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Startup Marketing in a Nutshell, or Things I Learned in 6 Years of Helping Startups Grow.

What is digital marketing

You have a product. That product can be used by certain people - your potential customers. All your activities aimed to connect your product and your potential customers are marketing.

You can use analog or digital channels for your marketing (think billboard, event flyer, business card VS google ad, website, facebook page). When you use digital channels to reach your potential customers, you do digital marketing.

Wikipedia says: “Digital marketing is the marketing of products or services using digital technologies, mainly on the Internet, but also including mobile phones, display advertising, and any other digital medium.” Considering today’s digital transformation trend in business, it is safe to assume that most, if not all marketing activities will very soon become digital.

Digital marketing can be divided into subgroups based on a type of a communication channel you use to reach out to your potential customer: Social Media marketing, Search Engine Optimization, Content marketing, Email marketing and Automation, and so on.

Most tech founders do not focus on marketing at all until they get through their first big funding round. This explains why lack of market need is number one reason for startups to fail.

What is marketing strategy

For a startup, marketing strategy includes few aspects:

Product Marketing  - this includes all marketing activities aimed on:

  • Understanding market conditions, landscape and opportunities.
  • Developing and improving product that customers need and want.
  • Building go-to market plan that ensures your customers discover your product.

Business Marketing  –  things and activities needed to be visible and attractive to potential business partners, investors, advisers, and future employees. For example:

  • Investor pitch deck.
  • PR and business communications.
  • … and many more.

Internal Marketing  -  this includes activities and tools needed to ensure your business idea, vision and values are widely accepted and used by your fast-growing team. It also includes activities aimed to ensure your company looks attractive to your employees and potential hires.

Most marketers and marketing resources focus on first two of them; most tech founders do not focus on marketing at all until they get through their first big funding round.

This explains why lack of market need is number one reason for startups to fail, and having a wrong team is the third one.

Let’s look at marketing as a part of startup business strategy.







How is marketing strategy different for a startup

The difference between a startup and any other business is laying in its main business goal. A business is normally shooting for stable, long-term profitability, and a startup is focused on fast growth and has an intent to relatively quickly become a large company.

Marketing for a startup should follow lean methodology: Build - Measure - Learn

In addition to basic business principles, marketing strategy for a startup should follow two rules:

  • It should follow lean methodology. In short, it comes down to simple 3-step program: Build - Measure - Learn. When working on your marketing strategy, keep this approach in mind.
  • It should scale. When choosing customer acquisition strategy, channel and activities, keep in mind that it should be scalable easily.

For example, if your marketing funnel includes one-o-one meeting with your potential client, and your goal is to add 1000 customers every months, it means your team have to have at least 1000 additional conversations every month. You might want to replace it with something different, e.g. webinars.

Understanding your marketing costs, metrics and KPIs

Your marketing budget can be divided into 3 main groups: marketing expenses, salaries, and opportunity costs.

Marketing expenses include all money you spend on your marketing (ads, marketing tools, events costs, and so on), plus costs of discounts and free products you give away as a promotion.

Salaries are the money you pay to your marketing team. They include payroll and consultancy fees (money you pay agencies or mentors / advisers).

I recommend be very careful with hiring people in house, especially on the early stage, since the only way to adjust payroll expenses is to fire someone or cut off his/her salary, which can be quite damaging for your team.

Finally, opportunity costs. Every time you spend working on marketing yourself, or ask someone on your team to do the work, you use the time that can be spent on something else. For example, when your developer fixes website speed to improve SEO, he doesn’t work on the new feature your customers want. Opportunity costs are hard to calculate, but are important to keep in mind.

Now, metrics and KPIs. Remember lean methodology: build - measure - learn? Take some time to understand how to measure your marketing efforts.

The key to a successful marketing for a startup is to find acquisition channel(s) that drive leads & customers at an acceptable for you business model costs and can be scaled. Therefore, when testing your channels, you have should keep in mind at least the following metrics:

CPA (cost per acquisition)  -  how much does it costs you to acquire a customer through a particular channel

Revenue per user for a certain time frame or LTV (lifetime value)  -  how much money does one user acquired through that channel generates for your business

Channel volume and growth potential (how many customers you can get through this channel and what are additional costs to scale)  –  this is needed to determine what to focus on first

Profit (LTV/# of users - CPA)  -  what is the final business outcome from this channel. You want to focus your marketing efforts on channels with higher profit.

Sometimes it is hard to figure out even those basic metrics since you have too little or no data; keep tracking them and with time you will get a clear picture.

Developing digital marketing strategy for your startup

As I said earlier, marketing should be a part of overall business strategy for your startup, preferably from day one. To make sure business and marketing are aligned, follow this steps when working on marketing strategy.

1. Learn everything you can about the market, users, potential competitors and companies who tried to solve the same problem before.

At the very early stage, your main focus should be on marketing research. Investing into this activities now can save you a great headache later. The more you learn about the market, users and potential direct and indirect competitors, the better product or service you can build.

While spending money on research might seems like an overkill when you don’t even have the MVP yet, it is better to discover what your future users need now then after you invested hundreds of hours and your 401K into building the product no one wants.

2. Figure out your WHY - why you build this product, what problem are you solving.

Define your business values and goals, understand what connects you and your customers, and formulate your USP - WHY people should love your product and buy it from you.

Make sure your company is using strategic approach to communications - you target right people, you know their values, pain points and success metrics, and you speak their language.

This is a good time to figure basics branding - logo, slogan, style guide, voice and tone etc. Those elements will help you create consistent feeling around your company and brand.

3 Plan your marketing activities.

Following ‘lean’ principle, I divide all activities in three groups: product growth, finding your channels, and brand management.

Product growth:

First, you focus on the product, and so should your marketing. The leanest way to acquire customers is to use the product you have already built. You can do that by:

  • Investing in product quality. Listen to your users, their concerns and suggestions, and improve the product up to the point it is so awesome people naturally share it with other people. Do alfa, beta and so on tests, user research, usability testing.
  • Invest time in SEO, referrals and viral marketing.
  • For customer acquisition, focus on building lead flows and optimizing your conversions at every step - traffic quality, landing pages, website, mobile app, etc.
  • Any advertising you engage in should be on the grassroots level - let your influencers and early adopters spread the word via social media, referrals, beta invites, free trials, and other methods of generating buzz.
  • Another important area of marketing efforts here is investor pitch deck development.

Finding your channels:

  • At this stage, you want to invest into developing customer acquisition channels that are scalable with only additional input from marketing expenses.
  • These are the most common examples: Paid Search Traffic (e.g. Google Ads, Bing Ads, etc.), Email and Marketing automation, Online Mobile & Display Advertising.
  • What should happen here: for each channel, you need to test different target and creatives, to see if you can acquire a customer within your KPIs for CPA. Then, analyze overall channel / targeting / creative results by looking on LTV and Profit from customers acquired that way, and invest your money in the most profitable channels first.
  • When your paid scalable channels are tested and you define where you should focus on, you may think about hiring someone on your team to manage this specific channel(s).

Brand Management:

  • These are the most expensive, less-scalable, driven by people activities and you should start doing them when you exceed all previous options.
  • Examples of activities you might consider: content marketing, community growth and management, PR, out of home ads, and so on.
  • This activities are coming in place at the relatively old stages of startup development, when marketing team is already hired, and the company has acquired finances to grow marketing budget further; they require a lot of labor and consume a lot of time.


This 3 categories are just a generalization, and not a one-fits-all rule. You should always being paying attention to your market specifics and target audience behavior to figure your own best strategy.

Digital marketing tips  -  areas to focus on

As I said before, each startup is different and needs its own strategy; saying it, these are my most favorite marketing tools that proved many times they work.

User experience  –  the very first step you can do to market your product is think about experience you create for your user.

Referrals  –  when people like something, they tend to share it with other people. Make it easy for them to do so; furthermore, if you add some additional motivation, the results might surprise you.

SEO (including voice!)  -  the level of trust we have for Google is sometimes ridiculous. We look up recipes, psychological advices and event instructions on how to fix our cars. Make sure when people search something about the problem you solve for them, your name appears.

Email  –  the most simple, cheap but also the most underused tool in marketing.

Viral marketing  -  this one is hard, but brings great results if you come up with a right idea and execute well. Make sure to hire an excellent creative team for your viral campaign.

Micro-influencers  –  almost every business requires building relationships. The more you invest into creating deep connections with your brand advocates, the easier it will be for you in the future to build awareness of your product.

Marketing Service: In-house, Outsource or Hybrid

Learning to delegate is one of the most important skills for startup founders. But, whom and when should you hire?

You can bring someone on your team, outsource your marketing tasks to someone, or use hybrid model.

In my experience, hybrid model gives the best outcome, but  –  again  -  every case is different.

In-house marketing

Benefits: your CMO and marketing managers have a deep understanding of the product and the business in general; they have a close connection to management, therefore react quickly to company news and changes;

Downsides: even when you hire someone who is very good at his job, he/she will still have areas of expertise where the knowledge will be limited - otherwise the hire will be very expensive; your in-house team can’t scale quickly; it also requires operational expenses, such as management, equipment and office space.


Benefits: with outsourced team, it is quite easy to control spendings; you can scale efforts up and down quickly; you can pick one contractor or agency for each task or channel and hire experts for each area / channel.

Downsides: outsourced team needs briefing and constant updates; ongoing communications are more difficult than in house. They are good for regular marketing issues and ongoing operational activities, e.g. Google Ads management; but not ideal for overall marketing strategy and management, unless you are on the very early stage.


With a proper setup, this approach gives you an in-house team, who develops tools for the outsourced people (communication strategy, style guide, voice & tone, creative briefs, articles outline and target audience). Your in-house team also controls the timeline, budget and ensures quality of the results.

Simultaneously, you hire outsourced experts for specific tasks and channels; based on the situation in the business you can scale your marketing up and down by adjusting budgets for outsourced agencies and contractors.

Startup Marketing: Costs & budgets

Hiring costs

The table below shows salaries in Seattle, WA for different marketing positions. This numbers include: base salary, total costs (base salary plus yearly bonuses and benefits, social & medicare costs, 18 days paid leave & sick expenses) - per year and per hour.

*based on data from glassdoor.com, March 2019

Planning your marketing budget

According to the structure provided above, you should plan your marketing budget keeping in mind 3 main types of your marketing costs: costs of development (opportunity costs), marketing expenses, and payrolls.

At the very early stage, your marketing budget should be mostly consist of development costs (opportunity costs) and the growth should be product-driven.

As I said before, I do not recommend hiring marketing people in house early since payroll is the most difficult part of marketing budget to cut off. When making a decision to hire in house, compare your total hourly costs to a costs of hiring a contractor - on average, contractors are cheaper.

At the same time, you need at least one person on your team who understands the product, knows market conditions and is an expert in marketing, communications and customer relationships. If you don’t have someone like that on your team, invest into finding a consultant / mentor / advisor who will help you figure high level strategy and delegate some marketing activities to freelancers or contractors.

When testing channels, it is a good idea to plan in ahead to invest time & money into experimenting with each channel to see if there is a way to fit CPA into your KPIs. Keep in mind, sometimes it takes time and a lot of A/B testing to nail down Facebook ads or choose the best creative for display advertising. The bids and therefore CPA can be lowered sometimes by 10–20 times by optimizing different parameters. Budget at least 3 to 6 months of ongoing investment for each channel.
For brand management part, each case is different. Some startups get exposure naturally by attracting famous team member or investor, or by working on popular problem; others need to invest into building relationships with influencers and journalists, creating high-quality content and buying expensive ad placements.

In Short

  • Marketing is not only advertising - it also means user research, understanding market conditions and building a great product. Invest into high-level marketing strategy from day one.
  • When marketing a startup, follow lean methodology - ’build, measure, scale’
  • To do that, start from understanding your marketing costs, metrics and KPIs - CAC, LTV, profit.
  • Using your metrics, find acquisition channels that scale.
  • Focus your efforts on product development and scalable channels until you excess all opportunities there; then move into branding and content marketing, since those two are expensive, require a lot of human work, and can’t scale.
  • Marketing tools that proved themselves: user experience, referrals, SEO, email, viral, micro-influencers.
  • Hiring: you should have an expert who knows your business, understands the product and can help you figure your marketing strategy as early as you can. It can be your co-founder, someone you hire, or your advisor.
  • Hiring: for other tasks, use contractors until you know for sure you need someone to manage a certain type of activities - and then hire.
  • When planning your marketing budget, keep in mind that each paid channel will require time and money for tests and experiments. I recommend at least 3 to 6 month of work with each paid channel.

If you have a need in a mentor / advisor to help you figure marketing for your startup, contact me at julia@emeraldmktg.us


July 5, 2019

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