Step 1 – Strategy Before Tactics

Small businesses always want to grab the idea of the week. And small business owners are absolutely the worst at this because they’re doing a hundred things.

So the shiny object that makes the most noise this week is now the marketing plan. The thing is, if a business owner gets the strategy part right in marketing, he or she can surround it with just about any set of tactics that are performed and measured consistently. That’s how important the strategy piece is.

There are two very significant components to getting a marketing strategy down for a business: to narrow focus down to an ideal client, and to find some way to clearly differentiate one’s business.

Now those may not sound like earth-shattering ideas, but most businesses don’t think about them as thoroughly as they should.

Part One: Define the Ideal Client

Many small businesses try to be all things to all people and find it hard to really focus or succeed at serving narrowly defined market segments. Small businesses don’t necessarily intend to be all things; it just sort of happens from a lack of focus and a prospect on the phone asking for some help in an area that’s not really the business’ thing.

While it may seem like growth to take on a new customer, if that customer isn’t a good fit, it can actually stunt real growth. In some cases, trying to work with customers who are not ideal clients can lead to such a bad experience for both your business and the customer that you actually create vocal detractors for your business.

Most businesses are best suited to serve a narrowly defined market segment – a sweet spot. This doesn’t mean the sweet spot won’t grow, evolve and change altogether over time, but at any given time there exists a set, ideal client for most businesses.

The trick is to discover what that ideal client looks like in the most specific way possible, and then build an entire marketing strategy around attracting more of these.

For some, an ideal client might simply be a subset of people who can afford what you offer. For others, the ideal client might be comprised of six to eight long-term clients. In the latter, a company is probably better off working with people who are a perfect fit or life may get miserable.

A perfect fit may mean that the customer has the kind of need your company can really help with, but it also might mean the client values your unique approach and treats your staff with the respect the relationship deserves. A multiple red flag client, taken because they said they can pay, will suck the life out of a small business faster than almost any other dynamic.

A less than ideal client can also come in the form of a person with whom a company would love to work, but they just don’t really have the need that matches what the business does best. Think of a good friend or relative who works for an organization that’s not a good fit, or buddy at your golf club who has a company you would like to help, but doesn’t have the resources.

The 5 steps below, applied to a current client base and worked in order, will tell small businesses more about their true ideal client than any marketing class or book ever will.

  1. Find your most profitable clients.
  2. From the above group, identify those that refer.
  3. From that even smaller group, find common demographic characteristics
  4. Take the time now to understand the behavior that makes them ideal.
  5. Draw a fully developed biographical sketch to use as a marketing guide.

Part Two: Differentiate the Business

Small businesses absolutely must find or create, as part of their strategy, a way to differentiate their business from all the other businesses that claim to do the same thing.

This isn’t necessarily a new concept, but it’s one of the hardest to get businesses to actually do. Everyone wants to think what they do is so unique. Unfortunately, in most cases, it’s something that everyone either can or does claim as well.

Here’s a good way to get a sense of this idea. Cut and paste the first paragraph of your top five competitors’ websites, blacking out all references to names, and then pass the document around the office to see if anyone can recognize which company each paragraph belongs to. Chances are, the descriptions will be nearly impossible to tell apart.

One of the most effective bits of research you can conduct to help find what really sets your organization apart is to sit down and interview a handful of your best customers. Ask them these questions:

–  What made you decide to hire us?

–  What’s one thing we do better than others like us?

–  What’s one thing we could do better?

–  Would you refer us or do you refer us?

–  If you would refer us, what would you say?

It’s amazing how quickly core differences come to the surface, directly from the mouth of a satisfied customer. Look for common threads that surface in conversations, then develop a core message that supports those themes. It’s not easy because business owners often want to be like everyone else; they don’t want to be the different kid. Everybody in our industry talks about their services in the same way, so that’s what business owners think they need to do.

Stepping outside the box is essential. It’s actually how businesses charge a premium for their services and products. It’s also one of the hardest things to do.

If your business is receiving phone calls and inquiries, and one of the first questions is, “How much?” there’s a really good chance you’re not differentiating your business.

If prospects can’t tell how the business is different, they’re going to use the one measure that makes sense: price. As many small business owners have discovered, competing on price is not fun. There’s always going to be someone willing to go out of business faster.

What people like most may not sound unique or sexy. It might be the unique products and services, but often it’s a company’s way of delivering an experience. It’s the people, guarantees, packaging, brand promotion, and special touches. It is how the company positions its business to solve a problem that everybody in the industry is having. That’s what people buy.

Step 2: The Marketing Hourglass >>