Why up to 75% of startups close in the second year of existence.

Por qué hasta el 75% de las startups cierran en el segundo año de existencia.

According to a report by The Failure Institute, the 3 most common factors why startups fail are: 

  • Focus on your product instead of your customer.
  • Inadequate organizational structures that prevent the execution of entrepreneurial plans.
  • View marketing as an expense rather than a strategic investment.

The first two speak for themselves. I am going to focus on the field of Marketing because for many businessmen, Marketing is an activity that "they wish they didn't have to do". It is a kind of inconvenient expense or tax, added to your work. Due to this pre-conceptualization, they strive to focus as little investment as possible, creating a marginal marketing model for their company, under the perception that “If marketing is an expense, I manage it as such”. That is to say: From time to time I will fake and cheat, frequently I will cut it, and I will always do absolutely everything in my power to pay as little as possible.

Speaking of digital marketing For a large number of companies in the B2B profile, Marketing is a person in the office that works as an "internal agency" acting without any strategic plan to get more leads for the sales team. In the Business to Consumer (B2C) profile, Marketing is generally an area that is taken more seriously, however, we frequently find a mentality of simply finding new "creative" ways to promote the product as it has always been done, without thinking about the client.

Hundreds of companies are fighting for their survival without identifying the strategic relevance of their marketing efforts, while they are immersed in the intricate panorama of global competition, digitalization and the new organizational structures that this environment provokes. Their marketing departments (if any) are simply adding solutions to their technology stack in an attempt to digitize their traditional processes, instead of creating new customer-focused strategies capable of generating growth, and then understanding and implement its scaling and digitization mechanism.

However, the rapid advance of digital technology has caused marketing to be seen more as an automated day-to-day commerce operation, vs. a long-term value investment. Companies expect immediate satisfaction with returns on investment in weeks, days, or even hours, supported by the vague promise of thousands of digital solutions that provide "returns on investment in real time" or "predictive data analysis" with which theoretically you can know the results of your campaigns even before launching them on the market.  

These companies are substituting Formal Strategy and Deep Customer Knowledge for Volume and Execution, causing a massive escalation in their advertising costs, by requiring more budget to maintain the expected efficiency of their campaigns. This is the trap of AI, programmatic advertising and most of the "Silver Bullets" that promise automatic sales with the click of a button.

I have mentioned before that in the coming years we will see a gradual erosion of offers with the imminent conversion to "commodity" of all products and services, so your brand will be the only substantive value and connection link with your customers. Why not change the focus of your Marketing strategy?  

What if instead of thinking about high-frequency campaigns where we try to persuade the potential customer to “Buy Now”, we focus on creating valuable and relevant experiences for audiences that really want to engage with your brand.

How about we focus on how paid advertising can spread and support our key message, bringing potential customers to our home turf with a marketing strategy? original content.

If you are interested in these topics, take a tour of our website to learn more about our services - schedule a call here and start your next campaign with us.

Make it Real | Make it Human | H2H Beyond Digital

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