Small business owners and entrepreneurs know that marketing is one of their most important jobs, but many of the marketing strategies that are available for large corporations just aren’t feasible for the little guy, whether it is taking out a Super Bowl ad or having a Madison Avenue advertising agency create a campaign.
Most marketing plan examples that can be found both on and offline are designed for larger corporations that are looking for SBA loans or angel investors. They are overkill for most small businesses. More than that, they are too complex to be implemented without a large budget of both time and money.
So let’s bring it down to the basics of marketing for small businesses and entrepreneurs—without the corporate speak. There are four elements to consider, known as the Four Ps of Marketing: Product, Price, Place, and Promotion.
Product
Know exactly what it is that you are offering. If you are not able to clearly define your product or service, your potential customer won’t understand what you are selling, much less what the value is to him or her. A confused person does not buy. They go watch cat videos on YouTube and put the decision off for another day.
There’s a reason why ads and commercials show people happily using a product. They help potential customers put themselves in the picture. “If I buy this, I’ll be happy, too” or “If I buy this, I’ll finally be able to lose that last 10 pounds.”
In advertising, you’ll hear a lot about features vs. benefits. A feature is “This wrist brace will automatically cause your wrist to hinge at precisely the proper point in your golf swing.” The benefit is “you’ll gain an extra 25 to 30 yards and be able to drop the ball exactly where you want it to land.”
You need to not only be able to clearly state what you offer but show people the personal benefit to them if they buy your product or service. Your product might have several different target markets that derive different benefits from the same feature. Part of your marketing job is to list all the features of your product or service and then brainstorm all the possible benefits to different market segments.
Price
Price encompasses more than “what the market can bear.” For physical products, there are hard costs involved: raw materials, labor, manufacturing, packaging, shipping. For services, there are preparation and delivery costs: Time is a hard cost, whether it is your time or an employee’s time.
Price is also a reflection of your target market and your brand. Coffee makers sell in a price range from $5 for a simple plastic filter holder that sits on top of a mug to $20,000 commercial espresso machines. If the lowest you can charge for a product or service is $140 and everyone else in your niche is able to sell the same thing for $100, you need to find some differentiating factor—real or perceived—that makes your product worth the extra money. Many companies do this with branding. Is a Starbucks mocha latte better than Cindy’s Local Gourmet mocha latte? Is it worth an extra dollar or two? Probably not. But Starbucks has a lot more brand recognition than Cindy. Brand recognition allows a company to charge more, whether the product is actually worth more or not.
For some products and services, price is tightly tied to supply and demand. Prices at the only store in a small, isolated town are higher than prices in a store in the city with lots of local competition. Specialists charge more than generalists. There are fewer specialists (lower supply) and so their services are in higher demand resulting in higher prices.
All these factors can be part of your pricing calculations. One of the most important questions you can ask yourself when setting your price is “Can my target market easily afford this?” You might not easily afford Manolo Blahnik shoes at over $1,000 a pair. You’re not their target market. (Neither am I.) Their target market is the woman who will buy a pair without blinking and then say, “I’ll also take a pair in red and another in ivory.”
If your price is not quite a no-brainer, you can make it more accessible by offering payment plans or accepting credit cards. But if your product is completely out of someone’s economic reach, they are not your target market.
Place and Placement
Where are you most likely to find your customers? Where do they hang out, both online and offline? You need to be where they are. Once you know what you are offering, you want to create a complete picture of your ideal client—your client avatar. Is it a man or a woman? How old are they? What’s their economic status, their educational status? Do they eat at Applebee’s or only dine at restaurants with Michelin stars? Do they shop at Walmart or Costco? (Both offer low prices but appeal to different target markets.)
From there, you can make an informed decision on where to best find your target market, both online and offline. You want to place your product in places where your ideal customer will see it. You also want to be able to distribute your product to any buyers. The internet gives us access to the entire world, but if you’re a massage therapist in Iowa, having someone interested in your services who lives in Bulgaria is not going to help you. If you ship hard products, you may not want to deal with shipping outside of the US due to increased costs and potential customs issues with other countries. Those are situations and decisions for you to think about before spending money running untargeted ads.
Having a firm grasp on exactly who your ideal client is will help you find them. I have a Target Market Analyzer that I use with my private marketing clients. It helps us narrow our focus so we aren’t wasting marketing dollars. There’s a reason no one is running ads for mercenaries in Better Homes and Gardens.
Promotion
This is the actual implementation of marketing strategies and tactics. It includes advertising and public relations, as well as email marketing, social media campaigns, search engine optimization (SEO), audio and video.
Many business owners throw money into advertising, trying everything that seems logical without doing the groundwork of clarifying their offer, identifying their target market, and setting the proper price point. Knowing exactly who your best customers are and where to find them informs your promotion strategies.
With small businesses and entrepreneurs, promotion is often limited by budget. The smaller the marketing budget, the more time, effort, and creativity you will need to put in. Fortunately, there are a lot of free and low cost marketing strategies available both online and offline.
But not every strategy is right for every business, of course, and just because a strategy is low or no cost doesn’t mean you should use it. You also need to think in terms of long and short term results and which product or promotion to move a product will bring the best return on your investment. For that you need the fifth P, an integrated Plan.
The Fifth P: Your Marketing Plan
Fortunately, small business owners and entrepreneurs don’t need a marketing plan that looks like the schematics for the weapons systems of the Death Star. But as a business owner, you do need to have a plan in place so you’re not chasing shiny objects or making half efforts that are doomed to fail.
The best marketing strategies are those that you can afford to do, both in terms of time and money, and those that you will carry out consistently.
Knowing the basics of marketing for small businesses and entrepreneurs is the first step towards creating a practical marketing plan that will bring in clients. My book, The 8 Step Marketing Plan, walks you step by step through creating a marketing plan that is practical and effective. It is specifically designed for small businesses and entrepreneurs: no corporate speak, complicated math, or budget breaking strategies. It’s time to put your marketing plan in place.
