Thousands of new food/beverage/natural products are introduced to the marketplace each year. Nearly of them are small entrepreneurial startups. Most of them will fail in the first year.
In a marketplace of clutter and noise, coupled with the battle to breakthrough customer’s ever-shorter attention spans, it’s easy to see why so many really great products never get the chance to get off the ground. In an age of micro-segmentation, failure rates for new product introductions range from 80-90%.
Even for deep-pocketed multinational brands, less than 3% of all food and beverage products will achieve mega-hit status of $50 million in annual sales. This is after they spend millions in marketing.
If you’re a Founder of an early stage food/beverage/natural products brand, you already know the odds are long and the climb is steep. But if you’re anything like the Founders I’ve collaborated with, your purpose/passion/cause runs deep and unwavering in the face of your early growth challenges to build a brand customers love and can’t live without.
A case in point: An excellent case study in strategic brand development all Founders can learn from is the startup dietary supplement brand UFORIA.
This is a great example of what it takes for a startup to innovate new value to the right market and elegantly express it with focus and clarity through the entire organization and at every point of customer interaction. It sure meets my criteria for enlightened strategic brand development.
If you’re a Founder stuck on a plateau of early struggle, here’s what it’s going to take for you to get the traction and momentum to build a one and only brand:
A compelling “idea of value” that deeply resonates with SOME people and is the ONLY one of its kind.
An idea of value is always based in the customer achieving their desire. It’s really not about your product rather it’s what your customer achieves as a result of your product. Because you’re a baby startup, you need to focus on serving the small group of early adopters who will be the basis of powerful word of mouth. Then your idea of value must be the one and only source where customers can achieve their desire. That’s how you start a fire–with relentless focus.
Have a great name.
As a startup, you need to be strategic about what name your business/brand will be known for. You need to develop your business and brand strategy first. You brand name–which will endure forever–should come after you’ve figured out who you are, what your business/ brand stands for, and how your desired reputation shapes your business goals. Your brand name is everything and the only thing that builds financial value over time. Take the time to create a memorable brand name worthy of your aspirations.
Disrupt the category.
Innovation is about creating new value, not competing for the value already created by others in your category. Change the rules of the known game to your benefit–no sense crawling your way into the middle of the slush pile. The UFORIA case study is a great example of disrupting the dietary supplement industry. It does this through DNA science. You take a DNA test; UFORIA evaluates your genetic code and formulates a single dietary supplement based on your genes that you take once a day. No other dietary supplement company is in that space. Customers can say goodbye to all the different expensive dietary supplements lingering in their pantry.
Credibly position the alternative to your offer as something “less than”.
The most important component of brand positioning strategy is to position the available alternatives to your proposition as something of less value received.This is tricky because you must have credible proof in your positioning that truly matters to your customer. Remember too, perceived value is always in the eye of the beholder. It’s not enough for your marketing to claim you’re better and different, customers must experience the difference and they’ll be the judges.
Own a high barrier to entry into your market.
Barriers to entry enhance your competitive advantage. The higher the barrier to entry into your space, the fewer players in the market. Barriers to entry, in all their forms, are an inescapable fact of business economics. There are two types of barriers to entry in a given market. A primary barrier to entry is a cost that constitutes an economic barrier to entry on its own. An ancillary barrier to entry is a cost that does not constitute an economic barrier to entry by itself, but reinforces other barriers to entry if they are present. Examples are capital, intellectual property, manufacturing processes, supply chain, distribution, market research, etc. Is there a high barrier to entry for others to compete with your innovations?
Invest in the important role strategic design plays in crafting the customer’s perception and appreciation of your unique value.
Design in all its discipline has created trillions of dollars in market value. Design takes form everywhere in your business– brand identity, product design, packaging, physical spaces, and customer support– the very quality of your presence in the marketplace. Good design is just good business. Every experience customers have of your brand must be carefully designed to bake your marketing into the amazing experience of doing business with you.
When these elements are in place, not only will you attract your early adopter customer who eagerly share their experience with others, but over time, equity partners with the seed money to finance and scale your business will be coming out of the wood work to take a stake in your bigger future.
A word of caution here–too much equity investment too early in your growth can do real harm to your future. My advice to startup Founders is to create the first level of success on your own steam.
You can do it!
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