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Marketing is a small business owner's best friend and one of the main keys to success. A good marketing plan can get you customers and help you to keep them coming back for more.
We've put together this guide to help you work out a marketing plan for your business.
The very first thing that you need to do is market research.
Market research helps you to learn about your customers, competitors, pricing and the industry. When done properly, it can help you to plan and run your business. It can also save you thousands of dollars!
Speaking about the importance of doing your research, TAFE NSW Meadowbank Business Services Teacher, Lisa Rohanek said, ‘Market research provides you with such wonderful snippets of information that can really help you connect with your customer. Too many times people don't find out what the customer really values and then they waste a lot of money offering products and services that have little need to the customer.'
Work out what it is that you want to know. For most small businesses, market research objectives revolve around the following questions:
‘Is my business viable? Who are my customers? How much are they willing to pay? How do I set myself apart from the competition?'
Once you have defined what it is that you want to know, it's time to start researching.
Spread your research across four focus areas: customers, competitors, industry and geographical location.
Primary research is information that you get directly from the source. You can conduct primary research in a number of ways, including:
Primary research is great because it lets you ask very specific questions related to your research objective, and get detailed responses.
When you are addressing primary sources, you will want to come up with a targeted list of questions around your research objective. Examples of these questions may include:
Ask questions that will help you to understand your customer, your competitors and your industry. Use the answers to plan your business and target your marketing.
Secondary research is research that is already complied and organised, like reports, statistics or studies. These resources are perfect for finding out about industry trends and growth, statistics, locations, and competitors.
Good sources for secondary research include:
Knowing who is buying your products is great. Being able to target them with marketing based on customer segments is better!
For example, say you sell hand-made woollen jumpers and you notice that half of your customers are aged between 25 and 35, and the other half are aged between 55 and 65.
You have two different customer segments. These groups will have different behaviours (how they purchase, how much spare cash they have, where they live, what they do for fun etc.). Your marketing will need to speak to them and reach them in different ways.
You can segment your market based on any number of factors, including:
‘When we can really understand who our target market is, what they like, what they do in their spare time, it helps us offer products and services specifically to them' said Rohanek.
‘What customers value is important, and through targeting correctly, we can use the target market to help co-create value within the product or service – this way, we embrace the customer as part of the business to help promote loyalty… and loyalty – well that just brings a good financial outcome,' she added.
Find out what sets you apart from your competition. This is called your USP (unique selling proposition).
Knowing what makes you unique will help you to market and sell your product, as well as get and keep your customers. When formulating your USP, sometimes it is the little touches that make all the difference.
‘A unique selling proposition is really about saying – I'm different. This is what you will get with me over everyone else. Realistically we purchase from businesses because of their unique selling proposition, not in spite of it,' said Rohanek.
It is not enough to have a business; you need to have a brand. Your brand speaks volumes about how you want your business to be seen, and what you have to offer.
Think about it this way, a luxury hotel and a budget hotel will have very different colours, logos, typeface and tone of voice in their advertising.
When branding your company, you will need brand:
‘Why do I want a little white box with a blue ribbon wrapped around it, holding a small silver piece of jewellery coined with the phrase ‘please return to Tiffany & Co.',' said Rohanek.
‘That little white box with a blue ribbon is a brand that I equate to status, to luxury and decadence. Sure, I could buy the same item from another jeweller and it may come in a brown box, white bag – but everything about Tiffany's communicates prestige and luxury – I have a status when I wear it, or open the box. It's a brand – a series of well-appointed elements that communicate a message, wrapped around a unique selling proposition, linked uniquely with key communication messages that have let me understand that Tiffany and Co is a coveted brand, and it's luxurious.
‘A brand is a way to communicate a message. McDonalds' golden arches can be seen from way down the highway, lit up at night – screaming: ‘you're hungry – eat me'. The fast food, low priced giant has done its research well and found that people associate yellow with fast food and it encourages feelings of hunger. So McDonalds have brand elements wrapped around yellow. A small symbol with so much meaning,' she added.
Once you've done your research and laid some foundations, the next step is to look at what challenges and opportunities your business may face.
Write a list of challenges/opportunities, based on your research and experience. This will help to steer your marketing activities in the future.
‘Although I wasn't a Girl Guide, I like to be prepared for anything,' said Rohanek.
‘I don't like dealing with an unknown future for a business, so I do a lot of research to understand challenges and opportunities. A way to try and see what little pockets of possibility exist for a business in the future, knowing what your competition is doing, or what the target market is after allows me to capitalise on this and create a new section of a business that offers something of value. In the same way, I want to know what's coming that could cause a challenge – this way I am prepared and ready to face it, with some contingencies in place,' she added.
Get specific about what you want your marketing to achieve. There are a huge number of directions you could choose, so get focused and get specific.
Do you want to get new customers? Increase sales? Or to increase awareness of your product? Use the SMART acronym to help you work this out:
Specific – clearly define your marketing objectives.
Measurable – work out what you will measure your marketing success on.
Achievable – make sure your objectives are achievable.
Realistic – are your goals realistic, and do you have the resources and time to make them happen?
Timely – set a timeframe for your marketing objectives. Stick to it, and at the end of the timeframe, analyse whether they were achieved or not.
The seven Ps form the basis of your marketing mix. This mix will help you to reach your target customers.
‘The marketing-mix Ps provide a way to help you package your product and service and not leave anything unturned,' said Rohanek.
‘The marketing mix helps you put together your offering, helping you know what you have, how much its worth, how you will deliver it, communicate about it, and consider elements involved along the way. The marketing mix ensures you aren't offering a product of low quality, charging at a really high price and offering it through exclusive availability only. It allows you to create an integrated offering that helps you support the wonderful brand you are creating,' she added.
Take into account your current financial situation, and how much money your business (or you personally, if you haven't started your business yet) is pulling in.
From your revenue, subtract your expenses. You should arrive at a ‘disposable cash figure'. Work out how much of this you want to dedicate to marketing.
Consider what your business goals are for the next quarter. If it is to open a new store, you may need to direct more money into saving for that, or if your focus is to get new customers, launch a business or get your name out in the market, then putting more cash into marketing is advisable.
Business is not just about getting customers, it's also about keeping them. Customer loyalty can make or break a business. You need to focus part of your marketing strategy on keeping your customers coming back.
As a guide, review your marketing strategy every three months to see if it's working for your business. Check to see what parts of your strategy are doing well, and where you may need tweaks and changes.
‘I like to think of it as a rocket heading off into space,' said Rohanek.
‘You may track slightly off path at the beginning, but if you don't straighten up, you will end up somewhere else in the galaxy you don't really intend to be. Whilst a farfetched analogy – if we don't monitor and check what we are doing along the way, we end up somewhere we probably don't want to be. So it's really important to stay on top of your goals and make sure you are meeting them,' she added.
Starting a business is tough work and you will put in long hours, but the potential rewards are impressive. Getting your marketing plan in place can go a long way towards making sure your business is successful not only in the immediate future, but for the long term as well.
If you want to find out more about marketing your small business, check out the range of marketing and business courses we offer at TAFE NSW.