Early on, of course, like most companies, we turned to those that we could solicit personally, as well as early adopters who would be naturally inclined to use our offering, a software tool that assesses the fit between a candidate and potential employer. Then the real work began: getting the product out to a lot of customers so that we could really build a company. At that stage, traditional tactics involve advertising to bring customers in — and building a large sales force to go out and find them. We carefully considered both.The economics of nationwide advertising are quite daunting for a startup. You can run a small country with the budget required to fund full-page ads in any national periodical. The other challenge is that, just like teenagers trying to complete their journey into adulthood, startup companies require time and lots of customers to really know how to position effectively and differentiate in a national marketplace. Without that knowledge which only comes with time and customers, advertising can be risky, since you may be spending a lot of money on a message that you may look back on and consider quite adolescent and immature. So we decided that we were not quite ready for a national advertising campaign.
The other consideration was an internal sales force with national scope. Most startups I know have, at one time or another, drawn up plans for investors for opening sales offices in all “NFL cities.” But the dot-com days are over, and the money that it takes to establish that kind of national footprint is a thing of the past. So how do we get there?
Instead, we turned to another proven technique that was not only less costly, but also designed to leverage the entrepreneurial talents of others and allow us to increase sales exponentially: building and training an army of independent companies and individuals to sell our product.
Using other companies and independent sales reps to distribute a product isn’t a new concept, of course. This so-called channel strategy has been around for a long time. One has only to look at Microsoft MSFTand Mary Kay Cosmetics to see how powerful it can be in generating sales. It is all about execution, though.
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