Business Start-Up Packet
Step 10: Marketing
The best product or service in the world will not guarantee success for your business. Potential customers must purchase your product or service in order for you to survive and grow. Developing and implementing a marketing strategy is a necessary process for a successful business. This process begins as you start your business, and it must remain an ongoing process throughout the life of your business.
Marketing is neither sales nor advertising, although both of these may be part of a marketing strategy. Instead, marketing is the thought process by which you:
• Identify the product or service you really sell
• Identify potential customers for your product or service
• Identify your competitors in selling to these customers
• Understand the basis on which those potential customers make buying decisions
• Know why customers will choose to purchase your product or service instead of your competitor’s
• Determine the most efficient and effective methods to reach these buyers before they make their purchasing decisions
• Identify methods to deliver your product or service
• Develop an action plan
Identify the Product or Service
The key is to identify your “market niche,” not only in terms of the services provided, but in terms of needs fulfilled. For instance, a residential lawn service provides lawn cutting, fertilization, etc. One need this business fills is for convenience on the part of “time poor” homeowners.
Identify Potential Customers
A potential customer is one whose needs may be filled by your product/service, and who may reasonably be expected to consider your business as a source of this product/service based on price, location and other factors. Everyone in the world is not a potential customer; you must focus on an attainable and realistic portion of the market.
Identify your Competitors
A competitor is a business who does the same service, or sells the same product as your business; they may or may not have a similar business. For instance, companies providing guard services to warehouses and those selling alarm systems to warehouses are to some extent competitors, even though they are not in the same industry.
Understanding Why Customers Buy your Product or Service
Customers buy different products or services for several reasons, including:
• Price
• Quality
• Convenience
• Prestige
Also, understand the basis on which customers make buying decisions related to your type of product or service.
Know Why Customers Will Choose Your Business
Based on why customers buy your product or service, you must determine the nature of your competitive advantage. If your potential customers buy solely on the basis of price, are your prices the lowest? If not, how will you compete? Be cautious in this analysis. Your potential customers probably have established buying patterns which do not include your business. You must give them sufficient reason to break these established patterns and buy from you if your business is to succeed.
Determine the Most Efficient Methods to Reach Buyers
Having determined why potential customers buy your type of product or service and why they will choose you, you are in a position to identify how they make their buying decisions. Do they typically buy because they’ve seen an advertisement in the telephone book or because they have driven by your place of business? Is this type of product or service generally purchased on the recommendation of another individual? Knowing how people “will” find you ensures that your marketing dollars are spent in the most productive way possible.
Determine Effective Delivery Methods
The most enthusiastic purchaser is unlikely to become a repeat customer if the product or service does not live up to his/her expectations or if it is not delivered in a timely fashion.
Develop an Action Plan
You know what you need to do. Now you must develop specific, deliverable steps that will enable you to do it. For assistance in developing your own marketing plan, contact your local Small Business Development Center.
Call (605) 626-2565 for Aberdeen, (605) 677-5287 for Vermillion, (605) 367-5757 for Sioux Falls, (605) 945-1661 for Pierre, (605) 882-5115 for Watertown, (605) 655-0751 for Yankton, and 394-1706 for Rapid City.
Return to Top
|
