Marketing is the essential force behind every small and start up business. It’s the only way to attract clients and actually make the business successful. Effective marketing for small business is the key ingredient in a successful and profitable marketing campaign. Anyone can launch a huge, high cost campaign that will capture attention, but the key for a small or startup company is to market in a smart and cost effective manner. There are many limitations small or startup companies face when approaching a marketing campaign. They can include:
- Small Budget
- Little to no data on industry trends(in niche industry)
- No company recognition
- Little to no company history
- Lack of marketing knowledge
We will discuss these 5 key elements that can affect a small business marketing campaign and offer advice on how to overcome these common pitfalls.
A small or limited budget can be one of the biggest hurdles to overcome in a marketing campaign. For the most part, effective marketing requires some sort of budget. There are three common scenarios that occur with a limited budget and can be addressed: working effectively with a small budget, finding ways to raise capital to increase budget, and ways to market with no budget whatsoever.
Working with a Small Budget
It is still possible to launch a great marketing campaign with a limited budget. The key is effective placement of the funds. Depending on the company or industry, investing in driving website traffic via paid ads on Google or Yahoo may be a great way to get instant traffic to an e-commerce site. Hubspot offers a wide range of insights on internet marketing. While in many cases local advertising in a newspaper, magazine, or TV commercial may be most effective. There are even some industries where direct mail and/or catalog marketing works very well.
The key is to determine which method of advertising is going to reach the largest number of potential clients. The key word here is potential; it’s better to reach a total of 10 clients of whom 8 may be prospective buyers, as opposed to reaching 100 clients of whom only 3-5 might be prospective clients. It’s more important to turn those leads into buyers as opposed to just getting a lot of attention.
Raising capital to increase a marketing budget
Raising capital can be essential in some industries because massive marketing efforts may be the only way to compete within the industry. Small business loans are usually a great option because the company does not have to give up any ownership and can pay the principal back over time(interest is also tax deductible) but now small business loans are harder to get, especially for a start up with no credit history. Other options can include investors who will invest capital for a stake in the company which could be a good idea if the company may need more capital infused down the line. One last option could be to find an investor that will offer their marketing services for a smaller stake in the company and only invest time, as opposed to capital. All three options should be considered and played out in the company business plan to determine viability.
No Marketing Budget
If there is no budget available for marketing it can be smart for a company to take advantage of free services like Facebook, Twitter, Linked In, Google +, etc. to try and reach out to a client base. Other options include the classic cold call or door to door marketing which can be time consuming, but can create revenue with no capital investment! Effective marketing for small business is difficult with no budget, but not impossible!
Finding Industry Trends
Marketing is always changing, so it’s very important to stay up to date on trends in the industry to make sure a marketing campaign is effective. In some niche industries it can be very hard to find either industry data or enough competitors to determine how the market place works. However, in some cases it may be required to conduct a market survey with existing clients or potential clients to see how the industry in trending. In larger markets it can be much easier to either find competitors or public company data to determine the best way to reach a client base.
No Company Recognition (early and start up businesses)
Lack of company recognition can have both a positive and negative effect on a potential client. It’s a smart idea for a start up to take advantage of the positive aspects. If your name is not recognized in the industry that means the company has no bad press or negative word of mouth which can benefit a start up greatly. It also gives a company the chance to create brand recognition on their own. The downside is some clients may be wary of working with a company with no history, so it could be helpful to offer promotions or deals that customers can’t refuse in order to gain them as a long term client. In the service industry it’s easy to offer clients the option that they do not pay until they are satisfied. In many cases this can outweigh a client’s apprehension to try out a new company.
Little or No Company History
This can be a challenge for starts ups because with no history comes no credit score, no word of mouth, zero testimonials, and no client base. This seems like a daunting task to overcome but can give the small business owner even more incentive to get out there and make a name for the new company. Some great ways of overcoming lack of history are creating company history in the form of press releases, news articles, blogs, etc. that will give the company a presence. Reaching out to friends and family for business or referrals can also give a company the opportunity to create some client history and offer at least some referrals to new or potential clients. Effective marketing for small business will tell clients a story about your product or service to instill trust and reliability in your brand.
Lack of Marketing Knowledge
For a small business with limited employees and/or resources it’s possible no one on the team has knowledge of marketing. This may require the use of a outside marketing or advertising agency. Trade shows are also a good way to market without specific marketing knowledge. We have an article on tips for first time exhibitors that can be helpful in this area. A marketing agency may also be helpful for up and running small businesses that need to gain specific insight into their market and increase market share to the maximum.
Although this article has only covered 5 key points in effective marketing strategies, they are some of fundamentals needed to start a successful marketing campaign. Small and startup companies have the hardest hurdle to overcome, but the most to gain with a successful marketing effort. At the beginning of the article we pointed out obstacles to overcome in a marketing campaign so its import to highlight the ways to overcome these obstacles:
- Use free marketing mediums such as social media
- Study your industry to create your own industry stats
- Use press and online marketing to make a name for your company
- Create your own company history with referrals and press releases
- Consult with an agency or marketing expert to increase effectiveness
An effective marketing campaign can not only gain revenue but increase your long term client base and company history. Studying articles, expert blogs, and text books can all be a valuable source when evaluating how to launch your next marketing campaign! Effective marketing for small business is possible for anyone regardless of education or budget!