Increase Sales With Targeted Marketing

Marketing is by no means a small game, and marketing your small business to big success will require some dire attention to detail. A hefty amount of work goes solely into marketing an organization's goods and services each year. Billions are spent on things like advertising, promotions, consumer surveys, and quality control to assure the thorough-put of an organization's reach to its most valuable asset - the consumer.
The sunny side of this road is that we have come a long way in understanding the bridges between attracting consumers and making sales. This allows for a small business to learn from the previous failures and successes of its competitors. Outsourcing through more adept organizations, who are fervent in turning up qualitative and quantitative statistical research, is then a luxury to your small business.
Many of those going into business for the first time tend to believe that the more people they market to, the more sales they're bound to make. While this may only seem logical to the average mind it is quite far from the truth in the world of small business marketing. You shouldn't try to compare your small business with that of a multi-billion-dollar corporation like Coca-Cola where, to them, everyone is considered a potential customer. For your small business to grow and make a name for itself you will need to do the opposite. This means eliminating unnecessary marketing expenses on those groups of people who are not very likely to benefit your small business.
Finding Your Target Market
You need to become successful in your marketing efforts and drive up your sales, without incurring additional expenses or furthering your business in debt. That requires finding your target market. A target market is a well defined set of present and potential customers that your small business attempts to satisfy.
You will need to identify your target market and focus all of your marketing energy on that specific group. There are a number of analytical approaches to understanding and refining your target market depending, of course, on your product and business. However, it is important to be creative and open-minded when seeking out your target market. Many aspects of a target market may seem vague and obscured, at first, to the inexperienced marketer.
In defining your target market you will need to create what is called a marketing mix. The marketing mix combines the four variables - product, place, promotion and price - that are controlled by your business, and uses them in a manner which aims to satisfy your target market. The product variable is made up of all the qualities that are perceived by the customer from your product and have the potential of satisfying their wants. The place variable determines time, place, and possession value. This means distributing the right product to the right place, at the right time, and in the right quantities. The promotion variable focuses on communication between the marketer and the customer. Is your message getting across to your target customers effectively? If so, how are they reacting and how fast? These are important variables to note when effectively trying to promote your product. Finally, the price variable notes the amount of money or resources your business seeks from the buyer in exchange for the goods or services being sold. All four of these variables are what make up your entire marketing mix and must be coordinated and developed so that they may both satisfy your market and result in a profit for your small business.
Furthermore, you will need to understand the relevance of dividing your market in order to pursue effective targeted marketing for your small business. This is what we call 'Market Segmentation'. Every market can be segmented into a number of categories and subcategories. A few basic market segmentations, for example, would be geographic, demographic, psychographic, and product-related segmentation. The primary objective here is to identify all of the characteristics or traits your most promising customers have in common so that you may harness all of your business efforts on reaching those particular customers. This will involve nitpicking through the market and finding a market segment, or a smaller group of people or firms, that exists within a larger market and whose wants are currently not being filled by products already on the market.
The Mass Market Strategy
The mass market strategy assumes the target market to be any potential buyer of brands in a product category and offers a single marketing mix. The mass marketing strategy has been used by such large corporations as Ford, for example, even in the early 20th century to retain low production and distribution costs. Henry Ford offered only one marketing mix for all car buyers with the Model T automobile, which enabled him to become the lowest-cost mass producer of cars.
Times have changed though and today's consumers are more demanding and expectant than ever. Pursuing a mass market strategy proves unreeling to the ill-capitalized firm. Mass marketing draws a great deal of risk and uncertainty when inexperienced or underprivileged.
Market Segmentation
As your small business begins to better understand its market, it will become second nature to practice market segmentation. Offering one or more marketing mixes to just one segment of a market might prove more resourceful than trying to conquer the entire market share. In this case, agility becomes the tradeoff to muscle.
Markets are often segmented based on geography. Geographic segmentation divides a mass market into such units as regions, nations, states, cities, and districts. For example, your small business may choose to target the sunny Florida state differently from the windy city of Chicago due to the climate for which their geographic locations afford them. This may result in two different market segments for a product category that holds a market in both geographic segments. Just as more stringent emissions laws in California cause auto makers to provide for a different market segment from the rest of the country, your small business too will become overpowered by geographic segmentation for all sorts of reasons.
Markets are also segmented on the basis of demographic variables. Demographic segmentation pertains to statistical data as in age, gender, race, nationality, education, occupation, and purchasing power. Your products can not only be marketed depending on where a potential buyer is situated, but also based on who they are and to what they are associated with. Power drinks are targeted mainly to athletes and male fitness fanatics. Apple computers target the youthful and creative individual. Centrum Silver vitamins are targeted to people over the age of fifty. The demographic classifications of your target market can go miles long and stories high or they can be short and resolute depending on how well you know your product and market.
Psychographic segmentation zeros in on social class, personality, and life-style. For example, the Oprah Winfrey show targets independent women. Harpo productions has committed a great deal of its marketing efforts in various psychographic segments by empowering female opinion. Also, the Mirage hotel and casino in Las Vegas, Nevada caters to the high-roller gambler's life-style. These market segmentations are subject to a great deal of scrutiny, however, and it can be hard to clearly predict the scope of a psychographic market segment.
A firm may also divide a mass market based on the consumer's amount of usage of a product or service, the type of usage involved, and what benefits the consumer is looking for. This is called Product-Related segmentation. For example Google AdWords, targets the direct marketer or low-budget small businesses looking to gain global, national, or even regional exposure for their business with the flexibility of controlling how much or how little they spend.
Once you have clearly understood your target market and begun the process of eliminating unnecessary marketing expenses on groups or individuals outside the scope of your target market, you will inevitably see a much higher return on your investment and long-term growth in your business. Targeted marketing increases the chances of your small business for channeling more spectators into buyers.

Business owners often find it difficult to know whether their marketing tactics are working. This can be especially tricky when you use a combination of marketing activities simultaneously, or if using personal-contact tactics such as networking.

No matter what business you're in, your marketing should be accountable. So here's a few ways to evaluate how well you're doing. Look at your sales (or fee income).They should be going up! But be careful about what you measure. Some firms have a longer sales cycle than others. To get an accurate picture you might need to also measure the number of new leads being generated, or the number of appointments, or the number of billable hours achieved. Remember discounts or variances in fees will affect total sales values. Ask your clients. Check to find out where they heard of you. Most businesses never ask this question and miss out on gleaning valuable insights into how clients select a service provider. Does your advertising and/or promotional activity produce direct responses?

It should. If your answer is "I don't know" then you've got some work to do. In addition to 2) above, there are some things you can do to improve response rates. Firstly, make sure you are advertising in the right media. Choose media to suit your selected audience. Be as specific as possible. And avoid rejecting options just because they don't look "exciting", such as trade journals that might have relatively small readership. Importantly, check with your audience to make sure they actually do read the publication.Use a strong headline that asks a pertinent question, or gives a solution-oriented statement.Include a clear call-to-action.
Tell people what they should do. For example: Ring today for your free appointment; Ask for our free information sheet.Include multiple methods of contact. Phone, email, and web site are all important. Give prospects a choice of how to contact you.Do your networking activities create new opportunities for you?One of the major principles of effective networking is to "give" rather than "sell". That is, you should look to help others as you spread word about your services. But this softly, softly approach can make it hard to measure effectiveness.To measure your networking activities make sure you track the source of incoming enquiries. Then see if any of your visible/tangible tactics can be credited with generating the enquiry. If not, then maybe you can safely say it was a referral generated by networking.
This is made a lot easier if you're a member of a lead-generating club such as BNI or Leads. You'll get specific feedback each week from these groups.Do your marketing tactics make it easier to sell your services? To do this your marketing activities and/or material should do the following:Attract qualified prospects (who have shown a specific interest in your services).Anticipate and diffuse potential questions/concerns from prospects.Be easy to use when personally selling to prospects. For example: material should be relevant; images/charts easy to understand; and be presented in a format the prospect will be likely to keep.Focus on your client needs and your points of difference (Unique Selling Proposition).
Check your sales conversion rate.The best approach here is to look at your historical records and determine whether your conversion (or closure) rate has improved. "Selling" is an important part of the "marketing" function, so make sure you assess your success at closing the sale, rather than just focus on generating new leads.Does your plan have a positive return on investment Does it bring in enough new/repeat business to justify the expense? Rather than just look at the "marketing budget" as one total, you really need to evaluate the cost effectiveness of each specific marketing activity. Even if you think you're getting a great ROI overall, maybe you can do even better by changing or eliminating unproductive tactics.

7 Ways to Evaluate Your Marketing Plan

Business owners often find it difficult to know whether their marketing tactics are working. This can be especially tricky when you use a combination of marketing activities simultaneously, or if using personal-contact tactics such as networking.

No matter what business you're in, your marketing should be accountable. So here's a few ways to evaluate how well you're doing.

1) Look at your sales (or fee income). They should be going up! But be careful about what you measure. Some firms have a longer sales cycle than others. To get an accurate picture you might need to also measure the number of new leads being generated, or the number of appointments, or the number of billable hours achieved. Remember discounts or variances in fees will affect total sales values.

2) Ask your clients. Check to find out where they heard of you. Most businesses never ask this question and miss out on gleaning valuable insights into how clients select a service provider.

3) Does your advertising and/or promotional activity produce direct responses?
It should. If your answer is "I don't know" then you've got some work to do. In addition to 2) above, there are some things you can do to improve response rates.

Firstly, make sure you are advertising in the right media. Choose media to suit your selected audience. Be as specific as possible. And avoid rejecting options just

• because they don't look "exciting", such as trade journals that might have relatively small readership. Importantly, check with your audience to make sure they actually do read the publication.
• Use a strong headline that asks a pertinent question, or gives a solution-oriented statement.
• Include a clear call-to-action. Tell people what they should do. For example: Ring today for your free appointment; Ask for our free information sheet.
• Include multiple methods of contact. Phone, email, and web site are all important. Give prospects a choice of how to contact you.

4) Do your networking activities create new opportunities for you? One of the major principles of effective networking is to "give" rather than "sell". That is, you should look to help others as you spread word about your services. But this softly, softly approach can make it hard to measure effectiveness.

To measure your networking activities make sure you track the source of incoming enquiries. Then see if any of your visible/tangible tactics can be credited with generating the enquiry. If not, then maybe you can safely say it was a referral generated by networking. This is made a lot easier if you're a member of a lead-generating club such as BNI or Leads. You'll get specific feedback each week from these groups.

5) Do your marketing tactics make it easier to sell your services? To do this your marketing activities and/or material should do the following:

• Attract qualified prospects (who have shown a specific interest in your services).
• Anticipate and diffuse potential questions/concerns from prospects.
• Be easy to use when personally selling to prospects. For example: material should be relevant; images/charts easy to understand; and be presented in a format the prospect will be likely to keep.
• Focus on your client needs and your points of difference (Unique Selling Proposition).

6) Check your sales conversion rate. The best approach here is to look at your historical records and determine whether your conversion (or closure) rate has improved. "Selling" is an important part of the "marketing" function, so make sure you assess your success at closing the sale, rather than just focus on generating new leads.

7) Does your plan have a positive return on investment (ROI)? Does it bring in enough new/repeat business to justify the expense? Rather than just look at the "marketing budget" as one total, you really need to evaluate the cost effectiveness of each specific marketing activity. Even if you think you're getting a great ROI overall, maybe you can do even better by changing or eliminating unproductive tactics.

Marketing strategy: Doing the two step - Part 1

You've seen the advertisements in the yellow pages, newspapers, and on brochures. You know the ones. They have several common and recurring themes. There is usually a featured photo of the business owner; and is very often accompanied by a picture of the store or company head office. The ad states prominently how many years the company has been in business, and lists proudly any award received since the beginning of time.

Stating that their business service is the best, their people superior, and their products unmatched is almost required by law for ads of this type. All too often, these traditional style ads provide results that are very disappointing. The owner is left in head scratching mode, and at a loss to explain the ineffectiveness of the expensive marketing program. There has to be a better way to market your products and services.



The advertisements mentioned have several factors in common. The first and most obvious similarity, is the focus being placed on the business, and not on the potential customer or client. While the company is important to the entrepreneur, it is not the centre of the universe in the eyes of the customer. In fact, neither the business nor the owner is important to the prospect at all. For many business owners, that realization is like a splash of cold water in the face.

Customers care about themselves and their needs. The concerns and accomplishments of the business are irrelevant at best. More likely, the company-centric marketing approach turns away more new customers than it gains. If the customer doesn't see their concerns being met, then the customer moves on to the next business. If the entrepreneur fails to focus on the customer or client, an untold amount of business is being let walk past the door, straight to a customer focussed competitor.



There has to be a better way. It's time to try the two step.

Two step marketing is different fundamentally from the ubiquitous single step marketing employed by most companies. One step marketing place an advertisement or places a cold call, for example and expects a resulting sale. Very often, the one step system will work well. All too frequently, however, one step marketing brings in fewer customers than projected by the marketing plan. It's time for a two step approach.

From the beginning, many advertisements and sales calls do not focus on the needs and desires of the potential customer. One step marketing practices are notorious for self concern, rather than on the needs of the prospects. Two step marketing programs, not only shines the spotlight on the needs of the clients, but has the customers select themselves for you as well. Self selected clients are not just found in a dream world, but they are a realistic idea for your business. Two step marketing is practical and can be easily applied to any business plan.

Marketing Plan

The information for this article was derived from many sources, including Michael Porter's book Competitive Advantage and the works of Philip Kotler. Concepts addressed include 'generic' strategies and strategies for pricing, distribution, promotion, advertising and market segmentation. Factors such as market penetration, market share, profit margins, budgets, financial analysis, capital investment, government actions, demographic changes, emerging technology and cultural trends are also addressed.

There are two major components to your marketing strategy:

• how your enterprise will address the competitive marketplace
• how you will implement and support your day to day operations.

In today's very competitive marketplace a strategy that insures a consistent approach to offering your product or service in a way that will outsell the competition is critical. However, in concert with defining the marketing strategy you must also have a well defined methodology for the day to day process of implementing it. It is of little value to have a strategy if you lack either the resources or the expertise to implement it.

In the process of creating a marketing strategy you must consider many factors. Of those many factors, some are more important than others. Because each strategy must address some unique considerations, it is not reasonable to identify 'every' important factor at a generic level. However, many are common to all marketing strategies. Some of the more critical are described below.

You begin the creation of your strategy by deciding what the overall objective of your enterprise should be. In general this falls into one of four categories:

• If the market is very attractive and your enterprise is one of the strongest in the industry you will want to invest your best resources in support of your offering.
• If the market is very attractive but your enterprise is one of the weaker ones in the industry you must concentrate on strengthening the enterprise, using your offering as a stepping stone toward this objective.
• If the market is not especially attractive, but your enterprise is one of the strongest in the industry then an effective marketing and sales effort for your offering will be good for generating near term profits.
• If the market is not especially attractive and your enterprise is one of the weaker ones in the industry you should promote this offering only if it supports a more profitable part of your business (for instance, if this segment completes a product line range) or if it absorbs some of the overhead costs of a more profitable segment. Otherwise, you should determine the most cost effective way to divest your enterprise of this offering.

Having selected the direction most beneficial for the overall interests of the enterprise, the next step is to choose a strategy for the offering that will be most effective in the market. This means choosing one of the following 'generic' strategies (first described by Michael Porter in his work, Competitive Advantage).

• A COST LEADERSHIP STRATEGY is based on the concept that you can produce and market a good quality product or service at a lower cost than your competitors. These low costs should translate to profit margins that are higher than the industry average. Some of the conditions that should exist to support a cost leadership strategy include an on-going availability of operating capital, good process engineering skills, close management of labor, products designed for ease of manufacturing and low cost distribution.
• A DIFFERENTIATION STRATEGY is one of creating a product or service that is perceived as being unique "throughout the industry". The emphasis can be on brand image, proprietary technology, special features, superior service, a strong distributor network or other aspects that might be specific to your industry. This uniqueness should also translate to profit margins that are higher than the industry average. In addition, some of the conditions that should exist to support a differentiation strategy include strong marketing abilities, effective product engineering, creative personnel, the ability to perform basic research and a good reputation.
• A FOCUS STRATEGY may be the most sophisticated of the generic strategies, in that it is a more 'intense' form of either the cost leadership or differentiation strategy. It is designed to address a "focused" segment of the marketplace, product form or cost management process and is usually employed when it isn't appropriate to attempt an 'across the board' application of cost leadership or differentiation. It is based on the concept of serving a particular target in such an exceptional manner, that others cannot compete. Usually this means addressing a substantially smaller market segment than others in the industry, but because of minimal competition, profit margins can be very high.

Pricing
Having defined the overall offering objective and selecting the generic strategy you must then decide on a variety of closely related operational strategies. One of these is how you will price the offering. A pricing strategy is mostly influenced by your requirement for net income and your objectives for long term market control. There are three basic strategies you can consider.

• A SKIMMING STRATEGY
  If your offering has enough differentiation to justify a high price and you desire quick cash and have minimal desires for significant market penetration and control, then you set your prices very high.
• A MARKET PENETRATION STRATEGY
  If near term income is not so critical and rapid market penetration for eventual market control is desired, then you set your prices very low.
• A COMPARABLE PRICING STRATEGY
  If you are not the market leader in your industry then the leaders will most likely have created a 'price expectation' in the minds of the marketplace. In this case you can price your offering comparably to those of your competitors.

Promotion
To sell an offering you must effectively promote and advertise it. There are two basic promotion strategies, PUSH and PULL.

• The PUSH STRATEGY maximizes the use of all available channels of distribution to "push" the offering into the marketplace. This usually requires generous discounts to achieve the objective of giving the channels incentive to promote the offering, thus minimizing your need for advertising.
• The PULL STRATEGY requires direct interface with the end user of the offering. Use of channels of distribution is minimized during the first stages of promotion and a major commitment to advertising is required. The objective is to "pull" the prospects into the various channel outlets creating a demand the channels cannot ignore.

There are many strategies for advertising an offering. Some of these include:

• Product Comparison advertising
  In a market where your offering is one of several providing similar capabilities, if your offering stacks up well when comparing features then a product comparison ad can be beneficial.
• Product Benefits advertising
  When you want to promote your offering without comparison to competitors, the product benefits ad is the correct approach. This is especially beneficial when you have introduced a new approach to solving a user need and comparison to the old approaches is inappropriate.
• Product Family advertising
  If your offering is part of a group or family of offerings that can be of benefit to the customer as a set, then the product family ad can be of benefit.
• Corporate advertising
  When you have a variety of offerings and your audience is fairly broad, it is often beneficial to promote your enterprise identity rather than a specific offering.

Distribution
You must also select the distribution method(s) you will use to get the offering into the hands of the customer. These include:

• On-premise Sales involves the sale of your offering using a field sales organization that visits the prospect's facilities to make the sale.
• Direct Sales involves the sale of your offering using a direct, in-house sales organization that does all selling through the Internet, telephone or mail order contact.
• Wholesale Sales involves the sale of your offering using intermediaries or "middle-men" to distribute your product or service to the retailers.
• Self-service Retail Sales involves the sale of your offering using self service retail methods of distribution.
• Full-service Retail Sales involves the sale of your offering through a full service retail distribution channel.

Of course, making a decision about pricing, promotion and distribution is heavily influenced by some key factors in the industry and marketplace. These factors should be analyzed initially to create the strategy and then regularly monitored for changes. If any of them change substantially the strategy should be reevaluated.

The Environment
Environmental factors positively or negatively impact the industry and the market growth potential of your product/service. Factors to consider include:

• Government actions - Government actions (current or under consideration) can support or detract from your strategy. Consider subsidies, safety, efficacy and operational regulations, licensing requirements, materials access restrictions and price controls.
• Demographic changes - Anticipated demographic changes may support or negatively impact the growth potential of your industry and market. This includes factors such as education, age, income and geographic location.
• Emerging technology - Technological changes that are occurring may or may not favor the actions of your enterprise.
• Cultural trends - Cultural changes such as fashion trends and life style trends may or may not support your offering's penetration of the market

The Prospect
It is essential to understand the market segment(s) as defined by the prospect characteristics you have selected as the target for your offering. Factors to consider include:

• The potential for market penetration involves whether you are selling to past customers or a new prospect, how aware the prospects are of what you are offering, competition, growth rate of the industry and demographics.
• The prospect's willingness to pay higher price because your offering provides a better solution to their problem.
• The amount of time it will take the prospect to make a purchase decision is affected by the prospects confidence in your offering, the number and quality of competitive offerings, the number of people involved in the decision, the urgency of the need for your offering and the risk involved in making the purchase decision.
• The prospect's willingness to pay for product value is determined by their knowledge of competitive pricing, their ability to pay and their need for characteristics such as quality, durability, reliability, ease of use, uniformity and dependability.
• Likelihood of adoption by the prospect is based on the criticality of the prospect's need, their attitude about change, the significance of the benefits, barriers that exist to incorporating the offering into daily usage and the credibility of the offering.

The Product/Service
You should be thoroughly familiar with the factors that establish products/services as strong contenders in the marketplace. Factors to consider include:

• Whether some or all of the technology for the offering is proprietary to the enterprise.
• The benefits the prospect will derive from use of the offering.
• The extent to which the offering is differentiated from the competition.
• The extent to which common introduction problems can be avoided such as lack of adherence to industry standards, unavailability of materials, poor quality control, regulatory problems and the inability to explain the benefits of the offering to the prospect.
• The potential for product obsolescence as affected by the enterprise's commitment to product development, the product's proximity to physical limits, the ongoing potential for product improvements, the ability of the enterprise to react to technological change and the likelihood of substitute solutions to the prospect's needs.
• Impact on customer's business as measured by costs of trying out your offering, how quickly the customer can realize a return from their investment in your offering, how disruptive the introduction of your offering is to the customer's operations and the costs to switch to your offering.
• The complexity of your offering as measured by the existence of standard interfaces, difficulty of installation, number of options, requirement for support devices, training and technical support and the requirement for complementary product interface.

The Competition
It is essential to know who the competition is and to understand their strengths and weaknesses. Factors to consider include:

• Each of your competitor's experience, staying power, market position, strength, predictability and freedom to abandon the market must be evaluated.

Your Enterprise
An honest appraisal of the strength of your enterprise is a critical factor in the development of your strategy. Factors to consider include:

• Enterprise capacity to be leader in low-cost production considering cost control infrastructure, cost of materials, economies of scale, management skills, availability of personnel and compatibility of manufacturing resources with offering requirements.
• The enterprise's ability to construct entry barriers to competition such as the creation of high switching costs, gaining substantial benefit from economies of scale, exclusive access to or clogging of distribution channels and the ability to clearly differentiate your offering from the competition.
• The enterprise's ability to sustain its market position is determined by the potential for competitive imitation, resistance to inflation, ability to maintain high prices, the potential for product obsolescence and the 'learning curve' faced by the prospect.
• The prominence of the enterprise.
• The competence of the management team.
• The adequacy of the enterprise's infrastructure in terms of organization, recruiting capabilities, employee benefit programs, customer support facilities and logistical capabilities.
• The freedom of the enterprise to make critical business decisions without undue influence from distributors, suppliers, unions, creditors, investors and other outside influences.
• Freedom from having to deal with legal problems.

Development
A review of the strength and viability of the product/service development program will heavily influence the direction of your strategy. Factors to consider include:

• The strength of the development manager including experience with personnel management, current and new technologies, complex projects and the equipment and tools used by the development personnel.
• Personnel who understand the relevant technologies and are able to perform the tasks necessary to meet the development objectives.
• Adequacy and appropriateness of the development tools and equipment.
• The necessary funding to achieve the development objectives.
• Design specifications that are manageable.

Production
You should review your enterprise's production organization with respect to their ability to cost effectively produce products/services. The following factors are considered:

• The strength of production manager including experience with personnel management, current and new technologies, complex projects and the equipment and tools used by the manufacturing personnel.
• Economies of scale allowing the sharing of operations, sharing of production and the potential for vertical integration.
• Technology and production experience
• The necessary production personnel skill level and/or the enterprise's ability to hire or train qualified personnel.
• The ability of the enterprise to limit suppliers bargaining power.
• The ability of the enterprise to control the quality of raw materials and production.
• Adequate access to raw materials and sub-assembly production.

Marketing/Sales
The marketing and sales organization is analyzed for its strengths and current activities. Factors to consider include:

• Experience of Marketing/Sales manager including contacts in the industry (prospects, distribution channels, media), familiarity with advertising and promotion, personal selling capabilities, general management skills and a history of profit and loss responsibilities.
• The ability to generate good publicity as measured by past successes, contacts in the press, quality of promotional literature and market education capabilities.
• Sales promotion techniques such as trade allowances, special pricing and contests.
• The effectiveness of your distribution channels as measured by history of relations, the extent of channel utilization, financial stability, reputation, access to prospects and familiarity with your offering.
• Advertising capabilities including media relationships, advertising budget, past experience, how easily the offering can be advertised and commitment to advertising.
• Sales capabilities including availability of personnel, quality of personnel, location of sales outlets, ability to generate sales leads, relationship with distributors, ability to demonstrate the benefits of the offering and necessary sales support capabilities.
• The appropriateness of the pricing of your offering as it relates to competition, price sensitivity of the prospect, prospect's familiarity with the offering and the current market life cycle stage.

Customer Services
The strength of the customer service function has a strong influence on long term market success. Factors to consider include:

• Experience of the Customer Service manager in the areas of similar offerings and customers, quality control, technical support, product documentation, sales and marketing.
• The availability of technical support to service your offering after it is purchased.
• One or more factors that causes your customer support to stand out as unique in the eyes of the customer.
• Accessibility of service outlets for the customer.
• The reputation of the enterprise for customer service.

Conclusion
After defining your strategy you must use the information you have gathered to determine whether this strategy will achieve the objective of making your enterprise competitive in the marketplace. Two of the most important assessments are described below.
Cost To Enter Market
This is an analysis of the factors that will influence your costs to achieve significant market penetration. Factors to consider include:

• Your marketing strength.
• Access to low cost materials and effective production.
• The experience of your enterprise.
• The complexity of introduction problems such as lack of adherence to industry standards, unavailability of materials, poor quality control, regulatory problems and the inability to explain the benefits of the offering to the prospect.
• The effectiveness of the enterprise infrastructure in terms of organization, recruiting capabilities, employee benefit programs, customer support facilities and logistical capabilities.
• Distribution effectiveness as measured by history of relations, the extent of channel utilization, financial stability, reputation, access to prospects and familiarity with your offering.
• Technological efforts likely to be successful as measured by the strength of the development organization.
• The availability of adequate operating capital.

Profit Potential
This is an analysis of the factors that could influence the potential for generating and maintaining profits over an extended period. Factors to consider include:

• Potential for competitive retaliation is based on the competitors resources, commitment to the industry, cash position and predictability as well as the status of the market.
• The enterprise's ability to construct entry barriers to competition such as the creation of high switching costs, gaining substantial benefit from economies of scale, exclusive access to or clogging of distribution channels and the ability to clearly differentiate your offering from the competition.
• The intensity of competitive rivalry as measured by the size and number of competitors, limitations on exiting the market, differentiation between offerings and the rapidity of market growth.
• The ability of the enterprise to limit suppliers bargaining power.
• The enterprise's ability to sustain its market position is determined by the potential for competitive imitation, resistance to inflation, ability to maintain high prices, the potential for product obsolescence and the 'learning curve' faced by the prospect.
• The availability of substitute solutions to the prospect's need.
• The prospect's bargaining power as measured by the ease of switching to an alternative, the cost to look at alternatives, the cost of the offering, the differentiation between your offering and the competition and the degree of the prospect's need.
• Market potential for new products considering market growth, prospect's need for your offering, the benefits of the offering, the number of barriers to immediate use, the credibility of the offering and the impact on the customer's daily operations.
• The freedom of the enterprise to make critical business decisions without undue influence from distributors, suppliers, unions, investors and other outside influences.

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.