The golden era of the startup ecosystem in India seems to have hit a rough patch with a lot of shutdowns, mergers, and acquisitions before stepping into 2017. Investments have slowed down by almost 24 per cent quarter-on-quarter, as investors are carefully scrutinising business economics, due diligence and brand value before parting with their money.
In spite of this period of transition, the Indian startup ecosystem is still prolific and optimistic about the future. For startups to survive in this crowd, get noticed by customers and investors, and be valued for themselves, they need to take a close look at how they are going to approach the business apart from managing the basics of product and service. Obviously, creating a media blitzkrieg of publicity, maximising valuations in subsequent funding rounds, and too many clone businesses are not succeeding in making a mark.
Upcoming startups need to learn from other startups that are still around and growing steadily. A good example of a valuable startup is Byju’s Classes. From classroom formats, this startup expanded into an online site and a hugely successful app. It has garnered 125,000 people on its platform and has been adding 25,000 users every month.
Byju employs about 1,000 people and has raised US$75 million. The site offers original content which encourages learning through videos, animations and interactive simulations in a fun way. Pai, ex CFO Infosys and now an investor in this startup, calls Byju “India’s greatest edtech entrepreneur,” who gave fourfold returns on his investment in a span of four years. It has all that a successful startup should have: brand value, differentiated product and service, a satisfying customer experience, and a strong offline and online presence.
Considering, by virtue of being a startup, there isn’t much else other than a product or service to showcase, startups are often left struggling with how to sell their offerings without really having created a brand yet. So, it’s important for them to differentiate themselves from the competition and figure out what value they are really offering apart from just the product or service in order to attract customers, get financial backing and forge strategic partnerships.
Creating a strong brand value that instantly resonates with the customers and investors
When a startup launches its services or products, and sets up suppliers and distribution, it is time to create a brand. It cannot be made by throwing money at it, or by marketing tactics, but by creating value.
“Those entrepreneurs who eventually grow up to dominate their market represent a compelling ‘idea of value’ in the minds of customers that is simply not available from the alternatives in the category,” as Thomas Dawson rightly sums it up. A startup’s brand should be able to express what it’s product can do, the core values behind it, the business methods that create it, and how it can change the customer’s user experience.
A brand is what differentiates an Apple from a Samsung, or an Ola from Uber. They may share similar products and services but the promises and expectations from the respective brands are different.
For creating brand value with the right connect, startups must address their core values and vision, identify its customers, and understand how they feel about their experience with the product and what need it fulfils in their lives. Once the core of the brand is created, regardless of the fact that products may change in the future, or teams may dissolve and customer preferences may shift, the brand remains constant and everything falls in place around it. So, creating a lasting brand value far outlives the dynamics of market share and makes an organisation grow organically.
Be original, be the expert in your field — only then will your brand be valued
Most businesses try to be everything at one time in a rush to satisfy all kinds of customer needs and demands. Startups should stop trying to compete in multiple areas and only focus and develop their strengths, however limited it may seem at first. Once this is under control, then expansion in other areas can be planned. For instance: a brand called Licious based out of Bangalore is focused on delivering fresh meat at 5 degree Celsius and growing at a tremendous pace due to a clear-cut niche.
Aim to offer your customers an experience synonymous only with your startup
Startups should thoroughly understand that customer service extends beyond merely selling your product. Customers should be treated more like partners than business targets. Free trial services, try-and-buy options during delivery, money back guarantees, loyalty rewards, and referral bonuses are a few great mediums for customers to use and know your product. Use genuine customer feedback, testimonials and recommendations to differentiate your products, make improvements in your services and follow up on all complaints and returns with sincerity.
Special promotions like philanthropic associations by startups to support specific communities or initiatives score big points on creating a favourable image of an organisation. It elevates the stature of an organisation from being only a commercial venture into a social contributor and creates a lot of goodwill.
The key to a startups’ survival in an overcrowded market is to create the value proposition of their brand as apart from being a mere commodity, to emerge as a leader in their space.
(By – Mahesh Nair)
