Product Marketing Rule #8 from the best-selling book, 42 Rules of Product Marketing, was written by Brian Lawley, CEO and Founder, 280 Group
Oftentimes the courage they had to build the product turns into denial about what it really takes to build a viable business
Sure you have a great product idea and the guts to build it, but do you really have a realistic picture of what it is going to take to bring it to market?
Do you have the courage to spend enough to launch your product and create significant momentum?
My company, the 280 Group, works with many companies that are trying to launch products. Oftentimes clients will first contact us when they are 3-6 months away from launching a product to help them plan how they are going to reach customers and make sales. Or they’ll bring us in shortly after the product has been released and they can’t figure out why sales have not begun to take off.
These companies will have spent tens or hundreds of thousands (sometimes even millions) of dollars, and months or years developing their product. They have a huge sunk cost that has been incurred to get to market. They’ll ask us to create a marketing plan to reach their target market as cost effectively as possible so that they can generate qualified leads and make sales. Their attitude is usually that, “We’ll be so smart about marketing (like we were with development) that we will get things going without having to spend much, and then we can fund future efforts from the initial sales.” But when the rubber hits the road and the company has to invest enough time, resources and money to get sales and revenues going, oftentimes the courage they had to build the product turns into denial about what it really takes to build a viable business.
One company that we worked with had spent $3M doing a management buyout and bringing a new product to market, with the hope of turning the company around and generating $8-$10M in sales. When we proposed a ridiculously low marketing budget of $50k (with some VERY creative leveraged marketing ideas) it took them 8 weeks of internal debate to finally decide that they weren’t quite sure enough about the product and market to spend the money. Guess what – after all that work they didn’t come close to making their revenue projections.
What’s the lesson here?
Start your marketing and go-to-market planning very early – even before you make the commitment to build the product. Get real about what it will cost you, and get a seasoned marketing person involved to help you create a ballpark estimate. Take that estimate and double it as your working figure.
Sure, you might be able to come up with the next completely viral product that requires no marketing, but these are few and far between. When you are making the decision about whether to develop a product ask yourself, “When we have built the product, used up more funding than we dreamed we would to do so, and are ready to really try to get the revenue engine going, will we have the marketing courage to make it happen?”
If the honest answer is no, don’t do it.
The moral of the story? Go big or go home.
Product Marketing Rule #8 from the best-selling book, 42 Rules of Product Marketing