Small Business Owners Need Marketing Advice To Succeed
I had a discussion with a small business owner last week who was experiencing problems due to a lack of knowledge in key areas of the business. This company has been in business for approximately 15 years and the owner felt he had a good understanding of the key issues facing his business.
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As the discussion progressed, it was clear opportunities were being missed to make the business more profitable. For example, the results of marketing campaigns were not being monitored or measured, the company has never performed a customer satisfaction/loyalty survey to understand the key issues facing their customers (which may also impact their business), and they did not have a referral program in place to capitalize on their reputation, and the use of social media was minimal. Over the past 15 years, the Internet, social media, communication and information technologies has changed the game for all businesses - large and small.
Small businesses owners do not have a lot of money for anything that is not visibly growing the bottom line. However, there is overwhelming evidence that shows you cannot ignore the value of “information” for finding new customers, determining customer needs, analyzing purchase patterns, retaining existing customers, and operating your business more profitably. In fact, research has shown if you are not actively measuring the performance of your business using both financial and nonfinancial metrics, you are missing opportunities. It has been often said that if you fail to plan you are planning to fail. All business have problems and to solve them we need collaborate, share, and learn from others.
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Statistics from a recent study conducted by the National Federation of Independent Business Provide Key Insights
• Small employers think the most effective means to promote their business is positive word-of-mouth and associated referrals. Eighty-two (82) percent report word-of-mouth contributes substantially to generating their sales revenues.
• Of the promotional means that small employers directly and immediately control, personal selling and business location generate more sales revenues for more ﬁrms than other means. Advertising and Web sites also appear reasonably effective in generating sales revenues for the small, employing businesses using them.
• Few small, employing businesses generate significant revenues through telemarketing (5%), trade shows and events (10%) or free publicity (13%).
• The single most important means of advertising for small businesses are the Internet (16%), word-of-mouth (15%), newspapers (15%) and direct mail (14%). Since multiple advertising methods are often employed, the importance of an advertising strategy and performance metrics for each approach is critical to avoid unnecessary expenses.
• Half (50%) who advertise, advertise steadily throughout the year and another 25 percent do so with periodic ups and downs. The content of advertising material is typically (57%) developed by someone inside the business.
• Virtually all small employers use subjective means to evaluate the effectiveness of their advertising.
• Fifty-one (51) percent of small, employing businesses have a Web site, but their owners do not think that their site contributes much toward generating sales. Twenty-one (21) percent of those Web sites are equipped to make a secured ﬁnancial transaction.
• Sixty-four (64) percent of small employers change the content on their Web site less frequently than once a month. Five percent do it daily or more often.
• Sixty-six (66) percent of small, employing businesses have a logo or trademark, including 84 percent of those employing 20 or more people. However, just 43 percent have theirs registered with the government.
Video that provide useful insights about the special challenges experienced by small businesses from the perspective of Michael Dell
Discussion Topic of the Week
If you have similar experiences, thoughts, or comments about this story? Please tell us! Here are a few questions to start the conversation:
Are business owners reluctant to share their business challenges? If so, why? Who do small business owners turn to for advice? What is the best way for business owners to educate themselves (or stay current with) technology and business practices to improve profitability?
This article was written by SCH & Co. SCH mentors and coaches small business owners on how to become more profitable through the collection and use of business analytics, social media, technology, and business process improvement.
This article is for information purposes only. All trademarks, if any, are acknowledged. The content in this article are the copyright of SCH & Co. © 2013. All rights reserved.