In recession times the first thing that many companies cut is their marketing budget, but in reality no business will be sustainable or successful without marketing and the resultant sales. All businesses face the challenge of finding and retaining customers.
It’s therefore important to communicate the product or service to a target market and establish effective distribution channels.
Entrepreneurs that are aware of the need for marketing show higher growth. Such entrepreneurs targeted their markets carefully while employing direct selling, web-based strategies and increasing media presence as a manner of communicating their messages.
There are two types of challenges where a market need exists and where one does not. If a market need exists, there will be competitors and marketers will have to communicate a unique differentiator to the target market. If no market exists, the advantages of the product will have to be communicated in order to create a need in the market.
Limited resources but extensive results
Global competitiveness is forcing entrepreneurs to increase market awareness and marketing knowledge within the team. Marketing techniques used should be sophisticated and state-of-the-art. Marketing ideas should be customer driven and position the organisation strategically.
Integrated marketing components are used to create sustainability and ensure business growth in the entrepreneurial firm. It is the backbone to achieving business success. Reputation management is no longer enough to create growth.
With limited resources it’s important to prioritise marketing activities and ensure return on investment through choosing the activities that will contribute towards the company success. Sales and marketing are critical success factors for small businesses and activities should start with market research, leading into promotion.
Marketing activities are important factors affecting business success as confirmed by a recent study conducted in Botswana. Marketing activity was cited as the main factor influencing business success and specific marketing activities that were identified as contributing the most to business success include promotion, research and training.
However, entrepreneurs remain unsure of the value of the marketing function and are therefore less inclined to develop marketing strategies or invest in marketing. Marketing capability is about having knowledge of the target market, customer needs and requirements and providing a solution to those needs.
Not just a pretty advert
Entrepreneurs should focus on the customer to enable him to react according to client requirements, adjust prices and deliver a quality product at the right time and place. The entrepreneur must have knowledge of every aspect of marketing and the ability to undertake the necessary research.
From the research, the entrepreneur should be able to identify a market need and develop the product or service accordingly. This is the first and most important step towards entrepreneurial success.
It’s vital for entrepreneurial success to find a niche in the market, a protected place that will give a competitive advantage. Failure to find a niche could lead to business failure. The process of identifying the target market and areas of marketing requirements, such as product marketability, will require the development of a strategic marketing plan in which potential customers should be identified and their needs documented.
Delivering on promises
During an empirical study that measured market interaction through marketing and customer relationship management, marketing was shown to comprise of six items: advertising, communications, events, sales, networking and promotions.
The effect of these factors on business success as measured through sustainability, growth, profitability and customer satisfaction was researched and it was found that marketing of the business and customer relationship management explain 24.7% of the variance in the sustainability of businesses, 13.8% of the variance in business growth and 11.3% of the variance in profitability.
This proves that when marketing and customer relationship management is done well, the business will be more sustainable, will grow faster and will be more profitable, yet there is no positive relationship between marketing and customer satisfaction, perhaps due to customer expectations being raised.
Maintaining a company’s marketing functions will achieve profitability. The significant relationship between customer relationship management and sustainability also proves that cooperative relationships with clients will achieve business success.
Entrepreneurs should therefore not focus on marketing to satisfy customers, but to open new markets and obtain new customers and, in such, positively affect profitability, sustainability and business growth.
The interconnectedness of all the factors should not be ignored. Through intensive marketing, more customers will be secured which will require more employees and therefore affect business growth.
Once the customers have been secured through marketing activity, operational excellence will be required to satisfy customers; should the customer be disappointed as a result of the delivery of the product or service falling short of the marketing message, the marketing budget would have been wasted.