Hiring the first team members in a start-up can be challenging, and is always crucial to the company’s development from its earliest stages. Hiring the wrong person can be costly, and without a proper HR department in place it can be easy to make mistakes. Tomasz Tunguz, Partner at VC firm Redpoint Ventures, argues that the most common mis-hire in start-ups is the first Head of Marketing. Not because companies hire a bad marketer, but rather because they tend to hire the wrong kind of marketer.
Although the scope of Marketing as a discipline can be incredibly broad, we can divide Marketing practitioners into three main categories based on the different skillsets needed for each:
- Product Marketers, who are responsible for bringing a product to market with the right positioning, carrying out a successful launch and then enable the sales team with the right messaging around the product;
- Demand Generation Marketers, whose job is to “generate leads” – an expression that encompasses a variety of techniques including search advertising, social media, events, content marketing, outbound calling and many others;
- Brand Marketers, who make sure that the market is aware of a company or product. A brand can be a terrific asset when it comes to increasing customer loyalty and gaining and retaining market share, which is why the brand is so valuable in the long term especially to consumer products company who rely on a large user base.
It is a common strategy for Founders and CEOs to hire a sales team to push the product around the time it’s going to market, and then hire a Demand Generation Marketer or a Brand Marketer to try and scale demand and retain current buyers. However, hiring a Product Marketer early on in the company’s lifetime may actually lead to higher success rates. Here’s why.
One of the first dilemmas for a start-up Founder is achieve a product-market fit. That is basically a requirement: selling a product with poor market fit causes 42% of start-up deaths, but even when such fit is reached, it is fundamental that the company deeply understand the nuances of such fit, which come down to the questions: who is using the product and why?
That is Product Marketer’s Job. Gartner reported that 81% of companies expect to compete solely or mostly on the basis of customer experience, which is especially true in relatively crowded sectors with little barrier to entry such as SaaS. Customer experience needs to be curated every step of the way, from sales to technical assistance, but a company can only do that properly thanks to a deep knowledge of their customers’ needs and relationship to the product.
Through their thorough research and planning work, Product Marketer can help everyone else in the organisation understand how to deliver the best possible customer experience. This results in more successful launches, leaner marketing funnels, lower churn rate and higher loyalty.
Every other Marketing professional will benefits from the work carried out initially by a Product Marketer, enabling more effective sales, lead generation and giving a head-start to branding wizards allowing them to build a brand around the product’s core values and messaging.
Of course, different business models require different kinds of investment in Marketing, so this might not be the case for all start-ups, but we believe that focusing on Product Marketing early on can be beneficial in the long term, laying the foundations for the rest of the Marketing and Sales team to work on, and establishing a customer-centric approach from the very start, rather than having to pivot later on to meet customer needs and expectations.