I was sitting on a panel when an attendee asked the question, “As a startup, how do I compete with the bigger companies? I can’t get the same number of followers, so what do I do? Is there software I should use?”
I was pleased to hear a fellow panelist respond that the goal shouldn’t be a certain number of followers, it should be first to produce valuable content and then to use the data to adjust course as indicated.
When my turn came to respond, I answered, “You shouldn’t spend your time comparing yourself to Facebook. Don’t worry about the complicated marketing tech or the numbers. Start with the things you can do that Facebook can’t.”
The moderator asked me to outline what I meant. Here it goes:
There is great power in being small.
Most of that power lies in forging tangible relationships with your potential customers (your people) so that you’re certain what you build and how you build it serves a real need.
“But it’s a great idea! I can worry about sharing it with people later.” Mistake. A recent article by the Harvard Business Review cites one issue that underpins the other primary reasons startups fail. Want to guess what it is?
“After analyzing 101 startup post-mortems, the reviewers found that 42% suffered from a lack of demand for the product or service being offered. They used a harsh phrase to describe this cause of failure: “no market need.”
Whenever I’m working with an early stage company, I always ask them if they’ve spent time talking to potential customers and if so, how much time they spend and what happened in those conversations.
The awesome thing about being small is you don’t have to rely on an algorithm or surveys to tell you what you need to know. You can go out and talk to real people about their real needs, problems, and desires.
Here are some reminders to keep you on the path of providing real value to real people:
1. Everyone is not your customer.
How many pitches have you watched where the market size is in the multi-millions because everyone could benefit? The truth is, your product or service is not for the whole world. It’s for a specific customer.
In fact, Seth Godin says, “Stake out the smallest market you can imagine. The smallest market that can sustain you, the smallest market you can adequately serve. This goes against everything you learned in capitalism school, but in fact, it’s the simplest way to matter.”
Being small means you can really focus in on defining that MVM, or minimally viable market. You must know your customer intimately in order to build a product for them.
In addition, the data suggests that people do not trust brands, news stations, or even CEOs. We trust each other.
When you’re getting started, make sure you build the value - and the trust — needed for people to recommend you to their peers. Having a market of thousands or even hundreds will give you a leg up on building that community as compared to trying to herd millions — even if you do get there one day.
2. Mass surveys and help desks aren’t your only option.
Big companies might have big data, but they often lack something more engaging: face time. As a smaller company, you can develop in-person relationships with your community including your customers, your partners and your team.
Since we already know that you’re focusing in on your MVM, this is your opportunity to listen to what they have to say. Find out what pain points they suffer from by listening to their actual stories and experiences — firsthand if you can. Technology cannot beat the act of meeting someone face-to-face and showing genuine interest in their lived experiences.
We often hear, “You’re not a number to us.” Well, if you’re a smaller company, you can actually, tangibly deliver on that promise. I myself still send handwritten notes and invest a good amount of my time meeting in person with current clients, prospective clients, and members of my community to make sure I’m building meaningful relationships.
And while these bonds matter in general, the ultimate reason for them is to make sure you matter in a critical way to your customer. You must ensure that what you’re creating actually solves their specific problems in the most effective way possible.
This may sound overly simplistic, but when you’re in doubt about what you’re doing, ask your customer. Most importantly, when you do get their feedback, respond accordingly. Since you can garner such in-depth feedback at this stage, you should take every advantage of it.
One day, you won’t be able to deliver on the personal touches, and something in your relationship building process will get lost. (We all know that the Happy Birthday Facebook sends us is a simple database entry.)
Make sure you’re building the relationships now to get the exponential ROI later.
3. You aren’t stuck.
You go out and talk to your people. In the process, you discover that what you’re doing, how you’re presenting it, or both is not resonating with them. They don’t see it as adding value to their life, which means they certainly aren’t going to pay for it.
Does that mean you close shop? No. You’re going to pivot.
Yes, your idea is brilliant, just the way it is. That innate belief is required for founders. But if your person is saying they don’t need it, you’ll need to pivot. Truthfully, you’ll probably do so again. They may be micro pivots, but if you’re always in tune to what you MVM needs, you’ll be evolving on some level as you go.
In some cases, it may mean that you need to completely abandon your original idea, or original company. It doesn’t mean you failed; it hopefully means you listened and are going off to make something that your people do need.
Massive corporations make major changes at a sluggish pace due to all their red tape. You should see your small size as an opportunity to make the changes you need to make while you can make them with relative ease.Take advantage of the fact that you don’t really have any to ensure you’re always meeting your customer’s needs with tangible value.
All founders start companies with big dreams for where it can go. That can lead to the belief that their early stage company should behave like large corporations from day one. This belief undermines the power — the inherent advantages — of being small.
One of the most important advantages is the ability to connect one-on-one with the people you’re attempting to serve.
Knowing that necessity is the mother of invention, take advantage of your smaller size in your earlier years to invest in your market. Develop real relationships with your person, and listen to what they have to say.
This is your time to make sure you know the promise you’re making, who you’re making it to, and whether or not you can deliver on that promise.
Face time matters. Go have coffee.