Over the last couple of weeks, I had a bunch of first calls with entrepreneurs to discuss their ventures. It struck me that most of them immediately jumped into the 'what', explaining the product they are building, instead of focusing first on the 'why', the problem they are solving. By doing so, they force those listening to figure out the big picture challenge they are solving themselves. Not only will those listening be distracted by that looming 'why' question, they might also come up with the wrong answer to that question, and get lost.
It is so important how you introduce yourself to the world. Let's not waste this opportunity. As Don Draper put it: 'Make it simple, but powerful.'
The importance of taglines.While there has been a growing school of thought over the last decade that considers taglines as bygone marketing relics, I don't agree, especially not in the tech world. Of course, your product is the most important to win in the tech world, but great taglines are game-changers when it comes to user acquisition, PR, and company culture, and employee alignment. Unfortunately, most tech taglines are generic and meaningless. When a company gets it right, though, it is brilliant. This is a CEO's responsibility, and should not be delegated to branding and marketing only. Let's have a look at the ingredients of a good tagline and some examples.
Be different.A good tagline is concrete and summarizes differentiation. In this time of accelerated tech disruption and increased startup competition, clear positioning is crucial. Taglines that do not evince a clear company focus or that could apply just as easily to other companies aren't going to cut it.
Taglines matter at all stages of company development: from the very early stage all the way up to successful public tech companies. In the VC world, entrepreneurs are urged to condense their company presentation into an elevator pitch – what you might call tagline+. In the public company world, taglines are used to quickly communicate company differentiation.
An example of a cool tagline is Verizon's 'Can you hear me now? Good.' The US telco came up with this tagline as it was battling with T-Mobile and AT&T. While Verizon may not have had the hippest image or the best range of options, it could offer something its rivals didn't - the most reliable coverage.
I also think that taglines can even provide insights into management thinking. Perhaps more important than a tagline attracting customers is whether management can succinctly state its differentiation. The importance of slogans is understood in politics, where a campaign must be summarized on a pin or poster. Strong slogans differentiate a candidate and are two-sided - they not only reflect positively on the candidate but negatively on the competition.
Be attention-grabbing.If a slogan falls on the marketplace and no one is around to hear it, does it make a sound? Great taglines are capable of grabbing consumers' attention right off the bat from a radio or TV commercial, email campaign, billboard, print ad, or pitch deck! Remember that you may only have a few moments to get your customer's attention and interest in your product.
Domino’s Pizza’s original 'Fresh, hot pizza delivered in 30 minutes or less, guaranteed' is a classic example of this principle. Domino’s has not only outperformed the industry over the last decade, but it was also the biggest winner of the pandemic with its efficient digital service and delivery system. Domino’s long-term investment in advancing its delivery capabilities and rehabbing its public image since 2009 has paid off in a big way. The pizza franchise essentially figured out cloud kitchens before they were cool, and they communicated it well. And it all started with a new, attention-grabbing tagline.
Once you have an attention-grabbing and differentiating tagline, you can take the exercise to the next level and wordsmith it into a memorable, even catchy, slogan with a little bit more personality.
Be memorable.Good slogans run the gamut from fun or bold to silly or provocative; but to be successful, they all need to be unforgettable. Make sure you speak to people's minds and hearts. Great slogans need to be catchy enough to stick in people's heads long after the ad has passed them by - sometimes for years, from company launch to IPO, and beyond.
Many companies follow the 'if it ain't broke don't fix it mantra' and continue to hang onto their original slogans sometimes with minor variations. Others cycle through completely different slogans frequently. For early-stage tech companies, I'd always go with the first option. You simply don't have the time to reposition your marketing all the time if you want to keep up your growth. Of course for this to work, it is critical that you get it right, at least in a basic way, from the outset. So, make sure you hire the right people who can nail it and build on your positioning until you reach a significant size. In the more traditional consumer goods world, things look different, of course. They have to innovate regularly as their brand, not so much their products, is their key competitive edge. Dr. Pepper once tagged itself the 'King of Beverages,' and other times went with slogans 'Be a Pepper' and 'Be You.' The brand switched from 'Always one of a kind' to 'The one you crave' in 2017, for example.
In the tech industry, there have been a few home runs. The best taglines capture the 'personality' of the business. Apple did this with "Think Different." The campaign caught attention with pictures of famous independent thinkers but, more importantly, tied back to the company strategy of providing different products (particularly relative to Microsoft). Also effective were the “I’m a Mac, you’re a PC” series. The tagline perfectly embodied the idea that Apple is different, and so are its customers. Apple has successfully branded itself as the computer for creative professionals, and it’s this slightly elite image that allows them to charge higher prices to this day. Another hit was 'Be Direct,' Dell’s slogan that enjoyed the double entendre of expressing its direct selling model in contrast to the indirect distribution of its PC rivals.
Let's have a look at a recent startup example.A great example is the European money-transfer app Wise (formerly Transferwise) that, founded in 2011, recently made a strong debut on the London Stock Exchange. I am not evaluating the business here, but rather its positioning. You just have to go on their website, and you understand what I mean - you immediately get what the company's value prop is: Sending money at a better exchange rate. The tagline is 'The 6x cheaper international account', and, next to it, you see exchange rates between different currencies. The tagline clarifies what it is for, a service to send money online to somebody else, they also exchange the currency for you - it really feels like a neat way to send money to somebody abroad. While the company iterates its tagline frequently (e.g. 'bye bye bank fees, hello world', 'a cheaper, faster way to send money abroad, 'send money with the real exchange rate', etc.), the key message remains consistent since the launch of the service. It doesn't really matter how they do it; it just seems much simpler and effective than what other market leaders such as Western Union offer. The latter also has a generic tagline ('money transfer' or 'moving money for the better') which explains the service, but it is neither differentiated, attention-grabbing nor memorable.
Nothing beats 'free', of course. Our companies Skype (free calls), Wix (build your website for free), or K Health (free healthcare) have become global success stories with such taglines. The taglines have evolved to become more memorable, but the core value prop remains the same.
Crafting the perfect tagline is challenging and may take multiple attempts to nail. But in the words of Tag Heuer, 'Success. It's a mind game.' Let's use the summer break to come up with a great tagline. I can't wait to hear what you guys come up with. 🙌
In July, some great Lithuanian founders (special thanks to Justas and Rokas) invited me to spend 10 days with them at the country's seaside. I was really impressed, to say the least, by the beauty of the region, the food, and, most importantly, the fantastic hospitality of my friends. Below is a pic from the annual techno festival Ant Bangos in Nida they took me to. I am bullish on the Lithuanian tech ecosystem, and will be back soon.
Life is awesome,
Yannick
Other content I've found useful- Check out one of our latest European investment - Exoticca: 'Travel is back! With sales 50% higher than pre-COVID days, we believe that this is the right time to invest in order to build a category leader in the multi-day package tour space.'
- The hype subsidy: A great post by Sarah on how to kickstart marketplaces and the danger of over-hyping them too early... Check out my post 'you are hyped. what's next?' as well. Hype is a powerful force for startups. But 'hot' companies come and go. You can't create lasting value on hype.
- A great read by the WEF on 'Why helping people to age well is a new healthcare priority': 'The fact that a child born today is more likely to live to old age makes ageing well a new health priority. In fact, it’s a multi-trillion dollar target...'
- A great podcast by Prof G on NFT's, Defi, and their potential. One of the best I've heard so far.
- A cool Twitter thread on the history of Bernard Arnault and LVMH: Bernard Arnault recently passed Jeff Bezos to become the world's richest person. Worth $193B, he has spent ~40 years building luxury giant LVMH. His success is described as a combination of 'generational' vision with 'Sun-Tzu' business tactics.
- A great read by VIP on the importance for VCs to exit their businesses, and not only their home runs: 'VCs are Often Judged on 3 Main Skills: Sourcing, Accessing, Building…but What About Exiting?'
- The IPPC (the UN's body for assessing the science related to climate change) has published its 6th and latest report. Humans have already heated the planet by roughly 1.1 degrees Celsius since the 19th century. And the consequences can be felt: This summer alone, blistering heat waves, floods, and wildfires are happening all over the world. Even if nations started sharply cutting emissions today, total global warming will likely rise around 1.5 degrees Celsius within the next two decades, a hotter future that is now essentially locked in... Not all is lost, however, and humanity can still prevent the planet from getting even hotter. The report concludes that there is still a short window to stop things from getting even worse, and global warming would likely halt and level off at around 1.5 degrees Celsius.
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