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SME’s do no marketing??

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This week in the Canberra Small Business group on Linkedin a discussion was started around an article asserting that 90% of small businesses do no marketing at all, and that most advertising was a waste of money. If you’re like me and find this statistic to be somewhat incredulous you wouldn’t be alone. 

I’m yet to come across a business of any size that does no marketing at all. Even the simple step of producing a business card is an outward manifestation of marketing strategy. It’s probably fairer to say that most small businesses have not put a great deal of thought into actively marketing their business.

A good marketing strategy will look at what to say, when and where to say it, to whom, what medium it will be conveyed in or upon, and why that audience will move to the action you want them to take. However even with an immature marketing strategy its our experience at RiotACT that the relationship between marketing and advertising is where many businesses fall down and spend ineffectively.

The first of those mistakes is not recognizing that any advertising should be approached with an eye on lead generation. Just recently (in a consulting capacity) I’ve was working with a client who was evaluating re-signing a campaign with much diminished Yellow Pages. Looking at the stats we worked out that each lead through that channel was costing $171 which was significantly higher than expectations and definitely not being accounted for in their pricing structure. The sales reps advice was that it was working and to do more of the same for the coming year. Not to say that’s everyone’s experience with YP but we see a lot of business owners who aren’t evaluating the effectiveness of their advertising and marketing spends, both in time and $ commitment.

If you’re looking at any advertising in 2013 we recommend considering these 9 tips before you start.

  1. Understand the core demographic offered by the advertising platform. If it doesn’t match your ideal client you’re spending in the wrong place.
  2. Create a message that addresses a problem that your product or service solves. Focusing on your solution first is putting the cart before the horse and a significant problem in most advertising we see.
  3. Understand environmental considerations affecting your target audience’s motivations ie if its cold you’ll sell less ice cream. Without this understanding you wont be able to evaluate your ROI effectively,
  4. Be prepared to test and measure. Just because your first message didn’t work doesn’t mean that platform you’re evaluating isn’t the right one.
  5. Put enough fuel in the tank. There are myriads of studies and reports out there that suggest that about the time you get sick of telling someone about yourself, is just the point that they start to get it. Building that mind share takes time or intensity, both of which are very hard to achieve if you are unrealistic about the cost of doing so.
  6. Take your sales reps advice, but only if they’re making the effort to understand your business first.
  7. Get help from a good marketing company or design agency if you don’t have the skills in house. Be honest with yourself, most small business owners are technicians first and getting the help of a good marketer or designer will increase the likely hood of you getting an ROI from your advertising spend
  8. Have some idea of how you’re going to convert leads when they come in. There is very little point in attracting new leads without an idea of how you’ll convert them to clients.
  9. Understand the lifetime value of a new customer to your business. It’s OK to spend $10,000 on client acquisition if the relationship is worth $1 million, but not if the lifetime relationship is only $200
Interested in knowing what RiotACT could do for you
r business? Give one of our media advisers a call for a no obligation chat on (02) 6154 4198 or submit an enquiry via our handy online form. 

Tony Commisso FCA, BA (Accounting) An experienced business coach and adviser, Fellow Chartered Accountant that makes a difference to SME's seeking operational improvement and systemisation, profit improvement or exist strategies. As a natural leader he drives people to achieve their goals.

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