How startups have changed marketing as we know it
This article is an updated and abridged version of my most popular talk to date.
The 1990s: Big equals better
When I graduated from university in the 90s, the best jobs for marketers were in big companies — especially CPG firms where marketing was king and budgets were flush. I was lucky to get a job at a multinational consumer products company. Life was good.
In order to be eligible for better and new work opportunities I did what every ambitious big company person was advised to do at the time — I went back to school to get my MBA. I was drawn to a place known for fostering entrepreneurs. Even though the idea of starting my own company was alluring, working in a startup seemed like the cheap imitation of the real thing. Doing great marketing required great budgets, which startups didn’t have.
It was like the difference between being the real Elvis, or a cheap imitation. As a result, I continued to work for large organizations.
Late 90s: Things were changing, or were they?
In the late 90s, things started to change. Or at least it seemed to. Startups were getting funded like never before. I got a dream job running international marketing for a VC-backed startup, joining them when we were about 100 employees, through a NASDAQ debut and eventual acquisition. I spent half my time based in our European offices. Life was really good!
But was it really any different from my earlier work at large companies?
Turns out, not really. Despite ushering in a new era of communications, the internet boom of the late 90s took place in an environment where you still needed a lot of money to make noise. My marketing budget alone was in the high six figures and it went mostly towards hiring agencies, buying lists for email campaigns and having a presence at big technology trade shows like CeBIT. Why? Because this was still the only way to reach large numbers of customers.
The web felt like a digital version of the one-sided marketing we had already been doing for decades prior.
Eventually as we all know, the dot com boom turned into the dot com bust. It was a terrible time to be a startup marketer. <sadface>
The mid-2000s: Change is in the air
This downturn didn’t last long. And around 2006, a noticeable shift started happening that led to what I feel is the biggest change in marketing in the timespan of my career.
Shift #1: the social web created affordable ways to reach customers
I was working at a Toronto-based startup in the mid-2000s, but decided to fulfill a dream of opening a contemporary art gallery on the side of my “day job”. I was funding this completely out of my pocket so I didn’t have a huge budget for reaching customers. Turns out, I didn’t need one. I started using social media — the first Toronto gallery to do so — and before I knew it, I built a steady following that led to national coverage in traditional media and sales from around the country.
I wasn’t alone, of course. Startups like Buffer were reaching 700,000+ readers per month through their blog.
Shift #2: SaaS + decreasing cost of data storage brought new marketing technologies to market that startups could afford
It’s hard to remember a time when things like Google Analytics and Kissmetrics didn’t exist, but it wasn’t actually that long ago. In fact, I remember when a colleague told me in 2000 that eventually companies would rent their software, not own it, I thought he was crazy.
Fast forward to the last 10 years when services like AWS made it cheaper than ever to start companies, and startups saw an opportunity to sell SaaS solutions to marketers directly rather than going through IT. (I’ll explain why this matters shortly)
Shift #3: our expectations around work changed
If you asked people entering the knowledge workforce 15 years ago what they were looking for in their work, it wouldn’t be unusual to hear things like “Prestige, Security, Stability, Big Budgets, maybe even a corner office one day!”
People have changed and their attitudes about work have changed too. I would bet that asking the same question to people who entered the workforce in the last 5 years would bring answers such as “Making an impact, being able to work remotely, having undiscovered opportunities, flexibility, and working in a get-shit-done learning environment.”
So coming back to the premise of my talk (and this article). How has marketing changed as a result of what startups are doing?
Here are the 5 changes in marketing that stand out most to me:
1. Getting close to the customer
Marketing traditionally learned about their customers by holding focus groups, doing surveys and commissioning expensive market research. This is still the case in large companies. I am still surprised when I speak to a marketer who hasn’t had a conversation with a customer in weeks or even months.
Startups, not typically having these budgets or even the know how, adopted other ways to learn about their customers. The most common one — talking to them as often as possible. While not as scientifically rigorous as formal research, startups showed that companies — and therefore marketers in those companies — who were close to the customer developed an understanding of their pains, concerns and aspirations that led them to develop better products, programs and messaging.
Ryan Hoover of Product Hunt famously built his startup from a grassroots effort to talking with a community of like-minded people on Twitter and through email.
Pressly, another startup, uses a now-common-but-previously-rare technique of sending an email from their CEO Jeff Brenner, right after signup. Not a fancy, formatted, branded email, but a simple, single line introduction and offer to help.
This single tactic gave Jeff plenty of insights around the context and criteria customers were using to choose a platform like Pressly.
Startups are great at being “truly social” as my friend Tara puts it, using these channels to have real conversations with people, gaining fans and customers as a result.
2. Marketing operations
Another way startups have changed marketing is in having a bias towards action versus planning.
A trickle down effect of this is that marketing teams have to operate in a different way than their large company compatriots. Gone are the days of long planning cycles and in are the shorter smaller sprints. They are including in company daily standups and often sit alongside their design, product and sales colleagues.
What this allows startups to do is to learn and react more quickly to the environments they operate in, which are changing faster than ever before.
3. Hiring
A typical marketing team used to be comprised of different flavours of marketers. Direct mail, events, advertising, etc…
And getting a marketing job used to require 3 things:
- a degree (bonus if from a good school)
- upward progression through traditional marketing tracks
- demonstration of stability
Today, entry level startup marketing jobs are more likely to look like the ad below, in other words:
- know how to get shit done
- have a great attitude
Even executive level marketers are expected to have a more direct handle on every stage of the pipeline and a granular account of marketing’s contribution to revenue. And the people they are bringing onto their teams have titles such as Growth Hacker, Front End Developer, UX Specialist, Customer Evangelist and Content Creator.
4. Measurement
In the pre-startup days, marketers were measured by things like how many leads we generated, how many press mentions we got, and how much budget we secured.
Today, startup marketers use dashboards, which could look like the one below, they know about things like cohort analysis. In another words, they can better connect what they do with the outcomes they generate, and the tools are available for them to retrieve much of this themselves.
5. The definition of marketing
Perhaps the biggest change I’ve seen that I credit startups with introducing, is rethinking what marketing means.
Marketing used to the be the messages that the marketing department controlled.
Today, marketing is the sum of all experiences a person has with a company.
It’s how you interact on social media, it’s how you treat your employees, it’s the user experience of your product, and way you provide customer support.
What’s next for marketers?
It remains to be seen where marketing will go in the future. I expect we will see a continuation of the requirements that marketers will have a good handle on data, but I expect we will also find some limitations with an engineering-only approach, and value the importance of things like storytelling, brand and experience design, perhaps delivered in new ways and measured more closely.
In the end I don’t believe all startups do great marketing and all big companies market in archaic ways. I think we’ll see more cross-pollination of the two as startups grow and large organizations try to become more innovative.
What I can say is that marketing is changing, like much of the world, which is what makes it an exciting time to be working as a marketer anywhere.
Amrita Chandra is a startup marketer based in Toronto.
