A Step By Step Guide to Building a Marketing Plan For Your Startup
If you haven’t noticed, marketing has moved ever-closer to center stage in business. For an emerging business like a startup, a well-executed marketing plan can make a big difference as it effects every aspect of the business — including and most importantly the bottom line.
“Nothing kills a bad company faster than good marketing”
But good marketing can elevate a great product.
“To be successful, you must match the way you market your products with the way your prospects learn about and shop for your products.”– Brian Halligan, Hubspot
What is a marketing plan?
A marketing plan consists of the strategies and devices you’re going to use to communicate to your target audience, engage with them and provoke a required result that will support your business goals. I recently created an e-book that contains detailed explanation of the different stages required to create a successful marketing plan. Some of these stages may seem obvious or trivial, but should be addressed never the less. I really hope you find it useful and that you implement the different stages to create a great marketing plan.
Below is a summary of the different stages required to create a marketing plan, If you want the full explanations and models please download the e-book.
The 6 stages of building a marketing plan:
You may think you have the best idea in the world, you just thought of the one solution that no one else thought of and you are going to disrupt an industry. And then you do a Google search…
Great ideas are everywhere, so it’s quite possible someone else already came up with the same idea and if that’s the case — you need to know.
Every idea has to start with a competitive research. Start with the basics — google search the problem your product or company wants to solves to find existing solutions. If you can’t find formal solutions, try to understand what is the alternative solution. What are people currently doing? Is there real pain there, or are the happy with the current solution?
Customer Development (user persona)
To be able to understand your customers you need to go beyond looks, you have to understand their personality. It’s not enough to group them into general categories like “students”, you’ll want to have a specific description (persona) — one that is so clear in your mind, that you will be able to use it to make product related decisions by asking “will X like it?”
I usually start with the obvious and build from there. Imagine your dream customer, your die-hard fan, the one type of person you know will love your product. Start describing this customer as if it was your best friend. Give them a name, describe how they look, how old they are, what they like to do. Are they athletic? Do they read? What are their goals and dreams? Once you have the big picture start narrowing it down into personality traits. You can use this diagram to help you focus.
Defining Pain Points
Here’s how you can try and identify your customer’s pain points:
1. Describe the pain your startup solves — and why anyone should care — in just a few words? Can you persuade prospective customers to purchase your product using your simple explanation?
2. Take your efforts to Google. Find Frequently Asked Questions related to your industry. This is a good starting point. FAQs arise because they address common concerns of a general audience. However, they are surface-level, so use them to dig deeper.
3. Go out and talk to your customers. There is no better way to fully understand customer needs. You can use the 5 Why’s questionnaire or develop your own questions. You should do these interviews face to face, but if not possible you can use online surveys as well.
The 5 Why’s technique: You start with a surface-level issue they need solving, and you ask them “Why?” five times to pull out the pain points associated with it.
4. Track what customers are talking about on social media (find relevant groups, forums and websites).
Defining Your Target Market
When you think you know who should be your target audience, consider these questions to make sure it’s a viable market:
- Market Size — Are you targeting a regional demographic? Male? Children? Know exactly how many potential customers are in your target market.
- Market Wealth — Does this market have the money to spend on your product?
- Market Competition — Is the market saturated? As in, are there many competitors?
- Value Proposition — Is your value proposition unique enough to cut thrugh the noise?
2. Brand & Messaging
USP and Brand Essence:
You can’t begin to tell a story without understanding why that story should matter to the people you want to serve. So how do you start writing your story? The first thing you should do is lay out everything that you consider to be your Unique Selling Proposition (USP). These are the highlights of what you provide & how it’s unique. Even if you haven’t put any thoughts into branding yet, you know your product or service and can describe what you consider to be the differentiating factors.
Once you have your USPs, look at each criteria and ask yourself “so what?” the answers for these questions would be your RTBs — reasons to believe. This is the backbone of your story & the marketing promise.
Now it’s time to take the next step and find your one core value, your brand essence. The hedgehog method or the 3 circles is taken from a great book by Jim Collins called “Good to Great.” You start by asking yourself three questions:
- What you can be the best in the world at. This goes beyond core competences. Make sure you also define clearly what you don’t do.
- What drives your economic engine? How to most affectively generate sustained and robust cash flow profitability (a single denominator).
- What you are deeply passionate about. The idea is not to stimulate passion but to discover what makes you passionate
You can find a full guide on how to find your brand essence here.
3. Goal Setting
Defining SMART goals:
“Would you tell me, please, which way I ought to go from here?”
“That depends a good deal on where you want to get to.”
“I don’t much care where –”
“Then it doesn’t matter which way you go.”― Lewis Carroll, Alice in Wonderland
You can’t get to where you are going if you don’t know where you want to end up. This is why you need goals, for direction, for motivation for setting expectations. Goal setting is a process that starts with careful consideration of what you want to achieve and why, and ends with a lot of hard work to actually do it. How do you come up with the right goals?
Evaluate your current status and review any previous achievements. Look at the company’s growth rate and asses what would be the growth in the next few month/year and try to estimate how will the marketing be affected by this growth. Which results will support such growth? The types of goals you should be setting depends heavily on what stage your startup is in. Early on, focus on engagement with a small community and collecting feedback to validate your product or service. Later on, focus on growth metrics that are tied to major business objectives (awareness, generating leads). Make sure your goals are authentic and specific to your business. Choose 1–2 core goals that impact the bottom line and an additional 3–5 goals that will support growth. Oh, and set up SMART goals. What are SMART goals?
- Time Bound
Setting up KPIs and metrics to measure performance
Key Performance Indicator (KPI) is a quantifiable metric that reflects how well an organization is achieving its stated goals and objectives.
“If you can’t measure it, you can’t manage it”
And more importantly
Anything can be measured (even “touchy- feely” things like creativity or employee empowerment) because if it doesn’t make a measurable effect — why does it matter at all then?
Sometimes people confuse goals with KPIs, here is the difference:
For a sales team, the goal might be to increase sales to $200 million a year. To do that, the KPIs need to be built around the process for generating profitable sales. Increase in the amount of traffic to the website, % of growth in CTR rate…
Prior to setting up a KPI, you need to answer the following: What is the decision this KPI needs to support? Don’t measure things because they are easy to measure and makes for nice information, think about what you are going to use the information you measure for first.
4. Customer Journey
User Conversion Funnel
Customer Journey Map
This is the funnel that customers go through, the different touch points vary from business to business. It’s important to map out the specific funnel a customer would go through when looking for your product.
It’s not enough just to point out the funnel and the different marketing tactics that can be used at every stage and every touch point. It’s crucial to map out the entire customer journey and focus on what the customer is going through — identify what they want & how they feel in every step and outline potential blockers or concerns. It’s also important to notice where and when the customers are satisfied, and what are the incentives encouraging them to move forward in the funnel.
5. Demand Generation
Owned, Earned and Paid Media
Inbound marketing is about using marketing tactics to bring potential customers to you, rather than fight for customer’s attention (Pull vs. push). Inbound marketing is about creating and sharing valuable content with your audience. By creating remarkable content, optimizing that content for search engines and promoting it through social media you’ll be able to attract qualified leads. The beauty of inbound marketing is that unlike paid media, it doesn’t stop working when you run out of budget or when a campaign ends. It’s always there.
Keep that in mind when generating content. It’s not so much about the format (blog post/newsletter/e-book) but rather about providing super valuable content. One more thing to remember, it’s relatively easy to get started with inbound marketing, but it takes time to see results, so be patient.
Outbound marketing is about using marketing tactics to identify, target and reach out to your customers (push marketing). This can include events and meetups, PR, paid media and advertising, cold email blasts or phone calls. Although it is sometimes considered intrusive, outbound marketing has its benefits, especially when you are just getting started.
- It’s immediate, as soon as you start paying you’ll see results
- Allows you to test several assumptions/variations of content to optimize messaging (A/B testing)
- Helps you reach early adopters (using targeted media)
Choosing the right channels
There is no wrong or right here. Choosing the right channels is up to you and should be based on the research you did on your target audience.
- At the end of the day, you want to show up where your audience is at. If your audience is hard core IT guys or developers, a platform like Facebook may not be the right place. If you want to reach millennials though, Instagram could be your platform.
- Don’t be tempted to operate on every channel out there just because it exists. It’s better to have an amazing presence on 1–2 platforms, then an average performance on 10 platforms. If you are not sure which channels to choose make some assumptions (I will find HR professionals on LinkedIn) and test them.
- Don’t be scared of new and raising platforms. Make sure your target audience is there (or supposed to be there) and experiment. Check out these Success stories for inspiration.
It’s very hard to estimate costs when you are just getting started. You can rely on your past experience and estimate or do a market research for every service you need. I recommend looking at this article that breaks down marketing to its essentials (list below) and provides an estimate for costs (in the US). The marketing essentials:
Branding / Website / Social media / Advertising / Content / Events / PR
In general, a startup or a young company (1–5 years) should plan to spend 12%-20% of gross revenue (or projected revenue) on marketing. If you are working with a limited budget prioritize the list of essentials and invest in the ones that bring the best results (that will require some testing at the beginning).
Make sure you tie your marketing budget to your marketing activities (as explained under setting up KPIs) like a percentage of qualified leads or paying customers. If your marketing plan is working, then the more you use it to convert customers, the more you should consider spending on your marketing efforts.
How do you tie marketing to paying customers? Compare on the amount of money you spend on a specific channel or tactic to the number of converted customers from that channel X revenue from each transaction. If you have a subscription model, estimate the life time value of a customer to get an average number. Positive unit economics: The revenue from your marketing efforts is bigger than the cost of user acquisition.
Don’t forget, everything can be measured including brand awareness and exposure, but some costs are required to set up the infrastructure (like website) and will it take longer to see the ROI. Make sure you take those costs into account when planning your budget. To keep everything organized, use this free template to manage your marketing budget.
Marketing is no longer just marketing
The role of marketing in startups id no longer restricted solely to advertising or branding. Marketing is part of the product development and every business goal set by the CEO. you can’t create a marketing plan without getting more people involved, so regardless of your size, get feedback from all stake holders in your startup: Product, Technology, finance, manufacturing, personnel, BizDev etc. Whether you like it or not, it will take a village to make your marketing plan work. The key stakeholders will provide realistic input on what’s achievable and how your goals can be reached, and they can share any insights they have on potential opportunities, adding another dimension to your plan.
You can download the full e-book here and please let me know if you have any questions or comments.