Love it or dread it. Right brain or left. Waste of money or revenue generator. Marketing is always in question.
Should we do it? Why isn’t it working? How much should we spend? Can we even afford it? Why do others do it so much better?
The answers are actually quite simple. Unfortunately, too many people get easily confused over the real objective of marketing.
Marketing should only be about clearly telling specifically targeted buyers what you have to offer to them and why they should spend their money to buy it. What makes this tough is that people get creative. That’s right, creative. They try to use cool design or complex descriptions to ‘wow’ someone when all the ‘someone’ wants is to understand “so what?” Don’t get me wrong, I am as creative as they come but pretty for the sake of art isn’t marketing.
Then we compound the problem when the marketing is driven by the engineers or someone technical (i.e. lacks professional communication skills) or the worst scenario, when marketing is driven by the founder (i.e. “Doesn’t everyone want one of my perfect puppies?”).
Therefore, here are some of the top mistakes software companies make. I offer you the following lessons based on decades accruing my own marketing scars, together with helping several dozens of client companies of all sizes and shapes to succeed by doing more strategic, smarter marketing.
Mistake #1: Assuming you are your target customer
Let’s be clear. “Customer” can mean the buyer (person who signs the check for the purchase), the user (person(s) who actually use the product), and the influencers (people who have a say in whether the company buys it or not). As such, you can never be all those roles for whatever software you sell. Whether your product is business-to-business (B-to-B) or consumer-to-business (B-to-C), there are almost always multiple customers in each sale and as such, knowing them is paramount. ‘Knowing’ includes nailing down their demographics, their buying cycles, their budget requirements, their price sensitivity, their experience with other similar products, etc. You can only know these things by asking and no amount of web research or analysts’ reports are going to help with that. You need to do primary research – even if it is on a small scale and done informally with target customers.
I often get asked to do this on behalf of clients who are too busy, too intimidated or too fearful of what they may hear from prospective clients. Oftentimes using an outside person (e.g. consultant) is even better since the outsider can ask the naïve and politically incorrect questions while the respondent can feel a little less worried about honestly answering about the company they do business with. That middle layer adds some perceived protection thus often exposing more the truth than the vendor will get directly. After all, a customer is already in the boat and as such, doesn’t want to rock it too much. So whether you use an outside interviewer or not, just talk to your customers and if you want to get really smart, talk to the people that decided not to purchase your software – that’s where the most insightful information lies.
It’s best to do such research early and often. Like any diagnosis, the worst case is that you find out that you are off the selling tracks but hopefully can readjust (albeit potentially costly changes but less so than making the changes later in the cycle). The best case is that you make new or renewed fans (everyone loves to have their opinion asked and matter). It will probably grease the sales cycle too when that person interviewed is presented the product now ready that they actually asked for.
Mistake #2: Asking what users want and not why
If you’ve been trained on the art of good product requirements gathering, you’ve learned that use cases and personas are great tools to ensure that requirements are put into perspective. A typical use case might say something like, “The user shall be able to change the background colors.” This may seem like a nice feature to offer the users but in fact, could make your product look horrible if they select poor combinations. Therefore, the question is “what value does it really have to the user?” If the concern is that colorblind individuals may need a different palette in order to best use the software, then be specific. You can either specify that the colors used must be visible to someone who is colorblind, or you can offer a handful of pre-designed palettes that you know will maintain the integrity of your user interface. This is a simple example but in my work, I see so many product requirements that are nicely packaged with use cases and even specific details. However, without asking why this feature is required, you miss a whole lot of understanding as to what you really need to build and how to market it.
Mistake #3: Accepting that not every requirement needs a business justification
An axiom to Mistake #2, part of asking ‘why’ helps determine the business case for each requirement. The revenue related to some requirements may be clear (i.e. “By expanding our interface to the iPhone, we will increase our target customer base to over 5 million with an expected penetration of 10% and subsequent revenue opportunity of $400,000.”). However, more than likely, most requirements don’t have such a clear ROI. How do you quantify usability or better code base development? Consider the long term cost savings such as how much support or other company resource will be saved over time with such product enhancements. Customer retention from happier, more successful customers is also quantifiable. Better competitive positioning is a good thing but only if it helps to really sell more of your software which is often hard to prove unless you have lost sales or other provable such experiences. There is also personnel retention. No kidding – there may be features or at least development projects that are done for the sake of keeping critical internal team motivated and innovative. It’s not a great way to justify projects from an ROI perspective, but nonetheless, a way to think through whether that use of company resources has a decent justification versus other projects.
Mistake #4: SEO and social media is critical
Because software companies understand SEO and social media, they assume it is important for their business as a competitive advantage. Perhaps it is, but in many cases, it is actually a waste of time and money (Yes, I am a marketing person saying that!). If your target buyers search for information related to your products on the internet, then yes, you should make it easy to find your company and content, especially if your keywords are highly competitive or mixed with other unrelated products. However, often in the b-to-b software business, I hear the need to “get into the C-suite”. If this is a legitimate need to sell the company’s software, then think about if those C-level managers are spending time surfing the internet and reading Facebook pages and blogs. Most likely not – or at least not for the purpose of you selling them software. Rather than spend precious resources blogging or Tweeting, consider how to reach your target individuals in the channels they use for information gathering. If you don’t know this, ask them (yes, it’s that easy). SEO and social media properly done are voracious marketing tactics requiring constant content feeding and monitoring. As such, if they are important for your business to reach prospective and existing customers, do it and commit fully. If not, don’t waste anyone’s time.
Mistake #5: Marketing has to cost a lot
Speaking about social media and SEO, many people assume those are good marketing ideas as they are free. Email, too, for that matter. While the channel may be free to use, there is always a cost. Someone’s time to create the content is obvious – but also consider the time to monitor the impact, plus respond to and refine these marketing tactics. So the issue becomes whether those same resources could be put to better use doing more effective marketing even if that appears to cost more.
Take for example, one of my clients that sells global trade management software. Their customers are any company that imports or exports products from one country to another and the trade managers in those companies do use the internet to search for information about trade management and related topics. As such, my client wanted to optimize their site and create some social media venues to help reach out to their targets. My concern was the amount of time and content knowledge that it would take to do this well given the client was a rather small startup. I recommended that since the VP of Products already did weekly summaries and links to important industry articles for her own management team, we could repurpose that content onto a blog and offer that as a service to the external target audience. In 10 minutes, we taught a junior associate how to post to one of the free blog sites. We created the ‘sponsored’ blog simply by adding the company logo to one of the blog templates that complimented (but didn’t replicate) the company’s look and feel. Now the admin uses the same links from the weekly internal emails that the VP was sending out already. In a few weeks, the site became quite popular and now provides a valuable news service to target buyers. With all the rich keywords created from the newsworthy articles it lists, the blog has terrific SEO and subsequently generates traffic to the company’s website. So by using a free blog infrastructure to create a very professional, valuable social media channel, we created an online magnet for prospective clients and even media and industry analysts who take advantage of this vendor-neutral (but clearly vendor-sponsored) clipping service. And each and every time they go there from their RSS feed or other trigger, my client’s logo is there associated with the latest and greatest news about the global trade management industry. “FREE”!
With that said, there are so many other free tools that can help with marketing significantly. Do you use Google Alerts as your own, free clipping service that reports all the news about your competition, product, industry or whatever you decide to track? What about TwitHawk for your Twitter marketing needs if your product is something talked about in the Twittersphere? Heck, we already discussed the importance of talking to customers which is usually a “free” activity that yields the most precious marketing intelligence and builds sales relationships.
In reality, what costs a lot is misguided marketing and spending money recklessly to promote your company without the clear knowledge about what your targets need and want from you and how they want that information delivered to them.
Mistake #6: Word of mouth happens on its own
If you build it, they may not come. Seriously. Even if some targets said your idea was a good one, are they willing to pay for it? Many entrepreneurs go to friends and family for funding as well as confidence that the proposed software is needed. But your friends and family (or even investors) are probably not your buyers. Don’t get happy ears and think because someone is being nice to you means they will open their wallets when you come back with the product ready for sale. Friends and family won’t tell you your baby is ugly either so make sure you have good representation of your real target buyers before, during and after you build the software. Better yet, go to people who bought from your competition or are accomplishing the same tasks using a totally different method. Ask them why they didn’t choose yours. They have nothing to lose and just may tell you that your breath stinks.
And despite what Malcolm Caldwell’s Tipping Point implies, if you read the case studies, you know that word of mouth/viral marketing, isn’t something that happens from nothing. It happens because there is a market that has enough information to buy and share among their colleagues to get a trend going. For software, we use additional tricks like “powered by” and “read only” ways to get non-licensed individuals to be impressed enough upon receipt of the ‘runtime software’ to want them to seek us out for the rights to be a real part of the club. It can’t hurt to do that but let’s be real – it isn’t going to make most of us rich. What will is building software that really does solve a problem that a target group has and letting them know explicitly that we have the solution.
Mistake #7: If mine is best, they will buy it despite their budget
Just because your target customer doesn’t have one of your types of products and may need one, there are tons of other things that are priorities. If you sell to small businesses, for example, email marketing tools may be very important but so are the computers that create them which may be competing for the same scant available dollars. “Only $15 per month” can mean either email autoresponse to online inquiries or printer cartridges to deliver decent brochures. As we were reminded in the past 2 years, money isn’t recyclable and as such, fighting for a limited budget at your target customers doesn’t always mean your product or the competition. It means proving that their business will gain more by buying your product than any other thing they plan to spend their money on. Therefore, don’t just consider products ‘like yours’ your competition. Consider anything that is chasing the same budget dollars from your target customers’ wallets as competition.
And speaking about chasing budget dollars, it always bothers me when prospective clients complain that they have no more marketing money in Q4 knowing full well that most of their target customers budget for the following year in the previous quarter. Therefore, why would do all your marketing in Q1 to targets that have already made their purchase decisions?
Being the best solution for the problem at hand is key but also making sure the value is greater than other purchases is critical to get that target spending their precious budgets. And don’t forget that just because they budgeted for it, things change. All good intentions from your “hot leads” may change on the time due to new competitive factors, organizational changes, adjusted budgets and all the other financial shifts that have tainted the past few years of every company. That’s why lead nurturing is so important until the sale is completed. The game isn’t over until the checks are cleared and the warranty period is over. And yes, even then, marketing still probably has a role in retaining customers and buying more.
Mistake #8: Marketing is a science
Because we’ve become obsessed with measuring marketing, we assume it is a science. Sure we can quote page views and click-throughs but we still can’t easily measure reputation and rarely the customer’s ROI when using our software. I am a major proponent of planning measurement and tracking for every marketing program so you can see what is working and how well. However, I am also a big fan of testing and refining things that aren’t quite working when we think they should. Often times we spend marketing dollars on programs such as a direct mail piece and when it fails, we don’t take even a moment to find out why. We think because we did all the homework to ensure its success, it should have had better results but in reality, there is too much volatility in the real world for us to predict. Economic factors, competitive factors, social factors, even environmental factors (e.g. 911, Katrina) are wildcards as we execute a marketing program. However, when things fail, software companies often blame it on marketing as an unreliable concept and in reality it may be the product, the people or the pricing of the offer – things that the marketers may not control. As such, you owe it to yourselves to debrief on every marketing program that fails.
With that said, don’t get mislead that lots of views and clicks mean lots of sales. Marketing success isn’t about open links and eyeballs, it’s about wallets opened. I can stand outside on the street corner and get lots of people to hear me yelling a message. Getting the target buyers to pay for my software is the only relevant metric.
Mistake #9: More information is better
If you can’t convey what you do to whom and why they care in two sentences or less, something is wrong. I am not suggesting that you can explain your entire offering or competitive value in two sentences but a good positioning that makes it clear who, what and why separates the targets from the others quickly. As humans (particularly us girls), most of us are fearful that we may offend or reject potential friends. In marketing, filtering the market is actually good! If I can separate wheat from chafe, targets from uninterested, I don’t waste sales time and marketing resources. Ideally, if your positioning is clear and specific for those who care, those who don’t will politely say, “That’s not for me”. Good, then both of you can move on.
Now, once you have the target person intrigued, you do need to provide more information to convince them that your product is not only right for them but the best one for them and something they absolutely must buy (ideally now!). Doing this should be done in incremental, meaningful steps. That is, providing a 20 page datasheet may be too much for the buyer to invest at the early stage of the buying cycle. However, offering digestible amounts of information to the buyer is really important so they continue to seek more and are willing to invest their time knowing your offering seems to be a good solution for something there are needing. Slamming them with a folder full of datasheets, brochures, article reprints, case studies and press releases probably is a bit overwhelming to most any customer in any business. The same applies to your website that probably contains much of this content. Unless it is well organized (much like your software itself), it may say more about your company before it is even read.
Mistake #10: Your mother doesn’t need to understand what you do
Don’t assume that writers (me included), analysts or other “thought leaders” understand your product, let alone your specific target customers. Even with industry experience, chances are we all have our own baggage and unique perspective that may or may not help us know what your software does. Throwing in acronyms doesn’t impress us but rather often confuses us and we won’t tell you that because our egos won’t let us.
To know if your positioning and sales message works, try it on mom or the neighbors and even your kids. If they can understand it well enough to paraphrase it back to you, you’ve succeeded. Don’t assume it’s too complex for them because if it is, most likely it’s not the product but your words that are complex.
Heck, your mom probably is your best evangelist and just may surprise you. I wouldn’t believe that myself except it literally did work for me. While I was working on customer relationship management (CRM) software and writing articles and whitepapers for my own company years ago, I had explained the topic very generally to my mother who had sold promotional products during her career. She understood enough about what I did that she connected me to her friend who was in a bind with a regular CRM section in BusinessWeek. Guess who got the gig…your’s truly. See, you never know unless you make the effort to get your marketing speaking for you in a way that everyone around you can easily help promote your product to target buyers – even mom.
Author: Alyssa Dver is the CEO at Mint Green Marketing (www.mintgreenmktg.com) which offers affordable, expert marketing consulting and classes (live and online). Her books, “No Time Marketing” and “Software Product Management Essentials” continue to be best sellers and she is a frequent speaker at conferences and corporate events. Contact Alyssa at alyssadver@mintgreenmktg.com or 508-881-5664.
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