Developing An Effective Marketing Strategy As A Small Business Owner
Having been involved in the marketing world for quite some time, I see bad advice regarding this subject being written and given daily. A legitimate marketing strategy is not getting someone to manage your FB ads, or your Instagram page, your SEO, or anything else that some broke college student trying to make a buck is telling you is the end all be all one hit strategy that every business owner needs. Marketing is also not necessarily meant to get your phones to start instantaneously ringing off the hook, that’s why it remains separate from sales.
What Is Marketing?
I really like The Chartered Institute Of Marketing’s definition: "the management process responsible for identifying, anticipating and satisfying customer requirements profitably.”
I like this definition because it’s simple. Marketing’s job is to identify and/or create a niche by creating a customer need that is only solved by your product.
As far as explaining what this actually looks like in the real world, my favorite example du jour has been Target. Their whole existence over the last 10 years has been sustained solely through aggressive Business Intelligence and very targeted marketing. Over this time, they’ve quietly acquired a lot of assets such as Cartwheel, which is their targeted coupon and sale promotion tool and like Facebook and other big online players, they’ve bought up a few Consumer Research companies. Their consumer research is so good that they can now pinpoint when their female frequent shoppers are pregnant based on subtle changes and cues in their buying patterns that occur during pregnancy.
Over the last 15 years, marketing has seen a major shift as the digital era has taken hold. In the old days, it was all about mass broadcasting your message as far and wide as possible. Nowadays, a lot of marketing is all about pinpoint accuracy and targeting very specific niches. The other benefit that the digital age has brought is the ability to track the ROI of marketing campaigns like never before.
But How Does This Relate To Small Business Owners Specifically?
To me, the digital era has created a brand new playing field and a new game, one which a lot of people, small business owners in particular, are still trying to wrap their heads around. The new rules are rather straightforward though, marketing is no longer restricted to expensive campaigns run by large enterprises and agencies. Using tools that are free or near free, I can create marketing campaigns that are on par with the tools that the enterprise companies I work with pay 10x to 100x the price for.
The biggest pitfall that I see small business owners fall victim to when it comes to trying to market their businesses is that they are still stuck in a 20th century mindset of what marketing is. Radio and TV infomercials, yellow pages ads, newspaper ads, billboards, etc., all fall into one type of marketing called direct response advertising. Nine times out of ten, when you ask a small business owner what they think marketing is, they give you a definition that is some form of direct response advertising. If you have an impulse buy item in a trendy category, this type of advertising can perform like gangbusters for your business in the modern era. For the 95% of business owners that this isn’t applicable to, this is not what you should be thinking of when you think of marketing, or at least not solely.
Creating A Sales Funnel
If you have done any research into this topic whatsoever, you have probably seen the term sales funnel kicked around a lot. From a marketing perspective, this means the exact same thing that it does on the sales side. Unless it’s for a candy bar, no one is going to see your ad and suddenly rush out the door or click a button to buy your product after seeing an ad, clicking onto your site, and browsing through your products. Rather, there are a series of steps that a consumer goes through before making a final purchase decision. The ultimate goal of modern day marketing is to pinpoint consumers that are at some stage of the buying process, figure out what stage they are in, then deliver custom content to them that is stage dependent. Direct response advertising is effective for consumers who are at stage 6 of what is most commonly laid out as a 7 to 8 stage funnel. Most small business owners fail at marketing because they focus their entire budget into late stage marketing strategies, inevitably fail, then call the overall venture a failure.
Build A Brand
No matter what the business and almost without exception, my golden rule is to never talk about price in mass advertising and never create campaigns centered around price. Again, the biggest exceptions being impulse buy businesses. Price is actually only one of four ways in which a business can create differentiation. The four ways are; price, service, quality, convenience. Out of those four, price seems to me to actually be the worst differentiator to choose. If you build a reputation based on price, it creates a scenario where the biggest company with the deepest pockets always wins because they can starve out everyone else. Service and quality on the other hand, allow you to be much more agile and differentiating yourself in this way builds actual loyalty towards your brand.
The reason why brand building is so important (and the aspect of it that I strangely almost never see get talked about by a lot of “marketing experts”) is the fact that brand building lowers your customer acquisition costs over time. Most likely, you have a favorite soda or beverage manufacturer, favorite car company, cell phone manufacturer, etc. Coca Cola’s per customer acquisition costs are significantly lower than RC Cola’s for example.
Perhaps the greatest gift of all that the digital era has given to small business owners is the fact that it has shifted consumer expectations in ways that all greatly benefit the small business owners that utilize effective brand building tactics. The modern consumer does research into a company before purchasing and is swayed just as much by the brand image and company voice as they are the products. If the brand image is not in alignment, they know that they can simply find the same product somewhere else.