Marketing in Perspective
Marketing begins with the development of a product or service to fill a true market need. It continues on to guide the pricing and positioning of the product or service to appeal to specific customer segments. Finally, marketing dictates the transaction support and after sale services required to ensure customer satisfaction and retention.
Marketing is the central and key activity of every successful business. Yet, many entrepreneurs find marketing the most difficult of all business management disciplines. This is true in part because their marketing plans are often centered on tactical concerns, such as:
- Should we be in the yellow pages?
- How should we advertise?
- What promotional activities should we be doing?
- Which guerilla marketing ideas will work best for us?
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To be effective, a marketing plan must be built around a specific expectation - either short term (1 year or less) or long term (3-5 years). For many businesses this is not well defined and generally something like "to be as successful as possible".
There's an old saying - "If you don't know where you're going, then anyway will get you there!"
Entrepreneurs need to develop a marketing perspective of their business objectives and the customer segments that are going to deliver them.
Here is a practical three-step guide to building a marketing perspective for your business, followed by two examples of how they can be applied to a small business.
Step 1 - Determine your marketing break-even point
A useful way to establish a specific business expectation is to ask yourself:
- What is the minimum result that I am willing to end up with one year or three years from now to justify the investment of money and time I am going to put into this business over that same period?
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The answer may relate to income, life style, or other criteria. For example: achieve annual sales of $100,000 within 3 years or double my current annual sales.
Once you know exactly where you're going, you need to figure out the best way to get there. The next two steps will help you do that.
Step 2 - Develop a market perspective.
This exercise involves gathering information from available resources and a lot of common sense. Getting your market into perspective will help answer three key questions.
- Where is the market for your business concentrated?
- How much of that market can you reasonably expect to access with your way of doing business?
- Will your resulting competitive share meet (and exceed) your marketing break-even point?
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For more information on determining the feasibility of your idea and some suggestions on resources, see Step 3 of the Business Start-up Guide.
Step 3 - Determine what is required to achieve your marketing break-even point.
Begin this step by translating your revenue expectations into:
- the type of customers you need to focus on
- the number of customers required
- the resulting volume of transactions
This breakdown of your revenue objective will help you select the specific marketing strategies required to reach it.
Let's put these three steps into practice.
Following are two examples of how the three-step market perspective process can be applied to specific small businesses. The first is a start-up venture. The second is an existing business searching for growth.
Example 1 - Marketing Perspective applied to a start- up venture
Example 2 - Marketing Perspective applied to an existing business in search of growth
These two examples demonstrate that developing a market perspective is an important first step in understanding where the market opportunity for your business lies and what specific marketing strategies can get you there.
Good marketing answers start with discovering the real questions.
For more information see: