The Power of Brand in the Technology Markets
I have listened to hundreds of presentations from entrepreneurs looking for funding since I joined InterWest Partners. They all have one thing in common: the majority of the presentation is spent on the product they are building and the market they are targeting.
Similarly, when a venture firm does its due diligence, it spends a significant amount of time and effort speaking with current or prospective customers and analysts to gauge their level of interest, the importance to the business, ROI, usage rates, etc.
This is all very laudable.
However, if you were to perform autopsies of technology start-ups that have failed, I think you would find that most were able to build the products they said they wouldâ€”and that the customers who purchased them received more than marginal utility from them.
I believe that one of the primary reasons has nothing to do with products or markets. Instead, most of these companies went under due to their failure to create a recognized and differentiated global brand– a brand that linked their company and the use of their products with their customersâ€™ success.
Global brands must be engineered â€“ they seldom just happen on their own. It takes a management team that understands the value of building a brand and one that knows how to do it and is willing to invest a significant amount of effort.
When I think of great high tech brands, I think of those built by IBM, Microsoft, Oracle, SAP, or more recently Salesforce.com. Each of these companies invested heavily in their brands and their â€œbrand promise.â€ When you think â€œSAP,â€ you think â€œruns my business.â€ If you think â€œSalesforce.com,â€ you think â€œNo More Software.â€ Oracle invested heavily in PR and advertising for many years â€“ and still does today â€“ to build its brand as a leading provider of database and information technology.
So, if creating a global brand is important, what can you do if youâ€™re a small technology start-up with very little cash to create a global brand?
Well, consider the example of Salesforce.comâ€™s Marc Benioff. Marc created controversy by taking on the CRM Goliath at the time — Siebel Systems â€“ even when his product was substantially inferior and he wasnâ€™t focused on the enterprise market. He created conflict and drama through the use of his â€œNo More Softwareâ€ campaign and got the media to write about him at virtually no cost in order to achieve an unfair share of voice in the market.
Itâ€™s a good strategy. Technology journalists are weary of writing about speeds and feeds. If you can give them juicy content about your companyâ€™s plans to upset the status quo–with some credible evidence to back up your statements–you will get â€œfreeâ€ press all day long.
As I wrote earlier, you must engineer your brand — and your brand objectives — into your day-to-day operations from the very beginning. You must measure yourself against these objectives weekly if you are serious about achieving these goals.
Here are some questions to ask yourself and your team to gauge your progress:
1. How many keynote speeches at major industry conferences were you and/or your key executives personally invited to deliver last year? Not panels, keynotes. You should be giving at least one keynote every quarter, perhaps more often, or you really arenâ€™t relevant. If not, why isn’t your PR agency getting these for you?
2. Do the leading industry analysts regularly follow your space and are you in the furthest upper right hand corner of their charts? If not, what are you going to do about it? Achieving this position takes a dedicated effort by the CEO and key product and marketing executives. It wonâ€™t just happen because you build a great product.
3. Does your Web site support a community of your end users and partners with content, ratings and a way for the community to suggest new product ideas? Hosting a “User Week” is fine, but it’s only once a year. Today, you can receive customer feedback on your products and funnel it to your organization daily.
4. If you did a random survey of influential CEOs in your industry, would they know you personally and would they recognize your company’s name and products? If not, what are you going to do about it?
5. If you took a random sampling of your employees, customers and partners, would each of them use the same words to describe what your company does and its value proposition? Does every employee in your company know the corporate mission statement? Have you tested every customer facing employee to ensure they deliver the corporate messages identically? A global brand starts with consistency.
These are five things you and your team can do to start separating yourself from the rest of the pack. From my experience, the great companies never neglect their brands.
And if youâ€™re still looking for funding, a good place to start paying attention to your brand is during your presentations to venture capital firms.