by admin | Jan 7, 2011 | Blog
A 2008 PwC survey “Private Business Barometer IV” paints a depressing yet realistic picture of the Australian small business state of play – about 92% considered cutting their marketing budget. Gregory Will, partner at PwC, rightly points out that these are the very areas that are the source of most small businesses’ competitive advantage. 3 years on and nothing much has changed!
The reality seems to be that we’ve gone from riding on a sheep’s back to acting like them at a time when we need leaders not followers!
You can call farmers “battlers”, but not the majority of SME business owners – their droughts are mostly self inflicted. The following is a statistic I found on the CPA Australia website – 3 years ago – and it estimated that one in three new small businesses in Australia fail in their first year of operation, 2 out of 4 by the end of the second year, and 3 out of 4 by the fifth year, with only approximately 8% of small businesses succeeding beyond five years.
Failure to plan is a plan for failure
Conducting a business without a formalised plan is much like trying to drive a car to an unknown destination without a map. Yet the estimates are that only 3% to 5% of Australian small businesses starting from scratch prepare a business and marketing plan; that is, know that their business is feasible and have a formal plan to steer that business towards success. Based on the fact that a Feasibility Study, a SWOT Analysis and a Marketing Plan are a part of any Business Plan, I suggest that approximately 70% of all business failures and almost 100% of lack of business growth are due to inadequate Marketing.
Peter Drucker, the grandfather of modern management said business is about 2 things and 2 things only – innovation and marketing! A number of studies conducted since WWII showed something that marketers have known all along – keep marketing through the downturn. The following quote is from Professional Marketing, Oct-Dec 2008 – article titled “All Hands On Deck”: “…companies that increased marketing spend (relative to market size) during a recession, increased their return on capital employed by 5% in the recovery, compared to a 1% decline for the budget cutters”
Most businesses are either ignorant or choose to ignore the empirical evidence for maintaining or even increasing marketing investment in a weak economy
– Competitors tend to cut spending, creating opportunities
– Maintaining promotional spend will sustain or even grow market share
– Stealing share of mind is a bargain during a recession
– Consumers don’t “go away” during a recession, they become more conservative
For most SME’s marketing is an expense and not an investment.
Most SME business owners do not understand the meaning of marketing or branding let alone have any basic understanding of advertising principles to effectively and efficiently reach their target audience. Much of the SME marketing efforts are wasted anyway – just open your local paper, look into your mailbox and see the standard or the lack of it in SME marketing communication. Only a few weeks ago the ABS released a frightening statistic that 66% of Australian businesses do not have a website!
Attitudes have to change
“Ego and advanced ignorance have killed many a business, and continue to do so. …ignorance is acceptable because it means we don’t know. Advanced ignorance, however, is ‘knowing we don’t know’ and doing nothing about it! It’s deadly….there’s information readily available on every conceivable issue relevant to growing a healthier business, but it’s far easier not to seek anything at all.” Says Brett Lowe of Business Planning Works.
There are businesses still around today, that perceive customer service to be a “Thank You” on the invoice
A study of 460 B2B organizations that employed 100+ people, conducted by Strike Force Sales, found that only 6% of Australian companies pick up the phone and respond to a web generated sales inquiry with a phone call. The MD of the company, Chris Moriarty brings this reality home with another statistic that shows 46% of the time auto-response emails are never followed up.
In the last 5 years, I have met hundreds of SME proprietors and completed over 70 SME marketing projects. I have discussed the SME challenges with colleagues and other consulting professionals and have to say that there are glimmers of hope. These generally lie with the younger more entrepreneurial SME business owners who have grown up on the ‘brand rich media diet’.
There is plenty of professional help out there, admitting you need it, is the hard part…
by admin | Jan 7, 2011 | Blog, Promotion
A 2008 PwC survey, “Private Business Barometer IV” paints a depressing yet realistic picture of the Australian small business state of play – about 92% considered cutting their marketing budget. Gregory Will, partner at PwC, rightly points out that these are the very areas that are the source of most small businesses’ competitive advantage. 3 years on and nothing much has changed!
The reality seems to be that we’ve gone from riding on a sheep’s back to acting like them at a time when we need leaders, not followers!
You can call farmers “battlers”, but not the majority of SME business owners – their droughts are mostly self inflicted. The following is a statistic I found on the CPA Australia website – 3 years ago – and it estimated that one in three new small businesses in Australia fail in their first year of operation, 2 out of 4 by the end of the second year, and 3 out of 4 by the fifth year, with only approximately 8% of small businesses succeeding beyond five years.
Failure to plan is a plan for failure
Conducting a business without a formalised plan is much like trying to drive a car to an unknown destination without a map. Yet the estimates are that only 3% to 5% of Australian small businesses starting from scratch prepare a business and marketing plan; that is, know that their business is feasible and have a formal plan to steer that business towards success. Based on the fact that a Feasibility Study, a SWOT Analysis and a Marketing Plan are a part of any Business Plan, I suggest that approximately 70% of all business failures and almost 100% of lack of business growth are due to inadequate Marketing.
Peter Drucker, the grandfather of modern management said business is about 2 things and 2 things only – innovation and marketing! A number of studies conducted since WWII showed something that marketers have known all along – keep marketing through the downturn. The following quote is from Professional Marketing, Oct-Dec 2008 – article titled “All Hands On Deck”: “…companies that increased marketing spend (relative to market size) during a recession, increased their return on capital employed by 5% in the recovery, compared to a 1% decline for the budget cutters”
Most businesses are either ignorant or choose to ignore the empirical evidence for maintaining or even increasing marketing investment in a weak economy
– Competitors tend to cut spending, creating opportunities
– Maintaining promotional spend will sustain or even grow market share
– Stealing share of mind is a bargain during a recession
– Consumers don’t “go away” during a recession, they become more conservative
For most SME’s marketing is an expense and not an investment.
Most SME business owners do not understand the meaning of marketing or branding let alone have any basic understanding of advertising principles to effectively and efficiently reach their target audience. Much of the SME marketing efforts are wasted anyway – just open your local paper, look into your mailbox and see the standard or the lack of it in SME marketing communication. Only a few weeks ago the ABS released a frightening statistic that 66% of Australian businesses do not have a website!
Attitudes have to change
“Ego and advanced ignorance have killed many a business, and continue to do so. …ignorance is acceptable because it means we don’t know. Advanced ignorance, however, is ‘knowing we don’t know’ and doing nothing about it! It’s deadly….there’s information readily available on every conceivable issue relevant to growing a healthier business, but it’s far easier not to seek anything at all.” Says Brett Lowe of Business Planning Works.
There are businesses still around today, that perceive customer service to be a “Thank You” on the invoice
A study of 460 B2B organizations that employed 100+ people, conducted by Strike Force Sales, found that only 6% of Australian companies pick up the phone and respond to a web generated sales inquiry with a phone call. The MD of the company, Chris Moriarty brings this reality home with another statistic that shows 46% of the time auto-response emails are never followed up.
In the last 5 years, I have met hundreds of SME proprietors and completed over 70 SME marketing projects. I have discussed the SME challenges with colleagues and other consulting professionals and have to say that there are glimmers of hope. These generally lie with the younger more entrepreneurial SME business owners who have grown up on the ‘brand rich media diet’.
There is plenty of professional help out there, admitting you need it, is the hard part…
I’ve discovered that there are three reasons why business leaders don’t initiate a growth strategy:
Self Delusion – It’s just a temporary downturn. My business is doing ok.
Procrastination – I’m going to get to that growth strategy next month because this month is really busy.
Reality – To tell the truth, I don’t know how to create a growth strategy.
Read more
by admin | Jan 6, 2011 | Blog
Getting Your Brand Out There – Business Essentials Interview
Interview with Business Essentials covering questions about branding:
- Why Branding is the most misunderstood concept in business?
- Why Branding is critical to Small and Medium Enterprise (SME) success?
- Does Branding add to the Bottom Line?
- Difference between internal and external branding.
- The importance of developing your point of difference.
- Why it goes wrong more often than right?
- Have the principles of branding changed over the years?
Download Interview
by admin | Jan 6, 2011 | Blog, Strategy
I’ve discovered that there are three reasons why business leaders don’t initiate a growth strategy:
Self Delusion – It’s just a temporary downturn. My business is doing ok.
Procrastination – I’m going to get to that growth strategy next month because this month is really busy.
Reality – To tell the truth, I don’t know how to create a growth strategy.
Robert Bloom, ex Chairman Publicis Worldwide, Author “The Inside Advantage: The Strategy That Unlocks the Hidden Growth In Your Business”
In order to be irreplaceable one must always be different
Read more
Business is about two things and two things only; marketing and innovation
Read more
by admin | Jan 6, 2011 | Blog
Once upon a time, in a land not so far away, services firms wanted more customers.
Without time or skills they wasted money on websites, collateral, and marketing in general, actually repelling prospects and making sales people’s jobs harder.
Like sand in an hourglass, opportunities passed. One day they found the lost wisdom of Peter Drucker, who said: “business is about two things and two things only; marketing and innovation”, but marketing and selling were becoming increasingly complex due to media fragmentation, increased competition and clients with A.D.D.
Copywriters, designers, SEO experts were engaged, budgets spent, yet they still weren’t getting results. They were missing out on “big picture” strategy and creative. Well meaning specialists lived in silos without the necessary skills to teach them that their brand was their biggest asset; not a logo, or their look and feel. They heard of Coco Chanel who coined a phrase “In order to be irreplaceable one must always be different”, and learned that their brand was what their customers thought, felt and said about them and this made sense.
Told to go to a “professional” advertising agency to develop their brand, they heard that awareness is key, from the Account Director who walked out the door to attend a long lunch with blue chip clients, never to be heard from again. Serviced by juniors who had little experience but a great desire to work on a more glamorous account, our heroes, from I.T., HR, accounting and law, to name a few, were still busy and stressed, and now confused by the jargon used to “impress” them. Meetings with pretty young things, free tickets to events, cool parties came and went.
When they took charge of their own brand and understood the basic principles of branding, they discovered what made them truly unique, learned how to communicate effectively and within 6 months had increased sales. They focused on what they did best and made their customers happy, increasing their profits and enjoying life. But that’s the end of the story and we are only at the beginning…
by admin | Jan 6, 2011 | Blog
In order to be irreplaceable one must always be different
Coco Chanel
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