The fundamentals of marketing strategy for small businesses

You have a business, you know that you need to do some marketing to increase awareness to potential customers, but where do you start?

There are a few key things that you need to think about when coming up with your marketing strategy:

1.       Who are your customers?

2.       How do your customers typically find you?

3.       What makes them choose you over similar businesses?

4.       What do you want to achieve?

5.       What is each new sale worth to you?

6.       Do you have a marketing budget?

7.       Are there any barriers to conversion?

Once you have uncovered the answers to these question, you’re on your way to coming up with a strategy. 


Who are your customers?

This may seem straight forward, these are people who buy from you, but have you thought about the people who buy from you but are making the purchase for someone else, i.e. as a gift? Or the person who tells other people about your services but may not spend directly with you? These are called influencers. These days, more and more people will be influenced by a friend, a review site, a colleague or family before making purchases. We seek the approval of others and the benefit of their experiences before parting with our cash, the success of sites like Trip Advisor proves this.

It is crucial that you understand what types of people increase your revenue stream, through direct sales or referrals, when coming up with a marketing strategy. If your business has social media pages, these often provide insights into who your followers are. Before you take this information as gospel, you need to understand whether your social media followers are your customers or just people you know.

Does your business have a website? If so, ask your web developer to add a piece of audience tracking code on your pages where your customers make a conversion action. This will give you a truer picture of who your buyers are. If you start to track your customer’s data, make sure this is detailed in your cookie and privacy policy.

Collect data over a reasonable period of time, you will not get the answers you need about who your customers are in a matter of days. Look at this information over a period of a month or so and repeat regularly. When done correctly, you should be able to tell lots of things about your customers, when they shop, what type of devices they use, what they are interested in, what sort of job they have and age and sex. (In most cases, more than 100 people will have made a conversion before you are provided with detailed insights).

You can simply ask your customers at the point of sale if they will tell you about themselves, they don’t have to do this there and then, you could set up a survey using some free web-based survey tools like SurveyMonkey and ask them about themselves. You may have been handed a receipt in the past, and been asked to complete a survey to be entered into a prize draw, there are no statistics on how many people actually do complete these surveys but it can’t hurt to try. Make sure that you publicise any terms and conditions though.

 

How do your customers typically find you?

This really isn’t too difficult to find out; you should be able to tell this through simple analytics or asking ‘where did you hear about us?’ You could add this into the survey mentioned above.

Knowing how your customers find you is critical to coming up with a marketing strategy, find this out and maximise your marketing on this channel or platform. If you only get orders through your Facebook page, then utilise Facebook in your marketing strategy. If your customers walk in off the street, look at investing in out of home advertising (i.e. billboards or signage in the street).

If you are a web based company then website analytics is a must for you. You will be able to look at something called acquisition (where your website visitors came from) and then the referral path, this will tell you if they came from a search engine like Google, through a social network or another site. You can apply some filters to show which of this traffic brought in the most conversions once you have set up tracking goals.

 

What makes them choose you over similar businesses?

When you set up your business, you would have thought about why this business would work. You will have thought about what made you different from other businesses that provide similar products or services and identified a gap in the marketplace.

Customers care about the benefits of choosing you over everyone else in the area. They will have come to you with a problem, they want a solution. They are less concerned about the features of your product or service they just want to know how you can solve that problem. When you can understand this, you can market to people who need help to solve their problems too.

The look and feel of your brand will have a huge impact on whether people choose you over your competitors. Your customers will be more inclined to buy from you if they see you as someone they can trust and if they can picture themselves as your customer.

 

What do you want to achieve?

Sales, right? But how many? And how? You need to cover your costs and deliver a profit, do you know how many sales you need to make to achieve this and in which timeframe? Those working in the corporate world will be fully aware of goal setting and objectives, these goals need to be SMART

Specific

Measurable

Achievable

Realistic

Timed

Smart goals are drummed into us at work, but they do make sense. A run of the mill goal of ‘make 50 sales’ doesn’t give any detail that can be measured. You can measure a number of sales but is that 50 sales in the lifetime of a company of in the first month? Who knows? If you are making any kind of projections about your company then setting goals and objectives is a must. Don’t base these goals on thin air, think about it all rationally and how you plan to achieve these goals.

 

If you were to approach a company like JeMarketing, the first thing you will be asked is what are your goals? What do you want to achieve? By when? If you aren’t sure then how can you measure the success of your outputs?

 

What is each new sale worth to you?

To work out how much is the appropriate marketing budget for your business; you need to look at how much profit you make from a sale and how much you need to make from each sale to keep your business running. Think about how much you can afford to allocate towards generating new sales through marketing. This needs to be realistic and representative of the amount of an average order.

Average order value is calculated by taking the total revenue from your orders over a fixed period of time and dividing it by how many sales were made in the same time frame (make sure you calculate by orders and not items).

Only you can decide how much a sale is worth to you, there is no hard and fast rule. You need to understand your business model to put a value on this. The amount you spend should factor in how likely a customer is to come back and buy again, the average order value of a customer and how much profit you make from each order.

Once you have worked this out and put this together with sales goals, you can get an idea of your ideal marketing budget. This will also help you to report on how successful your marketing activity is.


Do you have a marketing budget?

During business planning, did you allocate an amount for marketing? This is often a stab in the dark figure until you understand all of the above. A good starting point is to work out how much you can afford to spend on marketing for each sale. It is important to remember that marketing is both proactive and reactive so your marketing budget, in an ideal world, will need to be fluid. They often aren’t! This isn’t just the case with small businesses; this is the case with nationwide corporations too.

Marketing can be done on any budget, regardless of how big or small. At times where you have a lot of sales coming in, you do not need to spend as much on marketing, when you are struggling to make sales, this is the point where marketing is crucial. Sounds simple? Many of the largest companies in the UK struggle to do this; they often see marketing as a nice to have, yet if you pull marketing spends out of a company when their sales are down then all you have left is existing customers, these are people that you can probably predict, you know they buy a tin of beans on a Tuesday, if you can survive on this then great but it is vital that you continue to reach new customers when things get tough, they may buy a tin of beans every day, this new customer will be delivering you more revenue, however they will be costing you more because of additional marketing costs, this will impact on your profit margins in the early stages. Juggling marketing budgets can be an art form and you need to keep selling your tins of beans, customers are fickle and easily drawn away, brand loyalty doesn’t keep people buying from you anymore, this is evident through the increase of budget stores such as Aldi and Lidl, we, as customers, want the best deal. In marketing, you cannot afford to rest on your laurels.

 

Are there any barriers to conversion?

What is stopping everyone you come across buying from you? Well, the list is endless. This could be that there is a consideration period for your customers when they do their research and shop around, it could be that they can’t find the information that they need, or that they want to look at your product in person but you only have a web shop. We are all people who are someone’s customer and we know how we behave. We don’t just land on a holiday website and buy the first deal we see, we read reviews, we look at the area, times of flights, airport parking, and for cheaper deals.

The key to marketing is to make your customers journey as easy as possible within your business constraints, don’t just open a shop because one person said that they wanted to feel the fabric of a sofa you have for sale, offer to send them a fabric sample in the post.

Often, barriers to conversion involve the web side of things; we just can’t find what we are looking for. You are unlikely to every get a customer back once they have got lost within your website. Specific marketing campaigns deserve specific landing pages on your site, a page where the user landing can just buy, book or enquire. This removes barriers to conversion. It is wise to add heat map or mouse click tracking to your web pages, so you can see where your users get lost. Always look at behaviour flows in your analytics to see where your customer journey falls down.

Ask people for feedback, people who are honest and brutal. Or run A/B tests to see how you can improve conversions. If you have a healthy marketing budget then explore the possibility of user experience testing, this can be done in a number of ways, but typically it will involve a group of people being asked to complete a specific task whilst being filmed and feedback any problems they face. They do not know you or your company so will be very truthful.

Make sure you are easy to contact should someone want to pick up the phone and just ask a question, have your contact details prominently displayed, and in a clickable format that a user on a mobile phone doesn’t need to shop and find a pen (never display your contact details as part of an image!).   


With the above in mind, you should have enough to start coming up with a marketing strategy, once a strategy is in place, then comes the time to start planning how to implement your marketing strategy. Your plan will involve a much more detailed set of information, the how, why, when and what you will achieve from each element. JeMarketing specialises in marketing planning and can either deliver a plan that you can put into action or deliver that plan for you, depending on your budget.