As a result of the downturn in the real estate and financial markets beginning in 2007-2008, many professionals changed careers. From realtors to lenders and from developers to appraisers, people left the lending, construction and real estate industries in droves. As the market contracted, many small companies went out of business. However, in recent years as the market has rebounded, professionals are slowly returning to these industries. Many are starting new businesses. Also, the adult children of real estate moguls and successful entrepreneurs see this as a good time to leave the parental nest and start businesses of their own. Moreover, changing market conditions has created opportunities for new businesses that never existed before such as crowd funding and trailer document tracking. For these reasons, real estate, building and lending startups are springing up at every turn.
Even though many of these startups are being led by seasoned professionals, starting a new business can be a challenge for even the most experienced businessperson. It is especially true for any startup on a tight budget which, let’s face it, includes most startups. While professionals launching a business in real estate, construction or finance may have a lot of technical knowledge and industry experience, they may not necessarily have much marketing know-how. Here are some basic marketing tips to keep in mind for any folks starting a new company or expanding their business with a new division.
Top Seven Marketing Tips for Startups
1. Research, Research, Research.
It’s been said that the three most important factors in real estate are location, location, location. For a startup in the real estate or lending industries, the three most important words are research, research, research. It is important to do a lot of homework before even deciding on a name for a new business. It is critical to research the competition thoroughly. A solid market analysis is a must. Which competitors are most successful? What do they do and how do they do it? What reputation do these competitors have? Are there any areas in which their products or services can be improved? Is there a need for a company that can deliver a product or service better or faster? After all, necessity is the mother of invention. Is there room in the market for another company providing the same product or service? Sizing up the competition is the first order of business.
2. Know Thyself.
After understanding the competition, the next step is to carefully define the new business.
What will this new startup provide that isn’t being satisfied by competitors? How will the startup deliver that product or service better or faster? The person forming the startup should ask a lot of questions of himself (or herself) and also speak to knowledgeable, trusted advisors and mentors in the industry. Gain an understanding of industry jargon and issues. Identify what clients want and need… perhaps even things the customers themselves may not know they need. Synthesize the answers into the key elements that will be the focus of the business. This information will likely change over time, but it is important to have at least a clear starting point of the company’s purpose. According to Wendy’s founder Dave Thomas, what is needed to start a business are three simple things. “Know your product better than anyone; know your customer; and have a burning desire to succeed.”
3. Win the Name Game.
What’s in a name? In today’s overcrowded, noisy, cluttered marketplace, a company’s name is very important. It is vital for a business to have a name that is recognizable, unforgettable, enchanting and/or impactful.
Tech startups, for example, chose names that are memorable or meaningful. Consider the name ‘Google’, probably the most well-known brand in the world today and a term now used as both a noun and a verb. Legend has it that in 1997, Larry Page and Sean Anderson were brainstorming names for a massive data-index system with some other grad students at Stanford University. Anderson suggested “googolplex”, which is one of the largest describable numbers. Page shortened the word to “googol”. Anderson immediately went to check the availability of the domain, but when he typed the name online, he allegedly made a few mistakes, keying in “Google” instead. Sergey Brin and Page liked the name and the rest, as they say, is history… albeit recent history.
Page did one more important thing. He immediately registered the domain name for himself and Sergey Brin. Choosing a name is not just about finding a name and liking it. Selecting the name for a startup requires online research to see who else might have that name and determining if the domain is available for purchase. If a startup chooses a company name that is brilliant but the domain is unavailable, that is marketing suicide. Selecting a company name for which the domain is taken is like starting a secret business which most people will never come to know. The company name and domain should match as closely as possible and the domain should be easy to remember and write.
4. Create a Corporate Identity and Brandbook.
So many professionals think that a company’s identity is its logo or workmark. It is not. A logo is just one element – usually the most used and most recognized part — of a company’s identity. Identity includes logo or workmark, colors, typefaces and typographic treatments, slogan, use of space and negative space, icons and more. The elements of the brand should be uniquely identifiable, simple enough to be instantly recognizable, pleasing, engaging, thought-provoking, relevant, timeless, and easily used.
When creating all of the elements for a startup (and they should be created at the time that the company is created — not weeks or months or years later), the information should be cataloged in a brandbook. A company’s brandbook is a reference material containing information about the company’s identity and its use. It clearly describes what should and should not be done to maintain the positive image of the brand. Every respectable company should have a brandbook in order to make it clear and easy for staff to follow the rules of the company’s identity and protect the brand.
For example, while a company’s logo should always be rendered consistently, there will likely be a need to have variations based on placement and usage. Most companies have color and black and white variations of their logo, as well as versions for horizontal and square applications such as on a website banner or envelope. Yet all the logo variations of a company should have the same essential qualities, which are then shown in the brandbook along with how they are to be used.
5. Find ways to Differentiate.
Marketers commonly say “differentiate or die.” But, in a highly-cluttered, ultra competitive marketplace, how does a new company differentiate itself from the rest? After all, if a new company’s marketing sounds like everyone other competitor, then why would a customer choose a startup over an established company? To be effective, a startup’s market positioning must be clear, compelling and, most importantly, differentiated. How does a company differentiate itself when –truth be told – it’s not that different from the rest? For instance, so many companies claim that their products are “innovative”, their services are “world class” and they deliver “excellent customer service.” These are standard (stale?) buzzwords that marketers commonly use for positioning. Instead, new businesses should find or create real differences that can be leveraged in the market.
Case in point. It could be argued that computers are all alike. However, Steve Jobs understood that Apple’s niche was in its computers’ sleek design and user-friendly interfaces. Decades after the first Mac was introduced to the market, Apple still has a loyal following of fans that appreciate Apple’s commitment to great design and function. Each startup must identify the real differences that set the company apart from its competitors. It could range from such things as product design, the customer experience, the company’s specific expertise, or even the company’s service model.
6. Expect to Change.
In the beginning, every person starting a new company has a fuzzy sense of the company’s purpose, identity and focus. A startup’s messaging, marketing strategies and sales approaches are still young and untested. That’s fine. With time, the business leadership should not only expect but be open to accept changes in the company’s identity, direction and approach. Those changes might be minor or they might be a complete about-face from the point of origin. A startup might need to change its target audience, its products or services or even its name. That’s fine. One of the key things any startup can and should do is to test a variety of strategies and approaches… try different messages….and be willing to experiment with a plethora of tactics to connect with customers and build a customer base.
7. Start Marketing…. at least the Basics.
Many startups begin with an idea or a solution to a problem. A product or service is developed. The entrepreneur then casts a line into the business waters to see if there are any bites. If there are a lot of bites, a business is born. Often the first sales and customers come with little or no marketing at all. For the entrepreneur, it is all too easy to fall into the habit of continuing to cast the line and fish without taking any steps to expand the company’s reach, develop its customer base, define its audience or expand its territory. It is only when there are fewer bites or more fishermen fishing in the same waters that startups turn their attention to marketing. It is not unusual, then, to find startups that have been in business for months or even a few years that haven’t invested time into even basic marketing.
From law firms to lenders and from developers to interior designers, many startups won’t even bother to have stationary printed or a website created…. And those are the basics. Today, a company is not really considered legit without at least a website and a professional is not deemed trustworthy without a business card. Although they really don’t prove anything about a company or professional’s worth, things such as websites and stationary are generally viewed as some of the most basic elements of any real business. Determine what essential marketing elements the business needs in order to convey a positive image and invest in that right from the start. If that’s a branded powerpoint template, have it design. If the marketing support most needed is a branded powerpoint template, have it designed. If the most essential marketing element is a professionally-recorded voice message for the company’s phone lines, have it recorded. Just don’t wait. Keep in mind that the most successful startups – even those on a shoestring budget — spend money on marketing.
Starting a business is never easy. It takes a lot of planning and hard work. Investing time up front in a little marketing can go a long way to avoid problems and ensure that the company is successful and grows.
Quote of the Week
“The very first company I started failed with a great bang. The second one failed a little bit less, but still failed. The third one, properly failed, but it was kind of okay. I recovered quickly. Number four almost didn’t fail. Number five was PayPal.” Max Levchin
© 2014, Written by Keren Peters-Atkinson, CMO, Madison Commercial Real Estate Services. All rights reserved.