Small businesses are great assets to any economy. This is because they have the potential to grow and expand, and create job opportunities for citizens. As a small business owner, you’re an even greater asset, which is why you should understand marketing.
Regardless of size and budget, every business needs marketing to grow. Small business marketing can achieve so much – increase income, reach new customers, etc.
As a small business owner, it is normal to be intimidated by the number of terms related to marketing. This article helps you understand the basics of marketing for small businesses. By the time you’re done, you should be more confident about marketing as a crucial part of your business.
What is Marketing?
In simple terms, marketing is the collection of all the activities needed to build and retain relationships with your customers. That is, more new and loyal customers equals prosperity for your business.
Marketing is all about putting your customers first. It means knowing who they are, what they like, their pains and beliefs, and their goals.
These can be achieved by:
- Creating a profile, also known as a customer avatar. This profile will have a name, age, gender, habits, etc. The more detailed and specific the profile is, the better you understand your customers.
- Creating a customer database: This is a list of relevant information about existing customers. Even small businesses can have this. The length doesn’t matter as much as the information it provides you with.
- Getting to know your clients: Sure you can do this online through email, surveys, or direct calls. You should also try to know them in person. Physical relationships have stronger bonds than virtual ones.
All these being said, you should keep in mind that business marketing is not advertising.
Advertising is just one aspect of marketing that focuses on promoting products. Marketing is broader in that it covers pricing, distribution, customer service, sales, market research, marketing plan, and marketing budget.
To learn more about the differences between marketing and advertising, click here.
Marketing is obviously made of several components. This article will is focused on simplifying 3 terms: market research, marketing budget, and marketing plan. Every component is important, but these three are easily the most complex and most confusing.
What is a Market Research?
Market research is a process of identifying specific categories of customers who may be interested in your products/services. After identification, you can then figure out how your products can benefit this set of people.
This set of people are your target market. They are a very specific segment of an entire population that are willing to pay for your services. A proper market research shows you who these people are, and prevents you from making costly marketing mistakes.
An example of a costly mistake is assuming your product will serve everyone out there.
No matter how universal you think your product is, it can’t serve everyone. Targeting your business marketing efforts to that select group of people saves you time and money, and gives better results. This is the aspect of marketing where defining your customers really matter.
Creating an avatar, running a survey, or something similar is very likely to help you narrow down your audience.
Whatever you do, don’t make the mistake of falling in love with your products, and forgetting about your customers.
What is a Marketing Plan?
As the name implies, a marketing plan is a detailed map that specifies what marketing activity to carry out, in what direction, and at what time. It’s function is to help you visualize achieving your marketing goals.
A small business marketing plan has some important elements like:
Goals and strategies
Goals are specific results expected within a certain time frame, and strategies are ways to turn goals to realities. Knowing exactly where you’re headed with your marketing activities, is key to getting substantial results at the end of it all.
A marketing plan is expected to make that clear.
The prices attached to products/services can make or break a business. This part of the marketing plan decides on setting prices that will be profitable as well as competitive.
Here, opportunities for new and existing markets are highlighted. Goals contribute to this element by making it easy to decide on which market opportunity to invest in.
Defined target market
As stated earlier, knowing your customer is key to success. A marketing plan should clearly define your customers and how your products will benefit them.
What is a Marketing Budget?
A marketing budget is an estimated sum of money, needed to promote and market your products and services through paid ads.
For a small business to maintain a stable position in the market, you should spend about 5% of your total income on marketing.
You don’t want to incur massive loss at an early stage of your business. When you want to expand significantly, you can then increase the percentage you dedicate to marketing.
Your business is an investment, not a liability. Even if you’re on a tight budget, you can still achieve reasonable marketing results by:
- Attending events saturated with your target audience. You get the opportunity to interact with your target audience and create awareness for your business.
- Organizing workshops or programs that benefit your target audience. This will not only attract new customers but also confirm you as an expert in that field. When people trust you, they will patronize you.
- Sharing your story is also an effective way to create awareness for your brand and also build authenticity for your products an services.
Small business marketing involves different components, channels, strategies, as well as several tools. Being familiar with the basics will help you understand the rules of marketing.
Effective marketing will let you retain customers, reach more customers, and expand significantly.
How do you get started with implementing this knowledge? Have a business plan.
It is the easiest and clearest way to define your market, and make realistic financial assumptions.
Business plan experts at Side Hustle can get you started immediately. All you need to do is click here.