advertising promotion.
Those who call market analysis a mere formality clearly underestimate its impact on business development. It is no coincidence that this item is number one. It is the analysis that answers the question, “Is it even worth it to start producing this product?” If the niche still allows you to sell your products to another brand, then the study of the sales area will allow you to intelligently adjust plans to bring the product to market.
Here is an example of how a timely analysis saved a well-known brand from unnecessary spending. There was one company on the bandage market in America – Band-Aid, which everyone knew and bought Band-Aid patches. Curad, after analyzing the market, realized that it would be difficult for them to reach consumers with their patches. So they decided to make some changes to their products: they just added cartoon drawings. Their product quickly gained popularity among the children’s audience, allowing the company to make good money on sales.
In its essence, market analysis is the collection of information about a particular market, its consumers, its comprehensive study and analysis. Market analysis involves a detailed study of the following market elements:
- Products, services or goods
- Supply and demand.
- Consumer behavior, both real and potential.
- Market conditions.
- Price level dynamics.
How is the study conducted?
Strategic market analysis implies a set of activities that are aimed at several enterprises operating in one sector of the economy or economic sector. This industry includes the production, distribution of goods and their consumption.
The purpose of market research is to determine the risks in a particular industry. It should specify how stable the market situation is, what risks are associated with its instability and how to hedge against them or minimize their consequences.
Target audience research
Developing a marketing strategy should include an analysis of your potential customers. A startup without a clear understanding of its audience is doomed to remain without sales.
The target group is also crucial for the positioning of the company as a whole. For example, the target audience analysis we did for the Zegen brand, dividing it into primary and secondary audiences, made it possible to create a site that was close to the target audience and intuitive to use. Knowledge of its target group also helped the brand build competent communication with its clients, winning their favor.
Healthy competition always promotes the development of the firm and benefits the consumer. However, ignorance of the competitive environment for a startup can cost it many years of hard fighting for a place in the sun. Who are the key competitors? What are their strengths and weaknesses? How do consumers feel about their products? These questions are sure to be answered. Even if it seems to you that there are almost no competitors in your niche and it is not worth studying this point, we still recommend “to know the enemy of the competitor by sight.”
Here’s an example. We were approached by a marble beef company that was just about to enter the market. In our country, this niche is fairly vacant. It would seem that we could omit this point, but then we would not position the brand correctly, showing the firm’s advantages that others do not have. Even in a free niche, the company’s marketing strategy would be incomplete without the analysis of competitors! Study of the current state of the business and definition of goals.
A startup needs to define its goals:
- Study weaknesses and strengths;
- Identify brand development opportunities;
- Identify threats;
- Identify the uniqueness of the product (what distinguishes or sets it apart from the competition), based on which a unique selling proposition (USP) is written.
In addition, do not forget about the firm’s goals, objectives, and mission, which are important not only for brand positioning but also for the motivation of the firm’s employees. It is mandatory to describe the main advantages of the startup, determine the pricing policy and the budget.
Analysis of the current state of the business.
There are many metrics used to evaluate the performance of a startup to determine how healthy the business is. In this case, the entrepreneur’s mistake is to completely ignore the calculation and analysis of metrics and track a huge number of them.
Focus on critical metrics helps to identify weaknesses of the company at different stages of its development, timely understand that “everything is bad,” and change the business strategy. Metrics also guide the investor to assess the feasibility of their investments, the organization’s potential, and further tactics of behavior.
Defining the development goals of a startup
Small goals can be challenging to achieve, but they should be possible, straightforward, and uncomplicated. It is also essential to set reasonable expectations for the business that can be realistically achieved. Most entrepreneurs set unrealistic goals at the expense of their own emotions and excitement. This approach is misleading and apathetic. It is much more pleasant to constantly achieve smaller goals than global and unrealistic ones. We recommend applying the “3 Quarterly Goals” methodology. How does it work? Define 3 small but realistic goals for the quarter, distribute them among the startup members. The importance of the objectives defined for the quarter will focus the team on achieving the overall result and allow everyone to work on secondary objectives and projects in parallel. Setting goals for a startup can be compared to a child’s first steps. We’re all capable of making mistakes and trying again, and accomplishing short-term, small tasks will allow us to achieve the desired result faster.
Setting challenging and specific goals motivate and increase the team’s commitment to achieving them. For example, Google uses “goal as a key result” to set ambitious goals and track progress. OKRs, are responsible for specific steps towards the success of a startup project at an early stage of development:
The key result is measurable and should have a score, for example, from 0 to 10.
- Every ambitious goal will cause discomfort, and you have to be prepared for that.
- Key results are available to each team member and lets you know what the entire team is working on.
- An acceptable estimate of OKRs is achieved with 60-70% when tasks are performed regularly and consistently.
- A low score signals a problem in a certain area of the startup.
- The goal as a key result is not synonymous with team evaluation.
- OKRs are not part of the general task list.
The application of OKR is, different from the methodology of setting simple goals for implementing a startup by setting ambitious goals.
Positioning and advertising
Based on all of the above points, the positioning of the product (determining the place of the product in the minds of potential buyers) is built. These are the closing points in the development of the company’s marketing strategy. As a result of competent positioning, the consumer has an image of the product in his head, which they will not confuse with a similar (or similar) competitor’s product.
After a comprehensive study of positioning, an advertising campaign is developed. The most effective promotion channels are determined. These can be social networks, web portals, printed media, radio, or television. The development of an advertising campaign also includes preparing information messages about the product, media planning, and budget calculation.
A marketing strategy is essential to a successful startup as a marketing strategy is to a successful startup. The market laws are harsh, so if you really want to become one of its participants, and in the future, even seriously displace your competitors, be sure to put strategy development in your budget. And our team will always help with the implementation of the marketing strategy of your product.