Case synopsis----quick finish in 4 hours
PUBLIC RELATIONS FOR START-UP VENTURES
LECTURE 5
SECTION TWO: DEMAND-GENERATION AND SALES
AN INTRODUCTION
> Marketing strategy, positioning, and targeting establish the goals and objectives
> Marketing activities attract the largest number of customers and purchases in a cost-effective manner – Demand-generation
> Fundamental premise of entrepreneurial marketing − Direct scarce resources to the most effective marketing activities that yield the greatest
results and secure customers for a long period of time
− Both the short-term survival and long-term development
> How?
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SECTION TWO: DEMAND-GENERATION AND SALES
AN INTRODUCTION
> Customer lifetime value (CLV) is the total revenue contributed to your venture by a customer over the length of their relationship with your venture.
> CLV is dependent upon three factors: − Customer acquisition cost (CAC), the total cost to secure that customer
− Annual profits a customer generates for your venture (M)
− Number of years the customer is likely to purchase from your venture (L)
> The most simplistic form:
CLV = M × L − CAC
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SECTION TWO: DEMAND-GENERATION AND SALES
AN INTRODUCTION
CLV = M × L − CAC
> The entrepreneurial marketer must consider each marketing activity in terms of its ability to reach customers with the highest CLV at the lowest CAC to capture the greatest value for your venture
> The most effective way is to map the adoption process on the way to the customer actually making a purchase.
− The movement of information, influence, goods and services, benefits and value, and money
> Each marketing activity should have a positive effect, moving your customer closer to purchase
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SECTION TWO: DEMAND-GENERATION AND SALES
AN INTRODUCTION
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SECTION TWO: DEMAND-GENERATION AND SALES
AN INTRODUCTION
> Entrepreneurial marketers must ensure that every marketing tactic has a clear sense of:
− Audience — The target profile of prospects
− Objective — The goal that will allow the right prospects and customers to move on to the next phase
− Call-to-action — The specific action that the right customers will take to engage with you and move to the next phase of adoption, whether it be call a number, visit a website, or redeem a coupon
− Measurable outcome — The metric that will determine the success or failure of the marketing activity
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PUBLIC RELATIONS FOR START-UP VENTURES
PUBLIC RELATIONS FOR START-UP VENTURES
AN EXAMPLE - PAYMYBILLS.COM
PayMyBills.com − One of the final eight projects at the annual Wharton Business Plan
Competition.
− The cofounders were brought out to Idealab and given 60 days to launch the company and the business
− The business plan competition results help it be covered by the New York Times, Philadelphia Magazine, and other publications.
− This helped the company in its initial hiring and fundraising • Ten days later, they had hired ten people
• Three weeks later, Idealab used the buzz to raise more than $4 million for the company at a much more favorable valuation than would have been possible without the public relations (PR).
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PUBLIC RELATIONS FOR START-UP VENTURES
AN EXAMPLE - PAYMYBILLS.COM
The Alexander Ogilvy agency was hired to get a fast-track product launch − An interview schedule for trade press, business press, and radio that focused
on a product launch
− Meetings held with the Wall Street Journal, LA Times, PC Magazine.
− Spot radio advertising in several cities, including on the Howard Stern Show for the first two weeks after launch
− The two competitors, PayTrust and CyberBills, had been in existence much longer but were staying in stealth mode.
> PayMyBills.com tilted the playing field and gained 50,000 customers in less than a year.
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PUBLIC RELATIONS FOR START-UP VENTURES
BEING THE KNOWN WINNER
Entrepreneurs want to
> Drive Awareness − Before people can buy your product or use your service, they have to know it
exists and how to get to it
> Have the perceptual edge: − Customers should feel that they are going with a winner if there is a choice
among products in the category
> Proper use of public relations can − Drive publicity and
− Provide this “winner” feeling far faster and at much lower cost
> How?
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PUBLIC RELATIONS FOR START-UP VENTURES
BEING THE KNOWN WINNER
> The key driver to quickly gaining leadership in a new category is the creation of “buzz” — the feeling that you are the winner
> “It’s the cheerleader approach, where you tell the world that we’re the winner even before the game has started, which is successful in the Internet space.”
> Example: When Google first released its Chrome browser, − Competing products already successful in the marketplace, such as Firefox,
Safari, and IE
− A PR campaign got tremendous coverage in the trade press —declared Chrome as the browser to beat
− And Chrome soon gained overwhelming market share to make the perception a reality
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PUBLIC RELATIONS FOR START-UP VENTURES
BEING THE KNOWN WINNER
> How can you achieve this perceptual edge? − Understand how most users make their decision
− Generally, users ask someone they trust
> The key to gaining the perceptual edge is to influence the influencers, or gatekeepers
> Gatekeepers get their knowledge from a smaller set of influencers whom they trust
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PUBLIC RELATIONS FOR START-UP VENTURES
BEING THE KNOWN WINNER
You need to reach the following groups:
> Gurus — Key industry insiders•
> Influencers — Key trade and business press; industry analysts
> Decision makers — Key bellwether buyers; those who can say yes
> Naysayers — People who can say no
> Mass buyers — The masses who mainly follow what they perceive as the winning trend
Influencer marketing
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Types of Influencers
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
> Celebrities
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Macro Influencers
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Rising Creators
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Micro Influencers
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
How to choose?
> Efficiency
> Virality
> Scale
> Velocity
> Consistency
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Efficiency
> Does this influencer efficiently drive engagement/activity
> Some matrics to consider: − % active audience
− Average engagement (%)
− …
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Virality
> Does the content have pass-along value? − Shares (total)
− Shares/retweets per post
Scale
> Is there enough scale to achieve your goals? − Total actions/impressions/views…
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Velocity
> What is the trend of the impacts? Up or down?
Consistency
> Is the influencers consistently provide high quality influence?
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PUBLIC RELATIONS FOR START-UP VENTURES
INFLUENCER MARKETING
Key considerations
> Metrics have been taken into account to ensure the best chances of success, during the planning and selection process?
> Which type of influencer(s) are right to support the brand and campaign objectives?
> Is the influencer that a brand is partnering with a good fit not only in terms of aesthetics and style, but also by the existing affinities of their current audience?
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PUBLIC RELATIONS FOR START-UP VENTURES
SPOKESPERSONS/EVANGELISTS
One (or at most two) people in the company Serve as evangelists for the product and company
− Most often, the CEO and chief technical person
− Visiting the gurus on “press tours,”
− Getting them prerelease (beta) software or hardware,
− Providing technical support to ensure usage goes smoothly and positioning clearly communicated
> The evangelists need to be − Personable
− Knowledgeable about the company and its products
− Sensitive to what can and can’t be said
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PUBLIC RELATIONS FOR START-UP VENTURES
SPOKESPERSONS/EVANGELISTS
One (or at most two) people in the company Serve as evangelists for the product and company
− Most often, the CEO and chief technical person
− Visiting the gurus on “press tours,”
− Getting them prerelease (beta) software or hardware,
− Providing technical support to ensure usage goes smoothly and positioning clearly communicated
> The evangelists need to be − Personable
− Knowledgeable about the company and its products
− Sensitive to what can and can’t be said
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PUBLIC RELATIONS FOR START-UP VENTURES
SPOKESPERSONS/EVANGELISTS
The overall company and product pitch with three lengths − The “elevator pitch”
• 30 seconds to 2 minutes
• focus your elevator pitch on your positioning
• “We’re going to be the Uber (or Amazon, or Facebook...) for [fill in the blank].” (this can be risky though)
− 15-minute demo • a minute or two to introduce the speaker and company with credibility enhancers
(advisory board members, directors, investors)
• followed by a demo of the product
− 30 to 45-minute road show pitch • company history, financing, product rollout plans, advertising plans, partnering
deals, and, the product itself
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PUBLIC RELATIONS FOR START-UP VENTURES
CRISIS MANAGEMENT
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PUBLIC RELATIONS FOR START-UP VENTURES
SUMMARY
> Fundamental premise of entrepreneurial marketing
> Direct scarce resources to the most effective marketing activities that yield the greatest results and secure customers for a long period of time
> Proper use of public relations can − Drive publicity
− Provide this “winner” feeling far faster and at much lower cost
− Mange crisis
> Influencer Marketing − Types of influencers
− How to choose influencers
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