NASE News

Oops! How To Fix Costly Marketing Mistakes

By Sally Bell

Marketing is bewildering to many micro-business owners, who are far more versed in their own business niche than arcane marketing details that seem to take time from their primary work.

Yet effective marketing is vital to the success of any business, whether it is a one-person firm or a Fortune 500 company.

In fact, marketing in some form is behind every dollar in revenue, says Gene Fairbrother, the lead consultant for NASE ShopTalk 800.

“No business can operate without revenues, and the driving force for every revenue dollar is marketing – whether people see a sign out front, they were handed a business card, or they heard about the business on the radio,” he says.

Jerry Oakes, of Synergy Consultants in Dallas, is even more direct. “Marketing equals cash flow,” he declares.

Marketing mistakes can be costly to a micro-business and they’re easy to make. But with a bit of strategic thinking, mistakes can also be fixed. Here are some of the worst marketing blunders that micro-business owners are prone to make, and the way to turn them around.

MARKETING MISTAKE #1
Not Tracking Your Customers

“Without hesitation, the biggest marketing blunder I see in micro-businesses is not tracking their customers,” Fairbrother says. “Knowing where your customers come from is the entire basis for developing where your future business and marketing comes from.”

Without tracking, you are marketing in the dark, and your business revenue will likely stumble as a result.

That needn’t mean implementing a complicated tracking system. You simply need to know how your clients found out about your business.

“Just ask customers and keep a record of it,” says Fairbrother.

If 90 percent of your clientele say they learned about your business from an inexpensive direct mail piece, for example, and only 10 percent responded to a costly radio campaign, you can refocus your marketing direction – boosting sales exponentially while cutting advertising expenses.

MARKETING MISTAKE #2
Targeting The Wrong Customer

No matter how necessary your product or service may be to everyone, everyone is not your customer.

“One of the most common problems we get in ShopTalk is that people need to develop a marketing plan,” Fairbrother says. “They say ‘everyone is my target,’ but you can’t afford to market to everyone.”

Suppose you’re selling so basic an item as a ballpoint pen. In targeting men, you might stress how the pen is thick to feel comfortable in a man’s bigger hand and sturdy to withstand harder writing pressure. In focusing on women, the emphasis could be how stylish a pen is or that it feels natural in her smaller hand.

“Pick a market and go after it,” says Fairbrother. “If you have two distinct customers, develop a second marketing plan.”

MARKETING MISTAKE #3
Not Knowing The Difference Between Marketing And Advertising

Many micro-business owners confuse marketing and advertising. As a result, they often do too much thoughtless advertising and not enough thoughtful marketing.

There is a distinct difference between the two.

“Advertising is reaching a target audience through a particular medium,” explains Ron Sofranko, whose Pittsburgh-area S&S Group advises small businesses. “Marketing is the strategy behind that, the planning and strategic segmenting.”

Without planning, it’s easy to depend too much on advertising and miss many low-cost marketing opportunities. That can be expensive, yet may not reach as many potential customers as another, cheaper form of marketing.

For example, you decide you want to reach potential customers for your car repair shop through a local radio station that targets young people. You can run radio spots, of course. But that costs money. Maybe instead, you can be a guest on a local radio program to talk about how using a reputable mechanic for routine maintenance keeps an older car running longer. That’s free publicity, a great addition to your marketing.

Advertising is vital, but only after you’ve thought it through carefully. By broadening your marketing approach, you’ll reach more potential customers and possibly reduce advertising costs.

MARKETING MISTAKE #4
Not Knowing Your Industry

You’ve developed a terrific marketing plan on paper. It balances different forms of marketing and advertising. It looks sure-fire.

Sometimes, though, “What seems to be a great marketing plan, isn’t always,” attests NASE Member Beth Hawkins, who was a recipient of an NASE Business Development Grant in 2007.

Hawkins and her sister-in-law own Lizzie B Cre8tive, a Tucson company that designs quilt patterns for the wholesale quilt industry.

Soon after Lizzie B Cre8tive began in 2006, the two printed thousands of color flyers detailing their designs and mailed them to quilt shops across the country. Printing and mailing costs were huge for their tiny budget, and they received few orders for their big cash outlay.

The women learned that their industry is “unique and quirky in that sales are so hands-on. It’s a creative, visual, tactile industry,” says Hawkins.

They switched to meeting shop owners at trade shows and networking with distributors. The marketing change paid off. Now they have distributors in the U.S. and six other countries.

“It’s important to take the time to get to know your industry, and the inner workings of how things are done within it,” Hawkins says.

MARKETING MISTAKE #5
Advertising In The Wrong Spots

Just as you market and advertise to customers, your business is the target for other marketing people. They want you to buy an ad in a neighborhood coupon book or any number of other advertising vehicles that might not be right for your business.

“Micro-businesses waste huge amounts of money in advertising,” says Fairbrother. “Businesses are sold advertising rather than buying advertising.”

That’s what Ken Kucel experienced. Kucel, who owns a computer repair shop in the Pittsburgh area, was talked into advertising on placemats at three local restaurants. He also bought a centerfold ad in the member directory of the church next door to his business.

“These have totally failed,” he says.

Then he bought a Yellow Book listing that includes a $25-off coupon on service.

“It’s working amazingly well,” Kucel says. “I could tell the day the phone book was released that the calls went up, and they’ve stayed up.”

The difference? Placemats and the church directory weren’t top of mind when computers failed and their owners went looking for a repairman. The Yellow Book listing of computer repair shops was.

“Your dollars need to go where the most people will view it at the time they need the service,” says Kucel.

Sofranko is more blunt. “You have only so much in marketing dollars for the year, so you must really focus or your spending will be totally ineffective. “Learn how to say ‘no, I’m not interested,’ or ‘my budget can’t afford it.’”

MARKETING MISTAKE #6
Not Using The Internet Wisely

Nearly every micro-business needs an Internet Web site these days, but it must be done right.
“Many micro-businesses don’t know how to use the Internet as a marketing device,” Fairbrother says. “They just hope people will find their site. But a Web site is really an electronic brochure, and you have to market it as such. Just because you build it doesn’t mean people will come.”

Consultant Oakes advises optimizing your site, or promoting it in such a way that it pops up high in Web searches.

While you probably can’t optimize it nationally, “you can certainly be No. 1 in your local area,” he says, which is likely to pull additional sales because few people bother checking deep into a list of search results.

MARKETING MISTAKE #7
Marketing Inconsistently

Many micro-businesses experience continual feast or famine. They develop a detailed marketing plan, execute it well, and are suddenly inundated with work.

To make time for the work, they stop marketing. Then the work runs out. So they ramp up marketing, and the cycle begins again, but revenue suffers in the interim.

Fairbrother says that the failure to market and advertise consistently is one of the biggest mistakes a micro-business can make.

“By the time you need new customers,” he says, “it’s too late.”

He advises treating marketing time as if it were a client.

“Schedule two to three hours for marketing every week, just as you would on a project. Make an appointment with yourself to market. But if nothing is on your work schedule, you better spend 40 to 50 hours a week on it.”

Marketing might include attending a chamber of commerce or networking meeting, writing a brochure, updating your Web site, sending thank-you letters to past clients for their business, or placing ads in the newspaper.

However you market, the key is consistency.

“Marketing doesn’t just happen. You will never find time to market. You have to make time to market,” Fairbrother says. “And if you do, your business will grow.”