It has been about six months since I wrote “On quitting my job, then working 18 hours a day, and entrepreneurship”. Since that time, I have spoken to over 100 entrepreneurs, product managers and C-Suite employees from all over the world. For a little background context, I run a digital marketing solution (MarHack) focused on early stage startups.
As part of my own customer discovery process, I reached out and spoke to entrepreneurs at various stages of success and enterprise. I spoke to nascent brands where the products were still in the whiteboard stage or, at best, a few months since launch, to startups who had secured their seed fundings, to brands who were focusing on rapid growth having received multiple funding rounds. I also had detailed conversations with some pretty cool bootstrapped businesses.
I’d like to clarify here, that when I say I had conversations, I actually mean a much more complex process than a 15 minute consulting call. I talked to founders, CEO’s and CMO’s at length about their business model, growth targets and product roadmaps. For many of them, wherever there was synergy enough, I ran deep audits on their marketing and product-development efforts and then created granular level strategies which could potentially give them the kind of growth scale they were looking for.
As you can perhaps see, soon enough, I started noticing common trends in the thought processes, goals and aspirations of these people. Some were great; I found the zeal to do something for themselves infectious. Others, however, were disturbing at the metaphysical levels of business and startup culture. There is something uncannily similar here to the size-zero culture that peaked about a decade ago and still refuses to die in some societies and industries.
Let me explain the size-sero analogy in more details.
There’s only one size.
When the “size zero” culture was rampant, there seemed be only one physique that was worth having; the emancipated, unhealthy, “size zero”. Only people with that size made it in the modeling industry, it was the pink slip to popular social groups, and anything but size zero was undesirable. Patrons of this culture did not follow a diet to be healthy and happy. They followed one to be eternally hungry, bitter and jealous of everyone who had already made it. Many beautiful young men and women lost their health, family, and sometimes, even their lives in pursuit of size zero.
When I spoke to all those men and women, I saw a scary “size zero” subculture within the startup ecosystems across the globe. It was apparent that “million dollar” world domination was the only reason for existence.
Don’t get me wrong, I am all for “moon shots” and “dream big or go home”. But not at the cost of building a product that actually can take you there. This run for world domination is creating a dangerous and unhealthy competition at the grassroot level. Let’s take a very real-word example:
Until a few months ago, there was a plethora of choices when it came to ordering food online here in Bangalore. In fact, Maya Bansal from OfficeChai ordered from as many as 18 different services in just 20 days! Some of these startups have since closed shop, others have reduced their market coverage or have undertaken many other drastic steps for sustenance.
Instead of focusing on solving delivery route optimisation challenges, ensuring healthy unit economics, or undertaking robust customer discovery processes, most of these players took on heavy cash burns in a bitterly fought discounting war that was downright ugly for the onlooker who knew what was happening.
Focus on the wrong KPI’s
The only factor that seemed to matter was how do we get “1000 transactions a day in three months” and how to attain the “biggest market share”. Instead of focusing on connecting with the customers, they fell into the product-first-marketing-second paradigm (explained farther into the essay). Massive amounts of cash was injected into offline advertisement like radio, print and even television. The only kind of digital marketing done seemed to be focused on new user acquisitions riding on incentivised actions like (again) discounts and rewards.
I am not privy to internal data of any of these startups so I can’t really comment on the amount of effort put into increasing the LTV of users in a traditionally sticky vertical. However, from what I experienced being an end-user to most of these startups, I’d dare say it was minimal. I only remember being bombarded with (even more) discount notifications on the phone (sometimes several times a day!).
Unassessed investment by a non-discerning investing community lead to more cash being pumped into the already volatile market. We saw swanky offices mushroom, news of massive hiring drives, even more Facebook App Install ads, more full-page advertisements on newspapers and even more discounts. It was a brawl!
As you can see, everyone was vying for the only size that mattered – size zero. Or, the only kind of market share that mattered – complete dominance. I see similar developments across industries and geographies.
The biggest things require the most patience: Said none of them
As I mentioned earlier, I have nothing against world domination. However, it should never come at the price of building a sticky product, finding a great product-market fit, discovering the perfect audience personas and being able to build a brand that people can connect with at a human level. The paradox here is that you can’t get to market domination without first nailing all of the above, and these take time.
Interestingly, the only brands that seemed to care about these were mostly the ones who had already attained some degree of growth and had lived to tell the tale. Most early stage startups were still looking for the magic wand solution. That’s really sad because the entrepreneurs were honest, hard working men and women who were churning 16 to 18 hours every day for at least a year if not more. It was decidedly painful to know that most of these hours were spent in finding magic spells (read “Growth Hacks”) or pursuing investment which, if acquired, would be put right back into the magic hunting campaigns.
Why everyone should be a media company but so few are?
I am a big believer in what Gary Vaynerchuck here talks about in his article “Every Single One of You is a Media Company”. With the amount of tools and platforms so readily available today, it is absolutely flabbergasting to see just how many brands still look to traditional ads and direct marketing as the only solution to growth.
In fact, it’s astonishing just how many people expect Content Marketing to be about just writing blog posts and sharing it on their own social media channels. Forget engagement optimisation, trying to garner the attention of their prospective customers or figuring out where they should be distributing the content they were creating (I am not even going to mention understanding what kind of content to create in the first place!).
In today’s world where the average smartphone user uses 11 to 20 apps every day and most likely receive a 100 push notifications daily, there is an immense amount of brand agnosticism. Coupled with the fact that most internet users are becoming increasingly ad-blind, there is no way a brand can acquire and retain the most valuable asset they can have – their prospective customers’ attention, without creating meaningful content and strategically distributing it.
The Product-First and Marketing-Second Approach
During the “size-zero” pandemic, it was believed that if you could somehow get that stick figure, the world would open up its gracious arms for you no matter what. You would have name, fame and money. Just get that figure!
In all my years of marketing, I have learnt that marketing comes before product. You need to start putting out content that speaks of your vision before you or your team have written a single line of code. Hell, marketing starts even before you had a chance to transfer the notes about your idea from the cafe napkin onto a proper diary for safe keeping!
What I have seen, is that although there is a marginally better understanding of the importance of product-marketing synergy, there still is a cavernous gap within the early stage startup ecosystem when it comes to understanding what comes when.
Who cares about micro-influencers (real brand ambassadors) anyway?
Again drawing parallels with the “size zero culture” because this is what the post is all about, people following the size zero figure seldom cared for what their true supporters thought of them – their family, close friends and well wishers. They wanted to be the next Diva and only their stamp of approval mattered.
Coming to the startup ecology, the same thing pertains. A brand’s most loyal customers are the first thousand or so early adopters – people heavily interested in the industry and small public figures. These people might not have millions of followers online. They most likely have a few hundred friends and followers. The industry blogger is probably a mom-next-door who writes about the challenges of cooking a daily meal while taking care of her kids. She is the one person you should care about converting because she sees the value proposition of your product far more deeply than any of the people you are trying to acquire for under $2 an app install.
However, this would take time. You will need someone to find these bloggers, create content that they can connect with, engage with them online and offer to collaborate with them for even more content. Who wants to get into that when you can get installs so easily on Facebook and AdWords?
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