There are other ways to make money without spending it!
I recently came across Haje Jan Kemps’ For startups, ‘we haven’t spent a penny on marketing’ isn’t always a good thing (blog),February 10, 2023, and all I could do was shake my head in disagreement. As a professional, I will respect the author’s position, but I have a few points of my own that I would like to share.
The main idea of Kemps’ article is that start-ups – of which some of you may be – need to spend money to make money. According to him, “If all of your growth so far has been organic, you might not know how to accelerate the business. After all, you wouldn’t even have a benchmark for what it costs to acquire new customers.” In my opinion, this only holds true if the new business is funded by venture capitalists, and has a significant amount of capital allocated to advertising its new product or service. What concerns me about this idea is that it encourages new businesses, who don’t have significant capital, to spend money without considering other factors like sector and budget. This thought proports that paid advertising is the only way to market oneself, and I believe that it is not.
In today’s world, where every penny counts I believe in the value of organic advertising here’s why:
Remember guerilla marketing? It was a marketing tactic that started in the ‘80s as a low-cost approach to spread a message. It required two things: face-to-face contact, in the form of a major event, and word-of-mouth, not fancy advertisements or paid celebrity endorsements. Forty years later, guerilla marketing is still being used as a low-cost, or no cost method with one slight modification – it’s moved online and doesn’t always need a big event to reach the masses. It still uses word-of-mouth, which is now called “organic” in the form of “likes” and “follows,” and is exponentially faster with much greater impact. It still doesn’t need a major financial investment to institute, there isn’t any real risk, and it’s a great way for start-ups to grow their audience while having the ability to monitor and prepare for their growth.
There are plenty of start-ups who have the bankroll to support spending money on marketing, but from my two decades plus experience those businesses are the exception and not the rule. Before you invest dollars into advertising consider these steps:
- Make certain your business is financially healthy. This means that if you were going to take a chunk out of your coffers to execute a paid advertising campaign your business can sustain itself following this expenditure. Generally, paid advertising requires a commitment that may take from three to six months to yield results. Make sure you can make payroll while you are spending these dollars before you set out on a paid campaign. You don’t want to be left with a beautiful :30 sec. spot and no one on your staff to get the work done!
- Make sure all areas of your business are ready! Let’s say you hit it out of the ballpark with your paid campaign, and business is booming. The worst thing that can happen is that your business grows too fast, and you aren’t ready. Yes, the money is rolling in, but you don’t have enough personnel to answer phones, take orders, or fulfill requests. While the advertising campaign is growing in momentum, you need to pay attention to what is happening in the other areas of your business. Don’t neglect hiring and onboarding new staff if that’s what you need to satisfy customers. Maybe you need to concentrate on your processes to ensure that they are efficient, or perhaps you need to look at streamlining what you offer so you aren’t juggling more products than you can handle.
But, let me be clear: Paid advertising is a strong, proven method to help build your business. With paid advertising you receive important data that allows you to adjust your spending so you can maximize your dollars, see trends, and really get to know your audience. But before spending a penny on it the most important thing you need is:
As a marketing consultant, I look at both paid and non-paid advertising tactics and do my best to find my clients the most cost-effective ways to market themselves. Sometimes, we strictly concentrate on non-paid, organic methods while we get a sense of the market. Other times, there are clients who have the necessary protocols in place to launch a major paid campaign. Either way, I look forward to talking to you about what options are best for your business right now so that it, and you, can reach your future goals!
3. Have a solid message and brand. I cannot stress enough how important it is for your business to
have a clear and concise message about what it does, who you are, and what you believe in. I have
worked with many businesses who have been doing fine for years, but they have never put to paper
their values so that they can clearly articulate what they do. Having a clear focus lets your clients and
customers know you, and what you can do for them. If you have never been able to create a clear
and concise value statement let’s get together. This is the first step towards building a brand.