Guy K and the mirage of free marketing
So I had decided to stop reading Guy Kawasaki because he was writing too many top ten lists and would do anything to build audience. But I have to give it to the guy (who once famously turned down the CEO role at Y!), he does write some excellent posts too.
Here are two recent ones:
- Basic but good, 11 rules for building a company sustainably
- A book review of the “No Asshole Rule” by Robert Sutton (I fail rule 9 ;-))
Of the 11 rules, one rang particularly true:
Plan for marketing costs. Don’t depend on wishful-thinking marketing based on virality, buzz, TechCrunch, and a demo at Demo. It’s true that some companies do achieve success this way, but we’ve heard of them because they are few and far between. To use a sports analogy, we all know who Michael Jordan and Wayne Gretsky are because they are rare examples, not because their story is common. You need to explain your demand-creation process in a mechanical, not magical, way: ad rates, click through rates, unique visitors per month, conversion rates, revenue per customer, etc. Ultimately, the underlying assumptions in your marketing model is the key to the fundability and viability of your startup. “We’ll get it on TechCrunch and then viral marketing will be easy because we have such a compelling product” doesn’t cut it.
Virality has become a vastly overused concept (no, an invite a friend function does not constitute viral marketing), and so has grassroots marketing. As Seth Godin once said, what happens to most marketing is … nothing. In the brave new world of Web2.0 I find that too many people assume that free marketing is a given or that some ill defined proprtion of the world will care about their product. There is no cheap substitute for good media planning !