When it comes to tech brands; does disruption stop at the product?
In recent statistics published by CB Insights, it was stated that 70 percent of startup tech companies fail. There are myriad reasons for these failures, but perhaps the most significant is when the people inside the business focus exclusively on the product; at the expense of emotive, action-oriented content.
Startups and scaleups universe
Tech companies, like all businesses, are customer-obsessed. However, in the early period of growth, this lens tends to be numbers-based and product-focused, not brand-focused. For startups and scaleups, the pressure to meet the needs of investors and drive rapid growth means both the traditional brand building model is often ignored or abandoned.
In a sector dominated by hard measurement, the traditionally ‘less tangible’ brand metrics are easily rejected in favour of growth and sales metrics. Yet, as hard measurements of branding efficacy and impact evolve; so too has the pandemic more than proven that the impact of experiences, connections and emotions can be transformative for a business. Particularly a tech business.
Technology has the power to change the world, but only if consumers realise its benefits. Sadly, though, the sector’s preference for product and function-focused marketing means consumers often don’t understand the benefits or the impact the product could have on their lives.
Tech brands have relied on the disruption of the sector to propel their brands; however, this is no longer enough. With so many brands vying for people’s time and attention, tech brands have to apply disruptive, human-centric thinking throughout all marketing and brand activities – creating emotional connections with people – or risking failing altogether.
It seems alarmist, but research from Hotwire Australia and The University of Sydney Business School has revealed the power of brand marketing and people-centric messaging and its potential to make or break tech businesses.
The unprecedented research study, which examined the branding techniques used by tech startups and scaleups, revealed a sector obsessed with blue logos, descriptive names, functional brand taglines and product-centric marketing.
In this sea of sameness, there were very few startups and scaleups using any emotional brand messaging – and there was very little brand awareness among consumers.
Global tech powerhouses
On the contrary, a review of the global tech powerhouses leading the market revealed the opposite; these brands adopted more abstract names and taglines and employed more emotional people-centric storytelling.
The research confirmed that consumers are more likely to seek out information on brands that create emotional connections. The brands that combine product-focused marketing with more emotional people-centric messaging are more likely to drive growth.
While this may shock a sector dominated by engineers and product specialists, it will not surprise many marketers. However, it highlights the need for the broader marketing industry to champion the power and value of brand to the tech sector.
In an industry more familiar with growth, sales and equity measures, there is a hugely important job to be done to elevate the value of brand metrics, and the importance of messaging that creates authentic human connections.
By elevating tech brands to be more memorable and meaningful, marketers can unlock their business’ potential and drive real financial outcomes.
Jaime Nelson is the managing director at Hotwire Australia.