Management targets the center of the market.
Marketing targets one of the ends.
Where is the "sweet spot" for a startup? What portion of the market is best to aim at?
Most responses are "Aim for where the most customers are, that's the fat middle."
However, serial marketing minds know that is death. Instead they aim for either end of the market.
Do you remember the famous "bell curve?" The fat middle is what management thinks is where the startup should aim. But there is where most of the fights occur between startups who have copied each other and stand for nothing different.
Instead, think of that curve upside down with fat high ends and a sagging middle. That's how marketing minds see each new market. Here are some examples from a huge industry:
- Airlines: Singapore Airlines and Emirates battle for the high-end customers of the premium market segment, while the value market is lead by Southwest Airlines and AirAsia in Asia, and Ryanair in Europe, and Gol Airline in South America. All the rest (hundreds?) are in and out of bankruptcy each slugging it out for seats in the undifferentiated middle with profits determined by the price of jet fuel.
The temptation for first-time entrepreneurs is to think the middle is where the riches are. But there is only where commodities are, where startups fight among their undifferentiated selves.
It makes common sense that you cannot be both a premium airline ("luxury") and a value airline ("cheap") at the same time. Nor is it wise to try to be an "affordable luxury airline", or an "bit more expensive low cost airline". Those fight it out for the profit thin middle market.
All startups, including industrial grade new enterprises face this marketing dilemma: "Should we pick one of the ends, or fight it out in the middle with the mob?
That decision separates management from marketing. It is crucial to make the marketing choice, go for one of the ends?"
BOTTOM LINE: Marketing minds of serial entrepreneurs pick one end of their new market to dominate, leaving the rest to fight in a bloodbath of red ink in the middle. That calls for both a wise choice and focus. It makes sense to serial entrepreneurs who know that to win they must focus on executing well their plan to dominate a target market segment. That's how the company's product gets branded and stands for something compelling for the ideal customer. When you can figure that out for your startup, 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 marketing 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.