Three (3) primary reasons why Startups fail:

1. No one PRODUCTIZES the offering. They don’t identify how the idea’s FEATURES actually BENEFIT anyone. They don’t have a clue who their target AUDIENCE really is. They design a logo, put up a website up, and advertise online, without identifying a need or even desire for the product or service (offering). They don’t bother to look for competitors already producing the same or similar offerings. They don’t project how the product/service will make money now or in the future.

2. LAUNCH without INFRASTRUCTURE. Once PRODUCTIZATION is complete, and branding and marketing materials developed, launching with no infrastructure to support fulfillment (orders of your products, or scalability with website use) is the 2nd place I’ve seen startups fail. STARTUPS MUST DELIVER on promises (features, benefits/solutions) OUT OF THE GATE, and be able to fulfill ALL ORDERS, and have the infrastructure to scale, FAST!

3. Little to no R&D investment. Last place I’ve seen companies fail again and again, is their first product does 1 & 2, but they have no plan, and no one in the company is working on NEW PRODUCTS, or features…2.0, 2.1…etc. Horizontal & Vertical marketing of new products/services should be ongoing!! And new products or services should be releasing EVERY 6 months, MINIMUM!! Welcome to the internet age.


Introductions/Class Networking

Students with a product/service/message in mind will share their idea.

Students without a product/service they’re interested in launching will be assigned one, i.e. ‘You are the proud developer of a game app, and it’s better than Call of Duty;’ or, ‘You bake the best pastries on the planet, and you want to turn people on to your passion;’ or…the possibilities are endless!)

What is the #1 job function of any CEO? (Hint: #1 job of a CEO is NOT on any of the links below.)

1. Marketing [anything] 101

Marketing, advertising, PR, graphic design, copy writing, collateral, communications are, [or should be] developed as tools to SELL products/services/ideas/message.

Marketing must sell BENEFITS that continually fulfill NEED to successfully develop, and ultimately grow any business (beyond the freakish, short-lived fad).

►Read Marketing 101

a. Effective Marketing Practices: Ready, Aim, Fire (IN ORDER!)

Ready—Identify IDEAS’s offerings (features and benefits) and potential markets. Then find and analyze competition, as well as horizontal and vertical markets for productized idea. Finally, determine what profit model to employ for roll out, and beyond.

AimBrand company to target markets. Define the mediums on/in which to deliver your messages (radio spot is very different than a Facebook ad). Create marketing tools and collateral for launch, and beyond.

FireLaunch marketing tools and materials with CTAs (Call To Action).

b. Marketing Tools for Selling: from websites, to landing pages to direct mail packages, all marketing material and campaigns are (or should be) developed and designed as TOOLS for SELLING.

►View Marketing Religion

c. Psychology 101

Use the principles of psychology to discover what motivates people/individuals.

►Read The Psychology of Marketing

• Create Desire—understand the difference between NEED and WANT:

WANT is dynamic, changing all the time. WANT can be turned into NEED by continually delivering benefit, or perceived benefit (whether the actual benefit continues to exist or not), as in Apple products. There are many companies that produce better products than Apple at this point. Yet, most Apple converts believe they need the newest Apple gadget, and will wait in line for days to be the first to get them.

►Watch Samsung mocking Apple commercial:

NEED is compulsive, reactive, addictive. Your first offering out of the gate as a new company MUST HAVE features and benefits that fulfills a DESIRE for SOMEONE (even if it’s just to be entertained). The more people your product or service serves, the more likely they’ll be repeat customers. The more repeat customers, the more likely they’ll tell others about your products and services.

Objective Manipulation—using marketing techniques to funnel viewers towards an objective, usually to buy, or buy into an idea/message (also referred to as “false logic”).

Using Storytelling to Sell—creating fiction to sell [usually] idea/message, but sometimes product/services (‘tweaking’ the truth).

Self-interest—at the core of human motivation and evolutionary development to date. Examples of motivators to get people to act:

—To be liked

—To be appreciated

—To be right

—To feel important

—To make money

—To save money

—To save time

—To make work easier

—To be secure

—To be attractive

—To be sexy

—To be comfortable

—To be distinctive

—To be happy

—To have fun

—To gain knowledge

—To be healthy

—To gratify curiosity

—For convenience

—Out of fear

—Out of greed

—Out of guilt

2. Productization 1— Define IDEA’s FEATURES (1st draft)

What is your IDEA? To actualize an IDEA, begin by answering the following questions:

What IS it? (Features)

What does it DO? (Benefits/Solutions)

For WHO? (Target Markets)

a. Define IDEA’S space in marketplace:


Application Software—software programs directed at a specific function, i.e. Photoshop, Word, Quicken, Angry Birds, Call of Duty, Hulu, Amazon. Internet Explorer and Mozilla Firefox are application software written for internet browsing.

System Program—enable the computer hardware or system to run (without these the computer as a whole or parts of its functionality would not work), used to direct the operation of a computer, i.e. Cisco’s Networking Software, device drivers, iOS/Linux/Windows operating systems.

Industry Category—entertainment, social networking, information/media/communications, employment, creative/organizational/lifestyle

SaaS (Software as a Service/cloud platforms)—mobile and/or PC based apps, online gaming, web hosting, systems operations such as Cisco, and development platforms from Microsoft to Amazon, (also review LaaS and PaaS). P2P (Peer-to-Peer), B2B and B2C applications.

Computer Hardware

Consumer—computers, laptops, tablets, flash drives, gaming systems, connector cords, electronic devices…etc.

B2B (business-to-business)routers, switches, adapters, chips, CPUs, servers, cash/credit card registers…etc.


Brick & Mortar (may or may not include products)—schools, restaurants, psychologist to massage therapy, lawyer, bed & breakfast (hospitality), real estate broker, doctor, dentist, ad agency

Itinerant (traveling)—education enrichment programs, consultants, personal sales/solicitation (politics/religion), mobile library to neighborhood vaccinations, dog walking to in-home childcare/babysitting

►Watch DROZ Marketing by Dan Droz, Small Business Marketing Ideas For Your Selling Services:

Online Service Provider—All SaaS apps, i.e. online education, Wikipedia, website/email/blog hosting, web portals, search engines, magazines/media/newswires, gaming/entertainment, social networking

Real Products

Consumer Goods—retail and wholesale from food (markets, cafes) to cutlery to electronics to skin care products, selling brick and mortar, and/or online

Merchandise—housewares, clothing, furniture, electronics, vehicles, building materials

Commodities (product lifeline)—food, beverages, alcohol/home brews, marijuana


• Social Welfare— global warming, vaccinations, abortion, state’s rights

Non-Profit Organizations (as opposed to commercial business)—Red Cross, religious, political, public/private education

Startup offerings may include two or more categories, such as Apple that sells products, services, hardware and software, however, EACH product or service is productized individually, under Apple’s corporate umbrella.

b. The Elevator Pitch (aka Working Title)A 5 – 15 second succinct and persuasive pitch about you, your product/service, or company.

♦ Working Title— temporary title (headline, sentence) of a product or project used during its development. Term originally from film making and TV production. Now used for defining IDEAS into functional products and services

►Create a Working Title: In 1 to 2 sentences maximum create a Working Title for your IDEA. (What IS your idea? What does it DO? For WHO?)

c. LIST the FEATURES of what your IDEA does. Then convert FEATURES into BENEFITS and SOLUTIONS for a potential audience in need of your offering (target):


3. Productization 1a: Target Marketing

What does your product/service provide, and why should anyone care? What desire (or need) does your offering fulfill. For who?

a. Target Market: a group of existing and/or potential customers that a company aims its marketing efforts, and ultimately its products/services and merchandise towards.

Built-in perimeters for target marketing—from product/service FEATURES list, derive potential target customers. (Example: Game app like Scrabble may be for kids and adults, but it’s still a game, and should be marketed as entertainment, even if it’s “Entertain Your Brain and Get Smarter!”)

Low-hanging fruit—first go after potential customers who are most likely served by your offering. 

b. Umbrella Targeting: Identify [basic] characteristics of people who would be interested, or are in need of your IDEA.

Categorize potential customers—target parameters can be gleaned from demographics, geographics, psychology; sociology; market research; common sense; competition in your market space, predictive modeling…etc. (Scrabble-type game apps have a different target audience/market from FPS–first-person shooter games.)

LIST in bulleted points in less than a sentence each the answers to the below data on projected characteristics of people who may be interested in your startup’s offerings (NA if not applicable):

-age range


-income bracket

-education level


-race/ethnic background


-professional level (management, years of experience)



-sexual orientation


-lifestyle (i.e. city dwellers/suburbans, vehicle choice)

-entertainment (i.e. types of music, books, movies, tv…etc.) preferences

-political affiliation (often associated with location)

-technological proficiency (often related to age/income/education)

The more comprehensive this list, the tighter you’ve defined the target audience for your offering/s, and the better you’ll understand your markets and what motivates them to act.

Example: Developed a game app for mobile gaming? Projected Target Market Characteristicsboys/men, 10-45, multiracial, heterosexual, mobile literate, advanced gamers, low-middle+ income, poor to mid-level student, no to low level college education, single, religious, suburban, rock music, little to no recreational reading, digital life—online all the time, student/military/admin/civil service, nominal career demands…etc.

Feature & Benefits fulfilling needs of projected target audiences for mobile gaming app:

Kick alien butt!

290 advanced levels

342 killer weapons

20 planets or make your own

Mobile multi-player for iOS or Android!

Build fortresses

Lead battles

Plan tactical strikes

Buy and fly air and space craft

Mind-bending adrenalin rush!

The more comprehensive this list, the greater likelihood your offerings can fulfill the needs (and/or desires) of your target audience. A long list of benefits, real or perceived, will be useful in creating content for marketing messaging online, in print, display, advertising, broadcast and collateral campaigns after your IDEA is fully productized.

Watch How to Develop a Marketing Strategy:

4. Productization 2: Competition

a. Iterative Searching: using keyword and key phrase searching to get answers to queries, generally increasing knowledge with each search. 

• Finding what you want with access to…everything, isn’t easy sometimes. Iterative searching* is a continual process, and should be used to gain knowledge in any area. Use Google for the most relevant returns (generally start here, unless working in a specific framework with its own search capabilities):

Example: > 5th Grade Math >> 5th Grade Algebra >>> Free 5th Grade Algebra Worksheets >>>> 5th Grade Algebra timed drills >>>>> 5th Grade Algebra drills iPad…etc.

*Most search engines get confused with more than a few words. Return results are generally relevant to only the first two or three words in the search query.

b. Exploring and Monitoring Competition: Search the net for data, whitepapers and companies in your product space, and/or selling to your target market/s.

Begin a file of competitors and potential competitors sites you find through research or stumble upon.

Check your competitors site and google them frequently to monitor their progress.

Search for data, one-sheets, whitepapers, user-groups, meetups, colleagues through LinkedIn and other SN sites in your company’s space, and keep ongoing file of pertinent material.

c. Response to Competition

Define and LIST the differentiatorswhat makes your offering different, i.e. more valuable than similar products/services from your competitors.

• After an in-depth review of competition, and accurate assessment of their offerings, current and projected, if you have no clear differentiators— realign your Features & Benefits/Solutions. Upstage competitors benefits list by adding to your company’s offerings that delineates your company/product/service from competitors (even if only price point to gain market share).

Example: Compare your list of Features & Benefits with your competitors. Strike-through the ones that match exactly. Add features and benefits your competition has to your Features & Benefits list where applicable. Then make a new list of your value-add/s, i.e. your differentiators:

cheaper than competitors same offering/s

lasts longer

made better, and/or in U.S.A.




more capable

easier to use

cooler (as in hip, slick, and trendy)

the right thing to do…etc.


5. Productization 2a: Plan B, C, D…etc.

a. Review vertical/horizontal markets for your product/service: Identify possible spin-off products/services in the same market space as your original idea. (Example: ‘Elaine’s Famous Cupcakes are almost as Good as Her New Signature Cookies.’)

Vertical: variations/modifications/marketing of your product or service to specific industries

Horizontal: your offering/s fill a need/desire for people in a wide range of industries

Competition will give insight to vertical/horizontal markets, or spark ideas of similar industries/target markets to sell your product/service.

Explore your target market’s needs, both in and outside of your product market space to discover Vertical and Horizontal markets, not only as a Plan B (plan C, D…etc.) if your first idea doesn’t go as planned, but also as part of a working business plan with long range project goals.

Continual releases of new products or new features on existing products are a MUST for most any company to survive today! Setting up new development milestones makes it more likely to consistently achieve them.

6. Profit Models

a. How will your startup make $$$?

Gross profit—a company’s revenue minus its cost of goods sold, i.e. a company’s residual profit after selling a product or service and deducting the cost associated with its production and sale. To calculate gross profit: examine the income statement, take the revenue and subtract the cost of goods sold. Also called “gross margin” and “gross income.”

Net ‘operating’ profit—a company’s operating income after operating expenses are deducted, but before income taxes and interest are deducted. If this is a positive value, it is referred to as net operating income, while a negative value is called a net operating loss (NOL). NOI is often viewed as a good measure of company performance, as it is less susceptible than other figures to manipulation by management.

ROE (Return On Equity)—measures a corporation’s profitability by revealing how much profit a company generates with the money shareholders have invested. Return on Equity = Net Income/Shareholder’s Equity

• ROI (Return On Investment)— measures the amount of return (money made, response rates, engagement rates…etc.) on investments of money and TIME put into the development, branding, and marketing of your offering. Return on investment formula is: ROI = (Net Profit / Cost of Investment) x 100.

Profit Sharing—Employees share a portion of profits based on corporate and business performance.

b. Retail: selling physical products such as consumer goods, merchandise, electronics…etc., and/or services directly to consumers with an agreed upon price for offering:

Brick and Mortar—location based storefront such as a cafe, clothing or merchandise stores: dentists/doctors; salons/spas; banks/financial institutions…etc. are generally charged per product/visit

Itinerant (traveling)—education enrichment programs; carpet to house cleaning; dog walking to in-home childcare/babysitting are charged per visit, or as a monthly or annual service.

Third party sales/Value Added Resellers (VAR)—selling your product through another vendor/corporation as in Amazon, iStore, Esty, Google Play, and the VARs get a percentage of your sales.

c. Consulting services—IT/technology/computer services; financial services (accountants, discount brokers, financial managers); HR (human resources); travel agencies; business management/strategic planning…etc. are price per service, monthly or annual fee, sales or purchase percentage.

d. Wholesale: computer chips and cards (though some sell retail); consumer items as in sugar, fruits, grain for food; supply chain logistics (trucking, UPS, FedEx); business management software…etc., generally based on agreed upon price per product or service, or subscription fee for Saas.

Read more: The Art of Profitability

e. SaaS (Software as a Service):

License Agreement—the user agrees to pay for use of the software, and promises the software author or publisher to comply with all restrictions stated in the EULA (end user license agreement).

Per-seat license—software license based on the number of individual users who have access to the software. 50-user per-seat license would mean that up to 50 individually named users can access the program. A user may be a person, software or device accessing the software.

Subscription model—paying a monthly or annual fee to use the software or application, like Adobe Creative Suite or Microsoft Office.

Freemium or Premium Upgrade model—giving away a service like LinkedIn and charging for “Premium” use packages. Games that charge for virtual products as in extra weapons for video game. Books, where the first in the series is free, but you pay for every other book in series

• Affiliate PPC advertising model—selling virtual space on your website or blog or social network feed for others to put their PPC (Pay-Per-Click) ads on.

Watch: Affiliate Marketing For Beginners – How Does Affiliate Marketing Work:

Adwords is an advertising program offered by Google that pays owners of websites, blogs and vlogs on a pay-per-click basis for advertisements that another company displays on their websites. The advertisements are typically banner and text ads and have some content related to the site the ad appears on. Adwords are also known as “keyword” advertising, in which ads appear as “sponsored links” on the Google results pages as well as the results pages of Google’s partners such as AOL and The advertiser chooses keywords and a short one- or two-line text ad, which is displayed on the results pages when the ad keywords match up with the search keywords.

in_text_ads (1)

Watch: Use Broad Match in AdWords to Capture Local Searches – Google Best Practices:

Read Affiliate Marketing vs Adsense: