Do you need a marketing budget these days?

by Ashok Nayar

Back not too long ago, startups had million dollar marketing budgets. Five page marketing plans, a huge PR team, and numerous press events. Who does that these days? No one. Well maybe Pay Per Post, but we all know they don’t really know how to run a company anyways. The current “web 2.0” boom (I do hate using that term), has enabled startups to have a marketing budget that is virtually zero. Users are easier to reach, communication is much more efficient, and information is much easier to sift through.

Marketing today can be as easy as calling up a well known blogger and asking him to write about you. Let them know what you’re building, why the world needs it (the “proxy for demand”), and what’s good about it. Typically, even the A-List bloggers will listen to everyone that comes their way. If experience has taught them anything, it’s that anyone can build the next Google. Good review, or bad, the press is out there and you will get a huge influx of traffic. While this may not be your key demographic of users, it will help tremendously in securing early adopters.

Social networks are quite possibly the biggest boon to startups. Harnessing the communication potential of a social network is invaluable, and free. Two words that typically don’t go together. One of the most recent, and most talked about, examples is iLike. While they had grown to a reasonable size, with the introduction of their Facebook Application, they have grown exponentially. You may ask then, how are any of the current Facebook applications, or even MySpace widgets planning to make any money? Well, smart companies are using social networks as a distribution portal, rather than a platform to build their company on, reducing dependency completely.

In my opinion, the greatest way of marketing, is in creating virality. That is, will the product user base grow, as a result of using it? As Marc Andreessen once noted, the difference between 3000 users and 300MM users for Hotmail was the little link at the bottom of every email that said “Would you like to join Hotmail?”. The internet is marvelous at the dissemination of information and if you build this into your product, the word will get out there. Word of mouth marketing, and viral, organic growth, and extremely interlinked. While you shouldn’t depend on WOMM, you can expect it as a natural result of a viral feature within your product.

As noted by Aniq Rahman, in my previous post, building a good product is the greatest form of marketing. Build it and they will come. This is true, and while I think product development should be your number one priority within a startup, making sure you don’t detract resources into marketing is crucial. It’s just unnecessary. Take that money and hire a few good developers or designers. They’re worth their weight in gold.

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