Advertising involves more than putting an ad online or in the newspaper and hoping people respond. Many small businesses are on a limited budget, and make the mistake of creating an ad that they believe looks good, sending it to a medium they chose at random, and then wondering why it didn’t work.
There are two types of results from ads, instant and long term. Small business owners need to understand that most ads do not produce results for six months. They also need to understand their competition and use their successes/mistakes to help promote your own marketing campaign.
When checking out the competition you must:
• Make a list of direct and indirect competitors.
• How long have they been in business? I usually list this as over 5 years, over 10 years, over 20.
• Where are they located?
• What similar products and services do they provide?
• How do they advertise their product and service?
• How much do they charge?
These things are important to the success of any small businesses.
Location is vital for most businesses. The financial, lawyers, or accountants office in a high-rise building receive more business than the same professional whose office is in the basement of a small building in the industrial site. The first professional can charge more and will draw a different clientele.
Promises are as important as product. Look at those intangible elements that businesses inadvertently promise the client through location, advertising, image, and product. The unwritten agreement between a business and client is as good as a written contract. If the client assumes they will receive a certain level of competence or service from a service/product, if they do not receive it, there could be legal ramifications.
So, if a professional has no experience (other than law school) with corporate law, then you might want to stay away from the professional, high rise building and locate in a smaller area. The same applies to any business. There is no use paying mall prices for cheap clothing. The profit margin will be too low.
The same theory applies to the small boutique owner. If they are in the heart of downtown, in the classy district, then offer bargain service, the company will not remain solvent for long. The same applies for a boutique that sells top quality products, but selects a location on the low rent side of town.
Whenever you need to sacrifice something, like quality, location, service, they need to either redo the CUSTOMER PROFILE part of the market report, or increase the advertising budget.
The two boutiques I talked about here, one on the main strip with ‘almost’ top of the line products, and the one on the back street with top of the line products, can both succeed if they trade locations.
Advertising. My first business taught me the most important fact about advertising; you will never succeed without continuous advertising.
I have seen many businesses fail because they do not see the need for advertising. Businesses grow, or die, in cycles. A retail outlet may have a lot of walk in traffic, but that does not mean it will sustain the same level traffic on a continuous basis. A business possesses a certain level of synergy when it starts.
Customers walk in out of curiosity, interest, or just to browse. This large segment of these customers will not become long-term, nor is it a good representation of your clientele. Your business may boom for two years, but trends change, the novelty wears off, and traffic dwindles.
There is a catch 22 here. A business that always advertises will always incur enough sales to continue advertising. If they do not advertise, then by the time they need to advertise their income has dropped low enough they cannot afford a good advertising campaign.
No comments:
Post a Comment