Marketing tips for your start up business
by Mihaela Jucan, Junior Marketing Executive
Why should you focus on marketing?
As you know, one of the basic principles of your business, no matter what your product, is reaching and engaging with new customers. As such, there should be elements of your business plan that relate to marketing, which will help you to understand and meet the needs and desires of your customers.
The Outset Finance business plan template encourages you to discuss marketing under various headings including customers, competitors, your unique selling point and how to prepare a marketing plan, budget and strategy.
Often, when businesses ‘go live’ they encounter issues that are related to their marketing efforts. A great way to understand the issues and find resolutions can be to imagine yourself in your customers’ shoes. This will help you to perceive those needs and desires. The type of questions you can ask yourself are as follows:
- Who are your natural customers?
- What are the things that motivate them?
- How does the market for your service, products or business divide up, or segment?
Remember, your market research can help you do this.
Market Research to better understand your customers
You can test your intuition on your customers’ wants and needs through various types of primary research. Primary research is where you go straight to the ‘horse’s mouth’ to find out information, rather than using second hand information. Examples of primary research include:
- Customer research – Circulating surveys or picking up the phone and speaking to your customers can help you better understand what they’re looking for and how you could improve.
- Competitor research – Take a closer look at your competitors by identifying who they are and what they might not be doing to satisfy your potential customers.
- Product testing and market testing – Trialling new products with potential customers can help you identify what works and what doesn’t.
You can find more information about conducting market research through our free sister service Outset Online.
Other key aspects to consider
Depending on the marketing problem you want to solve, you might do some fresh thinking on the key aspects of the marketing section of your business plan.
Pricing Strategy – Often prices that are too low can actually turn customers off. On the other hand, prices that are too high mean you will lose business to competitors. There are a lot of things you can do with your pricing strategy: think of the (sometimes controversial) ‘bogoff’ – Buy One Get One Free – offers, ‘introduce a friend’, or other discounts.
Product Definition – How often is it said that small businesses survive because of the quality of service they provide? Sometimes though, the service provided by small businesses surrounding the goods they sell totally changes the definition of the product. This might occur with a small business supplying and installing gas cookers. Many larger online gas appliance retailers do not offer an installation service, so the definition of the product is different for small business compared to the larger competitor based on the entire service offered.
Customer retention – It costs far less to sell to a returning customer than it does to find a new one and all businesses should want to reduce their cost of customer acquisition. Selling to existing customers is one of the ways you do this. Sometimes to increase customer retention you have to change who you sell to; for example, selling to businesses rather than consumers helps you increase retained business because businesses more commonly need to buy the product more often.
Distribution channels – Are you a manufacturer, wholesaler, retailer or all three? Like most activities in business, you can sub-contract marketing and distribution, and distributors can often get your product to a wider geographical coverage than you could do alone. But, there are choices to be made in choosing distributors and retail outlets. Sometimes businesses have different sales channels: own retail on-line, wholesale and select retailers. Monitor and compare the performance of each to make sure you have the right mix.
These are just a few of the aspects to consider when putting together the marketing section of your business plan. For more information and advice, register now.