4 keys to startup advertising

December 5, 2011 2 Comments

Startups usually don’t do much advertising in their early stages. Entrepreneurs either think that it will be very expensive, or they don’t get this idea at all to advertise their startups and related offerings. Advertising does have the potential to make your biz get more eyeballs and hence more business. Advertising is an integral part of your overall marketing strategy . It can be done through either or a judicious mix of search engine advertising, banner advertising, magazines, newspapers, business directories, radio ads, TV commercials, billboards, mail campaigns, flyers etc. However you need to plan well before using advertising as your tactic for your Startup.

Well planned advertising can help you achieve the following,

  • Attract new customers
  • Enhance your reputation by building credibility in the market and establishing your brand image
  • Promote your product or service and boost your sales over time

Keys to successful Startup advertising,

  1. Research: The key step in your advertising is to research and know your audience. Whom do you want to target through your ads. Research into the demographics of your target customers. You should know this segment well and what mediums they generally use. That will cut down on your advertising costs and also will make your advertising focused.
  2. Planning: The mantra here is creating ‘to the point’ message that you are planning to convey, and keep it simple. You have to ensure that you are not putting across confusing messages to your potential customers. Plan your advertising carefully and use the right medium.
  3. Uniqueness: If your advertising is a boring one, it will not be effective. Try to make it distinctive and visually appealing. Also, frequency of your ads will deliver better outcomes.

Patience: And last but not the least, you need to have patience to see positive outcomes of your advertising. It will take time and effort before your targeted audience turns into your customers.

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Business mentoring for your startup

December 5, 2011 1 Comment

Even though you may have a constant stream of info through various sources based on which you make your startup decisions, but you may need wisdom of a business mentor to give the right direction and vision for your startup to steer towards the growth path. Mentoring can help improve productivity, build better business relationships and help to retain staff. Remember, a business mentor has more entrepreneurial business experience than you as they have ‘been there done it’ before. Read the full post HERE

However good your idea, there is no substitute for experience. A mentor will be your reliable sounding board, providing advice and guidance to help you overcome challenges as your business grows, and even give you emotional support in those dark times. Mentors can help you identify your strengths and weaknesses and can also provide you with some useful contacts when it comes to raising finance or finding suppliers, resources, or even developing your market base. Remember, that mentors are NOT consultants. They usually don’t charge any fee. Their motive is non financial, and most of the times they do it to sharpen their business skills or position themselves as strategists or teachers.

Finding the right mentor(s) can be hard for your business. Identify the key issues you want help with and look for people who have faced similar challenges and overcome them. Also look for domain expertise and the current networks they have. ‘Linkedin’ is one of the best places while searching for a mentor. Also, don’t hesitate in asking your friends, family, former bosses and business contacts if they know anyone with relevant experience. You can approach people you already know too – however be confident about differentiating between professional and personal relationship with the person. NETWORKING is the key to find the most suitable mentor for your startup.

You will need to put in efforts to build a good relationship with your mentor that creates a win-win ecosystem. This is important if you want to get the best out of mentoring. Communication is the key. Keep in regular touch over email. Do share your small glories, and make an effort to meet them for a face-to-face discussion when you want their help in solving key issues. Also, though you take key business advice from your mentor, don’t expect that a mentor will solve your every startup problem. Remember that it’s your own startup, and a mentor is there to guide you and not spoon-feed.

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Sales forecasting for your startup

December 5, 2011 Leave a comment

Most of the smaller and early stage startups do not take Sales Forecast for their businesses seriously. Your sales forecast also forms the backbone of your business model. Without a sales forecast for your Startup you cannot get the real picture of cashflow (expenses, profit and growth). Remember, Cash is the key to keep your Startup afloat! Read the full post HERE

Forecasting is usually easier when you break your sales down into manageable parts and then forecast the parts. Estimate your sales by product line, month by month, and then add the product lines for all months. Project monthly sales for the first 12 months and annual sales for the following three years.

What you need to do?

[Read ‘Economics of your Startup’ and you can send request for the FREE Template]

1: Develop a customer profile based on their demographics and determine the trends in your industry/domain. Make some basic assumptions about the customers in your target market.

2: Develop an in-depth profile of your target market. Use available statistics and research data to determine the general characteristics of this market. You can do some primary research, like user survey to determine unique characteristics about your target market.

3: Prepare Competitors profile already doing business in your target market. Prepare detailed competitors analysis, which will help you in your product/service positioning, pricing, innovative promotional techniques among other things.

4: Estimate your sales for your first year. The basis for your sales forecast can be the average monthly sales of a similar-sized competitor’s operations who is operating in a similar market. Be sure to reduce your figures by a start-up year factor of about 50% a month for the start-up months. Using your research, make an educated and rational guess at your potential market share. For example, if the size of the market is 1000, and your Startup is targeting at capturing 10% of the market (100 customers), I will recommend you to keep it conservative and reduce your figure by approximately 15%.

Don’t expect your sales forcast to be perfect, just make it reasonable. All it takes is good working knowledge of your Startup, and not advanced knowledge of finance or complex mathematics. Once you get hang of numbers, you are going to enjoy them! 

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Economics of your startup

December 5, 2011 Leave a comment

Usually entrepreneurs describe their products & services as they see them. It’s important to describe them from your customers’ point of view. Look the difference between features and benefits of your product/service, and think about them. You need to build features into your product so that you can sell the benefits. You also need to think hard and strategize on what after-sale services you will be giving? Some examples can be delivery, guarantee/warranty, service contracts, support, follow-up, and refund policy.

Customers

Identify your targeted customers, their characteristics, and their demographics. The description will be completely different depending on whether you plan to sell directly to customers/end users or to other businesses. If you are planning to sell a consumer product, but want to do it through a channel of distributors, wholesalers, and retailers, you must carefully analyze both the end consumer and the middleman businesses to which you will sell.

Competition

You need to think and carefully answer the following questions for your startups. What products and companies will compete with you? Will they compete with you across the board, or just for certain products, certain customers, or in certain locations? Will you have important indirect competitors? How will your products or services compare with the competition?

You need to honestly think about your product/service weaknesses. Sometimes it is hard to analyze our own weaknesses. Better yet, get some disinterested strangers to assess you. This can be a real eye-opener. And remember that you cannot be all things to all people. In fact, trying to be causes many business failures because efforts become scattered and diluted. You want an honest assessment of your startup’s strong and weak points.

Niche & Strategy

Now that you have systematically analyzed your industry, your product, your customers, and the competition, you should have a clear picture of where your company fits into the world. Consistent with your niche, you can outline a strategy for your startup.

Pricing

Develop your method of setting prices for your product/service. Does your pricing strategy fit with what was revealed in your competitive analysis? For most startups, having the lowest price is not a good policy. It robs you of needed profit margin; customers may not care as much about price as you think; and large competitors can under price you anyway. Usually you will do better to have average prices and compete on quality and service.

Sales Forecast

After you have laid down comprehensive information and plan for your startup in detail, it’s time to attach some numbers to your idea and prepare your sales forecast.  You may want to do two forecasts: 1) a “best guess”, which is what you really expect, and 2) a “worst case” low estimate that you are confident you can reach no matter what happens.

Do keep visiting our Blog for a specific post on Sales Forecast and a Free spreadsheet.

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