What is marketing?

What is marketing?
marketing definitionI had the chance to attend a luncheon in northern Michigan. I was fortunate enough to sit at a table that had two business coaches. One would have been a rarity, but two? I felt I had hit the jackpot. You see, I like business coaches. They coach a business on what needs to be done. Many times the owner doesn’t have the time to do this. The business coaches put them in touch with companies like mine. This helps them to get the work done by an experienced company and a cost cheaper than hiring a dedicated person.

 

We were discussing the problems we have working with small business owners. They have no understanding of how to market their business. Many we found feel that posts on Facebook is effective or they placed an ad on a restaurant placemat or they pinned their business card to every community bulletin board.  Yes those items are very in expensive but are they effective? Probably not. Facebook is limiting the amount of people that can see your post without you paying for your post to be promoted. How many times have we taken home a placemat (including the gravy stain) only to throw it away without call the business we took it home for? Have you gone back to the community bulletin board to find that your card has been covered over by another card or flyer? Or even worse they are gone! I’d like to think that interested people took them. But without receiving the phone calls you have to wonder if they ended up in the trash by your competitor.

What is marketing? The American Marketing Association defines marketing as:

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. (Approved July 2013)

First, you need to set a budget and develop a plan. Typically, the rule of thumb for a marketing budget is 10% of revenue (it’s more complicated than this but it can give you an idea of what you should be targeting). The next is the plan. Would you really take a cross country trip without Google Maps or some other GPS to guide you? Nope. If you’ve never put together a marketing plan you can find all kinds of examples here.

There are four components to your marketing program. They are:

1. Products and services
2. Promotion
3. Price
4. Distribution

In the past they were called the 4 P’s: product, promotion, price, and place (5 P’s if you include psychology – understanding your customers).

You always need to have the right product you customer is looking for. It doesn’t do you any good to offer an 80’s boom box when your customer wants a jam box that connects to their cell phone by blue tooth. Always listen to your customers on what they want or what they need.

Promotion is how you interact with your customer. Today you have many more options that you did pre-internet days. Online marketing has made it less expensive to market (notice I said less expensive; not free).

We’ve all done it. We’ve gone online to search the best price for the item we want to purchase. This doesn’t have to be something we’re ordering online either. Many people sit in a store and comparison shop with their cell phone.

Remember that time you went to the store to buy a product and found out they had none on the shelves? At some point the distribution chain broke down. If the price wasn’t right (i.e. a sale) your customer is going to look for the store that has one. Always make sure your distribution channel is working.

Now you have the concept of marketing. Next time I’ll talk about many ways you can market your business beyond the restaurant placemat.

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