MARKETING GUIDE : GUIDE TO SUCCESFULL FOR BUSINESS MARKETING

One great need of small business managers is to understand and develop marketing programs for their products and services. Long term small business success depends on the ability to maintain a strong body of satisfied customers while continually increasing this body with new customers. Modern marketing programs build around the marketing concept, which directs managers to focus their efforts on identifying, satisfying, and following up the customer's needs - all at a profit.

THE MARKETING CONCEPT
The marketing concept rests on the importance of customers to a firm. All company policies and activities should be aimed at satisfying customer needs while obtaining a profitable rather than maximum sales volume.

To use the marketing concept, a small business should:

• Determine the needs of their customers (marketing research).
• Develop their competitive advantages (market strategy).
• Select specific markets to serve (targetmarketing).
• Determine how to satisfy those needs (marketing mix).
• Analyze how well they've served their customers, and then return to step 1 (marketing performance).

MARKET RESEARCH
The aim of market research is to find out who the customers are, what the customers want, where and when they want it. This research can also expose problems in the current product or service, and find areas for expansion of current services to fill customer demand. Market research should also encompass identifying trends that may affect sales and profit levels.

Market research should give you more information, however, than just who your customers are. Use this information to determine matters such as your market share, the effectiveness of your advertising and promotions, and the response to new product developments that you have introduced into the market.

For once, small business holds an edge. While larger companies hire professionals to do their research, small business managers are close to their customers. They can learn much more quickly the likes and dislikes of their customers and can react quickly to change in customer buying habits.

What to look for, Market research should investigate four areas: customers, customer needs, competition, and trends. The research conducted should answer questions like:

Customers. Identify their:

• Age
• Income
• Occupation
• Family size
• Marital status
• Residence
• Interests and hobbies

Customers wants

• Is the product needed for a limited time (diapers, for example)?
• Are customers looking for quicker service?
• Do customers want guarantees with the products?
• Will customer come frequently (for example a grocery store) or seldom (a car dealership)?
• Are customers looking for a wider distribution or more convenient locations?

Competition

• What is the competitions' market share?
• How much sales volume do they do?
• How many similar firms exist?
• What attracts customers to them?
• What strengths do they advertise?

Trends. Are there:

• Population shifts? (Baby boom, for example) Legal or regulatory developments?
• Changes in the local economic situation?
• Lifestyle changes? (single parents, working women, smaller family size)

Where to get it
There are two general sources of information that can be gathered: data already available and data that can be collected by the business.
The following sources may provide already accessible data:

• Local area Chamber of Commerce
• Trade associations in the line of business
• Professional market research services
• Local library

Data can also be obtained by the business' own research efforts through the following means:

• Telephone surveys
• Local and national newspapers
• Surveys sent by mail
• Questionnaires
• Local TV and radio stations
• Interviewing
• Customer service cards

Market research doesn't have to be sophisticated and expensive. While money can be spent to collect research data, there are many inexpensive ways to collect this data that are easily accessible to the small business owner. Several of these methods are:

Employees.

This is one of the best sources of information about customer likes and dislikes. Usually employees work more directly with customers and hear complaints that may not make it to the owner. They are also aware of the items customers request that the business doesn't offer. They can probably also give a pretty good customer profile from their day-to-day contacts.

Customers.

Talk to the customers to get a feel for you clientele, and ask them where improvements can be made. Encouraging and collecting customer comments and suggestions is an effective form of research. By asking the customers to explain how the product could improve to fill their needs, constructive market research is done, as well as instilling customer confidence in the product.

Competition.

Monitoring the competition can be a valuable source of information. Their activities may provide important information about customer demand that were overlooked, and they may be capturing part of the market by offering something unique. Likewise, small business owners can capitalize on unique points of their products that the competition does not offer.

Company records and files.

Looking at company records and files can be very informative. Look at sales records, complaints, receipts, or any other records that can show you where your customers live or work or how and what they buy. One small business owner found that addresses on cash receipts allowed the pinpointing of customers in his market area. With this kind of information he could cross reference his customers' address and the products they purchased. From this information he was able to check the effectiveness of his advertising placement. However, realize that this information represents the past. Present or future trends may mean that past information is too obsolete to be effective.

Your customers' addresses alone can tell you a lot about them. You can pretty closely guess your customers' life-style by knowing what the neighborhoods they live in are like. Knowing how they live can give you solid hints on what they can be expected to buy.
In addition, check returned items to see if there is a pattern. Check company files to determine which items sell best, and which sell poorly.
The key to effective marketing research is neither technique nor data it's useful information. Customers likes and dislikes are shifting constantly so this information must be timely. It's much better to get there on time with a little than too late with a lot.

A MARKET STRATEGY
With the research information gathered, the next step is to develop a market strategy. Use this information to determine areas where the competition doesn't adequately fill consumer demand or areas where a new product or different product promotion would capture part of the market.
A new business may capture a significant market share by aiming their market strategy on areas not focused on by the competition.
Some examples of the various areas of emphasis include offering a:

• Better or wider distribution
• Specialized instead of a broad product line (or vise versa)
• Lower price
• Modified product (improved)
• Better value for the consumers money (quality)
• More dependable product or service
• Customer support service

As a new business can enter an industry and capture a share of the market, an established business can use the same strategies to increase their market share as well.

TARGET MARKETING
When the marketing strategy is developed, determine with which customer group this would be most effective. For example, a "better value for the money" may be more appealing to the "family" consumer group while a "wider distribution" would be more attractive to consumers who travel. Remember that different market strategies may appeal to different target markets. Therefore, apply the collected data to choose the combinations that will work best. The market is defined by different segments.
Some examples are:

• Geographic: Specialize products to customers who live in certain neighborhoods or regions, or under particular climates.
• Demographic: Direct advertising to families, retired people, or to the occupation of consumers.
• Psychographic: Target promotion to the opinions or attitudes of the customers (political or religious, for example).
• Product benefits: Aim marketing to emphasize the benefits of the product or service that would appeal to consumers who buy for this reason in particular (low cost or easy access, for example).
• Previous customers: Identify and promote to those groups who have purchased the product before.

THE MARKETING MIX
Before the marketing mix decision is made, determine what purpose these marketing efforts are going to serve. Are they to:

• Deepen the customer base?
• Increase the market share? If so, by how much?
• Increase sales? If so, by how much?
• Reach new geographic markets?
• Increase customer traffic?
• Sell remaining inventory to prepare for a new product line?

After these objectives are established, determine a date for accomplishing the objective. The marketing mix allows owner-managers to combine different marketing decision areas such as products and services, promotion and advertising, pricing, and place to construct an overall marketing program.

Products and Services
Use the product or service itself as a marketing resource. Having something unique provides motivation behind advertising. While the ideas mentioned under market strategy apply here, another option is to change or modify the product or service. Additional attention may be given to a product if it has changed color, size, or style, while a service may draw similar attention by modifying the services provided. Remember sales and promotional opportunities are generated by product differentiation.

Promotion and Advertising
With a marketing strategy and clear objectives outlined, use advertising to get the message out to customers.
Advertising can be done through:

• The yellow pages
• A press release
• Sponsoring a civic event or activity
• The newspaper
• Billboards or posters
• Flyers or handbills
• Direct mail advertising
• The radio

One element of advertising is promotional activities. These activities not only advertise, but they offer added incentive for customer patronage.
Some examples are:

• 2 for 1 offers
• Coupons
• Special sale prices
• Rebates
• Sweepstakes
• Give-aways

Try to reach the largest number of people with the money allocated to advertising and promotion. This may be accomplished by using several different methods of advertising. Remember to be creative and implement ideas.

Pricing
Determining price levels and pricing policies is the major factor affecting revenue. Factors such as the demand for the good, the market price, and customer responsiveness to price changes influence the price levels. Other factors such as a convenient location or more personalized service may allow a small business to charge a higher price. Make sure your price is competitive, however, by checking to see what competitors' prices are.

Place
The manufacturer and wholesaler must decide how to distribute their products. Working through established distributors or manufacturers' agent generally is most feasible for small manufacturers. Small retailers should consider cost and traffic flow as two major factors in location site selection, especially since advertising and rent can be reciprocal. In other words, low-cost, low-customer traffic location means you must spend more on advertising to build traffic.
The nature of the product or service also is important in locational decisions. If purchases are made largely on impulse (e.g., flavored popcorn), then high customer traffic and visibility are critical. On the other hand, location is less a concern for products or services that customers are willing to go out of their way to find (e.g., restaurant suppliers). The recent availability of highly segmented mailing lists (purchased from list brokers, magazines, or other companies) has enabled small businesses to operate anywhere - and serve national or international markets.

MARKETING PERFORMANCE
After the marketing mix decision is implemented, the next step is to evaluate performance. With a detailed list of company objectives, monitor how well the decisions are developing.
Evaluate objectives such as:

• Market share. Has the increased share been captured?
• Sales Volume. Was the increase reached?
• Strategy. Did the combinations of target markets and strategy work effectively? Which ones didn't?

Also, evaluate the following decisions and others:

• Did advertising efforts reach the target groups?
• Were promotions timely?
• Did customers respond to sales, coupons, or rebates?

Additionally, consider the following:

• Is the company doing all it can to satisfy the customer?
• Do the employees make sure the customer's needs are truly satisfied, leading to the vial repeat purchase and customer loyalty?
• Is it easy for customers to find what they want at a competitive price?
• If these objectives were not reached, what were the reasons?
• If they worked well, what elements were most effective?

By evaluating performance after decisions, there is reference for future decision-making, based on past results. In addition, periodically assess customers' feelings and opinions toward the business and how well their needs are being satisfied. This can be done through surveys, customer comment cards, or simply by asking them, "How are we doing?"
Assessing performance and asking for customer input brings us back around market research again. Your marketing plan is a continuous effort to identify and adapt to changes in markets, customer taste, and the economy for the success of your small business.

Planning Ideas

Quick...It's a Marketing Must

Respond quickly to a customer/prospect "request for bid." This gets them "out of the market" quickly and stops them from searching for another source. It also helps establish your reputation as "the person to deal with" in your business.

Your Marketing Budget - Don't Leave It to Luck

3-5% of gross receipts...that's the average amount small businesses spend on marketing annually. Be sure to add an additional 3-5% to all your proposal quotes. When the jobs come in, save that 3-5% to spend on future marketing projects.

Mature Marketing

One of the largest populations in the U.S.: older adults. There's a Web site out there called MATURE MART that offers over 20,000 products that meet the needs of older adults. These include playing cards with enlarged numbers/characters, gift baskets filled with senior-friendly household items, pill alarms and more.

How can your services and products be adjusted and marketed to this ever-growing group?

Who Else Needs What You Already Have?

McDonald's came up with the "Chicken McNuggets" product because their suppliers had old hens who were past their prime. These old hens, known for their dark meat, became "Chicken McNuggets", one of McDonald's most popular products.

Shift focus. Make the most of what you already have. Determine other target markets that need your products or services.

Sales Letter Trick

Write up a draft of your next sales letter. When you're done, put it in your desk drawer for a day. The fact that you've "walked away" from it for a while can help you look on the copy with "fresh eyes." You can then edit your copy more effectively.

Increase Sales to the Customers You Already Have

Create a quick grid that can lead to increased sales and profits. Draw a rectangular box in the middle a piece of 8-1/2" x 11" paper. Along the outside left hand side of the box write the names of your current clients. Write the products and services you offer along the space outside the top of the box. Draw vertical and horizontal lines within the box to separate clients and products/services. Starting with the Client #1, put an "X" in the box that corresponds to all the products/services you are currently offering that client. Do the same for each customer you have. When you're done, look at all the empty boxes. These represent the additional products and services you can sell your current customers.

Mind Your Own Business...Every 30 Days

We're so innundated with images and noise these days that most of us forget what we see and hear in less than 14 days. Sending out a mailing once a business quarter is not enough, especially after you've made the sale. Don't become the "forgotten" business. Remind your customers and prospects of the benefits of your services through customer satisfaction surveys, time-limited offers, "fact of interest" postcards, reprints of articles you have authored, fax newsletters, etc. Consistently keep in touch with the people who can help your business thrive.

Create Time to Sell

Everyone is busy these days. It's very important to maintain your sales schedule during the times when you're just swamped with "paying" projects. Take one day and devote the time to setting sales appointments for the next month. This will help keep "paying" projects in the pipeline.

Late Mail Delivery Helps Your Marketing

33% of all business mail arrives on Monday. Don't get lost in the post-weekend crush. Time the arrival of your mailing so it lands on the prospect's desk later in the week in a smaller pile of mail. You stand a better chance of getting noticed.

Change Never Hurt Business Promotion

Have you just won an award? Moved to larger space? Taken on a new partner? Won a big contract? Take advantage of the change and announce it now. Such communications are a wonderful excuse to keep in touch with your clients.

Put Marketing in Your Agenda

Want to impress your prospects and clients? Prepare a meeting agenda for your "face-to-face" meetings and fax it the prospect/client the day before your appointment. Lets them know that you're organized and that you value their time.

Make it easy on yourself and create a meeting agenda template using a word processing or desktop publishing software package. Just "fill-in-the-blanks" and fax. Good marketing.

What Have You Done To Improve Yourself Lately?

Want more business? Get better! Improve yourself and the knowledge that you already have and you'll be billing more in the long run. In a service business? Learn some new skills that can be used as additional services that you can market to your clients. Examples: 1) Graphics Designer learns how to design Web Sites and markets this expertise to her clients. 2) Management Consultant takes sales writing courses and then earns additional income by helping his clients to overhaul their stale sales letters.
3) Computer Specialist learns the ins and outs of a new popular software program and offers one-on-one training to his clients. Constant improvement leads to steadily increased revenues.

Zoom In...Not Out

Not getting the results you expect from your marketing efforts? Maybe you're spreading yourself too thin. Zoom in! Concentrate on a smaller, more targeted segment of prospects. This new tactic can give your business a jump start, making it easier for you to focus your marketing resources on proving that you can meet these prospects' specific needs.

Market for the Future!

Don't ignore the "start-up" company when it comes to marketing your products or services. Surveys have shown that many of today's affluent buyers still purchase from the people and companies that originally treated them as "winners who were going to make it big."

Old Files Hold New Marketing Clues

Your file cabinet holds clues for increased business. Take some time to review accounts receivable files, job jackets and client files from years past. Many of these documents have the names of folks you've done business with previously, and who may still need your products or services. Using the "old file" method, make a list of folks to call. When you do contact them and you find that some may not need your services now, ask each person for three referrals of folks they know who may need your help. You may also find that some of your past contacts have moved on to new companies or started their own businesses. This reality can open up new opportunities for you. Make the effort to contact these folks at their new locations.

Listen for Better Copy

Want to improve your ads? Some of the most successful ad copy sounds like a conversation between two people...you and your customer. Dust off your tape recorder and schedule some time with a trusted client for a frank discussion about the pros and cons of your products or services. Record your conversation. When you play it back, pay special attention to the phrases and descriptions used by your customer during your talk. Use these phrases throughout your ad copy for better results.

Have Your Niches Changed?

Business niches adjust to keep up with changes in technology or federal or state laws. Keep an eye on the trends that can alter the niches you're prospecting. Contact the Economic Development office in your county or state to find out where you can find these important business stats.