‘Shooting star’ companies are what I defined as brand new, short lived and ‘Big Time’ companies which invested heavily on marketing and advertising campaigns without a clear direction of where the company heading in the long term. These companies usually focus on getting quick profits.
Just like a shooting star, it shines the brightest among the other stars in the dark skies but only for a short while before it descends into nothing. Some of the signs of shooting star companies are, overnight massive branding and advertising campaigns in all kinds of online or print medias, sudden rush to get IPO within less than 3 years of business operations, where company’s business model is easily ‘copied’ by competitors with heavy advertising budgets with months.
It will be too ‘dangerous’ for a marketer to work for a shooting star company as it will be like venturing into the unknown without a clear vision of the future. Here are 3 reasons why.
Too Much Short Term Strategies
Shooting star companies spend too much time and money on short term advertising campaigns. They tend to be over focus and overly dependent on massive advertisements for their business survival. Such dependent on mass advertising will not work for the business survival in the long run. This is because the cost per acquisition of a customer may be very high due to its heavy investment on massive interrupting advertising. It seems that the company wants to become famous quickly without building its foundation well. A strong foundation is not just include getting the advertising or sales right but also all the other little things that makes up the whole business. Such little things are its employment policies, HR structure, customer support team, customer service team and so on. Hence, focus on both short term and long term strategies for the business can make it become a brand in the long run eventually.
Consumer Trust Lacking
Consumer trust on a brand new product or a brand is not built overnight; it needs time for people to learn and to appreciate it after a period of using it. Therefore, massive advertising campaigns only raise awareness of the product or the brand in the minds of the consumers; consumers are perhaps curious to find and try out the product and brand and see if it benefits them or not that’s all. It is only after a series of awareness and satisfied transactions, then the consumer can trust the particular brand or product.
When most shooting companies focus on getting large amount of sales in the short run, they might fail on getting things right especially when during the after-sales. Customers who have tried their products and services may not be unhappy about it. These companies may not have a support team to do damage control and handling consumer complaints. Hence bad word of mouth marketing will spread, making cost per acquisition of a consumer much higher in the long run.
No Product Uniqueness
If the uniqueness of the company is anything but its massive advertising budget only, then it actually means that it does not have any product uniqueness at all. This is because any company, so long it has a huge advertising budget, can become a competitor to the shooting star company anytime. Anyone can just duplicate its business model so long they have the money. Hence unless the particular shooting star company can come up with a new strategy to make its product different from the rest and make something that is not easy to be copied; then it can retain its market share for a relatively longer period of time and eventually marketers can help to make such product a lasting brand in the economy.
In summary, open up your eyes and be sharp in spotting signs of a shooting star company appearing; and with that in mind, by understanding the know-how of a shooting star company, you will also know how to deal with such company should they suddenly appear as a competitor in your market.