Company management favors favors a full line.
Startup marketing favors a narrow line.
There is where too many founders of new enteprises make a move that proves fatal. They choose to widen the product offering rather than focus it narrowly. The result is the end of greatness for the startup.
Selling more is appealing to left-brained people (on your board of directors, from large corporations). So it is obvious you will sell more with a full line of products and services.
So why do the great startup right-brained startup people want a narrow line?
Because selling is the second step in a marketing program. The first step is building a brand in the mind. And with a full line that can be difficult.
Consumer brand guru, Al Ries points out that we no longer know what a Chevrolet is. The brand sells more than seven car models. That makes it hard for the brand to stand for anything.
I know what a Porsche is (Germany's sports car). But watch out, it is widening its line of models and that's going to diminish its brand image. Will it go the way of Chevrolet? Porsche is now owned by the management that owns Volkswagen. The board of directors wants the company to become the largest in the world. Full line. Watch Porsche the brand. Stay tuned.
Similarly today we no longer know what HP stands for (printers, PCs, IT consulting, and more). The brand stands for an American electronics company. Not very exciting.
Do we know what Google stands for? Today yes, search. But its customers know it as the gorilla of online advertising, with a 55 percent share of market. Facebook has 9 percent. As management continues to broaden the line of services and products (the company is now in the hardware business via smartphones), the brand image is diminishing. Driverless cars are cool, but what then does Google the brand stand for? The direction is familiar: startup success (narrow line) is followed by gorilla expansion, desperately searching for revenue growth (broaden the line).
Same thing happend with Microsoft (the PC operating system). And with Volvo (was the "world's safest car").
Startups that get focused and remain focused can get branded. After that they can shift to selling more by expanding the product line. Until then, the product line must remain narrow. Expanding it dissipates the power of branding, it weakens the new enterprise.
Last evening I was in a coaching session typical of work with first-time entrepreneurs from large corporations. Their initial idea had been crafted and focused well after weeks of hard work. But our working session that evening was triggered by a dispute between the founders. Some wanted to add additional services and generate more revenue. Others wanted to remain narrowly focused. They decided to focus for the first three years on a single online service, adding follow-on lines after the company became branded. And even three years is early for adding a new line. A strong brand requires around ten years to be branded.
For some of you left-brainers, this thinking might seem wrong, adds risk, reduces sales. If you believe that, you don't understand startup marketing, how right-brained thinking works to create what generates rocket speed growth in sales. Turn over the marketing to your marketing people and enjoy the wild rise to branding success from your chair on the sidelines.
BOTTOM LINE: More seems better, less seems poorer. But savvy marketing people know startup success is founded on narrow, focused branding. Once branded, the product line can be expanded. But by then your startup will have gone IPO. Brands take a long time to establish. Wars with your investors tell you your opponents are left-brained thinkers. Instead of fighting them, deliver success stories of prior startups that stayed focused and won. Remind them of famous brands that no longer stand for anything because they expanded their product and services too widely. When you grasp how to do this, you'll be well on your way to building an unfair competitive advantage.
I wish you The Best on your Adventure!
"Marketing is too complicated to be left to management people who have little experience in marketing and who don't understand its principles." wrote Al Ries.
Rated by Advertising Age as one of the Top Ten living legends of marketing, Ries's findings and related implications in the book "War in the Boardroom" are spot on with the markeing challenges that confront first-time entrepreneurs.
This series on startup marketing follows the principles laid down in that book. I highly recommend the book to startup leaders.