We are in a global crisis situation that presents us with many challenges—in the personal as well as in the professional environment. As startup people and founders, we are practically used to challenges and difficult situations. We look for failures and patterns and adapt our best practices to always improve the product and startup.
With Covid, there is no blueprint for the current situation—we do not have a playbook that we can simply pull out of a drawer. The plan which we can simply adjust briefly does not (yet) exist.
At RE’FLEKT, we are currently confronted with new developments every day. Home office, shelter-in-place orders, customers who can no longer travel or urgently need technicians on-site to repair machines, new customer inquiries about how our products can be used in new situations.
The job of all marketing and communications leaders is to observe every day what the mood is like, play through possible scenarios, and be in close contact with customers, partners, and the own team.
1) Check the situation and monitor the markets
It is currently important to reassess the situation every day. To do this, you have to be very close to customers and markets. Which sectors are still optimistic or essential in the crisis (medical, healthcare, delivery services), which are shutting down their production or are in major difficulties (tourism, airlines, automobile)? Which geographic markets have which needs?
Google Trends allows a good overview of the search queries that provide insights into current needs and moods. For example, remote tools and desks (for home offices) are popular inquiries and products. Ask your customers and partners directly how they assess the situation. This gives a quick insight into the market and enables forecasts of further business developments. Other sources can be found on SeekingAlpha or Crunchbase.
2) Focus on targeted and personal communication
Instead of mass emails and campaigns (which are becoming less important anyway), startups should focus on targeted communication. Less communication but as personal as possible allows it to be on the pulse of customers and partners.
Direct emails or a personal call help to promote communication in the crisis. Please do not forget that many people are currently unsettled and sometimes alone in the home office for longer periods. Many are worried about their own future, their job, or their family. No school, children at home, all this creates a lot of emotional tension.
Show empathy in communication and keep the focus on people. A great example is Arne Sorenson, CEO of the Marriott Group:
3) Brand Value and Education first approach
Brand messaging and positioning as well as product marketing change in the crisis. The value of your brand plays an important role while traditional product marketing with the typical “Buy” button as well as “Get 10% off if you …” feels off right now. Rather, an education mindset comes first, in which companies get the feeling that they are finding a partner who helps in the current situation.
Thought leadership is recommended (which it should always be) so that companies gain the necessary trust in the solutions of the startup. And for media—that currently need information about important topics—it is easier to find experts on the topic and to interview founders.
Offer media support and actively approach individual journalists. Twitter is the perfect channel for this, but Quora or media-specific portals such as HARO also offer contact options.
4) What is the value your customer needs now?
Every startup solves a problem. And startups are good at quickly recognizing opportunities and acting accordingly. How can your product help in the current situation? Anyone who listens to the markets and the needs of customers as mentioned above will find new opportunities in the crisis. What can be done differently with the product even though it was perhaps not designed for it?
We develop products that use augmented reality to make it easier to repair machines and equipment without the need for on-site technicians. In the meantime, we have received many inquiries about remote collaboration with China and other areas of application that we had not previously focused on.
Many initiatives are springing up that offer a marketplace under the motto “Startups vs. Corona Virus” which brings together the problems of companies and the solutions of startups. The problem/solution approach fits the crisis situation much better than presenting your own products every day as a campaign push on social media.
5) Find new ways for events and trade shows
What to do if there are no personal meetings, events, and trade fairs? How and where can startups inform customers about news and updates? It will probably take at least until the second year before we can experience events and workshops again.
Video meetings are the logical alternative and work very well if you follow a few rules. Instead of all-day workshops, 3 to 4 hours of slots can be arranged—with sufficient breaks and active moderation.
We considered setting up a “Virtual Booth”—a small version of a stand with banners and furniture so that it looks more like a live atmosphere than just the face in the video.
6) Communicate with your teams
So far we have spoken about the external target groups but please do not forget your own teams. Everything I have described the insecurity of people with our customers and partners naturally also applies to our own employees.
Leadership and communication are required here to help employees in this unprecedented time. The CEO and founder must update employees every week. Video calls, update emails and direct 101 check-ins are extremely important, while no personal meetings are possible. An Ask-us-Anything format via Zoom/Skype/Teams or in Slack is a good alternative.
7) Keep your investors in the loop
In addition to revenue and expenses, the funding topic is particularly relevant for startups. Crunchbase currently sees no negative effects on funding. However, investors can be expected to be more hesitant in the coming weeks—at least as long as the short-term and mid-term effects are unclear.
Investors, like customers and partners, expect regular communication on revenue and cash levels as well as on the measures that are being initiated. This should not be one-way communication, but investors should share the feedback of their investments from different markets and promote a “Lean & Share” culture among their startups.
Adjustments to communication, business plan, and funding strategy can be discussed together. In the current crisis not only the behavior of startups with regard to marketing, PR, sales funnels are changing, but also the role of investors as crisis advisers.
8) Think in scenarios
In startups, plans can get outdated very quickly and in the current situation probably before the ink is dry. The crisis leads us to the basics: hypotheses and scenarios. So instead of just building a plan, it is advisable to run through different scenarios.
What kind of communication do we do when the greatest impact lasts until June? How do we change the strategy if it lasts until the end of the year? How do we deal with event planning for 2020? What budget is free due to canceled shows and how do we invest it? How can we support our customers when bottlenecks occur?
A matrix with questions as a basis helps to form hypotheses to build scenarios with checkpoints and makes it easier to make critical decisions.
9) What startups should focus on
- Build a market monitoring for daily/weekly checks
- Understand what your customers need
- Communicate less but targeted and personal
- Provide education for your customers instead of selling-as-usual
- Show the value of you brand and build trust
- Keep your investors informed and request active support
- Create a scenario matrix with hypothesis
Overall, be transparent, avoid hectic communication, and concentrate on the important issues. Everything that is not existential in the first half of the year plays a subordinate role.
Finally, three interesting articles. The first shows the assessment of three travel startups, probably the most affected business field in the crisis. The second article is a detailed look at marketing in uncertain times—current and worth reading. In the third article, Phil Venables shares his thoughts on selling in a crisis.
“Make the world a better place” is an inflationary saying in the startup world. Now, it is up to us to focus on what is important, be better people and let it happen.
Dirk Schart is CMO and President of the Augmented Reality startup RE’FLEKT. His focus is on B2B enterprise software and SaaS models with early-stage technologies like AR, AI, IoT—from market engineering to thought leadership and go-to-market. Dirk is a startup mentor at the German Accelerator in the Silicon Valley and author of two books about Augmented Reality.