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through the essential steps of setting your marketing goals, objectives, strate- gies, and budgets. In short, Part I helps you shape your business’s future. Part II: Sharpening Your Marketing Focus This part takes an unbiased look at your marketing to help uncover gaps that may exist between what people believe about your business and what you think or wish they believed. Then it looks at what you’ve been saying (or not saying) to lead to misperceptions. With all that in mind, it steers you through the process of defining your business position and brand — including expla- nations of what those terms mean. Finally, it offers advice on when and how to bring in professionals to help you implement your marketing program. Part III: Creating and Placing Ads Part III takes you on a tour of the world of advertising, complete with a quick- reference guide to mass media, a glossary of advertising jargon, how-to’s for creating print and broadcast ads that work, and step-by-step instructions for planning and buying ad space and time. Part IV: Getting the Word Out without Advertising Part IV is packed with information on the tactics small businesses use most, including direct mail, brochures, publicity, promotions, and online communi- cations. In the first edition of this book, Part IV was dedicated to the then-new topic of online marketing. Over a few fast years, though, businesses have adopted Internet marketing so completely that in this edition you’ll find online advice integrated throughout the book, along with a fact-filled Chapter 16 dedi- cated entirely to online marketing ideas and information. Part V: Winning and Keeping Customers A widely cited study by the U.S. Department of Commerce found that it takes five times more effort to get a new customer than it does to keep one. This part gives you priceless tips on how to do both. It begins with the process of capturing the interest of prospects and turning these prospects into cus- tomers through good sales techniques. Then it moves to the most important topic of all: developing customer loyalty by making customer service a cor- nerstone of your business. 3 Introduction 03_578391 intro.qxd 12/28/04 8:55 PM Page 3 Part VI: The Part of Tens Chapter 20 leads you through the ten most important questions to ask and answer before naming or renaming your business or one of its products. Chapter 21 shares ten all-time best and ten all-time worst marketing ideas. Finally, Chapter 22 brings it all together by outlining the ten steps to follow as you build your own easy-to-assemble marketing plan. Icons Used in This Book Marketing is full of logos, seals of approval, and official stamps. In keeping with tradition, throughout the margins of this book you’ll find symbols that spotlight important points, shortcuts, and warnings. Watch for these icons: This icon highlights the golden rules forsmallbusiness marketing. Write them down, memorize them, and use the cheat sheet in the front of this book to remember them. Remember the line, “Don’t tell me, show me”? This icon pops up when an example shows you what the surrounding text is talking about. Not every idea is a good idea. This icon alerts you to situations that deserve your cautious evaluation. Consider it a flashing yellow light. The bull’s-eye marks tried-and-true approaches for stretching budgets, short- cutting processes, and seizing low-cost, low-effort marketing opportunities. It’s not all Greek, but marketing certainly has its own jargon. When things get a little technical, this icon appears to help you through the translation. Ready, Set, Go! The role of marketing is to attract and maintain enough highly satisfied cus- tomers to keep your business not just in business but on an upward curve. That’s what this book is all about. 4 SmallBusinessMarketingFor Dummies, 2nd Edition 03_578391 intro.qxd 12/28/04 8:55 PM Page 4 Part I Getting Started in Marketing 04_578391 pt01.qxd 12/28/04 8:56 PM Page 5 In this part . . . W hether you’re running a do-it-yourself sole propri- etorship, a family business, a professional prac- tice, a retail establishment, a non-profit organization, or, for that matter, a multimillion-dollar corporation, Part I helps you focus on the plain-and-simple marketing truths that will fuel your business success. The chapters in this part offer clear-cut definitions and lead you on your own fact-finding marketing mission, help- ing you analyze your customer, your product, and your competition before setting goals and objectives that will shape your business future. If you’re in business, you’re a marketer. This part gets you well-introduced to your job! 04_578391 pt01.qxd 12/28/04 8:56 PM Page 6 Chapter 1 A Helicopter View of the Marketing Process In This Chapter ᮣ Understanding the meaning and role of marketing ᮣ Differentiating smallbusinessmarketing from big businessmarketing ᮣ Jumpstarting your marketing program Y ou’re not alone if you opened this book in part to find the answer to the question: “What is marketing anyway?” Everyone seems to know that marketing is an essential ingredient forbusiness success, but when it comes time to say exactly what it is, certainty takes a nose dive. If you pick up the phone and call any number of marketing professors, mar- keting vice presidents, or marketing experts and ask them to define market- ing, odds are you won’t get the same answer twice. In fact, if you look the word up in different dictionaries, you’ll find many different definitions. To settle the matter right up front, here is a plain-language description of what marketing — and what this book — is all about. Marketing is the process through which you create — and keep — customers. ߜ Marketing is the matchmaker between what your business is selling and what your customers are buying. ߜ Marketing covers all the steps that are involved to tailor your products, messages, distribution, customer service, and all other business actions to meet the desires of your most important business asset: your customer. ߜ Marketing is a win-win partnership between your business and its market. Marketing isn’t about talking to your customers; it’s about talking with them. Marketing relies on two-way communication between your business and your buyer. 05_578391 ch01.qxd 12/28/04 8:54 PM Page 7 Seeing the Big Picture If you could get an aerial view of the marketing process, it would look like Figure 1-1. Marketing is a nonstop cycle. It begins with customer knowledge and goes round to customer service before it begins all over again. Along the way, it involves product development, pricing, packaging, distribution, adver- tising and promotion, and all the steps involved in making the sale and serv- ing the customer well. The marketing wheel of fortune Every successful marketing program — whether for a billion-dollar business or a hardworking individual — follows the marketing cycle illustrated in Figure 1-1. The process is exactly the same whether yours is a start-up or an existing business, whether your budget is large or small, whether your market is local or global, and whether you sell through the Internet, via direct mail, or through a bricks and mortar location. Just start at the top of the wheel and circle round clockwise in a never- ending process to win and keep customers and to build a strong business in the process. CUSTOMER, PRODUCT & COMPETITIVE RESEARCH PRODUCT DEVELOPMENT PRICINGSALES LABELS & PACKAGING CUSTOMER SERVICE DISTRIBUTION ADVERTISING, PROMOTIONS & PUBLIC RELATIONS THE MARKETING PROCESS Figure 1-1: The marketing “wheel of fortune.” 8 Part I: Getting Started in Marketing 05_578391 ch01.qxd 12/28/04 8:54 PM Page 8 9 Chapter 1: A Helicopter View of the Marketing Process As you loop around the marketing wheel, here are the actions you take: 1. Get to know your target customer and your marketing environment. 2. Tailor your product, pricing, packaging, and distribution strategies to address your customers’ needs, your market environment, and the com- petitive realities of your business. 3. Create and project marketing messages to grab attention, inspire inter- est, and move your prospects to buying decisions. 4. Go for and close the sale — but don’t stop there. 5. Once the sale is made, begin the customer-service phase. Work to ensure customer satisfaction so that you convert the initial sale into repeat business and word-of-mouth advertising for your business. 6. Talk with customers to gain input about their wants and needs and your products and services. Combine what you learn with other research about your market and competitive environment and use your findings to fine-tune your product, pricing, packaging, distribution, pro- motional messages, sales, and service. And so the marketing process goes round and round. In marketing, there are no shortcuts. You can’t just jump to the sale, or even to the advertising stage. To build a successful business, you need to follow every step in the marketing cycle, and that’s what the rest of the chapters are all about. Marketing and sales are not synonymous People confuse the terms marketing and sales. They think that marketing is a high-powered or dressed-up way to say sales. Or they mesh the two words together into a single solution that they call marketing and sales. Selling is one of the ways you communicate your marketing message. Sales is the point at which the product is offered, the case is made, the purchasing decision occurs, and the business-to-customer exchange takes place. Selling is an important part of the marketing process, but it is not and never can be a replacement for it. Without all the steps that precede the sale — without all the tasks involved in fitting the product to the market in terms of features, price, packaging, and distribution (or availability), and without all the effort involved in developing awareness and interest through advertising, publicity, and promotions — without these, even the best sales effort stands only a fraction of a chance for success. 05_578391 ch01.qxd 12/28/04 8:54 PM Page 9 10 Part I: Getting Started in Marketing Jumpstarting Your Marketing Program Business owners clear their calendars for the topic of marketing typically at three predictable moments: ߜ At the time of business start-up ߜ When it’s time to accelerate business growth ߜ When there’s a bump on the road to success, perhaps due to a loss of business because of economic or competitive threats Marketing: The whole is greater than the parts Advertising. Marketing. Sales. Promotions. What are the differences? The following story has cir- culated the marketing world for decades and offers some good answers for what’s what in the field of marketing communications: ߜ If the circus is coming to town and you paint a sign saying “Circus Coming to the Fairground Saturday,” that’s advertising. ߜ If you put the sign on the back of an elephant and walk it into town, that’s promotion. ߜ If the elephant walks through the mayor’s flowerbed, that’s publicity. ߜ And if you get the mayor to laugh about it, that’s public relations. ߜ If the town’s citizens go to the circus, and you show them the many entertainment booths, explain how much fun they’ll have spending money there, and answer ques- tions, ultimately, if they spend a lot of money at the circus, that’s sales. Because marketing involves way more than mar- keting communications, here’s how the circus story might continue if it went on to show where research, product development, and the rest of the components of the marketing process fit in: ߜ If, before painting the sign that says “Circus Coming to the Fairground Saturday,” you check community calendars to see whether conflicting events are scheduled, study who typically attends the circus, and figure out how much they’re willing to pay and what kinds of services and activities they prefer, that’s market research. ߜ If you invent elephant ears for people to eat while they’re waiting for elephant rides, that’s product development. ߜ If you create an offer that combines a circus ticket, an elephant ear, an elephant ride, and a memory-book elephant photo, that’s packaging. ߜ If you get a restaurant named Elephants to sell your elephant package, that’s distribution. ߜ If you ask everyone who took an elephant ride to participate in a survey, that’s cus- tomer research. ߜ If you follow up by sending each survey par- ticipant a thank-you note along with a two- for-one coupon to next year’s circus, that’s customer service. ߜ And if you use the survey responses to develop new products, revise pricing, and enhance distribution, then you’ve started the marketing process all over again. 05_578391 ch01.qxd 12/28/04 8:54 PM Page 10 11 Chapter 1: A Helicopter View of the Marketing Process Your business is likely in the midst of one of those three situations right now. As you prepare to kick your marketing efforts into high gear, flip back a page or two and remind yourself that marketing isn’t just about selling. It’s about attracting customers with good products and strong marketing communica- tions, and then it’s about keeping customers with products and services that don’t just meet but far exceed their expectations. As part of the reward, you win repeat business, loyalty, and new customer referrals. Marketing a start-up business If your business is just starting up, you face a set of decisions that existing businesses have already made. Existing companies have existing business images to build upon, whereas your start-up business has a clean slate upon which to write exactly the right story. Before sending messages into the marketplace, know your answers to these questions: ߜ What kind of customer do you want to serve? (See Chapter 2.) ߜ How will your product compete with existing options available to your prospective customer? (See Chapter 3.) ߜ What kind of business image will you need to build in order to gain your prospect’s attention, interest, and trust? (See Chapters 6 and 7.) A business setting out to serve corporate clients would hardly want to announce itself by placing free flyers in the grocery store entrance. It needs to present a much more exclusive, professional image than that, probably introducing itself through personal presentations or via letters on high-quality stationery accompanied by a credibility-building business brochure. On the other end of the spectrum, a start-up aiming to win business from cost-conscious customers probably wouldn’t want to introduce itself using full-page, full-color ads, because prospects would likely interpret such an investment as an indication that the advertiser’s fees are outside the range of their small budgets. To get your business image started on a strong marketing footing, define your target customer’s profile and then project communications capable of attract- ing that person’s awareness and prompting the feeling that, “Hey, this sounds like something for me.” Pay special attention to the chapters in Part I of this book. They can help you identify your customers, determine price and present your product, size up your competition, set your goals and objectives, establish your market position and brand, and create marketing messages that talk to the right prospects with the right messages. If you haven’t already settled on your business name, see Chapter 20. 05_578391 ch01.qxd 12/28/04 8:54 PM Page 11 12 Part I: Getting Started in MarketingMarketing to grow your business Established businesses grow their revenues by following one of two main routes: ߜ Grow market share by pulling business away from competitors. (See Chapter 4.) ߜ Grow customer share by increasing purchases made by existing cus- tomers, either by generating repeat business or by achieving larger sales volume at the time of each purchase. (See Chapter 19.) Almost always, the smartest route is to look inside your business first, work to shore up your product and service offerings, and strengthen your existing customer satisfaction and spending levels before trying to win new prospects into your clientele. Part V of this book offers a complete game plan to follow. Scaling your program to meet your goal Whether you’re launching a new business or accelerating growth of an exist- ing enterprise, start by defining what you’re trying to achieve. Too often, smallbusiness owners feel overwhelmed by uncertainty over the scope of the marketing task. They aren’t sure how much money they should dedicate to the effort, whether they need to hire marketing professionals, and whether to create ads, brochures, and Web sites. They may have all kinds of other questions that get in the way of forward motion. And they delay launch- ing their marketing efforts as a result. Here’s the solution: Rather than worry about the tools you need to do the job, first put the task in perspective by focusing on what it is you’re trying to accomplish. Ask yourself: ߜ How much business are we trying to gain? ߜ How many clients do we want to add? A social service agency might set a goal to raise $100,000 in donor funds. An accounting firm might want to attract six corporate clients. A retailer might want to build an additional $50,000 in sales. A doctor might want to attract 100 patients for a particular new service. A weekly newspaper might want to gain 500 new subscribers. By setting your goal first (more on this important step in Chapter 5), the process of creating your marketing plan (see Chapter 22 for how to write a plan in ten easy steps) becomes a focused, goal-oriented, and vastly easier activity. 05_578391 ch01.qxd 12/28/04 8:54 PM Page 12 [...]... Because the whole point of marketing is to build and maintain customer relationships, it stands to reason that no business is better configured to excel at the marketing task than the very small business Chapter 1: A Helicopter View of the Marketing Process Making Marketing Your Key to Success How many times have you heard small- business people say that they just don’t have time for marketing? Think of it...Chapter 1: A Helicopter View of the Marketing Process How SmallBusinessMarketing Is Different All marketing programs need to follow the same marketing process, but the similarities between big business and smallbusinessmarketing stop there Budgets, staffing, creative approaches, and communication techniques vary hugely between... marketing? Think of it this way It’s the simple truth that without customers, a business is out of business Because marketing is the process by which your business gets and keeps customers, that means marketing is the key to keeping your business in business Put in terms like that, marketing is the single most important activity in any business — including yours The fact that you’re holding this book means... media opportunities that may or may not fit your business needs The small business marketing advantage As a small business owner, you may envy the dollars, people, and organizations of your big -business counterparts, but you have some advantages they envy as well The heads of Fortune 500 firms allocate budgets equal to the gross national products of small countries to fund research into getting to... both by type of service purchased and by client profile It might target individual clients for taxreturn business during the first quarter of the year, high-net worth clients for estate- and tax-planning right after the shell shock of the April 15 taxfiling deadline, and business clients for strategic planning services in early fall, when those customers are thinking about their business plans for the... a specific product or price Small businesses take a dramatically different approach They want to develop name recognition just like the biggest advertisers, but their ads have to do double duty You know firsthand that each and every small business 13 14 Part I: Getting Started in Marketingmarketing investment has to deliver immediate and measurable market action Each effort has to stir enough purchasing... ߜ Request ZIP code information at the beginning of cash register transactions ߜ Survey customers If your business generates substantial foot traffic, find places where customers naturally pause and be there to conduct formal or informal research — depending on your business environment Whether you survey all customers or limit your effort to every nth customer (every tenth one, for example), keep the... your business at noon on Thursdays!) One other important reminder: Be sure to respect and protect the privacy of information you collect from customers Establish and share your company’s privacy policy If you collect information online, visit the Web site of the Online Privacy Alliance (http://privacyalliance.org) and click on Business Resources” for policy guidelines A cardinal sin in small business. .. entry where guests consistently pause ߜ Use contests to collect information Create a postcard-sized survey and use it as a contest entry form For the cost of a nice prize, you’ll collect information that will help you develop your customer profile ߜ Monitor the origin of incoming phone calls When prospects call for information about your business, find out where they’re from and how they found you Callers... group Using customer profiles to guide marketing decisions Customer knowledge leads to strong marketing decisions, including decisions that affect product development, media selections, and the creation of marketing messages The following two examples show how businesses use customer knowledge to steer their marketing efforts ߜ A downtown dry-cleaning and laundry business determines that its market is . all about. 4 Small Business Marketing For Dummies, 2nd Edition 03_578391 intro.qxd 12/ 28/04 8:55 PM Page 4 Part I Getting Started in Marketing 04_578391 pt01.qxd 12/ 28/04 8:56 PM Page 5 In this. the Marketing Process How Small Business Marketing Is Different All marketing programs need to follow the same marketing process, but the similarities between big business and small business marketing. By discovering regions where these prospects live, you also discover areas for potential market expansion. 22 Part I: Getting Started in Marketing 06_578391 ch 02. qxd 12/ 28/04 8:56 PM Page 22