June is typically a month dedicated to startups. If you are an entrepreneur or know someone who is running a business fulltime, please be kind and give them – or yourself – many hugs this month.
Our focus for this month will be on startups and how to manage and optimize your cash. Before we dive into the nitty gritty of things, let us discuss the most important thing: Do people know what your business can do for them?
Advertising is the fastest way to be noticed but before you spend money on that, you should know that as fast as people come through advertising, they go even faster. The only way to gain any real retention will require a combination of time, content marketing and occasional advertising if you have the money for it. If not, you can also depend on referrals to advertise your business to your target audience.
Entrepreneurship is a lonely journey so you need to be sure that it makes sense in the grand scheme of things in your life. Successful businesses have one mindset that is, a firm conviction in their business efforts. Ask yourself what your aim is?
Based on your plans for your startup, assess what the best marketing strategy is for you. Is it advertising, direct sales, referrals or a combination of these? Use this questionnaire to assess where you are in your business and what kind of advertising you need.
If you follow through with your assessment of the best marketing strategy for your startup, be specific with the outcome you want to achieve and set a timeframe for accomplishing your goals. For instance in 6 months, increase sales by 5% using direct marketing.
If you achieve your goals within the time period you’ve set, how would that affect your earnings and the company’s value? Adopting the right marketing strategy is sure to increase the net worth of your startup.
If you grow your user numbers, how will that drive your company?
Companies selling to other companies are called B2B companies. They spend between 2-5% of their revenue on marketing. Those focused on consumers are called B2C and spend between 5-10% of their revenues on marketing.
These percentages could also be calculated as a time expense meaning as a consumer focused startup you may need to spend 5-10% of your work hours (45 minutes daily) on researching ways to better understand your target consumer.
For every naira, ceddi, shilling or dollar spent, know what it’ll yield you and your business in terms of new clients and/or revenue for the period. If not every week then you should review your business at least once a quarter.
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MONEY BRAIN with JR is the career and money management newsletter that connects you to wisdom, opportunities, and a very resourceful community of talented professionals.