We live in a day and age in which marketing and selling have become key determinants of success for any business, large or small. Large businesses spend millions of rand trying to ensure that their offerings are top of mind and easily accessible to consumers. As a new business owner with limited funding it is a challenge to try to compete with large established brands for the hearts and minds of consumers. The key to being successful as an entrepreneur on the marketing front is threefold: target,target, target; back to basics; and word of mouth.
All efforts in the marketing sphere will be wasted unless you know who you are trying to sell your product or service to.You should carefully define who the intended customers are in terms of factors like age, gender, race, income bracket and position in society. This empowers you with focus and direction and allows you to make key strategic decisions about how to make customers want to buy.
When one of my students set up his magazine business, he knew he could never compete with the large media players in mainstream magazine distribution. Instead, he created a series of publications targeted at individuals living in upmarket residential estates in South Africa.He carefully researched and defined his market identifying their income bracket, purchasing behaviour and demographics. This enabled him to focus his advertising sales drive on companies with a specific interest in reaching wealthy homeowners living in residential estates. Today, his magazine business is alive and well because he homed in on a niche market to maximise his return on effort.
Back to Basics
Open any traditional marketing textbook and one of the fundamental concepts that will be discussed are the four Ps of the marketing mix: product, place, price and promotion have formed the basis of marketing theory for the past few decades and are the basis for a solid entrepreneurial marketing effort. Too many entrepreneurs get carried away with innovative, off the wall marketing efforts when they don’t have the fundamentals in place.Work through each of the four Ps systematically to ensure you have the right mix of activities that will encourage the target market to buy the product.
Word of Mouth
I recently asked a class of MBA students to each interview a successful South African entrepreneur and write a report on the entrepreneur’s highs and lows, successes and failures. When asked about marketing their businesses, over 90% of the entrepreneurs interviewed said that word of mouth was by far the most powerful marketing tool. Referrals from previous happy customers and rave reviews from excited supporters of your business will help you grow faster than any other marketing medium.
Word of mouth referrals carry with them credibility and influence, and they cost nothing. The key is to ensure that you are wowing customers at every opportunity and doing all you can to keep your reputation intact. A marketing approach that identifies and targets a specific customer group, addresses the four Ps of product, price,place and promotion, and continually builds on itself to enhance the reputation of the company and create a flow of word of mouth referrals is an entrepreneur’s best chance of making much needed sales that ensure success.
Ensure your marketing approach addresses the four Ps
Good marketing begins with a good product or service. If the product or service does not fill a genuine gap in the market, or is of inferior quality and cannot do what it purports to do, there is no point in going any further with the marketing plan.
The amount of money charged for a product or service is key to its success or failure. You need to find a balance between attracting customers and making profits. If uncertain, do research in the market to work out what others are charging – set your price and justify in your own mind why you are higher or lower than the competition. For a period of time it is worth testing different price levels within a range and monitoring how a change in price affects sales and profits.
This is about getting the product or service to the customer. Customers will only buy products or services they have access to; it is therefore critical to have distribution channels that reach the customer. Consider distribution channel alternatives, from distributionthrough traditional wholesalers, to web-based channels, to a direct sellingmodel.
Promotion is about communicating themerits of the product or service to target customers and persuading them to buy. This can be done throughadvertising, PR or referrals.