All businesses need to understand the basics of marketing. However, when small business owners see the size and complex content of technical and academic textbooks on business marketing it is little wonder that they find the prospect of learning about marketing daunting. Nevertheless, effective marketing is just as important for a small business as it is for any other. Therefore, the intention of this article is to try to provide a simple and straightforward guide to marketing for the smaller business owner.
Marketing is the term given to the process of understanding your product, knowing who is going to buy it and how to find these customers and also being aware of the problems that your business might come up against when trying to sell. Simply put, marketing is about product, pricing, positioning and promotion.
Product
Understanding your product in a marketing context means more than just knowing that it works. In the first place, there is no point in producing something unless there are enough people out there who have a need for this product or service to make your task of making and selling the product or service into a viable business venture. To take a crazy example, it is unlikely in the modern world of colour TV that a company which produces black and white televisions would be successful.
Therefore, in technical terms the product or service has tp be marketable. There has to be a viable market for the product you have produced to be able to convert this process into a profit and continued success. Additionally that market has to have sufficient customers in it to achieve your business sales targets.
Pricing
Although many might think otherwise, pricing is also an important element of marketing. No product will achieve sales if it is overpriced. Similarly, there is little point in selling a product or service if it does not provide a reasonable return for the business, one that will cover the costs of production, distribution and administration and leave a profit for the owner. It is essential to set the price of the product to take into account all of these costs.
Remember that the price also has to be acceptable to the seller and purchaser and, furthermore, it has to be competitive. Despite the fact that it may not be possible for your product to be sold at a price as low as someone could purchase the same item in a supermarket, as far as other competition is concerned you do not want the price set so high that people will be forced to go to other independent outlets to buy it.
Positioning
When marketing experts use the term positioning all it really means is that you need to understand what type of person is likely to buy your product or service and where is the best place to promote or advertise it and, of course, how to find this information.
Take, for example, an aid that has been developed to help the elderly move about their home more easily. The business knows the customers who are most likely to purchase the product, but now needs to decide how to reach them. If the product is being distributed through retail shops then the obvious answer is that the business needs to locate shops that have elderly customers within their customer base. In this case an elderly persons' "mobility" store might be an appropriate outlet.
If the promotion is going to be undertaken by advertising through a print or TV media, there is a need to find out which publication or TV programmes the elderly read or watch. The product will need to be advertised through these sources to have maximum impact on potential customers. This level of targeting will also help the business to achieve the maximum return from its investment campaign.
Another example is the need to consider the location you are going to promote your business too. If you are providing services as an electrician for instance, it would be unwise to advertise it in an area that is miles away from where the business is located. The financial cost and time spent travelling to and from work is likely to make the business unviable or, alternatively, make you fees too high for the customer, which will lead to the same result, namely little or no business.
Therefore positioning is about making sure that your product is placed in an area or publication that your targeted customers will visit.
Promotion
You might think that this element of marketing has been dealt with, but that would be an incorrect assumption. The likelihood is that there might be a number of businesses trying to sell the same product or service as you. Therefore you need to develop a promotional campaign that will make your specific business stand out from the crowd. Promotion in this sense means that you have to come up with a message that is unique and different to others, one that will make the customer sit up and take notice.
To achieve this element of unique promotion, what you will need to do is research the needs of the customer in relation to your product or service to find the unique selling points (USP's) that will differentiate your product for the others. It might be something simple like the colour or a different manner of operation. Whatever makes your product stand out is the message you should be sending to the customer through your promotion and advertising.