“Argh! This thing is not selling. It’s boring people to death!”
Swift and clever action, bold and wise, can save the day. There are things you can do to turn around your stalled, threatened, sinking business. Serial entrepreneurs know what to do to turn flop into a pop, a fast selling new product.
Marketing Move Example
Let’s learn from some startups I’ve been close to whose CEOs ran into serious problems when their company’s first product turned out to be selling poorly.
My observations are based on startups whose initial marketing plan did not get their first product flying off the shelf. Here’s what I observed about what the leaders did then.
Trouble arrived for each startup after initial sales were acknowledged by the CEO and staff to be far below planned hopes, going nowhere great.
Among the startups in such dire straits, I saw those who were serial entrepreneurs act swiftly. Each spent only a month or two trying to figure out how to modify the existing product. The first timers changed little, instead spent time rallying the discouraged troops to work hard, to keep at it, trying and hoping.
During a series of frank meetings, the experienced CEOs lead the first discussions with company staff about what a handful of modest product modifications might produce. That produced suggestions for changes that might alter product performance in various ways so that customers might get excited, at last.
In about half of the companies lead by veteran startup leaders, the CEO chose to tweak the product a bit and modify the marketing message, willing to wait and see what then would happen over the next few months. I found those decisions gave the existing product an average of about nine more months of life. In the other startups run by veterans, the CEOs decided to make bolder moves.
The other half abandoned the first product after the first or second meeting, putting an end to it, putting it out of its misery.
With the CEO’s decision to end the first product came a quick series of meetings: First a gathering of the leaders and then an all hands meeting of the company employees. Reasons for the decision were given by the CEO without pointing fingers at individuals. Then the CEO gathered his staff and turned the brainstorming over to the marketing leader as they began to figure out what to do with the company.
The creative sessions I attended were a mix of stress and laughter. The mood of attendees was both deadly serious yet spiced by jokes and laughter. I could see that people were relieved enough of the stressful situation to make fun of what they’d done so far. It felt to me like a fresh start in spite of the dark situation.
As the working sessions proceeded daily, I could see people beginning to think boldly, making some amazing proposals. Some of the staff wanted to try a fresh product, much bolder in kind yet similar to but far better than the first failure. Others focused on how to come up with an entirely new product aimed at the same customer market segment. Some leaders pushed for an entirely new business model. A few wanted to shift to an entirely different industry.
All those CEOs ended up making bold decisions in a few weeks. Some turned a mess into a winner. Others did not and ended up closing the doors. The first timers all ended with their businesses going out of business.
During my decades of hands-on work with founders, I’ve found that for first timers, either their first product becomes red hot, or the company turns into a dud. They do not know how to make the bold changes needed to survive and thrive. I’ve only read and watched a few of those rare first timers whose founders converted boldly from a weak first product into an amazing winner. Airbnb – from renting air mattresses to what they have become today.
Making the big change decision to entirely change the startup is enormously stressful. It has to be done in just a few months, not years. It triggers deep soul shaking, pushes you to the edge of your emotional cliff. Fear of failure is very powerful, negative and always shows up in everyone in the startup.
There is a poignant example of CEO stress in the first half of the book “Explosive Growth” in which Cliff Lerner openly writes about his feelings and stress. I found the book full of rock-solid tips of what worked and didn’t when an initial product does not excite enough users. I recommend reading it to see what worked and did not for his company and how you might act when such an encounter arrives for you to respond to.
SNAP Interactive Inc. dating founder, Cliff Lerner describes in his book “Explosive” how he and his core team hit the not-selling wall, the nobody’s-using-it barrier. Even though SNAP was an early entry, the online dating service was still not catching fire but competitors were. It was a very sobering reality to him. Then he tells about the day by day scramble to figure out what he and his staff did about that horror. They embarked on weeks of marketing experimentation, trying all sorts of tactical moves, small things to try to change the service, shift market messaging, follow hot products, anything that might move the needle measuring the number of users. After a few months of intense efforts, he concluded the best next move was to abandon the online service, and pivot, this time to a Facebook app/API. Shortly after the SNAP user population soared.
The objective is to turn a flop into a pop, a fast selling new product. It can be done, often is. So can you.
I wish you The Best on your Adventure!