Being both a political junkie and strategy consultant, it's been impossible
not to notice that a challenger's campaign against an incumbent is incredibly
similar to starting a business. Like a start up, a challenger needs to overcome
the structural advantages of an entrenched competitor with the promise of
delivering enough extra value that it is worth taking a risk on an unproven
solution (the candidate and their positions).
Regardless of your political leanings, it is hard to argue that at this
point, the Romney campaign is looking quite a bit like a troubled start up. If
polls in politics are the equivalent of revenue, the Romney campaign is not
currently making its numbers. This brings us to another
similarity – both troubled start ups and campaigns can turn things around. There
are plenty of examples of companies and candidates that were stuck in limbo
becoming big successes.
Getting back on track isn’t easy. It requires not only recognizing where you
are off course but also making the right course corrections. Here are 3 common
mistakes that start ups make that we’ve seen from the Romney campaign as well as
our assessment of how well they have course corrected.
1. Focusing on the Problem
One of our first clients at Topline Strategy was a
company that offered a solution to help launch new products. Before they
released their own product, they had conducted a survey of VPs of Marketing and
the vast majority had rated New Product Launch as one of their top 3 pain
points. After six months, they had sold just one account. What the company
learned the hard way is that just because there is a problem doesn’t mean that
you have the solution to it. There is risk in change and the challenger, whether
candidate or company, needs to do more than point out the problem. They must
prove they solve the problem.
Early on, the Romney campaign sought to define the race as a referendum on
the President. Unfortunately, they made the same mistake as our client. In the
end, every vote and every purchase is a choice between the status quo and
something new. Just because there are problems with the status quo doesn’t mean
that people will buy from you. You have to demonstrate value.
What to Do: Companies and entrepreneurs who find themselves in this position
need to reevaluate what they are offering and the value they bring and realign
themselves with the market/electorate. Here the Romney camp gets credit for not
doggedly sticking with a strategy that isn’t succeeding. But, unfortunately,
they have fallen victim to the second mistake.
2. Changing Directions Too Many Times.
One of the axioms in marketing is "Just when you get sick of saying something is when people first start to
As mentioned above, the Romney campaign made the right decision to change
their strategy. But, under pressure to get results quickly, they then changed
their message again (and again) – long before people really started hearing any
of these new messages. While the right message may be in there, the candidate or
company will never know because they don’t stick with any message long enough
for it to work.
What to Do: While it is possible to come back from limbo, companies and
candidates typically only get one chance. If Strategy #2 doesn’t work, you’ll
most likely run out of time and money and will never get to try Strategy #3
So, when you make a change, carefully study your options, gather facts, make
the most informed decision you can….and stick with it. You still may fail, but
if you change directions over and over, you’ll definitely fail. At least if you
stick to your new strategy, there is some chance of success. At this point,
right or wrong, the Romney campaign needs to pick a direction and go with it.
3. Counting on Future Cash:
Both start ups and campaigns fail for the same reason – they run out of money
– and both have a hard time raising money when they are not perceived to be
doing well. Neither investors nor campaign donors want to fund something they
are not sure will be successful. At these times, the only money the candidate or
company can count on is cash in the bank. Other sources never seem to
Recent news stories have talked about how the Romney campaign is now finding
itself low on cash because much of the money that it ‘raised’ is not under the
control of the campaign itself but rather the RNC and SuperPACs – money that the
RNC and SuperPACs may decide is now better spent on House and Senate races
rather than Romney. The huge numbers reported by the campaign in the Spring and
Summer are the equivalent of a Start Up that announces $10 million in funding,
with a $3 million infusion now and the rest coming later. Not surprisingly, the
money that the campaign or that the start up does not directly control can
magically evaporates when there is a rough patch
What to Do: The key here is to manage cash so you can survive a setback. If
things are going well, you’ll have no problem getting more. But, if you run
through your reserves, it is a death sentence. Unfortunately, there don’t seem
to be any good answers here for the Romney campaign. Faced with a cash shortage,
they’ve had no choice but to put a lot of time into fundraising at this crucial stage of the race, valuable time that isn’t being spent campaigning in swing