When we think of launching a startup, we get really optimistic that our business idea can change the world.
While it’s good to be an optimist but an ‘idea’ alone isn’t going to guarantee you success with your startup in 2018. Market is now completely saturated and expectations of customer have grown to the level where catering them is not an easy task.
With a remarkable startup idea, what’s required is a clever execution strategy and several other aspects that you need to consider to take it to the next level.
Below we have covered six factors which you must consider while starting a startup.
Identify Your Niche Market
After coming up with a startup(business) idea, first task is to ask yourself, “who will be interested in my product/service?”
Take into account your potential customer’s attributes such as age, gender, relationship status, income, and hobbies.
Sometimes you need to dig deeper to identify the buyer persona, customer needs/wants, aspirations and the loopholes that you can fix with your product.
The best way to do this is talk to a wide variety of users.
The CEO of HashCut, Vijay, tells us how he found a new audience for his product. He says that he talked to YouTube enthusiasts, gamers, creators, and many more people, asking them about their habits around YouTube watching, sharing, clipping, and more. ‘In the end, we showed them HashCut, and asked how they might use the product.’
This helped him realize a core audience for his product and then re-positioned the website, social handles, and the marketing around it.
Similarly, after identifying the niche, start small. This means focus on being better with a select group of people. ‘Once you can do that, you’re equipped to tell the press and your customers a story on how your startup is going to change the world,’ says Paul Burke, CEO of RentHoop. Paul used the same strategy to market the product to his customers.
Determine Product-Market Fit
Achieving the product market fit can be challenging for startups in the initial stages, as it requires a deep understanding of your target market.
You can only win your buyer’s trust if you are solving their real problems with your product. ‘Make sure you are solving a big enough problem. If your company’s problem is not 10X better than the traditional product or service, it will be difficult to have a product-market fit. Talk to strangers, family, friends, and coworkers and see if they would PAY for your product or service not just see if they like it,’ says Gene Caballero, Cofounder at Greenpal.
It is better to charge your very first customers to make sure they’re willing to pay. As Steve Benson of Badger Maps says, ‘Even if your product is still a piece of junk, don’t give it away for free, or else you won’t learn if it’s a problem worth paying to solve.’
Target Prospects by Understanding their Behavior
You need to understand the behavior and lifestyle of your prospects before you target them for your marketing activities.
For example, if your audience is between 20 and 25 years of age, using social media and other online platforms will be the right channel to reach them.
You can also find publications that share your target audience. Once these publications are identified, pitch them as frequently as you can, about subjects surrounded by your startups. The more media opportunities you are able to secure, the better chances you have for increased visibility.
Linda Parry Murphy of Product Launchers, wraps it up succinctly saying, ‘If you have a business service, announce it on the radio so that prospects can hear your message while in the car thinking about work. If you have a consumer product, reach out to the trade media so that it’s on the radar of the retail buyers. Also, the old adage is true. You have to spend money to make money. And, if you have a killer value proposition, this will pay off tenfold‘.
One more way to connect with prospects is to create tailored messages for them. Different groups of audience needs different messages. And, the best way to reach a wider but targeted audience is through digital marketing, which makes personalization even easier.
‘GREAT WINE, Inc. creates different key messages for each groups of target audience. For millennial, the company emphasizes on “affordable everyday wine,” with additional classes on “vinotype.” For generation X and Baby Boomers, it highlights the concept of “ vinotype,” wine tasting, and wine lessons‘, says Michella Chiu Director of Brand Marketing at GREAT WINE, Inc.
Build a Winning Startup Team
To launch a startup get an astounding team on board, who will either assist or lead your executional plan all the way through.
Even the best business ideas are a waste if you don’t have the right people working with you to execute them. In fact, not having the right team is one of the biggest reasons most startups fail.
Three Key elements of a winning startup teams are:
- All team members work towards a common goal.
- Each member of the team takes interest in the idea.
- For every team member, growth is the main element of success.
Therefore, hire a solid team of people that are willing to go through walls [so to speak].
‘These people should be creative, driven, and can adapt to a high stress environment,’ says Kreg Peeler, Founder & CEO of Spingo.
Similarly, many entrepreneurs put too much value in their idea or brand, and neglect to value their employees enough.
‘Acknowledge the fact that you can’t do everything alone. So, recruit the right people, make them grow, and keep them happy. Also, ‘don’t be afraid to fire the wrong ones,’ says Mike Khorev, a digital marketing strategist while emphasizing the value of being straightforward in business.
Network So that People Know You
No matter what your business model is and to whom you are going to sell to, networking can be beneficial for you in one way or another.
As a startup founder, you need to network with your potential buyers or to the similar audience to identify their needs and wants. Similarly, networking with influencers can get you valuable feedback for your product. And, if you need some investments to launch your startup, talking with investors reveals which type of businesses they like to invest in and what do they analyze before investing.
‘Meetups can help you find like minded people and avoid bottlenecks. Find an industry professional to test your product and learn from their experiences,’ says Monica Barrette Founder at Monica Barrette Agency.
Immersing yourself into a network of like-minded business owners provides an insider’s take on the industry and allows you to develop relationships with business owners who previously forged their own startup paths.
‘Many times they will share their own stories and experiences that will help you avoid the very mistakes they made-saving you time and money along the way‘, adds Josephine Caminos Oria of La Dorita.
Know Your Competitors
To compete in a competitive market it is essential to know who are the direct and indirect competitors of your product.
Startup founders need to understand that at the initial stage they can’t compete with bigger businesses as these businesses don’t face those problems which small startups do and most of the time, their budget is hundred times bigger than the startups.
As Porter says in Five Forces of Competitive Position Analysis, you can analyze your competitors by identifying who their customers are? What technologies do they use? And, how much can they spend on their marketing?
Before launching your new business venture, make sure you have a good understanding of the industry such as the trends, current state of the market, and the recent news, as well as an understanding of the potential competitors.
Knowing your competitors inside out is invaluable. It gives you insights into how you can position your brand so that you can stand out and succeed. ‘It is also necessary to know the industry inside out, but don’t let the industry knowledge replace competitor analysis, because it is the in-depth knowledge of the competition that will set you up for success,’ says Matt Edstrom, Head of Marketing, Bio Clarity.
When launching a new product, it’s tempting to look at other products or competitors to see what’s working or what isn’t working for them. Startup founders typically have their own biases on what channels might be effective and which might not be, causing them to completely overlook a channel that might have a lot of potential.
‘More often than not, your competitors are also overlooking that channels, which may spell opportunity. So, before finalizing your marketing strategy, make sure to at least consider what each channel might have to offer,’ Mathew Lazarus, Chief Innovation Officer, Archbolt.
Finally, to successfully start a startup, there are many more things to do such as performing beta tests before launch, having multiple growth strategies in mind and following a systematic path.
Starting a business takes a lot more than coming up with just the startup plan, you need to at least have a Minimum Viable Product (MVP) before you can start focusing on the growth prospects, and even that is just the start of the journey.
Startup journey is a never ending one… What have we missed in covering the top startup factors to keep in mind while starting up for the first time? Let us know through the comments below.