The internet and technology has made it is easier than ever to start a business. Although it is easier to start a business, that doesn’t mean that it is easy to build a business that lasts.
Although about 1 million people start a small business in the U.S., at least 40% of those businesses fail within the first year and more than 80% of them will be out of business within 5 years. 96% will have closed their doors before their 10th birthday.
There are many reasons that businesses fail. One of the key components to building a business that lasts is having a system to consistently attract new customers. Every small business owner will acknowledge that marketing is important, but very few have a marketing plan that they follow consistently. Even fewer have a marketing system in place. You can create a simple, practical, and affordable marketing system that will consistently attract more of you ideal customers.
The typical small business in America is started by someone who knows how to do something. It might be how to prepare taxes, how to assemble a certain type of gizmo, how to wire a ceiling fan, how to administer a network, or how to plan a wedding. Almost never does this know-how include being able to market a business that does those things. While most small business owner will acknowledge that marketing is important, very few have a marketing plan or system that they follow consistently. Why is that? People are comfortable with having systems for accounting and production, but not for marketing. Marketing is viewed as some mysterious art. Without a systematic approach, small business owners fall victim to the “marketing tip of the week”. These individual tactics are not linked to any strategy and are therefore rarely successful. This leads to frustration and when you consider all of the daily issues a business owner has to deal with it is easy to see why marketing gets ignored.
Marketing is not mysterious. It is not difficult. It doesn’t have to cost a fortune. The key is to realize that small business marketing is a system, not an event. By understanding some core principles of marketing and applying them in a systemized manner you can consistently attract new customers
So how do you go about creating a marketing system without having to first become a marketing expert? That is what we are going to talk about today. We have a limited amount of time today, we won’t be able to create a full marketing system for each one of you, but I do think you will come away with some information and tools that will give you a good start. The goals for tonight’s session are: Talk about marketing as a business system Discuss the importance of strategy before tactics Give you a jump start on creating your system by giving you five or six things that you can do right away.
During the course of this talk, I am probably going to mention the word “system” about a billion times. I am a big believer in systems. In fact, one of the main reasons I quit my job and started my own company was to help address what I viewed as a big problem in the small business world which is the lack of a systematic approach to generating new business. Now don’t feel bad, most big companies don’t have a systematic approach either, they just have more money to burn than you and I do. That is starting to change, which is why there are so many articles being written about ROI and accountability in marketing. Back to systems. Since I will be talking about systems I should explain what I mean . The definition that I like to use is a system is a group of independent but interrelated elements comprising a unified whole. Here are some characteristics of a marketing system: 1. The system is documented – You can’t have a system or a step in a system unless you write it down. 2. The system is built on sound marketing principals and 3. You constantly measure, innovate, and refine the system. Some of the interrelated elements in our system are Strategies, Tactics, Tools, and Processes
Is this marketing? While the above may be accurate, as a small business owner I have no idea what I can do with that.
It’s really that simple. If you want a slightly more complex definition, we can say that marketing is getting someone with a specific need to know, like, trusts, do business with, and refer you. The bottom line is people want to do business with people they like. In order to like you they have to know you and trust you. We will use this definition to help us build our marketing strategy.
One of the major challenges that a small business faces is that your potential customers can’t tell the difference between you and your competitors. To them one accountant looks like another, one electrician is the same as another, etc. Therefore, the only way they can determine a difference is by price. Effective marketing will remove the need to compete on price and allow you to charge a premium for your services.
The first step in creating a successful marketing system is to create your marketing strategy. Most small business owners don’t think about marketing in terms of strategy. They tend to think of tactics. When you try to move straight to tactics without first developing a strategy you fall victim of the marketing idea of the week. Before we ever get to tactics we are going to create a strategy to get people with a particular need to Know, Like and Trust us. So the first thing we are going to do is create a strategy that will serve as the foundation for all of our marketing activities. Your strategy is comprised of two parts; your ideal customer description and your core difference. Last but not least, Write It Down! There are many benefits to writing things down, not the least of which is being able to share it with others.
Hopefully, your target market is not “anyone we think will pay us”. We want to be able to define our ideal prospects so that we can communicate in our marketing, this is who we serve. This step makes some business owners nervous because we are implicitly defining who we do not serve. This is OK. If we try to be all things to all people, we will quickly become special to no one. Begin by examining your existing customers. Look for common characteristics of your best customers. Your best customers are not necessarily the ones that pay you the most money. Consider how they value what you do, how they value the relationship, if they pay on time etc. One helpful exercise is to fill in the blank in this sentence: If I had ten more clients like _______________, my business would be ideal. There are three main categories of characteristics that you can use to describe you target market: Demographic – size, age, industry Geographic – local, regional, national, global Psychographic – personal image, values, what drives them Picture your ideal customer sitting across the desk from you and write a paragraph describing that person.
Sample Ideal Prospect Profile My Ideal Prospect is a service business owner with 5-100 employees and no internal marketing department located in the Kansas city metropolitan area. They have typically been in business for 3 or more years. These businesses are outwardly successful and have done very little marketing. They have begun to feel constrained due to this lack of marketing. The greatest problem my Ideal Prospect faces is that they have lost control over the various marketing initiatives and marketing materials that have been created on the fly over the years. Internally, there is no marketing accountability and most, if not all, of the marketing responsibility falls to the owner of the business. They have also found it difficult to grow their business beyond its current market share due to increasing competition. They desperately want to take their business to the next level. The best way to reach these Ideal Prospects is through direct mail offering productivity tools, business workshops sponsored by trusted business professionals and referrals from other business professionals.
What is it about you that makes you unique, that keeps people coming back? If you can’t articulate your core difference in a clear way to your prospective customers, you don’t have one. Fair pricing, having a great product, providing great customer service, these things are not differentiators, they are expectations. Raise your hand if you don’t provide fair pricing. How about customer service? Does anyone plan on not providing good customer service? These things are your ante into the game, not what makes you different. You need to find something that truly sets you apart that has value to the customer. It can be your specialized niche. It can how you charge (not how much) for you service. It can be how you package your services. Your customers often know better than you do what is unique and valuable – so ask them. Interview your clients. Ask them what they think makes you unique. Why did they came to you in the first place? What is it about your industry that bothers them. If there is something is something being done in your industry because “that’s the way it has always been done”, that may be a great opportunity for you to differentiate yourself.
Let’s put your marketing strategy to work by creating your talking logo. A talking logo answers the question “What do you do for a living?”. Most people answer that question with a label - “I’m a real estate agent”. One of the down falls of this response is that it kills the conversation. The person you are talking to thinks to themselves “my brother is a real estate agent, I know what they do” and the conversation stops. By using our Talking Logo we accomplish a couple of things. First, it will usually prompt a response along the lines of “Really, how do you do that?” so the conversation continues. Second, since your Talking Logo contains a problem statement, the person you are talking to can more readily identify if they need your service or if they someone that does. Here is the formula for creating your Talking Logo: Action verb (I help, I show, I teach) + ideal customer (married couples who’s children have move out of the home) + to + solve a problem or meet a need (downsize there home). So what do you do for a living?
Now that we have created our marketing strategy, it is time to implement it. We begin by creating marketing materials that educate. Then we will use these materials in our lead generation and lead conversion (sales) processes. I want to emphasize the importance of doing the important groundwork of creating our marketing strategy first. Many people want to jump right in and start making marketing materials without first defining who they want to speak to and what problems they solve. This results in marketing materials that only talk about the company and have nothing to say about the customer or how you will help solve their problems .
You have probably heard the saying “No one likes to be sold to but everyone likes to buy”. Most marketing materials are sales oriented. There message is “we, we, we…”. We want to create materials that are flexible, affordable, personal, practical, and educational. These materials can eliminate the need to sell by providing the information your prospects need to get to know, like and trust you. Our main tool for providing marketing materials that educate is the marketing kit. A marketing kit typically consists of a pocket folder containing several sheets of information. These sheets can be printed as needed. You can include only the sheets that are of interest to a particular prospect. The contents of a marketing kit may contain the following titles: Our Story Our Approach Testimonials Who We Work With (describes your ideal customer) How We Are Different Our Products and Services Processes and Checklists P.S. – This information also makes excellent web content.
Every lead generation system should contain three components A referral system – Everyone knows about the power of word of mouth but very few have a systemized way to generate it. We will discuss how to create this system in a moment. Advertising – Most small business owners are leery of advertising. It’s expensive and it doesn’t work, right? Well, not exactly. The main reason that it doesn’t work is that it doesn’t offer any value. If your typical ad was a sales person, this is what his pitch would sound like: “Hi, I’m Bill. Take a look at my fancy logo. I bet you didn’t know we’ve been in business for 20 years. I know what you need – here’s my phone number, call me when you want me to sell you something.” I can’t imagine that I would win a lot of business with a pitch like that. For more effective advertising, take a 2-step approach. The first step is change your ad to offer something of value, for example a free report. The second step is to send the report to all that respond and then market to this group like crazy. Public Relations – The power of public relations lies in the fact that when a third party tells people how great you are, it is more believable. The key to using PR is to remember that the media doesn’t care about your needs; they care about the needs of their audience.
All business owners understand the importance of referrals in growing there business. However, very few businesses have a systemized approach to generate referrals on a consistent basis. Asking “Do you no anyone who needs what I do?”, is not a system. There are two key rules about referrals that I want you to remember. The first is that people love to give referrals, so make it easy for them to do so. The second rule is you have to deserve referrals. Elements of a referral system Target – just as you have a target market for your services, you also need to define your referral target market. You have two main sources. The first is your existing clients. Look for people who already provide you with referrals and try to identify others with common characteristics. The second group is other businesses that serve your same target market or have a product or service that complements yours. For example, if you are a graphic designer you may want to partner with a printer or a web designer since most people will want to do something with the art work you designed. Education – A common complaint about implementing a referral system is that they don’t get the right kind of referrals. This is caused by not educating your referral sources about what makes a good referral for you. You also include information about how your referral system works. I have included a copy of the document and worksheet that you can use to create your own in your handout materials. Motivation – The are many ways to provide incentives and rewards to your referral sources. Make sure you pick one that is meaningful to your source. Some people use a 2-tier system. The first tier is for providing the referral and the second tier is for when a referral becomes a client. Following up with your referral sources is an important part of motivation. Expectation – Make providing referrals a part of doing business with you. Some businesses have two price lists. The first is the full price list and the second is the discounted price for providing referrals.
A lead conversion system is just a fancy term for a selling system. However, using this education based approach to marketing, we really end up with a “non-selling” selling system. Instead of traditional selling, we have moved the focus to educating prospects who have already expressed an interest in our products and services. Again, we are talking about having a set of systematic steps to move through the lead conversion process.
There are three phases in a lead conversion system. Discovery is where you find out if the person on the other end of the phone has the type of problem that you solve. During this phase your system needs to address things like how you respond to a lead, determining if there is a next step to be made, and, if so, what it is. Typically, you will want to move toward a presentation. You do not try to make a sale in this phase. Your goal is to move to the presentation stage, once you have determined it makes sense to do so. Your system should include delivering of pre-client materials to your prospect before advancing to the next stage. Presentation is the stage where you meet with the client for an “Internal Seminar”. You want to have a very set way (script) to present your value proposition in a consistent manner, no matter who is delivering the message. You will want to have a next step (i.e. free evaluation) example as well as some additional follow-up educational materials. In the Transaction phase you have signed a new client, but your marketing work is not done. Remember, marketing is about setting expectations. Make sure you have a system for adding a new customer. Your system should include a New Customer Kit. This is also a good place to include a surprise or extra value. Also start introducing Higher Education, how to get more from their purchase. These phases are sequential; you must follow them in order. Trying to move from discovery phase directly to transaction phase is a common mistake. This is the equivalent of going into a bar and proposing marriage to the first person that talks to you
No, this kit does not allow you to assemble new customers at will . Our new customer kit is what we will use to make sure that the expectations set during our marketing efforts are met. We also want to continue to manage expectations as we move forward in the relationship. Many customer problems can be avoided by clearly setting expectations at the beginning of the relationship. Your new customer kit doesn’t have to be fancy. The content is more important than the format. Following the model of our marketing kit, here are some of the components you may want to include in your new customer kit: What to expect next How to contact us How to get the most from your product What we need from you in order to get started Here is what we agreed upon today How we invoice A copy of our invoice
We have covered a great deal of information in a short period of time. I hope I have been able to show you the importance of viewing marketing as a system and the importance of developing your strategy before implementing tactics. I also hope you feel like this is something that you can do.
The last point that I would like to make is that the ideas in this presentation are only ideas until you do something with them. One of the principles in the Duct Tape Marketing system is “Live by a Calendar”. As you look at the list above, you may start to feel a little overwhelmed, particularly with the Marketing and New Customer kits. My advice is to make appointment with yourself, mark them down on your calendar, and devote the time to getting them done. You don’t have to create everything in one sitting. The important thing is to keep at it. Whether you complete one sheet a day or one sheet a week, it won’t be long until you have a powerful system to grow your business. If you get stuck, have questions, or just want someone to review your work, feel free to contact me (contact info on next page).
Simple, Effective and Affordable Small Business Marketing Small Business Marketing Presentation by Patrick Giammarco
There are more new businesses than marriages a year in the U.S.
Small business owners face many challenges to survival
Marketing, in economics, that part of the process of production and exchange that is concerned with the flow of goods and services from producer to consumer. In popular usage it is defined as the distribution and sale of goods, distribution being understood in a broader sense than the technical economic one.