What Kind of Marketing do Early-Stage Startups Need? …
In the early stages of development, B2B tech startups typically operate with limited budgets and small teams. It’s usually the most exciting time, when everyone operates as a single cohesive unit, every little win is a significant milestone, and every new customer is an achievement to be celebrated. It’s as if the business runs on passion alone, and there is plenty of it to go around from everyone who believes in the company’s vision with almost cultist levels of enthusiasm. Tapping into this energy is a startup’s superpower, the value of which cannot be underestimated.
Start Marketing Early
Passion, enthusiasm and drive will get you a long way, but they need to be channelled appropriately. When getting started, a tech startup’s focus is often on building a minimum viable product (MVP) and securing initial customers. Marketing efforts are usually focused on establishing a brand identity with meaningful messaging, creating awareness with an online presence and generating early leads. Startups have limited choices, due to their financial constraints, and may not be able to hire a full-time dedicated marketing professional, even though that’s exactly what’s needed to get started.
Keep an Eye on Costs
If a full-time hire is not yet affordable, accessing external marketing capability, from a freelancer, consultant or agency could be the next best option. It’s important to select resources for the specific capabilities you need at any given time. Marketing agencies can be expensive and prefer long-term commitments, neither of which aligns well with a struggling startup. Only use external resources provided they are cost-effective, have a flexible engagement model and require a low financial commitment. You must be able to put a hold on incurring additional costs at any time, should the circumstances necessitate a change.
Build Your Marketing Foundation
Startups must put the basics in place to create a foundation for a marketing function, which includes branding elements, messaging, a professional website and a social media presence. External agencies can help to quickly establish these assets, but they will do so with their own interpretation and biases, so you must be clear and decisive on what you want, communicating requirements clearly. Don’t let ambiguity have a chance to get in the way. The danger is that without giving proper guidance, you are not just outsourcing the work but potentially deferring important decisions to a third party’s interpretation of what they think they understand from your incomplete brief. If you have a new technology and strong views about how you want things to be done, outsourcing can be challenging.
Start Small and Grow Over Time
As you seek customer validation for a new product, marketing efforts must focus on activities that will bring revenue into the business. This can be done efficiently with internal resources or using an agency with expertise marketing to your target audience. In either case, you must be able to execute campaigns effectively to reach potential customers while measuring performance and feedback. Build up your marketing function over time to embrace both dedicated full-time employees and specialist third parties to extend your capabilities where and when required. As the business grows and funds become available, you must prioritise the needs and funding of your marketing efforts, so you can continue to raise awareness and increase the sales pipeline. This is a critical consideration to help continue success, grow the brand and increase sales. Remember, being a new entrant to the market means people still don’t know who you are, what you do or why you might be relevant to them. Marketing is your channel to reaching and converting cold prospects into sales opportunities, without which revenue (the lifeblood of any business) will be hard to generate.
Scale-up Stage
Early-stage startups might benefit from the expertise and flexibility of freelancers or an agency, but when it comes to scaling your business, it’s my belief you will need a dedicated internal marketing team. If you don’t have one, then you don’t take marketing seriously, and scaling the business will be an uphill battle. Internal marketing is necessary to create and direct strategy, develop processes, execute the plan and manage both internal and external resources. As a business gains market traction, increasing success, its marketing needs will develop, becoming more sophisticated and expansive. At this point in the cycle, the focus often shifts to accelerated growth by scaling operations, expanding the customer base and increasing market share. This can be the most demanding and exhilarating time in a startup’s story, but it will be difficult to achieve success without a fully financed, staffed and functional marketing team.
Focus on What Delivers Results
While an internal marketing team may grow, external agencies, freelancers and consultants still play a crucial role. They provide expertise in areas where the internal team may lack the required specialist skills or because outsourcing saves time and money. Some examples may include web development, press relations, international market expansion, advanced analytics or large-scale campaign management. During the scale-up phase, marketing efforts will focus on brand positioning and lead generation to support growth. Internal teams can handle day-to-day core marketing operations, while external resources may supplement these activities and manage special campaigns, such as new market entries. The two streams are not separate and must work together seamlessly as one unit.
Post-Funding Expansion
After securing funding from investors, startups usually enter a phase of aggressive, strategic growth, often involving international expansion. The primary focus is on achieving scale by entering new markets and solidifying the brand’s position as a leader in the industry. By this stage, it would be unusual for a startup not to have an established and multidisciplinary internal marketing team. These teams work on strategic initiatives, brand building and maintaining strong relationships with customers and partners. External resources will continue to play their part, mainly because there are so many pieces to fit together, and there is no sense in doing everything in-house. Decide which marketing activities are core to the business and ensure there is a high level of competency in those key areas before taking a view on other aspects that can be delivered by third parties when appropriate.
Third-Party Expertise
External resources continue to provide value throughout the different growth stages of a startup. They are particularly helpful in providing support and delivering special projects or during periods of peak demand. They can offer fresh perspectives, creative ideas, guidance on best practices and additional capacity for major campaigns and product launches. For startups looking to expand internationally, agencies with local market knowledge can help navigate cultural nuances and regulatory requirements. Internal teams coordinate these efforts to ensure alignment with the overall brand strategy. Agencies and freelancers may come and go, depending on shifting needs, but the internal marketing team is a constant function to be nurtured and developed, ensuring it has the conditions to operate effectively.
Long-Term Value
To be successful, marketing strategies must focus on innovation and differentiation. Startups need to continuously evolve their messaging and offerings to stay ahead of competitors, who will now have you clearly in their crosshairs and may regard you as a potential threat. External resources can bring additional value right when you need something specific that falls outside the day-to-day core activities but requires dedicated resources that may not be available internally. Complementing marketing efforts in this way can be more cost-effective for short-term projects or when specialist skills are needed. However, building an internal team and supplementing it will always provide more long-term value and greater control than outsourcing everything. A marketing function must not be regarded as a cost centre, but as an asset the business invests in to create multiples of that investment in financial returns.
Working as One
Working as a hybrid mix of both internal and external marketing resources ensures your startup has access to the broad range of skills you will need to grow effectively. Successful marketing requires the resources, systems, processes and collaboration with the wider business while managing and optimising all resources. When engaging with external resources, it’s important to establish a clear brief, open communication channels, shared goals, meaningful reporting and regular feedback loops to ensure alignment and maximise their effectiveness. By understanding the benefits and limitations of internal and external resources, marketing leaders can make informed decisions to continually improve campaign effectiveness and the return on investment.
Stay Flexible and Adapt
Startups may benefit from the agility and expertise of on-demand external resources at the very early stages. This may work well when budgets are uncertain and hiring people is not yet an option. As a business grows and before embarking on expansion, it will require a more consistent and robust internal marketing function, complemented by specialist external support. Ultimately, the key to success lies in a strategic, flexible and hybrid approach that adapts to the evolving needs of the business and market dynamics. Agencies can fulfil many marketing requests and act as a sounding board for ideas and the best ways to put a plan into action. You want to have a healthy and open relationship where they feel able to challenge your choices and make suggestions, just like an employee would.
Best of Both Worlds
Making the best of both worlds is the best strategy, engaging external resources in productive activities that help you grow and achieve success. Investing in a dedicated internal marketing team that will grow and develop along with the business is one of the requirements for startup success, just like having a sales team. Your marketing function will run all core activities so you can optimise and scale them to support growth and will manage and monitor all external resources to ensure they perform as required. The combination of internal core activities supplemented by third-party augmentation allows you to stay nimble and adapt to changes quickly without taking on the entire overhead.
You may want to read: “Startups Must Understand Buyer Personas.”
