Small Firms Can Survive Squeeze By Revamping Marketing
By JEFF BAILEY
Staff Reporter of THE WALL STREET JOURNAL
Sales and marketing is more art than science, and it's a particularly
difficult art in this tough economy .
For most of the 1990s, many products and services seemed to
sell themselves, as a booming economy and technological advances
made big spenders of both consumers and businesses. And as that
happened, many sales and marketing organizations grew flabby
and became less focused.
Familiar tips on selling and marketing, of course, are as numerous
as those on improving your golf swing. And certainly there is
no one-size-fits-all solution to sales problems. So, what follows
is an unscientific -- and at times contradictory -- sampling
of recommendations from sales and marketing experts at some
smaller companies -- companies successful enough, at least,
to still be in business. And if just one of these suggestions
helps your business sell and market itself better, then mission
Measure your results. Any sales or marketing program
requires an investment -- salaries and office space and phone
lines, advertising purchases, postage and printing and renting
of mailing lists for direct mail, supplies and travel expenses
for conventions and meetings. Those investments should provide
a measurable return, expressed in a ratio such as dollars spent
per sales lead generated.
"If you can't measure it, don't do it," says Ken
Kornbluh, chief executive officer of MarketingPilot Software
LLC, in Evanston, Ill. Mr. Kornbluh sells software that, not
surprising, helps companies organize, track and measure results
from marketing campaigns. At a previous company he ran, he had
found that traditional spreadsheet software wasn't enough for
him to keep track of -- and allow easy comparison of results
among -- such things as magazine advertising, e-mail campaigns,
direct mail and trade-show exhibits.
As Mr. Kornbluh's marketing efforts increased at the previous
firm, his ability to compare their results decreased, and that
slowed things down. So, he developed software to handle the
job, and that's what MarketingPilot sells.
For MarketingPilot, measuring its results has shown that its
money is best spent buying prominent places on search engines
such as Google, so that when an entrepreneur types in marketing
software, for instance, a link to MarketingPilot pops up. "That's
the most effective stuff for us," Mr. Kornbluh says.
He adds: "Rank effectiveness of the things you do. Lop
off the worst ones. Do a little more of the best ones."
Building a brand is different from closing a sale.
The Breakers, the 107-year-old luxury resort in Palm Beach,
Fla., since a mid-1990s $145 million renovation, spent heavily
on television, radio and magazine advertising, and often didn't
see big immediate sales gains from the efforts.
"If the results aren't what we were hoping for, it doesn't
mean [the marketing effort] wasn't successful," says John
Bradway, director of strategic marketing for the resort. "Sometimes
people come one, two, three years later.
" In repositioning itself from a "stuffy, old-world"
hotel to "a casually sophisticated resort," Mr. Bradway
says, The Breakers was spending on image building, not just
trying to fill up the rooms on a short-term basis.
In marketing your firm, you need to decide whether broad-based
brand awareness is a goal, as at The Breakers, or whether you're
merely looking for that next sale, as at MarketingPilot.
Think narrow. Nova Southeastern University, in Fort
Lauderdale, Fla., which has a graduate school of education with
an enrollment of more than 10,000 students, many studying online,
used to send out about one million pieces of direct mail a year.
Most of it was very general literature sent to people on broad-based
lists of education professionals.
And the response rates weren't as good as Nova would have liked,
says Brian Croswhite, the education school's director of marketing.
In the past three years, however, the school has slashed the
mailings by one-third and made them much more targeted. "We're
mailing the math teachers -- not all teachers," with literature
geared toward math education, Mr. Croswhite says. The school
spends more to assemble lists. But its response rates -- and
overall return on its marketing investment -- are up.
The Web development firm duoDesign LLC, Chicago, also improved
marketing results by narrowing its message, says Michael Silverman,
chief executive officer. Rather than buy space on a search engine
responding to a broad and crowded category such as Web design,
he now buys space for such narrower terms as law firm Web design
and offers services tailored to such firms.
Rather than impress potential customers with the breadth of
your product offering, offer to solve their particular problem.
You're not too small. Marc Goldberg, founder of Marketech
Inc., in Westborough, Mass., advises smaller firms on exhibiting
at trade shows and other events. And he exhibits his own tiny
firm at such gatherings three times a year, spending roughly
$10,000 per event.
"I don't think you're ever too small," Mr. Goldberg
says. "You reach a very focused audience, people you otherwise
wouldn't meet. They come to buy."
He rents a 10-foot-square stall and each year buys a banner
that absolutely must explain, he says, "who you are, what
you do, what your offer is." Mr. Goldberg says he expects
at least $50,000 in sales the year following a show he spends
$10,000 on, directly linked to the show.