Advertising is not a one-stop solution: Lessons to learn for Start-ups. Create value inward. 

Learn from recent setbacks faced by highly valued companies like Byjus and Paytm.

It is the dream of every entrepreneur to create a company with ever-increasing customers, high valuation among investors, and a brand name known all over the world. While pursuing these goals, many of them forget that unless you invest in your product upgrade, employee satisfaction, and customer loyalty, there is no use in creating brand value through heavy advertising via mass media. 

Recent issues faced by Byjus, Paytm, and very recently Bharatpe are all examples for any start-up company to learn some lessons.

Create value inward: Invest in your product, employees, and customers

Even before Byjus was called in by the authorities for an inquiry, the brand faced severe backlashes from its customers and employees. While customers were angry with the high-intensity personal-call marketing tactics (they would call an existing customer every day to market the same product) followed by non-upgradation in the product quality (even a 6th standard kid could find out spelling mistakes in their online study material), employees were angry at the pressure tactics used to make them meet high targets and the way they were sacked to be replaced by newcomers. 

The internet was already filled with customer complaints and the bad-mouthing by erstwhile employees. (This same author had warned about this in a previous article on this website.) 

Byjus as a unicorn company soared ahead with high valuation but it was losing its in-house brand ambassadors (customers and employees). The TATA group is an example where they invest continuously for generations in keeping their employees and customers loyal. Even when they face a tough situation, these two pillars - employees and customers – always stand behind them in full support.

Slowly and steadily build a solid brand

“Patience is a key element of success,” said Bill Gates. When a man who has created a great empire out of his business, we ought to give ears. 

In a recent talk show, Mr. Kochouseph Chittilappilly, the founder of brands like V-Guard, Wonderla and Veegaland said, “All of you know me now as a successful businessman. There were all those years behind where no one knew I existed. Business is about building it slowly and steadily.” 

Most start-ups nowadays try to be a unicorn and scale up so fast that on the way up it stumbles and starts falling. The higher you go, the heavier the fall will be. Recent issues faced by Byjus were due to its scaling up in all directions with high-paced acquisitions, and even the restrictions on Paytm came after its entry into every aspect of the financial business available instead of focusing and stabilizing its main business as a payment app. 

These companies might, of course, come back but will pay a high price for their lapses. Start-ups and entrepreneurs must learn the value of patience and build your brand slowly and steadily and keep all the physical and financial infrastructure in place before scaling up.

Follow the law of the land

The cardinal rule in any business to run in the long run is to follow the law of the land it operates. Just by creating high valuation and bringing in high-profile investments is not a solution for your business to be in the run for a long time. Byjus was called in by the officials for flouting several laws of the country, Paytm is facing issues for not following several norms to be followed under RBI rules, Bharatpe is facing issues as its co-founder has been called in by officials for breaking financial laws. 

You can build a brand for a short run by spending heavily on mass advertising, but keeping it alive in the long run needs to be by following the rules of the land. Great business thinkers have always said that the success of any brand, any product, or any technology depends on the law of the land.

 Especially when you are a start-up, you have to know the laws, should be updated about the changes in the laws, and adhere to them steadfastly. Unlike bigger companies, a small company may not be able to face the financial struggle while facing legal issues.

(Our guest author is Pradeep Menon, Co-Founder and Head - Branding & Strategy at Black Swan (India) Ideations)