Approaching Marketing

Strategically

Gayle Harris-Evans, OwnerHarris Media Direct

Marketing – A Challenge For SMEs

America has been through several economic hardships throughout the decades, and every time it happens, smart companies do their research to become more educated on how to come back stronger afterwards.

Marketing – A Challenge For SMEs

• Reactive to current crisis – not planned long term• Limited resources - lack economies of scale• Strong reliance on passive word-of-mouth for

sales• Focus on developing sales through new

customers• Limited awareness of what marketing really is• Tendency to 'shot gun' promotional activity• Limited market intelligence

According to the (SBA), the top 7 reasons that businesses fail:

• Start business for wrong reason• LACK OF MARKETING (KNOW-HOW AND

EXECUTION)• Poor Management• Insufficient Capital• Location• Lack of Planning• Overexpansion

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What We’ll Cover Today

• Myths about marketing during a recession

• Why you should develop a marketing plan

• Identifying your target market(s)

• What Channels to use

• How you can measure/track the effectiveness of your marketing strategies

• Strategies for marketing in today’s environment

• 2011 marketing trends

8 Myths about Marketing in Economic Downturn

#1: “Our brand is strong enough not to need support for the duration of the downturn.”

#2: “If we cut back on marketing spending, we can use the money for other things internally, and increase the budget when things get better.”

#3: “Nobody’s buying anything, advertising and promotions are a waste of money.”

#4: “We can cut back on Marketing now, and then ramp up quickly when things get better.”

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8 Myths about Marketing in Economic Downturn

#5: “We should examine what’s working for us, and cut out everything else.”

#6: “Marketing spends more money than any other department, they have the most room to cut budget.”

#7: “All of our competitors are pulling back advertising and media expenditures to save money, so we should too.”

#8: “We should downgrade the quality of our marketing materials, use a cheaper creative agency, and mail out less frequently to save money.”

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Marketing Planning: Why does it matter?

• Makes sure that all key players are on the same page

• Ensures that your team understands how they’re going to accomplish the bigger business goals

• Provides greater flexibility• Generally confirms allocated funds• Paves the way for great results• Makes you proactive versus reactive• Helps you identify cyclical and external factors• Gives you an opportunity to think bigger

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Knowing Your Customers

• Everyone or Anybody might be potential customers for your product

• However, you probably do not have the time or money to market to Everyone and Anybody

• Hence the need to segment the market

Market Segmentation

• A market segment is just a group of people with common characteristics that set them apart as a group

– Women with household incomes of $75,000 or more who live in up market suburbs

• The purpose for segmenting a market is to allow your marketing/sales program to focus on the subset of prospects that are most likely to purchase your offering

• If done properly this will help to ensure the highest return for your marketing/sales expenditure

Segmentation Focuses Marketing Effort

• There are numerous advantages to segmenting your market, such as:– You can identify and specify the market– You can estimate the market's potential size

more accurately and evaluate its feasibility– You can identify the specific needs of the market– You can tailor your marketing mix exactly to fit

the needs of the market– You can reduce marketing costs by being more

effective and more efficient

Target Marketing

• When a business has decided on the segments it wishes to concentrate its marketing activity on, we say it has decided on its target markets

• The more you know about a target market, the more precisely you can develop your marketing strategy to attract it to your product

How Many Ways Are There To Segment A Market?

• DEMOGRAPHIC: consumers grouped in terms of demographics - sex, religion, age, nationality etc. Popular because the data is more easily obtained and the measurements based upon these criteria easy to interpret.

• GEOGRAPHIC: consumers grouped by location - country, region, city, neighbourhood etc. Before segmenting geographically, a company must decide where it intends to market products.

• BEHAVIOURAL: consumers defined by the ways in which they use a product or perceive its benefits. Behavioural segmentation may include several categories such as benefits, loyalty, attitudes and so on.

• PSYCHOGRAPHIC: Consumers grouped upon lifestyle characteristics such as interests, opinions and activities.

• BENEFIT: Consumers categorized by the benefits they seek from a product.

• ORGANIZATION: B2B customers grouped according to business characteristics such as size of organization, industry or focus, level of technology, etc.

Different Strokes For Different Folks

• Customizing your product/service offering and your communication to be appropriate to each segment’s needs is the single most effective marketing strategy

• There is substantial evidence to show that businesses that take account of their market segments in this way are more likely to be successful– But only focus on a manageable number of

segments to avoid overstretching your resources

Competitor Research

• What are their product's strengths and weaknesses - are there weaknesses you can exploit?

• What are the differences between your product’s features/benefits and theirs?

• What is their pricing structure?

• Where do they promote their products?

• What is their advertising message?

• What is their positioning (profitability, market share, leadership)?

Customer Research

• Knowing how customers think about you and your business can provide vital strategic intelligence

• Two ways to tune in to customer views:– Customer surveys– A customer advisory board

Business And Consumer Markets Are Different

CHARACTERISITIC B2B B2C

CUSTOMERS Companies Individuals

SALES VOLUME Larger Smaller

MARKET SIZE Smaller Larger

LOCATION OF CUSTOMERS

Often localized Often dispersed

DECISION-TO-BUY For business reasons

Extended over time

Many decision makers

For personal reasons

Immediate purchase

One or few decision makers

MARKETING Personal relationship Mass advertising

Personal Relationships Are Important To B2B Marketing

• You need to develop personal relationship in B2B marketing– Where the number of buyers is small, their

needs complicated and their decision making process influenced by many people, the most effective way of marketing is through personal contact to build trust and understanding

B2B Market Research

• When you deal B2B you need to take the peculiarities of the B2B marketplace into account and develop a marketing strategy that answers to them

• Start by segmenting your current customers:

– If you can identify groups with similar characteristics, then you can develop products and services according to their needs

– You can also customize your marketing to each so as to concentrate on what is of interest to them personally and what they want from a supplier or a product.

• Marketing to segments is more efficient and less costly than a shotgun approach

Segmenting B2B Customers / Prospects

• Location

• How much they spend with you and their spending pattern – how many orders and how valuable they are on average

• Needs (price, quality, technical support etc.)

• How they position themselves in the marketplace

• What trade associations do they belong to?

• How they use the product

• Annual revenue

• How do they place their orders with you?

• How loyal are they to you?

The Small Business Advantage

• Smaller companies have certain advantages when it comes to building B2B relationships, they can often be more flexible than larger companies in delivering customized products

• In small companies, top management is available to deal directly with clients, so strategic business issues can be discussed and resolved in a direct and forthright way

Deciding On Channels To Use

• Main promotional channels:– Advertising – Public relations and publicity – Direct marketing – Promotions and events – Product marketing materials – Sales force

Make Your Website A Marketing Tool

• To achieve this you need to consider two main things:– Is your website easily findable through web

search engines?, and– Does it provide the range of information on the

site that would make it of interest to a customer regardless of where they are up to in the buying process?

Making Your Website Findable

• The Internet is becoming increasingly used for searching supply sources

• To come up in the near front pages of search results you need to optimize your web pages for location

• You need to be seen as a resource to the industry and prospects. Blogs, articles, info and news

Social Media

• Small business has gained a competitive edge in reaching customers by using social media.

• Effective management of social media offers an inexpensive way to engage with potential customers.

• Businesses are able to increase visibility of their services and products through low-cost or no-cost channels. 

• They are able to conduct online research and solicit customer opinions.

• Marketing through social media is time consuming, but it's beneficial to business success. 25

Measuring Marketing Success

SUCCESS FACTOR KPI

Channel effectiveness How many inquiries did you get from a particular channel you promoted through. Was it worthwhile?

Conversion rate Numbers won

Acquisition cost by channel – which channels are cost effective?

Net customer gain Customers acquired minus customers lost

Various reasons why customers ceased doing business e.g. product design fault provides things to measure e.g. fault free batches

Customer spend Average value of transaction - you can focus on chasing the most profitable segment

Achieving results with Marketing

• Focus—be concise with what you are trying to accomplish

• Facilitation—Make it easy for someone to understand the message

• Forecast—Have some sort of ROI calculation• Frequency—one of the most overlooked marketing

principles around• Flexibility –Always strive to continue learning• Fact-Finding—Gather as much information about

your clients and prospects as possible• Follow-up—after the advertisement/message was

received

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Strategies for Marketing in a Recession:

• Marketers must maintain steady levels of advertising at the risk of disappearing from consumers’ radar and being swept away by customers.

• During tough times you have to represent yourself as what your brand is: strong and the best option in the market.

• According to a study by the American Marketing Association, 60% of respondents believe that reducing or stopping the spending on key programs is the biggest marketing mistake that could be made during a recession.

• Respondents also said that their biggest internal challenge during an economic downturn is demonstrating the value of marketing amid declining sales.

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Strategies for Marketing in a Recession:

• Extending existing campaigns may be a better strategy than creating new campaigns.

• Marketers will find opportunity to gain momentum when competitors cut their budgets and there is less category clutter.

• This is a time for companies to make sure that they are the best stewards of their resources, by spending appropriately and looking for the greatest possible return on spending.

• This means staying the course, but also not being afraid of strategies that are new and different in an effort to gain market share.

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Marketing Trends for 2011

• Transparency and trust are paramount• Less interruption, more enhancement and value-

add• Speaking of value• Show it, don’t tell it• Social Media is not going away, and engagement is

critical• Peace-of-mind messages prevail• Relationships rule• Online video and mobile marketing are hot• Focus, focus, focus• Integrated marketing trumps stand-alone tactics

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Conclusion

• A business can survive for some time with poor records, insufficient finance or a lack of management skills, but it can't last long without a market

• Only a strategic approach to marketing based on good knowledge of your own product, your customers and your competitors, will ensure you maximize returns on your marketing spending

Thank you to ROCG Americas for partnering on this Webinar and providing this information in conjunction with Harris Media Direct!

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Thank you! Contact us to find out more about how we can help leverage your marketing dollars for less!

11473 Lakeshore DrivePlainwell, MI 49080-9201

(616) 206-3143

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Gayle Harris-Evans