In this article, I’m going to share a way of thinking about marketing fundamentals that will re-frame your relationship with marketing. Think of these marketing basics as distinctions that will transform how you approach marketing and eliminate 80% of the uncertainty associated with marketing your small business.
Table of Contents
What are the basics of marketing?
- You are in the marketing business
- Use the marketing process to build your marketing plan
- Choose a single marketing strategy for your small business
- Use your authentic story to build your brand
- Use your marketing budget to buy more customers
- Build a business website that sells 24/7
- Ignore the competition
- Find new opportunities in crowded markets
- Master profitable pricing
In this article, I’m going to share a way of thinking about marketing fundamentals that will re-frame your relationship with marketing.
Think of these marketing basics as information that will transform how you approach marketing and eliminate 80% of the uncertainty associated with marketing your small business.
What is Marketing for Small Business
Marketing is the process of uncovering problems in the market, identifying your ideal customers, communicating how you will transform their lives, and creating a pathway for them to choose you every time, regardless of price.
The purpose of effective marketing in a small business is to focus your scarce resources in those areas that will consistently reach your target audience and deliver profitable target customers with the least amount of effort.
You’re Not a Business Owner, You’re a Marketer
“Some people sell things so they can have customers. We have customers so we can sell them things” — Dan Kennedy
You started a business to solve problems for clients. But that’s not going to be possible if you don’t have any.
Every business owner wants a flood of ideal, profitable clients and customers so that they can spend their time doing what they love. To achieve that — you have to be a marketer first.
As a business owner, freelancer or consultant, you have to see yourself as a marketer first and technician second. Why? Because your business needs money to survive. To make money you need customers. To get customers you need leads and to get leads, you need marketing.
Your Company Exists to Transform Lives
As a business, your primary responsibility is to transform your ideal customers’ lives with your products and services. Your secondary responsibility is to build a machine that consistently and reliably delivers profitable customers. Everything else is a vehicle toward that end.
No matter what your role in business, marketing basics are unavoidable.
But here’s the good news, you don’t have to be an expert to successfully market your business. Just keep these basics of marketing in mind, and you’ll be ahead of the curve.
Follow the Marketing Process To Build Your Marketing Plan
Half of small business owners don’t have a plan. Is it any wonder that nearly 30% of them are stressed and almost all of them would rather do anything else. (source: OutBound Engine)
No one tells you that marketing is a process. Most people just assume marketing is nothing more than DOING a bunch of promotional stuff and hoping to attract new customers.
When it comes to marketing basics, the most important one has to be to use the marketing process. If you follow the process, by default, you’ll have a marketing plan. How exciting is that?
I like to say that there is a marketing cycle is like a math problem. It’s a lot faster and easier to get the right answer if you practice the “order of operations” in order.
Before you jump into the process, you’ll need to write down what you want to do:
- Launch a product or service
- Get into a new market
- Increase sales
If you work in a company, your CEO will often give you those goals — “We want to increase sales of product X by 30% in the next year.” for example.
Whether you set the goal, or someone sets it for you, it serves as a destination. With that in hand, you are ready to go through the marketing process.
Apply the Process to Achieve Your Goal
Unless you’re heading to a bank or asking some venture capitalists for money — you won’t need a fancy plan. But you will have to follow the marketing process and when you do — you’ll have everything you need for a functioning plan.
Remember how the math teacher would tell you to “show your work”? Once you’re done with the process, you’ll have the core of your plan in your head.
All you’ll need to do is summarize it on a single sheet of paper — and that will make it a breeze to follow, measure and adjust.
Here’s a quick summary of how an effective marketing process works:
- Market research: Research doesn’t have to be complicated. Your goal is to write down your questions and start collecting answers. You’re done with your market research when you notice a clear pattern or story about your customer and your market.
- Segment: The results of your research will help you group customers into segments. Any grouping can be a segment. You can segment by demographics (Age, gender) or psychographics such as interest. Segmentation is one of those marketing basics that is often skipped and results in wasted time and money.
- Choose a target Market: Your target market is also your ideal customer or market niche. With an outline of your segments, you’re ready to choose a target audience. Your target market includes those target customers who suck at what you do, don’t want to do it and are happy to pay any price to get it done right.
- Position your business: Positioning means to create a brand message that will most resonate with your target market. Put simply, positioning means that your target thinks of you first, when they are looking to solve a specific problem.
- Strategize and create an irresistible offer: In this step you choose one of three marketing strategies that you think will take you to your goal. You’ll also develop an irresistible offer. Some marketers call this the “marketing mix”. It’s really nothing more than
You need to know that successful marketers follow marketing basics every time and in order.
There Are Only 3 Marketing Strategies – Choose One
It’s easy for beginner marketers to get confused and overwhelmed when they do internet research on marketing strategies.
The strategy topics you find online are overwhelming and misleading. There are countless articles listing dozens of strategies. But when you take a closer look, you find that these aren’t strategies – they are ideas and tasks.
Your Marketing Strategy is a CHOICE — Not a Task
Once you understand that your marketing strategy is a choice, marketing becomes much simpler.
You get to choose if you want to generate leads and build your brand using content marketing, direct marketing or paid advertising.
Once you’ve made that choice, you get to decide what tactics you’re going to use to share information about your brand and your products with consumers; word-of-mouth, email marketing, website, etc.
Choose one strategy and two or three tactics to communicate your message and double down.
Use Your Authentic Story to Drive Your Brand
“Your mess is your message” — unknown
In the past, companies used to choose their customers and then bend themselves up into pretzel shapes to match what their customer wants to see. This strategy requires a HUGE budget reserved for large companies.
Your Life is Your Marketing Message
If you’re a small business, your customer wants to buy from an authentic human being. In fact, being small, intimate and personal is the biggest strength and competitive advantage small business brands have that no large company can compete with.
Even B2B buyers are consumers. In the end, people make buying decisions, not companies.
Take the foccus off your product and put it on your personal experience and life story. Incorporate that story into your brand and you’ll find people will be naturally attracted to your business.
How to Buy New Customers
Budgets are for buying things. So, instead of thinking about your marketing budget as money you spend for marketing activities such as blogging, building a mailing list, content strategy, public relations, or email marketing, think of it as the amount of money you’d spend to buy another customer.
A recent survey showed that most small businesses spend between 8-9% of their revenue on marketing.
How to Use Your Marketing Budget to Buy More Customers
- Start by choosing a single “ideal customer.” Picture that customer in your head right now. Think about the people, what they buy, how they buy and how much they buy.
- How much revenue did you get from that “ideal customer” last year? Chances are you’ve got a pretty good idea of what that number is right now.
- Now, subtract the costs associated with that customer. You may not know that particular number off-hand, but you could probably estimate some general cost percent. It might be 25% or 30% of the revenue that it costs you to maintain that business.
- Now what you have left is the annual profit that this customer has ALREADY contributed to your business. See. That was easy. In fact, if you really want to get happy, take the number of years that they’ve been a customer and multiply it by that profit number. That is now the LIFETIME value of that customer.
That customer has already given that money. You might still have some in your bank account – or you may have already spent it. The key distinction that you have to make from now on is about how you will invest that money.
You can go on a vacation, you can hire more people, you can buy equipment — OR you can invest that money in creating a marketing system that will get them to choose you.
That is a right-sized marketing budget. I love this method because it ties the money you spend to the size or spending capacity of your ideal customer. It doesn’t make sense to over-build a marketing system for a customer that doesn’t require a million-dollar investment.
At the same time, you might find that you’ve been grossly under-investing in your marketing system and it’s no wonder your sales with ideal customers are low.
Pull together a Marketing Slush Fund
Here is one of my favorite marketing basics tips — build a marketing slush fund of at least $5,000.
Because you want to have the resources to implement your strategies and tactics as soon as you’re ready. There’s nothing more frustrating than coming up with a menu of products and services, information that will inspire your fan base, blow out the competition and content to attract new customers only to be stopped because you don’t have the money.
When you have a lot of money stashed aside for services, you’ll feel like the king or queen of your business. There’s a sense of confidence people get when they have the freedom a budget gives them to bring their concepts to life.
Build a Business Website That Sells 24/7
How would you like a salesperson who sells all day, every day. They deliver a consistent message to your customer, answer all of their questions and can take orders on weekends and holidays.
They don’t even want a salary or a commission. This salesperson even does basic marketing, social media and will make sure that your products are described clearly. They also connect with consumers and set you apart from the competition.
Who is this salesperson? It’s your website!
If you’re looking for a place to invest your time and money that will do its part in communicating your strengths and value to consumers, the way to do it is via your website.
When it comes to user experience and helping your audience know-like and trust you, your website is the best way to increase sales without spending a lot of money.
Ignore the Competition and Focus on Customers
Let me ask you this. Who gives you money, competitors or customers?
Since your customers are the people who give you money, it stands to reason that you focus your efforts on delighting customers and serving them instead of focusing on what your competitors are doing.
Definitely invest in time to do research to identify who your competitors identify as their ideal customers, what products and services they are selling and how they are selling it. But keep your attention on what’s most important to your customers.
Find New Opportunities in Crowded Marketing
After saying to ignore the competition, I’m going to tell you to embrace competition as an opportunity.
A lot of people think that competition is bad. That’s not true at all.
A thriving competitive environment tells you that there is demand for what you’re selling.
What you are looking for is a competitive space where you can offer a unique product.
The easiest way to find a thriving market is to search Google for your topic. If you see lots of ads, it means there is enough demand for your product or service. Your next step is to visit all of those advertisers and look for “bad” marketing. Then focus on the part of your strengths where you provide the most value.
Reading through social media will give your company ideas about where you can place content. Make sure to find the social channels where your competitors are weak or where they don’t participate. That will be the perfect place to feature your products.
What No One Tells You About Pricing
Pricing is every marketers weak point. But, setting a profitable price for your product is the key to staying in business.
Setting the right price will require competitive research. You want to get a general idea of what your products are worth and then adjust accordingly based on the unique value you provide to your consumer.
There are three basic options for pricing;
- Cost plus: The cost of your product or service plus the percentage that you want to add for profit.
- Value pricing: What the market is willing to pay.
- Hybrid: This is a combination of cost plus and value pricing.
After a lot of reading and experience, I’ve found that the hybrid method is best. It’s critical to know your costs and what the market will bear. Then, make adjustments to your offering based on that information.
Finding Your Way Forward
If you find yourself feeling overwhelmed, use these basics of marketing to get your bearings.
Need Help? Feel free to reach out and schedule a one-on-one session with me. And we’ll work it out.