Editor’s note: Mamoon Hamid is a general partner at The Social+Capital Partnership.
Over the last few months enterprise giants Oracle and Salesforce have put on shows featuring the likes of Hillary Clinton and Bruno Mars reminding all of us in the enterprise world that marketing matters. While most enterprise startups will never reach these levels of budget and glamour, this time of the year does serve as a reminder that enterprise marketing matters.
More than 10 years ago, prior to becoming a venture capitalist, I was a marketing guy at Xilinx, a semiconductor company. I recall creating spreadsheets with tens, if not hundreds, of rows, outlining our marketing plans. It was a grind, but I didn’t know any better as a former customer-facing engineer who had a pretty good sense of all the things that would appeal to different types of customers.
While it was certainly laborious and manual, three years later we had a $100 million business that we built by effectively extolling the virtues of our products to a new set of customers. That experience informed my view on marketing, specifically in the enterprise.
The tools, channels and tactics available to marketers has changed a lot since the early 2000s – we didn’t have MailChimp or Marketo, nor did we have Google Adwords or Twitter ads – but many of the same strategies we employed then still have value today. Talking to analysts, writing white papers, hosting events and doing road shows have been and always will be a critical part of a successful marketing plan.
As an investor who tends to look at companies at an early stage when they are rarely classified as “sexy” or popular where it’s more about the technology and product, it may come off as a surprise that I believe that marketing and branding are some of the most important early-stage indicators of a company’s potential success.
Perhaps the biggest misconception in marketing today, is that there are a few foolproof “silver bullet” strategies that marketers can rely on in order to succeed. Marketing is a decathlon – winning requires you to be very good at multiple disciplines.
Drawing from my experience working with various companies, here are the seven most common myths about marketing in the enterprise:
Myth No. 1 – Being “first” or Being the “leaders” matters
In the consumer world it is well understood that Google wasn’t the first search engine and Facebook wasn’t initially the leader in social networking. Both came from behind and became universally loved by their users because of their products and the timing of their products, not because they were first or because they called themselves the “leader” in their respective space. It’s not too different in the enterprise.
Being first can actually be a weight as you’re tasked with evangelizing and creating market awareness which manifests itself into more time needed to convince buyers and longer periods of time burning cash. That can trickle down into more dilution and fatigue for the team because of the extra cash and length of time required to be successful. Market timing and achieving product-market fit is so much more important than being first. So don’t lead with “first to…” or “leader in…” Both are overrated.
Myth No. 2 – Your Brand Can Evolve as Your Company Matures
As the saying goes, you can’t judge a book by its cover. Well your company’s name and branding is its cover, and it better be tight from the get go. As someone who looks at early-stage startups, I consider a company name and one-liner a direct line into a founder’s mind as to how crisply they are thinking about their business. It’s an easy way to judge the book, and your eventual customers will judge you the same way.
So keep it simple and make it mean something. Branding matters. Messaging matters. If it’s too complicated or buzzword-filled, I see it as a red flag, because you may not even know what you’re in the business of. Simplicity is key because when working with complex technologies, marketing and branding is how you make a company and its products more relatable.
Myth No. 3 – Great Products Sell Themselves
This is certainly true of consumer products, but the best product doesn’t necessarily win in the enterprise. A great product is obviously important, but great product marketing is even more important. You have to constantly extoll the virtues of it, but even more importantly, you have to be able to convey a simple value proposition that creates a reaction. It starts by having a website that shows that you are “open for business.”
Marketing and branding are some of the most important early-stage indicators of a company’s potential success.
Customers need to instinctively and immediately be able to say “I get what this does for me, I know how much it costs, I understand how to adopt and deploy it, and it helps me do what I need to get done faster and better.” Even if you’re a two-person company, you can make yourself look open for business and make it seem much bigger than you actually are. It can be a self-fulfilling prophecy, as success begets success.
Myth No. 4 – Marketing Is an Art, Not a Science
This is what people say when they don’t want to dig into the numbers. Funnels and conversion metrics don’t lie, so more than ever marketers need to be analytical and multi-prong in their approach to drive cost-effective leads into the top of the funnel.
Whether it’s free trials, social, SEO, search engine marketing, webinars, syndicated articles or some other demand generation activity – everything needs to be instrumented and measured. Marketers need to constantly evaluate what’s working and what’s not, so that their spend is as efficient as it can be while still growing their new leads. It’s a lot of trial and error, and over time the effectiveness of marketing channels degrades.
So always be experimenting to find the next best channel. And there are literally hundreds of of tools on the market to choose from to help you do your job more analytically.
Myth No. 5 – Conferences Are a Waste of Money
It was not long ago that events and conferences were deemed old school. While macro tradeshows that cover multiple vendors and various far-flung topics may have become obsolete, we’ve definitely seen a surge in the number of companies hosting their own conferences and industry events. Now anyone who wants to be someone is hosting large user conferences. Established companies like Salesforce, VMWare, Oracle and even more recently, Amazon, put on big events every year. Even larger startups like Box*, Evernote and Twilio, have built quality events that customers look forward to every year.
Smaller companies are starting to get in on the act even earlier with large-scale user conferences to demonstrate thought leadership and create broader awareness. Just like myth No. 3 about products selling themselves, if you present yourself like the “it” company in your category, maybe potential customers will think you are “it,” too. Putting on your own event is not cheap and requires insane levels of coordination and creativity. Smart startups will budget for it and spend their year planning it with high production value, interesting speakers from outside the company and key influencers.
And it’s okay to start small. Box had dreams of being a big company way before it was one. In 2011, the company decided that in order to be taken seriously by large enterprise customers, it had to host a high-caliber user event – the first ever Boxworks, which was preceded by many smaller customer events. Boxworks has become one of the signature conferences every year, thanks to its great blend of content. Today Box is 10 times bigger in terms of revenue than it was in 2011, in no small part thanks to efforts like Boxworks.
Myth No. 6 – Analysts Don’t Matter
Believe it or not analysts still hold the keys to the kingdom for many categories in the enterprise. CIOs of the largest companies are influenced by these analysts, to the point where analysts have the ability to anoint the winners in any particular category of enterprise software.
It is critical for companies to engage analysts early and develop a relationship over time with regular check-ins. Analysts set the tone for the market and if they aren’t on a business’ radar, a business isn’t on theirs. Every company needs to have an actionable plan for meeting with analysts and educating them on new product development to ensure they’re not mis- or underrepresented in the marketplace.
You won’t be in the top right quadrant from the get go, but investing in these relationships will allow you to tell and refine your story especially for large enterprises, who analysts often cater to. You have to keep in mind that someone is paying for their research and these analysts are trying to appease that someone with their work.
Myth No. 7 – Word of Mouth Is the Best Form of Marketing
Well, this one is actually true. But you can’t just rely on your customers to tweet about how great your company or your product is. It takes more than that. Videos and case studies are a great way to make your company and its products approachable by connecting them with a human face. Put them on your website and organize them by vertical so that prospective customers can quickly find someone relatable. I love the depth and breadth of the customer examples that Hubspot provides on its website.
It is important to debunk these common myths of marketing as it is one of the most important things a business can do to impact their bottom line. I believe that if enterprise companies can avoid these marketing myths they will be even more successful.
What other marketing misconceptions do you think are still prevalent in the enterprise? Do you agree or disagree with the myth I have laid out?
* Mamoon is/was an investor and board member in Box, Intercom, Onelogin and Slack.