Chapter ppt_09.pptx

Section 3:
Launching the Business
Copyright © 2019, 2016, 2014 Pearson Education, Inc. All Rights Reserved

Copyright © 2019, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Essentials of Entrepreneurship and Small
Business Management
Ninth Edition
Chapter 9
Building a Powerful
Bootstrap Marketing Plan

Learning Objectives (1 of 2)
1. Describe the principles of building a bootstrap marketing
plan, and explain the benefits of preparing one.
2. Explain how small businesses can pinpoint their target
markets.

Learning Objectives (2 of 2)
3. Discuss the role of market research in building a
bootstrap marketing plan and outline the market research
process.
4. Describe how a small business can build a competitive
edge in the marketplace using bootstrap marketing
strategies.

Building a Bootstrap Marketing Plan (1 of 2)
• Marketing:
– The process of creating and delivering desired goods
and services to customers.
– Involves all of the activities associated with winning
and retaining loyal customers.
• A solid business plan needs to contain both a financial plan
and a marketing plan.

Building a Bootstrap Marketing Plan (2 of 2)
• Bootstrap Marketing Strategies:
– Are unconventional, low-cost, and creative marketing
techniques that allow a small company to realize a
greater return from its marketing investment than do
larger rivals.
– Do not require large amounts of money to be effective
– just creativity.

A Bootstrap Marketing Plan: Three
Objectives
1. Pinpoint the specific target markets the company will
serve.
2. Determine customer needs and wants through market
research.
3. Analyze a firm’s competitive advantages and create a
marketing strategy to communicate its value proposition
to the target market.

Pinpointing the Target Market (1 of 3)
• Target Market: the specific group of customers at whom
the company aims its products or services.
– Marketing strategy must be built on a clear definition of
a company’s target customers.
– Example: BlackRapid

• Target customer must permeate the entire business –
merchandise sold, background music, layout, décor, and
other features.
• Without a clear image of its target market, a small
company tries to reach almost everyone and ends up
appealing to few.

Figure 9.1 U.S. Population by Race, 2020, 2040, and 2060
Source: Based on data from the U.S. Census Bureau.

Market Research
• Determining customer needs:
– Demographics: the study of important population
characteristics, such as age, income, race, and
education.
– Market Research: the vehicle for gathering the
information that serves as the foundation for the
marketing plan.
 Never assume that a market exists for your
company’s product or service; prove it!
– Market research does not have to be time consuming,
complex, or expensive to be useful.
 Online surveys, social media, etc.

How to Conduct Market Research
1. Define the objective.
2. Collect the data.
– Individualized (one-to-one) marketing
 Primary research
 Secondary research
– Data mining
3. Analyze and interpret the data.
4. Draw conclusions and act.

Building a Competitive Edge (1 of 10)
• Bootstrap marketing principles:
– Find a niche and fill it.
– Use the power of publicity.
– Don’t just sell; entertain!
– Strive to be unique.
– Build a community with customers.
– Connect with customers on an emotional level.
 Build trust.
 Define a unique selling proposition (USP).

Unique Selling Proposition
• A key customer benefit of a product or service that sets it
apart from its competition.
– Answers key customer question: “What’s in it for me?”
– Consider intangible or psychological benefits as well as
tangible ones.
– Communicate your USP to your customers often.

• Create an identity for your business through branding.
– Branding: communicating a USP to the target market
in a consistent and integrated manner.

Branding and a USP
Figure 9.2 The Connection Between Branding and a USP
Source: Based on Brand-Savvy, Highlands Ranch, Colorado.

– Branding
• Embrace social marketing.

Embrace Social Marketing
• Social networks sites, such as Facebook, LinkedIn, and
Twitter, allow entrepreneurs to connect with potential and
existing customers at little or no cost.
• 96% of entrepreneurs use social media to connect with
existing and potential customers.

Social Media Entrepreneurs Use
Figure 9.3 Social Media Entrepreneurs Use as Marketing
Tools
Source: Based on Michael Stelzner, “2016 Social Media Marketing Industry Report,” Social Media
Examiner, May 2016, p. 23.

Benefits of Social Media Marketing
Figure 9.4 Benefits of Social Media Marketing
Source: Based on Michael Stelzner, “2016 Social Media Marketing Industry Report,” Social Media
Examiner, May 2016, p. 17.

– Branding
– Start a blog.
 37% of companies use blogs as part of their
marketing strategies.
 Economical and effective online communication.

Blog Guidelines
• Develop a clear purpose for your blog.
• Position the blog with other blogs that already exist.
• Focus on key words.
• Cultivate the image of an expert or trusted friend.
• Be patient.
• Be honest, balanced, and interesting.
• Ask customers for feedback.
• Use services such as Google Alerts.
• Be cautious.
• Promote the blog via social media and e-mail.

– Branding
– Start a blog.
– Create online videos.
– Host a special event.

– Branding
• Be dedicated to service and customer satisfaction.

Focus on Customer Satisfaction
• 79% of unhappy customers tell others about their
experiences.
– 48% of shoppers say they won’t patronize stores where
they know others have had negative experiences.
– For every complaint a company receives,17 other
complaints go unspoken.
– Disgruntled customers often post their experiences
online.
• Address comments and complaints!

Addressing Comments and Complaints
• Humanize your responses.
• Respond quickly.
• Respond publicly.
• Avoid a defensive tone when confronted with negative
comments.
• Set up alerts.
• Create a database of complaints and suggestions.

Achieving Stellar Customer Service and
Satisfaction (1 of 2)
• Listen to customers.
• Define customer service expectations.
• Set standards and measure performance.
• Examine your company’s service cycle.
• See customer complaints as a mechanism for improving
customer service.
• When you create a negative customer experience,
apologize and fis it – fast.
• Hire the right employees.

Achieving Stellar Customer Service and
Satisfaction (2 of 2)
• Train employees to deliver superior service.
• Empower employees to offer superior service.
• Treat employees with respect and demonstrate to them
how valuable they are.
• Use technology to provide improved service.
• Reward superior service.
• Get op managers’ support.
• Give customers an unexpected surprise.
• View customer service as an investment, not an expense.

– Branding
• Retain existing customers.
– Customer experience management

Retain Existing Customers (1 of 2)
• About 20% of a typical company’s customers account for
about 80% of its sales.
– Focusing resources on keeping the best (and most
profitable) customers is a better investment than
chasing “fair-weather” customers who will defect to any
better deal that comes along.
• One way that companies can entice current customers to
keep coming back is with a loyalty program, which many
companies are linking to their social media presence.

Retain Existing Customers (2 of 2)
• Companies that are successful at retaining their customers
constantly ask themselves:
– What are we doing right?
– How can we do that even better?
– What have we done wrong?
– What can we do in the future?

– Branding
– Customer experience management
• Be devoted to quality.
– Total quality management (TQM)

Devotion to Quality
• World-class companies treat quality as a strategic
objective, an integral part of company culture.
• Total Quality Management (TQM):
– Quality in the product or service itself.
– Quality in every aspect of the business and its
relationship with the customer.
– Continuous improvement in quality.
• Get it right the first time!

• Attend to convenience.
– Make it easy to do business with you.

Make it Easy to do Business (1 of 2)
• Questions to ask:
– Is your business conveniently located near customers?
– Are your business hours suitable to your customers?
– Would customers appreciate pickup and delivery
services?
– Do you make it easy for customers to buy on credit or
with credit cards?
– Do your employees treat customers with courtesy?

Make it Easy to do Business (2 of 2)
• Are your employees trained to handle business
transactions quickly, efficiently, and politely?
• Does your company offer “extras” that would make
customers’ lives easier?
• Can you bundle existing products to make it easier for
customers to use them?
• Can you adapt existing products to make them more
convenient for customers?
• Does your company handle telephone calls quickly and
efficiently?

• Attend to convenience.
• Concentrate on innovation.
• Emphasize speed.

Emphasis on Speed (1 of 3)
• Use principles of time compression management (TCM):
– Speed new products to market.
– Shorten customer response time in manufacturing and
delivery.
– Reduce the administrative time required to fill an order.

• Re-engineer the process rather than try to do the same
thing – only faster.
• Create cross-functional teams of workers and empower
them to attack and solve problems.
• Set aggressive goals for production and stick to the
schedule.

• Rethink the supply chain.
• Instill speed in the company culture.
• Use technology to find shortcuts wherever possible.
• Put the Internet to work for you.

Conclusion
• You don’t need a large marketing budget to successfully
reach your customers!
• Use clever, innovative bootstrap marketing strategies to
put your company in the spotlight and make a special
connection with your customers.

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