Marketing Your Lean Startup in 2020

Lean startup is probably the hottest concept in entrepreneurship today. Maybe you’ve heard of it, but you’re not quite sure what all the hype is about. Well the father of lean startups, Eric Ries, sums up the lean startup concept as:

Embedded within this process is the concept of

failing fast — in other words, learning quickly whether there’s a market for your great idea and whether what you’ve planned solves a consumer problem faced by real people.

Lean startup versus traditional entrepreneurship According to the Harvard Business Review, lean startup changes everything in the startup ecosystem. Traditional entrepreneurship delays market testing a new idea until months or years (and thousands or millions of dollars) have been spent developing your idea into a new product or service. Yet, despite careful planning, time, and money being poured into the venture, 75% of startups fail, according to a new study by Harvard Business School and Dr. Ghosh. In my experience working with the SBDC (Small Business Development Center) and private clients, my guess is the 75% failure rate actually under represents the actual number of startup failures because many startups never even reach the point of starting operations, but die in the birthing process. Lean startup methodology eschews extensive planning and hyping investors in favor of developing an MVP (not most valuable player, but a minimum viable product). In theory, at least, the concept of an MVP makes perfect sense — you test the waters with consumers before spending months or years and millions of dollars building a product no one wants. The Field of Dreams approach of traditional startup planning often only works in the movies. Using an MVP to test the waters means startups don’t spin their wheels and waste money developing elegant solutions to problems consumers don’t want solved. As small organizations without a top-heavy bureaucracy that destroys nimbleness, startups learn from early customer experimentation and iterate through to a product that meets customer needs, something termed agile development. In the lean startup process, startups discover what works in terms of reaching customers, effective messaging, production and distribution opportunities — in essence discovering and testing rather than planning in isolation. Pivoting is also critical for lean startups. Pivoting implies a malleability, and openness to change that’s hard to develop and harder to manage because it means a company opens itself up to quickly discarding things that don’t work and moving on to alternatives that might.

Marketing your lean startup I see this happen almost every day. I go to a pitch session where budding entrepreneurs demo their new, great product — often an MVP. The problem is, they’re still developing that MVP in isolation rather than in conjunction with consumers. Entrepreneurs have a great idea (they think) and start coding or tinkering until they have something to show the rest of the world. Problem is, often they’re solving a problem shared by few consumers, for which consumers aren’t willing to pay, or for which consumers are satisfied with current solutions.If I see one more dining app, I’m gonna puke. Companies like Github own that model, so don’t even try to horn in on their parade. Even if you offer it for free, I don’t have room for one more app on my smartphone, so NO, I don’t need you. These folks miss the point about lean startup methodology — get consumers involved from the beginning, not after you have MVP. Ideas are a dime a dozen — everybody has them. There’s nothing unique about your idea. Consumers buy solutions, not products. Find their problems. Consumers vent their frustrations every day and that’s your opportunity to become their solution. Whether you’re a budding entrepreneur or a big company wanting to grow your product line and bottom line, start with consumers, not product.

Finding customer problems Get out of your office. Interact with real people and seek out diverse groups. Listen to what people are saying. That’s where your great idea comes from. As an exercise with MBA students taking my entrepreneurship class, I asked them to think about a new product to solve a problem they see everyday by adding to taking away something from an existing product. It’s a great exercise in finding your “big idea”. When Chrysler introduced the minivan, they watched consumers using existing car and truck model to identify a set of problems. The result was the most successful new automotive product in decades.

Testing your MVP You can test some solutions without an MVP. You can talk to folks about your idea and get feedback without all the expense and wasted time. The problem with this testing is that consumers might not give accurate feedback about something they can’t see or try yet. When working on a project for the Aquarium in Tampa, we asked hundreds of folks what they thought and got high praise for the idea. After the city spent millions building it, attendance didn’t even approach projections. Or, you can create a down and dirty version of your idea to get feedback and be ready to change if your idea doesn’t work. That’s what happened at Facebook when Zuckerberg created his first product — users loved it, but women hated it and the school accused him of invading the privacy of students by scraping their images. Pivot. Facebook is born. Build. Test. Pivot. Produce.

Laying the groundwork for market performance Marketing is key to success in finding and developing your MVP — don’t leave it until you have product ready to roll out. Just as you’re using marketing tools to uncover unmet needs (problems) and testing your MVP, you should test your positioning, messaging, and plans for distributing your product to consumers — all marketing activities. Marketing develops personas representing likely consumers and develops strategies to reach each persona. Marketing also has a valuable roll in developing the user experience (UX). Marketing builds your initial customer base, then follows users with an eye toward iterating the product using customer feedback. Your marketing executive uses initial metrics to determine which platforms are best for reaching potential customers and develops marketing collateral. Then, when you’re ready to roll out product, you’ve already figured out the best ways to reach and convert potential buyers.