Why will SMEs move away from conventional marketing?
The Internet has brought about many changes in the last 5-10 years and none more so than Google’s introduction of AdWords and AdSense. These new concepts were important because they suddenly introduced a way to easily and effectively monetize the Internet. The principles established by these techniques of revenue from vendor advertising and product referral commissions have spawned an entire industry called Internet Marketing.
The internet marketing industry is still in its infancy, however it has matured well beyond the cataclysmic events of the dot com bubble and has revealed an exciting new method for many businesses to promote their products and services. Why SMEs will move away from conventional marketing techniques. Well, first let’s look at some of the more traditional methods used by SMEs around the world today.
1. Postal mail. Mailing has been around for decades and has formed the backbone of any business looking for new customers. There is no doubt that a concise, well-targeted list of potential buyers with a good following will inevitably lead to sales, as long as the product is good, the cost is fair, and the support/backup etc. everything is in place. But there are many variables, and in most cases the volume is too large, there is no follow-up or feedback on whether the information actually reached the person it was intended for. In short, there are no guarantees and making a second run costs the same again. Add this to the fact that people are fed up with emails and flyers, the process is now very tired and outdated.
2. Telemarketing. This spawned out of the double glazing industry, then timeshare and now even banks are doing it with insurance schemes and the like. This is a pretty hated practice, not just by the people receiving the phone call, but also by the people actually doing the work. Persistence in this form of marketing pays off. But it works best where there is repeat business or long tail services. Its biggest drawback is the cost. Callers need to understand the product or service, it takes time to get trained and get up and running, and there is a need for endless list management and reporting. Still, it’s beyond the budget of most small businesses.
3. Announcements. These really fit into two types, the first is the local ad. in a local newspaper, the second is national advertising or in magazines for enthusiasts of one niche or another. This form of advertising is quite unpredictable and is best done (as any advertising sales rep will tell you) over a fairly long period of time. Running two ads is unlikely to return anything, running the same ad. 12 weeks or months is likely to work much better. Ads can be for lead generation or brand awareness and what you get as sales from this type of advertising can be incredibly variable. There are stories of zero sales with huge budgets and great sales with relatively low budgets. It is ignorance, the lack of guarantees, that makes this type of advertising high risk. It has two other major drawbacks, it’s very expensive and when the campaign is over it stops, unless you repeat the process nothing more is likely to come of the effort.
4. Email. It seems strange to talk about sending email as a traditional method of marketing, but it has been around for more than 20 years in the workplace. Let’s face it, we’re all tired of getting the SPAM rant that comes our way on a daily basis, AND the costs associated with trying to ensure none of this crap gets through. God knows how much money has been spent on controlling this sector of the email industry, but surely billions of dollars. The problem now is that the email is so heavily protected that it is likely to get through unless you have spoken to or contacted the recipient first. If you try, your email may be classified as SPAM and you may be prosecuted. Unsolicited email is now a big NO-NO.
5. Cold calling. These words frighten the most inveterate salesperson. It’s not fun, it’s not profitable and the results are very low. If SMEs were to rely on this marketing method, it would certainly be a lean crop.
6. Network Groups/Breakfast Clubs. The rise of this type of network has been surprising in recent years. With fairly low costs and access to local businesses willing to share contacts and their networks, business has certainly been generated. The problem with this is that it is time dependent and based on individual style.
In short, the options available to an SME for generating new leads are not mind-bogglingly wonderful. As Henry Ford once said, “I know half my ad budget is wasted, the only problem is I don’t know which half.” Roadside vendors aren’t the holy grail either. Sure, working a specific patch with local knowledge can work wonders for some businesses, but for an SME, a salesperson can cost £3,000-5,000 in recruitment fees, have a salary of £30,000 or £40,000, a car, a mobile, a laptop And there is no guarantee that they will work well either!!! Add all this up, one vendor could easily cost £4K per month
Let’s take a look at internet marketing. So, first of all, what is internet marketing?:-Internet marketing is the union of many web-based services into a cohesive strategy that optimizes sales by increasing your visibility on the internet and driving traffic. web to your media-rich web content / blogs, automating the sales process and integrating with social media and bookmarking technologies. Sales can only be made if visitors can find your content. Internet marketing is firstly the part that sits among your content (website/blog) and allows potential visitors to find it and secondly the part that encourages them to buy from you once they have. found. Internet marketing is made up of the common elements shown below:
Search engine optimization (keywords, link building, page building, image optimization)
Regular updates (Blogging)
Publication of articles
Social media
Writing, Audio and Video (Sales Pages)
Pipeline Management (Autoresponders)
What are the advantages of internet marketing over conventional marketing techniques?
1. Low cost compared to other conventional forms of marketing
2. Prospects find you in the market, there are no aggressive or inappropriate approaches
3. Customers rate themselves on/off
4. Suspect/prospect lists are created automatically
5. Customers can be anywhere in the world (only applicable if electronic or specific industry types)
6. The sales process can be fully automated without human intervention once set up. Autoresponders offer prospects free news/products and the opportunity to buy something automatically.
7. Any time or effort spent today is accumulated and combined with the effort of tomorrow, unlike conventional marketing where a repetition costs the same again.
8. The Internet sells our products and services 24 hours a day, 7 days a week, whether we are there or not.
9. Internet users do not get sick, do not go on vacation, do not have disputes, do not demand a car, mobile phone or large salaries
10. Once established, internet marketing can become a 1 hour a day activity and it just continues to build and build on what has been done before.
11. Each person on the list is considered to be worth $1 per calendar month. A list of 12,000 people will equal a profit of $12,000 per month.
Internet marketing is more appropriate for today’s market. 100 years ago if you wanted to buy something you went to the market where people sold things. The advent of television, magazines and the media allowed companies to foist products on us, ‘see something enough times you’ll end up buying it’. Now, with the internet, the rules have been reversed and the customer is in charge. Today’s shoppers search for what they want using Internet search engines and then an increasing number are shopping online. Clearly from the above it is not hard to see why internet marketing will quickly become the main vehicle for SMEs to represent their products and services in the next 2-3 years. Of course, some types of industries do not lend themselves to all facets of Internet marketing, for example, when a physical product must be delivered; however, there are still many components that are highly relevant and will work for almost any SMB company.