Finding new customers - a big challenge before SMEs

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Shubhajit Chakraborty | 22 Mar, 2011
In the recent years, small and medium enterprises (SMEs) have been grown exponentially, and analysts estimate that it would become the major impetus for economic growth in the developing countries. However, there is still a bleak picture, which shows the ineffectiveness of business growth of SME businesses because of lack of penetrating marketing strategies. In a study it shows 43% of 1,700 SME owners say their biggest challenges in their business is finding new customers.

Probably the biggest hurdle the SME sector is facing is that owners and self-employed professionals starting or revolving around their passion with a little knowledge or rather less intention to do a planned promotion, effective marketing strategy and to ramify businesses in diversified horizons. They are quite self contented about the present growth and has no aspiration of becoming the marketing expert that is required of them to effectively market their business! Yet, the fact remains that, 80% of success in Small and Medium Business Enterprises depends on being able to effectively market the thing one does.

Before jumping into any flight of fancy marketing layout, SME owners keep one thing clear in their minds that there is an ocean of difference between the needs of their businesses and the larger ones. The popular marketing courses cite Fortune 500 companies as exemplary case studies. This evidently overlooks the practicality that the smaller companies simply do not have the resources to involve in advertising campaigns on a par with, say, Coke or McDonalds. The bigger brands promote their products through expensive marketing vehicles including television, radio, prime billboards, etc. Undoubtedly, these marketing promotions present a better expansion. Nevertheless, these strategies should be seen as an ideal rather what's practical for SMEs. In a nutshell, marketing framework for SMEs is different, and the key to successes is not by depending on the "brute force" of an extravagant marketing budget, but, instead, relying on the "gentle force" of an extraordinary and vivid imagination.

So what will be an effective marketing strategy for a smaller and medium size company?

1. Fix your goal: First and foremost is to make a clear vision and identify your goals. Increasing sales and mind shares have different approaches, so first fix your goal and work on that.

2. Know your market: The small fishes can't survive in the big ocean, therefore, small businesses have to clearly define their audiences and focus limited resources on reaching them. The most significant of all is extensive research and next review of budgets. Audience size is the next important aspect, as you have to consider the fact that is your target large enough to sustain your business?

3. Resource Review: You need to audit your resource pool so as to not only go further towards your identified plan of action, but also understand the increasing demand that will follow.

4. Form Follows Function: The product promotion does not mean beautiful poster or a nice looking website with extraordinarily rich content. Rather you must reinforce your company image and effectively communicate your messages in a simplest form. For achieving online objectives, you have to look after functionality, navigation and content that's required on your website.

5. Implement: Pro-active marketing plan is significant for creating awareness and display your messages in a more efficient ways. Remember to reserve funds for implementing marketing activities. Hiring a marketing consultant who can carefully orchestrated campaign for both online and off line.

6. Keep existing clients: A new client can be acquired at the cost seven to ten times more than that of developing the potential of an existing customer. SMEs would be more cost effective to retain the existing clients rather than searching for new ones.

Most SME make a grave mistake of being a constant marketing mode of trying to capture the mass rather to improvise the needs existing clients.

"If you want to play the mass, lead by products and prices only- but only when you have many advantages over your competition; and often, this is where the giants and Walmarts of this world excels." Says marketing analysts Ms. Blanchette.

Undoubtedly, marketing strategies give strong impulse to promote small and medium enterprises, but for a start, a steady client centric approach is better than a product-centric approach for small companies.