A fortunate and friendly meeting in a café with a startup entrepreneur friend who has just passed the three year mark. I ask him how he is doing and how his business is doing. Like most IT companies of this kind, the answer comes down to three words: go out, operate, close.
Survive the consolidation
Most techno companies operate in hyper-competitive environments. The market of my interlocutor is consolidating and acquisitions are increasing. Soon, the market will reach a form of balance with a smaller number of “players”.Illustration of the game plan concept
It’s normal and very healthy, you say. However, this often has the effect of delaying the adoption of a solution by the customers, because they are waiting to see who will be the winner of this vortex.
How then not to die in battle because of the hesitation or the inertia of the buyers in front of the many changes in the market? How to generate sales and grow to, on the one hand, ensure the profitability of the company in order to continue its operation and, on the other hand, make it attractive to potential buyers – and exit?
Marketing is here to meet these challenges.
Marketing in the “tornado” phase
For many, marketing is a function limited to communication, that of branding and public relations. Admittedly, these are components of communication-type marketing, but marketing is above all a set of disciplines that aim to recognize and understand the changing conditions of the market.
Through business research, validations to target customers and the identification of motivating buying factors, marketing is an essential function that precedes and supports sales.
In a turbulent market, marketing plays a key role in the path of a startup to the corporate stage. The growth of the company is largely due to the good use of marketing to identify growth and high sales potential markets, as opposed to finding innovators ready to adopt an innovative solution. In a nutshell, marketing is about generating leads. Finally, it has a sales-oriented promotional function rather than promoting innovation.
In the “tornado” phase, it is crucial to make sales to “occupy the field”. Too often, IT companies neglect the marketing function and invest only in a sales force. They relegate marketing to the production of sales tools while marketing is there to generate growth, with marketing tools, precisely (business research, strategy, content, sales and after-sales support, etc.). .
Limited in their means, the techno companies lose sight of the fact that in market consolidation phase the time is not for innovation, but for the stability and maintenance of the proposed solution. Limiting development frees up financial and human resources for the marketing function. Once sales are triggered in a safer way, another phase of innovation would see the light of day.
Close is not an option
Before leaving, I wish my friend that his goal of the year is realized: that his company becomes profitable enough to reward his efforts and that it eventually interests a competitor for an acquisition.
This can not be done without adapting to the current consolidation phase and investing less in the short term in technological development.
This can not be done without obtaining sales and occupying a share of the market that is sufficiently interesting.
This can not be done without marketing, in the true sense of the word.