Four things to understand about the power of marketing

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Boni and John Wagner-StaffordOne of the biggest mistakes new entrepreneurs make is to underestimate the power and importance of marketing.

Right from the earliest days of a startup, marketing deserves a seat with the big boys: finance, human resources, operations, product development and sales.

It shouldn’t be an afterthought. And it’s not fluff.

“Marketing is a core part of the business strategy,” says Ravi Dindayal, director of marketing consulting at the Business Development Bank of Canada (BDC). “Marketing isn’t just driving traffic, ads for online advertising and bothering people with email. It is understanding your customer segments, your value proposition, all the things fundamental to how you tell your story, how you market yourself and what you’re selling. To me, it really starts here.”

Market research

As a business owner, you’re conducting market research all the time, whether you’re aware of it or not. Every time you talk about your business to a prospective customer, or check out the offerings and prices of your competitors, you’re engaged in market research. But you need to be systematic about collecting and recording your findings.

“Most entrepreneurs are starting out because they’re passionate, they have a hunch, they sense the market is there,” says Dindayal. “But at a certain point as a business owner, you have to stop and figure out how to invest in market research.”

For DIY market research, you won’t find a lot of good-quality secondary information. Statistics Canada is a good and reliable source, but it can take more time than you may have as an entrepreneur to navigate through and locate the information you need.

You can hire a market research firm, including the BDC, but that quickly gets expensive. Or you can use an online survey tool like SurveyMonkey.

You can also put together a list of 30 people you think might fit your customer profile, including friends and family, and ask them a series of questions designed to provide insights into the market related to your products and services.

KPI and high-value customers

You’ve no doubt heard the saying ‘the customer is king.’ In today’s digital marketing world, it’s ‘the right customer is king.’ Dindayal says it’s common for businesses, whether they’re in the micro- (less than $2 million in revenue), mid- ($2 million to $50 million) or high-impact (more than $50 million) categories, to lack an understanding of their high-value customers.

You want to ensure your limited resources target the right customers.

Identifying those high-value customers requires a dashboard system of key performance indicators (KPI). It doesn’t have to be fancy – a series of spreadsheets will do.

You’ll want to collect data that tells you how much time and money you’re spending on a customer and compare it to what they’ve signed up for.

“If they’ve signed up for an $8-a-month subscription and you’re spending eight hours a month serving that customer, those are the customers you should send to your competition,” explains Dindayal.

Marketing strategy versus marketing plan

Don’t confuse a marketing strategy with a marketing plan. They’re different beasts, with different purposes.

Marketing strategy:

  • provides you with a roadmap to accomplish your business objectives and achieve results, like better market penetration and sales growth;
  • is a collection of medium-term and long-term methods that won’t change year over year, unless something major changes, like legislation, a big new competitor or a shift in consumer behaviour;
  • helps ensure you’re focusing resources to attract employees, partners and customers using only those initiatives that support your overall business objectives.

Marketing plan:

  • a collection of the marketing tactics and initiatives you’ll implement for the given period – monthly, quarterly or annually;
  • changes at least annually to address opportunities, threats and competitive actions;
  • includes budgets, deadlines and well-defined responsibilities.

Marketing as differentiator

Are you giving marketing the respect it deserves? Look around your business and ask how you’ve been treating marketing: is it a fluffy afterthought or a fundamental pillar?

“The companies I see that are really successful are led by entrepreneurs who have their marketing hat on from the beginning. They understand that marketing is an essential part of the business strategy. This is a differentiator,” says Dindayal.

In other words, they don’t underestimate the power and importance of marketing.

Between them, Boni and John Wagner-Stafford have five decades of experience as entrepreneurs and/or providing consulting services to other small businesses across Canada. Boni and Joni are the authors of Rock Your Business: 26 Essential Lessons to Plan, Run, and Grow Your New Business From the Ground Up.

Boni and John Troy Media Thought Leaders. Why aren’t you?

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power of marketing

The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.

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