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Building a Marketing Execution Engine for Start-ups

The ‘perfect’ ingredients for the success of a startup and SMEs would be a great idea, robust strategy and a strong team with the ability to execute the strategy and sustain the success. None of the ‘ingredients’ are complete without the other: building a startup or a small business is already extremely tough, hence a robust marketing strategy and execution are a must. Customers today are inundated with choices and with the phenomenal reach and interactivity of digital touch points, building a complete brand experience is becoming more important than before.

Limited resources, unfavorable timing, low visibility, bandwidth and other issues could seriously hamper the proper execution of the marketing strategy. To deliver a punch and lasting impact and gain sustainable ROI, marketing execution must be done right the first time.

Invest Behind Customer Insights

Gaining a deep understanding of customers is critical to the success of any brand. It has been for years and still remains a key source of competitive advantage for companies. Getting to relevant customer insights involves two parallel processes.  

First, getting ‘hard data’ from different sources and in today’s world there are many touch points from where data can be had. Some of the common data sources include shopper data, social media listening on your own brand pages, quantitative surveys and tracks that are undertaken from time to time. Good companies organize this data well and enable anyone in the organization to mine the data easily.

The second parallel process is ‘soft data’, which one should get by speaking to customers using traditional techniques like focus groups, depth interviews and observing consumers to understand the customer journey and the ‘reason why’ for their actions. Usually, both forms of data throw up a lot of potential insights and it is important to funnel down to the most powerful insight for the business.

“A good way to zero in on what matters most is to use the 3R Model – the insights should be Real, it should Resonate and it should be Relevant to most of your consumers.”

A good way to zero in on what matters most is to use the 3R model- the insight should be Real, it should Resonate and it should be Relevant to most of your consumers. The 3Rs can be validated using qualitative interaction modules and even checked using quantitative techniques.

Most companies today have a large amount of ‘hard data’ but are not investing enough in getting to know their customers and really understanding the ‘why’ for their actions. It is the combination of both ‘hard data’ and ‘soft data’ that results in competitive advantage that is very difficult to replicate. Good powerful insights drive not only marketing but are also core to building capability that is important to build a culture of customer centricity.e

Positioning with a Higher Order Purpose

Brands that are positioned well occupy a space in the minds of customers. It is important that start-up brands develop a position that clearly defines the functional benefit of their product or service (the job that customers want done), the emotional benefit (the feeling they derive from the service) and a higher order purpose (the reason why the planet needs the brand), which often differentiates the start-up from a crowd of players.

Brand positioning is a complex task that can be sometimes left to the intuitive brainpower of entrepreneurs but in most cases needs to be worked upon using techniques and refined over time. A good positioning usually involves defining the most important product or service attribute and linking it to functional and emotional benefits with a purpose.

“A useful way to look at functional & emotional benefits is by closely examining your target group, their day journey and identifying usage occasions where your brand or service fits in”

A useful way to look at functional & emotional benefits is by closely examining your target group, their day journey and identifying usage occasions where your brand or service fits in. Once that is done, in a competitive market, it is important to work towards benchmarking and getting to ‘parity’ where competition is strong and establish ‘points of difference’ where you would like your product or service to excel. It must be kept in mind that just getting to parity with competition is not enough – ‘Points of difference’ are important and also should be done on benefits that relevant category drivers that influence the final purchase in the category.

In the rush of getting early numbers, the question of defining the positioning is either left to the intuition of customers (which is sometimes okay for a first couple of years) or kept indefinitely for later, which is a mistake because it leads to confusion among customers and stake-holders on what the brand really stands for.

Getting the Marketing Execution Right

Execution of innumerable ‘moving parts’ is no mean task and taking them to the market as a seamless whole is known to give sleepless nights to those at the helm.

“One of the most important imperatives in execution is achieving common ground in thinking between the strategy team and the execution team. “

One of the most important imperatives in execution is achieving a common ground in thinking between the strategy team and the execution team. The strategy team would have great ideas,  in fact in most cases more ideas than can be put into practice and the marketing execution team would have the best intentions and robust strategies to put the ideas to action. However, without a common understanding of the possible complications and obstacles, execution would be subpar leading to some serious consequences for the brand. It is therefore important, especially in start-ups, which the strategy team and execution teams are joined at the hip or are one team and if they are not one team they must actually pen down a common ground with agreed metrics.

The second important execution imperative is to identify the stage in the customer journey where investment is required to acquire customers. For many years, companies got their first customers by investing first in building awareness to get customers to try their brand and then invest more to build loyalty.

“With – new media customers are now by-passing the awareness phase and now go through an extended evaluation phase on their own by searching what they need (not searching brands), reviewing many brands then trying the one that they find to be the best fit at the purchase occasion.”

With ‘new media’ customers are now by-passing the awareness phase and now go through an extended evaluation phase on their own by searching what they need (not searching brands), reviewing many brands and then trying the one that they find to be the best fit at the purchase occasion.

Marketing investments that help customers navigate the evaluation process and then help advocate are important to generate a positive word of mouth, which is the most important driver for success. For start-ups and SMEs, understanding this new customer buying cycle and investing behind getting their brand evaluation right is critical to get customers. In the initial years, this is also the more cost efficient way of building a customer base rather than spending more on generating just awareness.

As a startup / small business, it would be necessary to make a critical analysis of the processes / stages within your existing marketing execution practice. This will help identify potential risks, obstacles and even unexplored opportunities. Experts in this realm can help view the process holistically and ask the right questions to ensure that the brand experience is uniform across multiple channels and if there are inconsistencies find out why they exist and what needs to be done to remove them. In addition, the leading team and the marketing teams must have visibility and knowledge of the entire process of execution in order to have control and confidence in the success. Accountability with names of each stage of the process would ensure that each person does whatever is required of them.

In Conclusion

What matters at the end is reaching the target customer groups – and robust marketing strategy execution will help you reach them faster and ‘louder’. When the insight is powerful, the brand positioned is well and the market execution is right, your brand will compel your target customers to take action – will excite them to buy, recommend and buy again. Investing time, effort and money to get the right team for marketing strategy and execution makes for great business sense.

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Vectors of portfolio expansion

As brands mature, companies want to expand their product portfolios, sometimes to diversify and reduce risk and other times for chasing growth. Adding more products to a brand’s portfolio comes with management baggage. Most new products don’t make it big and the products that are added, often turn out to be too small to justify growth investments but are  too significant  to cut off since they added some vanity value to the top line. Strategic portfolio development focuses on leveraging existing capabilities, assets and resources while introducing new products carefully, thereby reducing incremental management overhead and increasing the chances of positive results from new products. In this post, we explore some of the approaches established brands can take to expand their product portfolio. Expansion on the depth of need All consumers of a solution aren’t alike. The base need for a solution may be same among various consumers, but different consumers value different outcomes. For instance, the basic need for a ride-hailing service is to get from point A to point B comfortably and reliably. But some consumers may have multiple stops and hence they are dissatisfied with having to wait for a new vehicle multiple times in a trip and a day-hire works out better for them. Similarly, there are consumers who have point-to-point routes which are too short for any value add to really be experienced. They’d rather pay less for a basic service and be ready to compromise on privacy for the short duration. UberPOOL caters to these consumers. By offering on-demand, ride sharing and for-hire models, Uber is able to expand its portfolio and cater to consumers who need more (and less) of their service.  Equity based expansion Another great vector to leverage and expand a brand’s portfolio is using the brand’s equity in the right solution categories. Most established brands are unanimously recognized for certain distinguishing traits among consumers. It could be things like being innovative, trustworthy, experts etc. That means that consumers expect those brands to act in the way they imagine and will be highly receptive to their products which live up to that equity. Brands can leverage this to enter categories where their equity is likely to be valued. A great example is that of Nivea, whose cold cream sells on ‘softness’ and being ‘safe for delicate skin’. Nivea leveraged this equity and extended the brand into several categories such as body lotions, deodorants, and even after-shaves for men. They’ve captured  a small, yet significant share in all these categories successfully.  Context based expansion One classic yet underestimated approach to expand a portfolio, is to simply build on top of core value of your existing product and make it relevant or viable in places where it currently isn’t. Snack and beverages brands know this tactic well. The same Pepsi comes in a 2L bulky bottle for home, a 600 ml carry bottle, a large iced glass at the cinemas, and a 250ml that you can hold between your index, pinky and thumb as a style statement. By taking this simple idea seriously, the same cola has penetrated into multiple occasions with no change but how it is served and consumed.  The ‘pffs’ sound of the can, and the handiness of the carry bottle are integral to their occasions, and effective in their execution.  Complementary solution expansion Most solutions don’t perform the full job that the consumer is trying to do. For instance, shampoo might clean a consumer’s hair, but cleaning one’s hair isn’t the whole job that the consumer is trying to do. The consumer is trying to clean the whole body, smell good, and look & feel presentable. The consumer probably uses multiple solutions to complete the full job. If a brand is used in any part of the job, it can leverage the opportunity to introduce solutions that help do more of the job more effectively or efficiently. For example, keeping hair healthy is essential to the complete job of looking and feeling presentable, yet many consumers don’t use a conditioner. Shampoo brands have introduced shampoo + conditioners to help consumers do more of the job, better in less time and consumer pay premium for it.  A combination of the above approaches may be deployed to increase returns without bloating portfolios and increasing management complexity. 

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Why CPG firms should leverage incubator partnerships

Incubating new brands or product lines and making them independently successful is quite different from growing established ones. Although the competencies required are similar in nature, the context under which both objectives are pursued are widely different. When growing established brands, a lot of information – awareness & equity of the brand, pricing benchmarks & power, costs, competitive differentiation etc. – are already known. Whereas, when incubating a new brand, these building blocks – and many more, have to be built and made to work well together, for the brand to sustain independently.  In theory, one can accomplish this feat with enough grit and trial-and-error, provided there are enough resources to burn through. In reality though, the task is to get there before competition catches up – or the venture runs out of funds. Therefore, in the case of incubating ventures, prior experience incubating an innovation, relevant consumer insights,  experience in keeping a venture afloat with little information and managing risks – all become huge advantages. But by the intrinsic nature of CPG product cycles, new incubations or product innovations aren’t undertaken very frequently and hence the above competencies may not exist or be available in-house. It is also difficult for firms to attract talent seasoned with incubations since it provides a limited canvas for them. Rather, CPG firms can access these competencies by way of partnerships with incubators. Full-scale incubators deeply augment a promoter firm’s existing capabilities and provide great leverage. Incubators offer venture incubation as a service by bringing enterprise, strategy, research, design, product, marketing and project management under one-roof with domain expertise and experience. The key tangible benefits of these partnerships are: Faster to market Due to their extensive experience with projects of varied nature, incubators knowledge and insights which is otherwise time consuming to generate, thereby being able to build a convincing business and investment case faster. Incubators have a well-oiled team with cross-functional capabilities in-house, which can otherwise take months to gather, just to get the project started. Incubators also have well tested frameworks, models and execution capabilities, which quickens the process through conceptualization, design, go-to-market and operations, without having to reinvent the wheel. Cost effective Incubators bring flexibility in deploying human resources as and when required, thereby bringing predictability and lower fixed costs. With proven models and frameworks incubators can help avoid a lot of wasted costs and optimize investments which are commensurate with the business scale. Better outcomes Prior expert experience that incubators bring help avoid common pitfalls thereby controlling risk to the venture. Expertise and superior operational capabilities increase the gamut of tasks that can be executed well, thereby giving the venture more shots at success. A broader understanding of the market, consumer, proposition development and competition greatly increase the chances of developing solutions that are really differentiated and motivate consumers to act. In conclusion, leveraging incubators greatly pushes the odds of success in favor of the promoter firm, at lower cost and time. NorthSide anticipates this to become a norm in the years to come.

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Do traditional consumer businesses need product management?

“We got rid of the classic product management function. Apple didn't have it either. We morphed the function to a more Apple-style product marketing function. We combined product management with product marketing and we said that you can't develop products unless you know how to talk about the products."  – select excerpts from Brian Chesky’s quote It is common in technology-driven companies products with new features fail due to poor positioning and marketing execution. The case of mismatch between product and its marketing remains true for traditional consumer businesses as well, where marketing over communicates the product benefits.  Traditional consumer businesses are equipped with sophisticated marketing expertise and the ability to position simple products in novel ways that motivate consumers to act. Most traditional consumer businesses rely too heavily on creating perceived value which excites consumers into trying, but products behind the claims often fail to deliver the actual value and low repeat purchases lead to failure of products. It would be hard to argue a case against developing products that deliver value that consumers can evidence (especially since it means charging more money). Then why do traditional consumer businesses not develop successful new products? In our collaboration with several consumer brands, we found that there is a mismatch between expectation and expertise that leads to this. In most firms, brand managers are responsible for discovering changes in consumer needs and for generating business advantage by delivering against them. However, brand managers lack know-how and research & observation techniques that lead to the level of nuanced need identification and specifications required for sharp product design briefs.  Since they are tasked with pushing the business topline and bottomline, they turn the only lever they know how to twist to deliver – positioning. One could argue that with consumer businesses, products don’t need to evolve as frequently, but with rising usage of more products and services per capita, many product and service formats have started competing with each other and hence purely relying on positioning and marketing execution is a unidimensional approach to competition. A good product manager would act as a creative problem solver and their agenda should be to strike harmony between all stakeholders and unlock value for all. In conclusion, a product manager would translate the concept or proposition into value that can be physically evidenced by consumers, while driving business results.

We are NorthSide. A strategy and execution company, that helps companies, incubate ventures and scale up brands by integrating market intelligence, insight generation, market segmentation, brand proposition development, creative services, e-commerce and quick commerce scale-up, all under one roof.

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