Chapter One & Two of "How To
Market, Advertise And Promote Your Business Or Service In A Small
Town"
By Tom Egelhoff
Section
One: Chapter One
The Small Town
Marketing Plan
Getting Started
Now that we know a little about small towns and how they work,
from the Small Town 101 section, let's create some marketing
strategies for your business.
What is a marketing
plan anyway? "I thought
I just needed a business plan." A marketing plan is a part
of your overall business plan. I usually recommend that 30% of
your business plan should be devoted to how you are going to
market your business. Your marketing plan is one major area that
investment bankers take a real close look at before lending you
any money. They are very curious how you will attract customers,
make sales, make a profit and pay them back on their investment
in your business. We will use some of the information from the
business plan in our marketing plan, but the marketing plan is
usually its own entity within the business plan. If you don't
have a business plan started yet, do that first. S.C.O.R.E. (Service
Core of Retired Executives) can offer free help to get you started.
Find them at the Chamber of Commerce. Also, check out your local
Small Business Development Center.
Once you have your financial statements and projections together
you can move on to the marketing plan.
Where do we start?
We start with you. You need to sit down and really look at yourself
and your business as you never have before. This is the most
difficult part of the marketing plan. We never let anyone really
see the "real us". You must be completely honest with
yourself about who you are and where you're going.
A little information
is a dangerous thing.
Before customers enter into a relationship with a business,
they quite naturally, want to know something about that business.
That's where a marketing plan starts.
Who Are You? Why would I want to do business with you?
In addition, you need to know every aspect of your business before
you can prepare your advertising and target your customers. Here's
how to start.
If you were looking for a job and saw an ad in the classifieds,
what questions would you ask yourself? The first question would
probably be- "Am I qualified to do this job based on the
job description." If the answer is yes- you put together
a resume and request an interview to present your qualifications
to your prospective employer.
Business is no different. You need a resume (or complete description)
of your business that can be presented to qualified customers
(your target market) in the form of an advertising message. This
"resume" is sometimes referred to as a business review
or background review.
In the next chapter, I'll give you suggestions for a few things
that should be included in your business resume.
For a complete table of contents
for "How to Market, Advertise And Promote Your Business
Or Service In A Small Town", Click Here
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here to Order Now! Or if you still need more...
Chapter Two:
Step 1: Business
Resume
Ask yourself the following questions as though you are a customer
of your business.
1.) How long have you
been in business? If you're a new business, what experience
do you have in this field? As a customer, would I feel comfortable
that you can do the job, or provide the level of service I am
accustomed to? Are special machines needed in the production
of your product? Could importing materials put the company in
jeopardy if they weren't available? Will training be required
of employees to produce the products? What are the company's
-long and short- term goals? Are there existing sales goals?
What is your mission statement or company philosophy?
2.) Who are the principles
in the business? What qualifies
them to start or operate this business? What special skills do
they have? What is their education or training in this industry?
Are they members of any associations in this industry? Is city
or state licensing required for this business, and if so, have
they complied with all local regulations?
3.) What purchase rates
or buying habits are related to your product or service? Would I buy it once a week, a month, a
year? What is the demand for your product or service? Is it seasonal?
Is it hard to use? Are there multiple users? Are there going
to be heavy users of your product? What percentage of your total
sales will they be? Is your basic industry growing or shrinking?
Is the customers base in your city or county growing or shrinking?
Is your product a luxury or a necessity?
4.) What about awareness
and attitude about your product or service? Does your
product harm the environment in some way? Is it fun or useful?
Is your product well known or will the public need to be educated
about how to use it? Are you the next Hula Hoop or Pet Rock?
5.) Most businesses
have some form of competition...how about yours? Who
is your principle competition? (Ask all the questions in #2 above
about the competition.) How big are they? What can you do that
they can't do? Can you specialize in areas they can't? If you
are competing against a large public company (i.e. Wal-Mart,
Costco, etc.) buy some of their stock. You'll receive their annual
report, and as a stockholder, a lot of information will be available
to you. Warning: Do not skimp or gloss over this business resume
section. It will be very valuable later on when we deal with
positioning your business.
6.) How's your pricing
compared to the competition? Can you be competitive
or are you going to have to ask a higher price? Is the lowest
price always the best? Of course not. Customers place a value
on products based on their perceptions of that product. They
base those perceptions on the information they get from you and
other sources and comparisons. If I said, CD player, a dollar
figure jumps into your head based on advertising you've seen
or input from friends or any of 100 different sources.
7.) You can't have a
business without customers. You
must identify your target market. Who are the people most likely
to use your business? Their age? Sex? (Most books refer to this
as gender... Gender is language, not people...sex is people...look
it up). Occupation? Martial Status? Home Ownership? TV shows
they watch? Newspapers and magazines they read? Average household
income? Education? Lifestyle? Number of children? All the stuff
you find on a warranty card when you buy a vacuum cleaner or
a blender. In addition, do some secondary research.
For example, if you are lucky enough to be in a town large
enough to have a library, they should have census information
for your state and county. This will give you a profile of the
average person living in your county. The Chamber of Commerce
may have the demographics of your city. Start with these and
be prepared to adjust your business as needed. A good library
will have a copy of the Rand-McNally Commercial Atlas and Marketing
Guide.
You'll find retail sales data for your state and county. What
did people spend on food? Housing costs? Clothing? Automobiles?
It's a great thumbnail source of information about people in
your state or county. I'll cover how to reach these folks in
the advertising section coming up later in the plan.
Who are the "end
users" of your product? For
example, I ask my wife to pick up some beer when she goes to
the store. She makes the purchase, but she is not the end user
of the product, I am. If I recommend a brand name I influence
the purchase, if not, she will probably get something "light"
or on sale.
8.) How much business
is really out there? In a small town this becomes
very important. I grew up in a small farm town in Illinois. The
population was 5,200 people. Yet, in a three block area, there
were 6 gas stations. These stations all stayed in business during
my grade school to high school years. That's twelve years in
business.
When we create a business plan we must know if there are enough
paying customers to support our business. Forget the competition
(not entirely) for the moment. Each one of those gas stations
needed a customer base of at least 5,200 total customers to survive.
Some customers only went to one station for all 12 years, some
went to all stations for 12 years, and the rest a combination
of the two.
The point is; each station needed X number of customers per
day, week, month, year, to survive in this market.
Could a seventh station go in this market and survive? The
answer is yes. Would it be easy, the answer is no. If you were
going to open a new gas station in this market you would need
to know the answer to three questions:
One: Can you develop new customers who do not go to any of
the other stations? (New people moving to town, people just turning
16 and getting a drivers license.)
Two: Can you take customers away from your competitors? (People
unhappy with the service, unhappy with the quality of the product,
unhappy with price.)
Three: Can you develop enough of both to make a living?
If the answer to all three questions is yes, I would advise
you to continue constructing the marketing plan. Please keep
in mind we are only in Part One of a 10 Part Plan.
This example with the gas station is greatly simplified for
demonstration purposes. There are a lot more things that have
to happen for that seventh gas station to survive than just those
three questions . If the answer is no, then I would advise you
to stop and regroup.
This process is commonly called a Sales
and Market Share Analysis. How many sales; and how
many people for the business to survive? I will tackle this in
more detail as I go through the rest of the marketing plan.
9.) Next, let's talk
about distribution of your product or service. What is your service
area? The whole town? The whole county? The state?
Is it delivered? Do customers pick it up? Can or does it need
to be shipped? Will you need delivery vehicles? A shipping budget?
FedEx account? UPS? Is it an intangible item: Life Insurance?
Office cleaning? Groomed dogs? Do customers come to your place
of business or do you go to their home or business? In small
towns you may be required to travel to rural or farm areas for
business. How much of this will be necessary and what is the
cost of that travel?
10.) How is the product
or service going to be sold? Where
do customers of your product shop now? Will this change in the
future? Will you need to hire salespeople? Will it be sold off
the shelf in stores? Mail-order? Internet? 800 number? Do you
know what the cost of sales of the product or service will be?
If you have to pay a commission to a sales person, that will
certainly take part of your profit.
11.) If you are in a
common industry like shoe stores, or construction companies,
CPA's, real estate, etc. study how these companies are advertising
in your area. Are they on
radio? TV? Newspapers (what section what days?) In San Diego
(not a small town, I know), construction and remodeling companies
comprised almost all the ads in the weekly newspaper TV listings.
Why? Because it hung around the house all week.
Now that we have the answers to these questions, it's time
to move on to Chapter Three and find out what we do with this
information and how to begin to construct our marketing plan.
Authors Note: In the following chapters is a step-by-step
marketing plan that will guide you through the process of creating
a plan for your specific business. If you have questions or need
direction, that's the purpose of the website.
Contact us if you
are having any problems following the plan or if your business
is outside the norm. Our articles will reinforce the directives
of the book and complement them. (To
small town marketing.com home page)
For a complete table of contents
for "How to Market, Advertise And Promote Your Business
Or Service In A Small Town", Click Here
Click
here to Order Now!
Based in Bozeman, MT, Tom Egelhoff is the author of How To Market, Advertise & Promote Your
Business Or Service In A Small Town, and The
Small Town Advertising Handbook: How To Say More And Spend Less.
He is also a seminar and workshop presenter
and trainer. He may be reached at 888-550-6100 or PO Box
271 Bozeman, MT 59771-0271
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