During these challenging economic times, small businesses may be tempted to cease marketing efforts. But, a marketing/advertising executive and a business professor advise re-considering that policy. They stress the importance of continuing marketing, advertising and new business development initiatives.
“The most important thing for small businesses in these tough economic times is to take care of existing customers,” says Philip Shirley, president and CEO of the Jackson-based GodwinGroup. “Make sure you hold on to your base. Call on them; listen to their concerns; hold special events for them. All kinds of studies outline how much it costs to get new business, making it crucial to respond to the changing needs of existing customers.”
He also stresses that businesses should not reduce marketing efforts now. “Don’t disappear from the marketplace even though you may have to go to guerrilla efforts,” he said. “Maybe you send an e-mail instead of a fancy direct mail piece. Reduce costs, not efforts. It will pay off when things turn around. When this economic difficulty is over, you’ll emerge much stronger. It’s important that someone else hasn’t taken market share.”
Shirley also recommends that businesses take this time to enhance websites. “Expand it or freshen it up. Gas prices are changing people’s behavior and shopping habits,” he says. “Shoppers will go to the Internet instead of the mall, or they will look online before going to the mall. Make it easy to pick products and give people a reason to visit your website.”
He feels it’s a critical time to have a web presence and that any business without one should start one.
Make the investment
A University of Southern Mississippi assistant professor in the School of Business says now is an especially good time for small businesses to invest in advertising.
“That’s because as others decrease their investment, your share of voice goes up dramatically. It is therefore easier to be noticed,” says William C. Smith, Ph.D. “Always remember, keeping your name in front of people adds to the people coming through the door or calling on the phone.”
He points out that there are only three ways to grow a business: get more business from existing customers; find new customers not presently being served, and, get competitors’ customers.
“All three require getting a chance to talk to people and turning them into advocates for your approach to serving customers’ needs,” he said. “The most important number for a salesperson is conversion ratio — the number of at bats (customer opportunities) and the number of hits (sales). Advertising done properly increases your at bats. Focusing on understanding the customer and sales skills improves your batting average. If you are getting plenty of at bats, then focus on improving your conversion ratio.”
The professor adds that increasing advertising to get more people calling or coming through the door should be done intelligently with a clear objective.
“Businesses need to include a distinct customer profile, a message which has meaning for them in particular, a media that can deliver the targeted group and a measuring system on how well the advertising worked,” he said. “It can be a simple ‘back of the envelope’ system but should be measured in some way.”
He also says existing customers can help businesses find new ones. “Start talking to people at school functions, parties, soccer practice about how they are meeting the needs your products and services are designed for,” he said. “If they are using a competitor, ask what they like and dislike about doing business with them. Now you have the information you need to start thinking about your target customer and the message you plan on giving them. Making the correct media choice for the message comes from this understanding.”
Shirley says it’s important for businesses to be in the marketplace letting people know they understand what they’re going through. “They need to know you’re feeling the same difficulties,” he said. “These are times when some of our strongest brands emerge. Small businesses can do things without spending a lot of money.”
He relates a recent experience with a new client that was asked to bring in photos of the business. The photos revealed a lack of curb appeal at the front of the business.
“Business owners need to look at their facility with a fresh eye. Look at the signs and plants or lack of plants around the front,” he says. “Is it safe? Does it look good? Plants play a big role to soften hard edges and send mental images.”
Smith advises that business owners be true to their commitment to sell value as people are now sensitive to prices but still buying.
“The operative question is will you get a chance at their business? Your prices have to be in a tolerable range, but you cannot compete with big box mass sellers on price — nor should you,” he says. “Understand your customer first and then bring in your sales knowledge and skills to perfectly match the customers’ requirements.”
He stresses the importance of employees approaching customers correctly with the objective of starting a conversation and understanding what the customer is looking for and why.
“Focusing on each individual gives you a chance to add value for an individual customer. That’s something that price-only stores can not do and gives you a real competitive advantage, something valued by many of today’s consumers,” he said.
Contact MBJ contributing writer Lynn Lofton at firstname.lastname@example.org.