Marketing Tips

Marketing entails a combination of market analysis and marketing strategy. Analysis gathers knowledge of customers and competition in your marketable area. Strategy is the means to reach them. You might say that doing the analysis is like consulting a map before going on a trip. Always read the map (perform your analysis) before starting out. When you do, you're a lot less likely to take a wrong turn with your strategy, or to get lost on your way to strategic business success.

Market Analysis

Market analysis identifies factors about your business, your market penetration, your customers, and your competition. For more marketing information, download SBA Pamphlet Marketing Strategies For The Growing Business, EB-2, from http://www.sba.gov/library/pubs.html

1. Outline Your Business:

State what products or services you provide to customers. Example: operate a cafeteria selling quality meals, beverages and deli-style take-out foods.

2. Business Location:

List your store or business location; insert density data from the rental manager. Examples:

• Type location (enclosed mall, strip mall, office complex, main thoroughfare, intersection)
• Vehicular and pedestrian traffic flow
• Customer parking spaces
• Security arrangements (in-store and parking area)
• Nearby complementary businesses (clustered businesses may aid sales)

3. Primary Market Area:

Set your target market area; insert census data. Examples:

• Knoxville area (East, West, Greater)
• Knox County (northern, southern, entire)
• Zip code(s)
• Mile radius
• Neighboring counties

4. Market Area Growth:

List 10 to 20 year growth factors for your target market. Examples:

• City and county general plan and potential zoning changes
• Population increases and shifts
• New home developments and shopping centers
• Market area upsurge or deterioration, including business relocations

5. Primary Customers:

Identify your primary customers, your niche market. Add census data. Examples:

• Age groups (teens, middle age adults, senior citizens)
• Occupations, professions, annual income level, education level
• Lifestyles and/or social class
• Race, gender, ethnic group, religion
• Buyer groups (new home buyers, hobbyists)

If selling to businesses, identify targets by industry, name, and size (gross sales and employees), financial strength, selling patterns, distribution patterns (yours and theirs), and special requirements

Note: Census, demographic, and market research data are available at the Lawson McGhee Library.

6. Customer Needs:

Identify why customers need your product or service. Identify their potential likes and dislikes for the product or service. A top priority item! Examples:

• Usefulness and customer taste
• Follow-on support
• Technological advances
• Timeliness and frequency for marketing to customers to satisfy their needs
• Customer wants and complaints

7. Customer Financing:

Determine your customers' financing methods, estimate the percentage for each method and measure the impact on your cash flow. (These are crucial to cash flow-the timely receipt of cash for payment of bills). Examples:

• Cash and check (minus bounced checks)
• Credit card and ATM card
• Charge account (less delinquent payments)
• Insurance coverage

8. Competition:

Identify your competition by name, location(s) and sales volume.

Identify competitors using personal knowledge, the Yellow Pages, information from suppliers, telephone/address databases, and libraries and college business libraries (for larger competitors)

List your feature products or services and good reasons for customers to bypass your competition and give their money to you

Estimate the market share (percent of total market) for yourself and like items sold by competitors

Compare your competitive factors with your competitors' factors using Competitive Analysis Matrix

After completing the Competitive Analysis Matrix, list your top 5 strengths (or more) over your competition and their top 5 strengths (or more) that you must overcome

Marketing Strategy

Marketing strategy is the setting of goals, advertising, and sales techniques to achieve market area penetration, customer sales, inventory turnover, cash flow, and owner profit. Review your Market Analysis as a baseline for setting marketing goals, advertising needs and strategy for daily business performance.

9. Marketing Goals:

Set achievable goals for improving sales; once achieved, set new sales goals. Examples:

• Increase sales by ___ % or to $ ______within ____ months, by next year or within 5 years
• Attain ___ % of the total market share for your type of business within your market area
• Improve quality of your products, services, customer service and also sales force quality and morale
• Increase number of items sold, contracts obtained, contracts renewed or other unit sales data

10. Advertising:

Identify methods, media and costs to advertise your business products or services. Examples:

• Business cards (hand one to everybody you meet)
• Word of mouth, network of friends, personal contacts, salespersons
• Advertising Media (Yellow pages, newspapers [display ad, classified ad], flyers, magazines, radio, television, Internet home page, billboards, press releases, direct mailings)
• Advertising promotions during peak sales periods (weekends, events, holidays and seasons)
• Special promotions (contests, demonstrations, trade shows, or giveaways [caps, cups, pens])
• Sales at flea markets or special events
• Follow-on special offering, special benefits or thank you letter
• Articles for local newspapers and trade journals, or publish a business newsletter

11. Sales Strategy:

Describe how you propose to get customers to give you their money. Consider:

• Specific nature of advertising and the products or services to be sold to penetrate your market area
• New products or services for your niche market
• Price reductions, coupons, trial samples or free services
• Seasonal and holiday sales promotions
• Salesperson's efficiency, tact, attitude, judgment, appearance and hygiene
• Owner's personal service, ability, efficiency and promotion effort
• Customer contact plans (before sale, after sale)
• Delivery system (supplier to you, you to customer)
• Customer service, follow-on technical service and support and handling of complaints

12. Community Relations:

Aid your marketing effort by assisting community non-profit organizations. Consider one or more of the following:

• Chamber of Commerce or similar group
• Trade associations and trade shows
• Local events (sponsor or participant)
• Donations of items or monies
• Seminars (speeches) for businesses or public (self initiated or at local events)

13. Evaluation:

Evaluate effectiveness of your marketing effort and the return on money spent. Examples:

• Advertising costs in comparison with sales of advertised items and also total sales
• Advertising periods and gross sales fluctuations during such periods
• Other marketing costs in comparison with gross sales
• Percentage of advertising costs in comparison with: gross sales, total business expenses, industry trends for your trade

The following contains a Competitive Analysis Matrix that you can use to assist you with the marketing strategy for you business. SCORE and SBDC is ready to assist you free of charge any time you want assistance developing your marketing strategy.

Competitive Analysis Matrix

Use this matrix to help select and analyze your top 5 strengths (your numbers 1's) and top 5 weaknesses (your number 5's) in order to complete Item 8 above. First, rearrange the Competitive Factors listed below in their priority of importance to your business. Then rank your business as compared to other businesses on a scale of 1 (best business) to 5 (worst business) for each Competitive Factor.