Why did the start-up fail? Because it didn’t “dO ThE ReSeArCh”
“We’re the first with product X on the market,” boasts the start-up. Apart from the other two dozen players offering the same product.
So what was it? Brash marketing gone wrong? Lack of market research? Deliberate deception?
If you’re basing your “value proposition” on the false premise of being first to market in one that’s already doing just fine, expect the competition to come calling:
- complaints to regulators that see your advertising banned
- complaints to regulators that see your product banned (because you missed established regulation);
- legal action because you’ve stomped all over established trademarks, IP or you’re “passing off”;
- offensive marketing to highlight your deception and position competitors as established, knowledgeable and reliable;
- being hounded into a niche player when you built your business model on mass market appeal.
While “do the research” is one of those terms thrown about as an insult it does matter. First in my dot.com days, then in the post-ecommerce economy and now in an AI fueled, Web3 world, I’m seeing startups make the same mistakes. Gut feel, quick Google searches, ChatGPT and a business model canvas aren’t substitutes for thorough market research.
As the old saying goes, “Ignorance is not a defense in law”. The same can be said for business.