Starting a small business is a huge goal to accomplish. Whether you are still mapping out that goal or have already started, you’ll need to learn all about marketing to be successful. Here are the basics of marketing.
The Four P’s of Marketing
Product: What is your small business selling? Whether it’s a tangible product like a homemade candle or a service like lawn care, your product is what you want people to buy. One of the most important things to remember about your product is how to differentiate yourself from another business who might sell something similar (or the exact same product). Maybe you have the widest selection of candles in the state. Differentiating within your own product line is important, too. Maybe you offer a deluxe lawn care package complete with edging and weeding, and you also offer a distinct, more standard lawn mowing package. Consumer Package Goods, or CPGs, generally have some of the best example of product differentiation. Look at Lysol as an example. They claim to kill more germs than any other cleaner, and they also offer a wide variety of sprays at different prices.
Price: To many businesses, price seems like the only thing that matters to your customer. You don’t need to just focus on slashing prices, however. Focus on giving discounts that really register with your customers. For example, $20 off a T-shirt is going to seem a lot more significant than $20 off a flat screen TV.
Placement: This fundamental principle of marketing usually pertains to physical location: the geography of your store(s), location of your product, or exact placement of your advertisement. Location can be very important. Is your store on a corner lot? Is it on the better side of the street for walkable traffic? People may notice you more. If your customer has to make a U-Turn to get to your business or has limited parking nearby, that could have a negative effect.
Lots of businesses develop location strategies or develop models to mirror their competition or a particular set of rules. Think of Burger King and McDonalds, where you rarely see one without the other close by. Also consider what requirements a community must meet before a Neiman Marcus will open up a location in that city.
Lastly, pay attention to things like shelf placement at grocery stores and big box businesses. Look at the types of commercials that you see and hear and how their targeting may be different depending on the station/channel. Think about why certain locations have billboard signs and others do not. This all refers back to the basic principles of marketing and, ultimately, placement.
Promotion: Every product needs a great promotional plan. How will you sell your product? Get the word out about your goods or services through TV advertising, a display ad campaign, search engine marketing, radio, direct mail, affiliate marketing partnerships, or even social media. The possibilities are endless. However you reach your customers, be sure to develop a comprehensive and sensible strategy to promote the product that your business is selling.
Return on Marketing Investment (ROMI)
ROMI is the money that you make from marketing. For example, if you spent $1,500 on a Facebook ad for your lawn care service, and you received 40 sales totalling $3,000 from that advertisement, your ROMI would be $1,500. You made that money from your marketing campaign. Set your ROMI goals and consider your marketing cost allowables as you build out your campaigns.
The Marketing Trifecta
Within a given competitive environment, your business must be the best at one of these things in order to be successful: best price, best research/development/technology, or best customer experience. A business only needs one of those things in order to establish a customer base. Maybe your business offers the higher scented candles, and you differentiate by also offering a more obscure vegan candles with no chemically manufactured scent. Your competitor offers the lower priced candle. The most important thing for your business is that you you understand the customer's needs. Does your customer want a fancy candle, or do they just want one that is affordable? Does your lawn care staff need to be faster than everyone else, or do they need to be sure not to cut any corners? Should you provide the latest technology that allows you to quickly determine the best treatment plan for your new shrubbery, or does your customer want to pay a price for the bare minimum hedging? Know which piece of the trifecta you want to impact, and build your customer base from there.
Figuring out a marketing strategy for your small business can seem overwhelming. Don’t panic! Knowing these simple basics will help you tremendously. Good luck!
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