1. Don’t have a generic name.
You probably remember most of the big technology companies that sprang up before the dot-com bubble burst in 2001: names like Yahoo!, AOL and eBay were easy to remember because they were quirky proper nouns. Today, the biggest tech companies have similarly memorable names (e.g., Amazon, Facebook, Google).
What you probably don’t remember are the countless generically named startups that went bust. Companies like Pets.com, Mortgage.com, iMotors.com and eToys.com raised between $50 million and $166 million each. All of them have since gone bust, despite some great ideas.
Granted, these companies may not have failed purely because of their generic names. But those names certainly didn’t help them. Choosing a common word for your company name is a losing strategy. It’s like naming your book “Book.”
2. The less you offer, the more you’re remembered.
I explained the dangers of offering too much in "5 Rules of Marketing That Will Help You Find The Right Niche And Thrive," but it bears repeating: Don’t confuse the customer.
Offering too many products or services weakens your brand name, which customers will always associate with the product or service that first put you on their radar.
A great example of a company that avoided this trap for decades but then fell into it is McDonald’s. When the fast food upstart first became popular, there were diners everywhere. And what do diners offer their customers? Everything. But when McDonald's first became popular, it had only nine items on its menu.
Today, McDonald’s offers everything. It's become the fast food equivalent of the diners it beat out over 50 years ago. As a result, it's had to reinvent itself multiple times to compete with new burger competitors like Five Guys and Shake Shack.
3. If you want to expand, launch a separate brand.
Granted, offering too much isn’t necessarily a problem if you can keep up with the demand. That’s why McDonald’s is still making billions every year. But offering too much under the same brand name is a mistake every single time.
One of the biggest cases of brand-extension failure is Microsoft. Sure, Microsoft is still an industry leader in some key markets -- but at one point the company completely dominated the tech market. Then it decided to release tons of new products and services under the Microsoft name.
That’s when Apple literally came back from death’s door and stole away Microsoft’s customers with strong brands like the iPod, iPhone and iPad. Today, Apple is the biggest tech company in the world, while Microsoft is number six.
Fortunately, if you’re thinking of starting a new brand, being a person is a lot better than being a faceless corporation. You can just piggyback off your good reputation on your new brand’s website (e.g., “Hey, remember how much you love me? I started this brand, too.”).
4. Promote what you do, not what you’re selling.
I see so many companies saying things like, “At our company, we offer unique offerings.”
The problem with this strategy? No matter how hard you try to convince them, most customers won’t care about your “unique value proposition.” This is why Pepsi beats Coke in taste tests but is still second in market share.
People don’t think in terms of products and services -- they think in terms of jobs they need to get done. Or, as Theodore Levitt put it, “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”
So, instead of promoting what you sell, you should focus instead on what you help people accomplish. Specifically, that means the job that you help them do -- one they wouldn’t be able to do by themselves.
5. Ratings and reviews are your salespeople.
Most people believe that they cannot close a sale without a set of interpersonal communication skills. Ultimately, they end up internalizing the belief that they (or a sales team they train) are the most qualified people to sell their own services. But this is only partially true -- after all, their customers are much better equipped to do the selling.
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