Small Business Marketing Strategy & Tactics

Most of the posts Steps to Starting a Small Business series focus upon the marketing of your small business.  If you’re an aspiring entrepreneur, the focus on marketing as an essential part of starting a small business may come as a huge disappointment to you.  If you were hoping to start a small business without spending a majority of your time and effort on marketing your business – um, well consider this your wake up call.

Creating a strategic marketing strategy is perhaps the most ESSENTIAL step in starting a small business.   Creating a marketing strategy is different than chasing marketing tactics.  A marketing strategy is essentially knowing what you’re selling and to whom you’d like to sell it.  A marketing TACTIC is nothing more than a way in which you’re going to achieve your marketing strategy.

Your marketing strategy is knowing what you’re selling and to whom you’re selling it to.  I know this sounds “simplistic” but it’s really surprising how often this most basic of business building steps is overlooked. (For an amusing illustration of a BIG company who really missed the mark on this one – read Cath Lawson’s Does Your Business Really Understand People? )

Which brings me to this essential point:

A blog can be a GREAT marketing “tactic” but it’s a LOUSY marketing strategy!

It’s why so many small businesses create websites that do absolutely nothing!  A website, whether it’s a blog or any other style of website, must be a marketing tool which you put to use to achieve your marketing strategy.

When you know WHO you want to sell your products or services to, then you need to find a way to let the people you want to sell your products and services to know that you have what they want or need.    That’s where a blog or website comes in!

In creating a blog or website that works, begin by finding a keyword combination people are actually USING to find products and services you offer.

This is frequently where the wheels fall off for most small business owners.    If you don’t know WHO your target audience is, there’s no way of knowing WHAT WORDS they are using to find solutions on the internet.

Talk about trying to find a needle in the haystack – try finding keywords when you don’t have a target audience in mind!

That’s why choosing a target audience is an essential part of crafting your marketing strategy.  When you have a target audience in mind,  you can then set out to find the words those people are using to find information on the internet.

Now comes the “easy” part.  This is where you create posts for your blog with your target audience in mind where you talk about the problems they’re having and how YOU offer the solutions they need.

Yes, marketing a small business is REALLY that “simple” – but if you’ve tried it you know that while it’s simple, it’s anything but “easy”.

If you’re struggling with the task of marketing your small business, it’s probably because you don’t have a marketing strategy in place.   I know, I know – you didn’t start your [insert your business product or service] because you wanted to spend your time on “marketing”.   However, marketing is an essential step to starting a small business.

When You Hear Hemp, Do you Think “Rope” or “Dope”?

A rose by any other name would still smell as sweet – or would it?

I’ve written before about how important choosing the right name is for your business, well here’s another example of how powerful the right name can be.

I made a visit to the health food store the other day.  As I was there, picking up my assortment of herbal remedies to bolster my immune system against the ravages of time and turmoil, the store owner came bounding up to me to share their newest product discovery : Hemp Bagels.

Right now, you’re probably imagining brownies laced with dried herbs of questionable medicinal value- at least, I know that’s what raced through MY mind as the tiny woman gleefully bounded towards the refrigerated section to share her latest discovery.   Why else would she be so excited?

In case you didn’t know, hemp – which has certain “medicinal” properties when dried –  was grown extensively back in WWII to make an extremely durable rope.

Allow me to share with you this ugly secret – when you think of hemp bagels – think of rope – not dope!

Trust me when I tell you that hemp bagels barely qualify as a food product.  However, with 19 grams of protein and 11 grams of fiber, hemp bagels are a really HEALTHY way to start the day.  At more than $1.00 a piece, they’re also one of the most EXPENSIVE breakfast foods on the planet!

Hemp seeds are highly nutritious, and contain beneficial omega fatty acids, amino acids, and minerals.  Trust me – they may possibly be the seed version of the fountain of youth but I haven’t figured out if they really will make my live longer or if it will just SEEM like life is dragging endlessly on – a parade of day after day of rope-like bagels.

I would consider hemp bagels as an essential part of the “if it tastes good – spit it out” school of diet and nutrition.   Yet they are selling by the CASE LOADS out of this tiny little health food store.

As I look back over the whole sales pitch, I never remember once any mention of hemp bagels being a tasty treat.  Nope – the entire sales pitch was on how healthy they are for me.

Knowing WHY people are buying is important.  I don’t know WHY I thought that hemp bagels would be as tasty as “healthy” high fiber Pop-Tarts – because I know that the “healthy” high fiber Pop Tarts are NOT healthy.  It’s entirely possible that hemp bagels are the secret to long life, thin thighs and limitless energy.  They certainly taste like they are.

I think naming them “Hemp” bagels was a genius naming move.   Visions of smoke filled rooms with music from the 60’s playing filled my head instead of the more appropriate image of a bagle which shares many qualities with virtually indestructible rope.

This is why it’s ESSENTIAL to know WHY your customers are buying your product or service.  Despite the fact that they’re expensive AND taste like rope, people are buying those suckers like they’re going out of style.

“They’re SOOO good for you” – I should have known that was the nutritional equivalent of “He’s got a GREAT personality!”  I don’t know if I can bring myself to buy more – even though my pants are noticably looser as a result of adding them to my daily diet.   Let’s face facts, when you start your morning eating rope bagels, the day has no where to go but up!

Steps to Starting a Small Business: #7 Your USP – Unique Selling Proposition

No list which proclaims itself the key to “steps to starting your own business” can avoid addressing the topic of the USP – the Unique Selling Proposition.

While the definition of the USP is often draped in “mystery”,  quite simply your USP is the reason people choose to do business with you.

It sounds simple enough – doesn’t it?  Unfortunately, I’ve been seeing that this topic needs attention so I’ll begin with what a USP is NOT!

1.  A USP is not the price of your product or service.

“It’s cheap” is a poor imitation of a USP. That part you probably already knew.  After all EVERYONE knows that – except for the people I’ve been noticing lately who are trying to sell their e books by proclaiming that the reason to buy it is because it’s so cheap.  Free and cheap are both piss poor unique selling propositions.

2.  A USP is not the quality of your product or service.

Your USP is also not that you’re the best or most qualified.  Everyone’s the best – the fastest- the smartest – the cheapest – the finest.  People have a REALLY hard time judging the quality of a product or a service and they’re positively numb to exaggerated marketing declarations.

It’s virtually impossible to judge the quality of most products or services without experiencing the product or service in person.  That’s why ecommerce retailers are offering online reviews – to help buyers access the opinions of others who have previously purchased products or services.

Another reason it’s difficutl to just quality is that buyer’s PERCEPTION of quality often affects their judgment.    For example, researchers asked volunteers to judge the quality of different wines.  The volunteers were hooked up to monitors and the pleasure centers of the brain were measured as they drank the wine.  In the experiment, the participants were told that there were 5 different wines ranging in cost from $4 a bottle to $90 per bottle.  You probably won’t be surprised to learn that the participants enjoyed the more expensive wines much more than they did the cheaper ones.

The kicker – there were not 5 wines in the study but only three.  One wine was doing double duty – being served as both a sample of $4 a bottle and a $90 per bottle of wine.  The same wine actually tasted better when served as a more expensive impostor.

This should illustrate how important it is to properly brand and market your products or service – but don’t confuse applying the label of “the best” with a viable USP.

3.  A USP is DEFINITELY not the “uniqueness” of your product or service. Unless you’re offering sex change operations for chimpanzees – there is probably someone else who offers a reasonable facsimile of the good and services you have to offer.

If you are TRULY the only one offering a product or service in a free market – it means competitors don’t view your product or service as a viable business.  Initiation is the sincerest form of flattery and it’s validation you’re on the right track.

So what IS your USP?  What is your UNIQUE SELLING PROPOSITION?

Hang on to your hat because this may come as a surprise to you:

Your USP – like Soylent Green- is PEOPLE!

That’s right.  The REASON people choose to do business with you and your business is usually nothing more complicated than you (or your staff) are reasonably competent and cordial.  If a customer or clients feels BETTER when they hang up the phone or walk out the door than when they picked up the phone or walked in the door to your business, then that my friends is a USP that can’t be beat!

Yet many business owners are on a QUEST to REMOVE themselves and their people from contact with their customers.  As more and more businesses set up ways to automate communication, they unwittingly (maybe not so unwittingly) set up barriers that prevent customers and clients from connecting on a personal level.

I’ll never forget a situation several years ago that stays with me to this day.  I had a friend who purchased one of the earliest info products on marketing offered online. My friend visited the website several times and called to ask my advice a few more times.  As he moved closer to making the decision to purchase, he picked up the phone and called the author before he placed his order. All the info guru had to do was pick up the phone to close the sale.

Meanwhile, I was creating a website for a coaching client who asked me to remove her phone number from the website.  I replied by referring to the role having the phone number displayed had played for this info guru. I have to confess, I was stunned at the passion in her reaction to hearing this.  Seriously,  you would have thought I had asked her to include photos of her having sex with household appliances into the design by her response.   Apparently the thought of people calling her on the phone literally terrified her.

I’m not a coach nor a therapist, so it wasn’t my job to figure out why connecting with people who might want to hire her frightened her so.  I removed her phone number from the website design.

Which brings me to my favorite subject, which is why blogs are the cat’s meow when it comes to a web presence for service professionals.

Your blog is a great way to allow people to “get to know you” before they pick up the phone and call – or send you an email.  They can “sample” what it’s like to do business with you by reading your blog.  They can guage whether you know what you say you know.    They can get a glimpse of what it’s like without taking the scary leap of faith and actually contacting you directly.

If you think your Unique Selling Proposition is anything OTHER than the people who are part of your organization  – then you have a rude wake up call in your future.  Social media is all about people making connections and those connections form the most important part of any business USP.

Steps to Starting a Small Business: #6 Setting Your Rates

A fast easy way to start a small business is to sell your services.  If you’re good at writing, you can become a freelance writer.  Have a knack for selling, you can freelance your services as a sales person or a telemarketer.  Think you know a thing or two about selling without meeting people in person (marketing), then you too can be a freelance marketing consultant.  The list goes on and one.

If you’re a service professional, then the big question you must answer before you begin practicing your craft is to decide HOW you’ll get paid for sharing your wit and wisdom with others.

Setting your rate is the biggest issue you’ll face in launching a service based business.

Unfortunately, setting your rates is  not a simple matter of “set your rates too low and you’ll be swamped – set your rates too high and you won’t make any sales.”  Ah, if only that were true!

Unfortunately, it’s far too common for people to evaluate your expertise by the rate you charge.  For example, I know of two Virtual Assistants – one charges $25 per hour and one charge $45 per hour.  When you hear what their rates are, do you automatically assume that  the one who charges $45 an hour is “better” than the one who charges $25 an hour?

Setting your rate is a lot more complicated than picking a pie in the sky number and setting that as your income goal.   Your rates HAVE to be based in reality if you want to succeed.

There are TONS of bullsh*t articles out there which will tell you to set your rates with the following formula:

How Much You Want To Make / 50 weeks (two weeks of vacation)/40 hours per week.

So, if you want to make $100,000 a year you simply divide and divide again to come out with $50 per hour.

OOPS!!!  This little formula tends to neglect that if you’re spending 40 hours a week on billable work, you’re probably putting in more than 60 hours a week at the job.  (This is a bitter pill to swallow in a world that buys into the idea of earning six figures in the course of the 4 Hour Work Week.)

So let’s “fix” this formula by substituting 30 for the 40 in the figure above so we can spend 10 hours marketing and promoting our services and 30 hours “working” at practicing our craft. Now the rate is $66.67 per hour.

It’s better – but still not good.  The flaw lies by starting from starting at the end (what you want to make) and working your way back to the beginning (what you need to charge to make what you want).

If you’re a Virtual Assistant and your income goal is $100K per year, you’re going to need to charge $67 per hour to hit the mark.

Here’s the “fly” in that ointment.  Remember when I told you that I know TWO Virtual Assistants – one charges $45 per hour and one who charges $25 per hour?  Did you notice how “similar” those rates are.  Now, if you’re a VA and you’re planning on charging $67 per hour – well, you’d better be able to do something those other two Virtual Assistants can not do!

In other words, you’d better have a Unique Selling Proposition or USP.  That means you better be able to provide a REASON for the rate you’re charging.

The first business coach I hired took me through this whole bullsh*t process.  We picked a pie in the sky number – did the math and VIOLA!    It worked great – on paper.  However, when I went out to drum up business, prospective clients would ALWAYS ask how much I charged.  I would reply by quoting people my “hourly” rate.

Invariably, the next question out of the prospective client’s mouth would be, “So how many HOURS will it take for you to do this?”

See, people didn’t care what my hourly rate was – they just cared how much their website was going to cost.

Oh, and by using the bullsh*t formula, I put myself in DIRECT competition with the hundreds of thousands of high school and college kids who created websites in between beer bong parties.  Fifteen years of successful advertising experience didn’t play a part in that calculation and the fact that I was fast wasn’t reflected in my hourly rate.

Since I’ve been doing this for a LONG time, allow me to share what I’ve learned about setting the rates for your services.

  1. No one cares about your hourly rate except you.  All your client cares about is how much this is going to cost.
  2. In the end, your prospective client is going to mentally measure whether the cost of the project outweighs the benefit.
  3. Your hourly rate should reflect not only the value of your time, but the value of your expertise as well.

The final advice I have on setting your rates is this: When you’re starting out – aim low.

The biggest struggle you’ll face as a beginning freelancer or service provider is filling your practice.  Set your rates too high and you’ll struggle to land clients.  However, if you price your services on the low end, you’ll fill your practice with clients who are DELIGHTED with the high quality of work you’re providing at a bargain basement price.  Before long you’ll  find yourself in the position of having to raise your rates to keep your waiting list reasonable.   Meanwhile you’ll have a STRONG portfolio of work and testimonials to share with other potential clients.

Then, when you raise your rates – you can either raise them across the board or “selectively,”  meaning, you can grandfather in your favorite clients at the old rate and the “pain in the ass” clients will find themselves faced with a rate increase.  Personal note: A rate increase is the most satisfying way to fire a pain in the ass client!

In closing – the absolute WORST thing in the world you can do is to doubt your own worth.  If you don’t believe you’re worth $X per hour – then your clients certainly won’t think you’re worth that either.

Steps to Starting a Small Business: #5 Marketing Strategies – AGAIN

This is the fifth installment of the Steps to Starting a Small Business and it’s really an extension of the previous Steps to Starting a Small Business: #3 Promotion. However, I’ve addressed this twice via email and phone over the past seven days, which is always a sign that I need to blog about a topic.  Here it goes.

A marketing strategy is different than a marketing tactic.  A blog is NOT a marketing strategy. Believe it or not, a BLOG is actually a marketing tactic.

Marketing tactics are how you achieve the marketing goals established in when you created your marketing strategy.

If you have a product or service of interest to bloggers, then by all means, a blog is a WONDERFUL marketing tactic for your business.   However, it’s possible that your target audience doesn’t know a blog from an online bulletin board.  If that’s the case, then a blog IS STILL probably a GREAT marketing tool but it may not be a marketing tactic to take your business where you want to go.  (Blasphemy – I know!)

Creating a marketing strategy is like planning a trip. When you’re planning a trip, you must first identify where you are, “I’m in Philadelphia, PA” and then you identify where you want to go, “I want to end up in Miami, FL.”

When you’re creating a marketing strategy, you begin with where you are.  “I provide coaching services to women who are divorced and want to create a new life after divorce.”    Then, you identify where you want to end up.  “I want to have a coaching practice where I have 5 coaching groups with 7 members in each group.”

GREAT START!  You know where you are and you know where you want to be.   Now all you have to figure out is how to get there!  Part of planning your trip is figuring out where your target audience (divorced women) are spending most of their time and what has their attention.

Marketing is a numbers game – pure and simple.  You have to determine how many people need to be exposed to your message to keep your business afloat.

The numbers game translates into an easy to represent funnel.  The first question to ask is how many website visitors do you need to get 35 clients into your group coaching programs?

The illustration to the left shows a “typical” sales funnel.   For every 1000 website visitors, 100 (1 out of 10) of those visitors signs up for the newsletter.  (If you don’t HAVE a newsletter – you’re missing an important step in the sales conversion process.)

Out of those 100 newsletter subscribers, 10 “bite” when you offer your coaching group.

With this information in hand, you now know that you need 3500 unique visitors to your website to get the 350 newsletter subscribers to get the 35 group coaching members.

This is why it’s so important to tightly target your audience and then do the keyword research to find out what WORDS your target audience is using to find solutions on the internet.

See, if our coach above didn’t define her target audience as “divorced women” then she wouldn’t have any idea of where to start when it came to looking for the keywords her target audience may be using as they search for answers to their problems via the web.

HOUSTON WE HAVE A PROBLEM:

a) It’s very possible that divorced women are not SEARCHING the web looking for a divorce coach.

b) The search engines aren’t going to be delivering tens of thousands of visitors to her brand new website any time in the near future.

Does that mean that you should scrap the idea?

DEFINITELY NOT!

If you’re offering solutions to people’s problems – and those people are willing to PAY to have those problems solved – then you have a viable business.  However, you may not be able to sit back and allow the search engines to drive the traffic you need to your website to build your business.

What it does mean is that she needs to look at using other methods to drive traffic to her website.

One way around the whole “oops I need more traffic” conundrum is to use Google Adwords.  Google Adwords is SOOOO amazingly easy to use, but I’ve got to warn you – it’s some of the most expensive advertising on the planet!

And for those of you who wonder what I do to pay the bills – here it is.  I come up with creative ways to build your business.  Sometimes it’s via the web – sometimes the web is just a “gathering basket” for traffic driven via other means.

In the client’s case above, we came up with a “vertical marketing strategy” of sorts.  See, my client really isn’t a blogging kind of a girl, so we had to brainstorm new and different ways for her to fill her sales funnel.

So I asked, where is the one place you can be sure to gain access to newly divorced women?  Answer, “Divorce attorneys offices.”

At first, my client was resistant.  After all, why would divorce attorneys help her build her business?  That’s where the hard work began.  I helped her to “frame” her services in a way that it was actually a benefit the divorce attorney could offer his clients – with no additional cost to him/her.

If you’re getting a divorce and your choice is between two attorneys – one of which offers not only access but a substantial discount on a program to help you get back on your feet in a matter of months instead of years after your divorce and the other doesn’t – which attorney will you choose?

The first ten attorneys she approached JUMPED at the chance to sit down and discuss this with her and now, instead of paying Google tens of thousands of dollars for a PPC campaign, she’s going to buy lunch for ten different divorce attorneys.  If each attorney sends her 4 clients, her practice will be full AND she’ll have access to a constant stream of new clients. Oh,  the “tough” economy is exactly WHY those ten attorneys are looking for something to give them an “edge”.

What’s your marketing strategy?   Who’s your target audience?  How are you planning on reaching them?