The importance of marketing to any business venture cannot be underestimated. It is a disservice to customers when businesses have something to offer that they could benefit from, but they do not know about it. Small firm marketing has been characterised by attributes such as haphazard, informal, loose, unstructured and spontaneous mechanisms.
However, marketing for SMEs can be relatively simple. It is all about building customer relationships and maintaining those relationships.
Marketing can be as simple as tapping into a social network and asking people to help. Small businesses people should not ascribe to the old philosophy that “if I build it the customers will come”.
If people do not know about your business, and what product or services are being offered, not only does the business lose revenue, but the customers also lose out on what could be a useful product or service to them. So with poor marketing, society is actually “worse off” because everyone loses out. SMEs should be able to undertake basic research to help them answer some of the most crucial questions to better understand their markets. Some of these important questions include; what consumer needs are?
How much would they need and when? What is the potential market for the business? These questions would allow the SME players to gauge the reaction of customers to the product, determining the customer needs; developing the product and service to satisfy the needs or wants; developing the processes to reach the customers; determine the methods to distribute the products or service; creating a place for transaction of the product or service with the customers.
It has been noted that marketing functions in SMEs are hindered by poor cash flow, lack of marketing expertise, business size, tactical and strategic customer-led problems, narrow customer base, over-reliance on the owner-manager’s marketing competency, limited resources relating to finance and time and limited impact in the marketplace.
With limited resources added to the day-to-day pressures of the business operations, marketing may seem to be peripheral and an unnecessary luxury in small firms. One of the fundamental weaknesses of the SME business has been the role of the owner-manager in SME marketing as she is seen to be omnipresent in every function of the small firm.
The small business owner-manager is a generalist who has to have a vision of where the business is going and at the same time to take care of the operational details carried out in the firm.
Though this has the potential advantage, it is always dangerous that the owner manager does not always have the experience to do some market intelligence to identify where the trend in the market is going and how the market is perceiving the products that are being produced. On the other hand, owner-managers may define marketing as quite narrowly relating only to selling and promoting, but the actual marketing done may still cover a wide range of marketing practices.
Depending on the size of the business, it may be important to consider acquiring a specialist to assist them to do the marketing work in a professional way.
However, we also note that some SME maybe too small to be able to hire sophisticated skill so it is imperative in this case for the SME owner manager to upgrade their own marketing skills by attending short courses in marketing and reading marketing related magazines and articles and books.
The advantages of proper marketing for SMEs include the following
Improved customer service: SMEs tend to be closer to their customers, allowing them to better understand their needs, tastes and preferences, and thus able to offer better care.
Better access to market information: the market size and proximity to customers allows SMEs to better understand their target audience and be aware of the new changes that arise in the market.
Greater flexibility to adapt to market changes, to have a lean structure: SMEs have the advantage of faster and better adaptation to new needs, tastes and preferences of consumers.
More flexibility to meet needs, tastes and preferences: SMEs also have the advantage of being able to better match the particular requirements of their customers, or make concessions when requested.
Increased capacity for innovation: SMEs have the advantage of being able to innovate constantly, to bring to market new products, services or promotions without running too much risk.
Increased capacity of reaction, due to their simple structures and being less rigid than large companies, SMEs can adapt quickly to market changes, to meet particular needs, or to innovate.
More rapid and timely decisions, due to its simple and low hierarchical structure, SMEs have the ability to make fast and timely decisions ahead of large enterprises, allowing them, in turn, have a greater capacity to react.
Increased ability to correct errors: due to the size of its structure, SMEs have the advantage of correcting their mistakes quickly, for example, are easier to remedy a product that failed, a bad campaign, or a bad choice target audience without incurring huge losses.
Better handling of complaints: SMEs can better meet customer complaints or grievances, for example, the can ensure that a single worker is responsible for making quick work of grievances or complaints from customers without having to consult with several employees.
However, it is also important to highlight the crucial role of market research in coming up with appropriate marketing strategies for the SME business.
Where resources are limited, SMEs can pool resources together if they belong to an SME association or cluster and conduct research as a collective. They can also share risks by engaging institutions such as NGOs which engage in capacity development for SMEs but they can only do this if they are well co-ordinated and organised.
Sanderson Abel is an Economist. He writes in his capacity as Senior Economist for the Bankers Association of Zimbabwe. For your valuable feedback and comments related to this article, he can be contacted on firstname.lastname@example.org or on numbers 04-744686 and 0772463008