Marketing is crucial to small businesses. You might have the best product or service in the world, but it won’t matter if no one knows about it.
It’s not just about spending money. It’s about knowing how and where to spend your money—and how to take advantage of free marketing opportunities, some of which can be more helpful and reliable than paid advertising.
It’s easy to confuse marketing with advertising, but they’re not exactly the same. Advertising is getting the word out: promoting what you’re selling, usually through paid channels. Marketing involves identifying a specific audience and either tailoring what you’re selling to them or targeting them with the right message.
Advertising can be, and often is, a part of this process, but it doesn’t have to be. It’s a component of marketing; but if it’s the only one, then you may be throwing money down the drain without knowing it.
3 Effective retail marketing strategies
Choose the right physical location
Marketing involves positioning yourself to sell. If you’re trying to sell in a physical space, then it can be as simple as choosing the right spot where there’s heavy foot traffic in an area your product is likely to draw interest.
Selling skis in a beach town probably isn’t a good idea (unless they’re water skis). However, a coffeehouse/bookstore near a university campus just might be.
Of course, prime locations are bound to cost more in terms of rent, so you’ll need to crunch some numbers before you sign a long-term lease. One important factor is safety: customers want to feel safe when they shop. So, if you rent a cheap space in a high-crime area, then don’t count on a lot of clients making the trip. Another downside is that you might be a crime victim yourself.
And physical location isn’t just about where your retail outlet is; it’s also about how you have it arranged. You’ll want to choose the best store layout for customer flow in order to keep them engaged and looking for more than just what they came into the store to look at or buy.
Be easy to find online
Your online presence is just as important as your physical location. In fact, many retailers don’t even have a physical location; some businesses that used to have brick-and-mortar shops have transitioned to being fully online. Remember Montgomery Ward? Its stores no longer exist, but the brand still does at Wards.com.
Today’s digital marketing world is a complex one, relying on strategies like search engine optimization (SEO) to boost visibility on Google. However, even though 93% of all purchases occur via search engines, only 49% of small businesses invest in SEO, according to a survey by The Manifest. And only 21% of small businesses build links that lead back to their websites.
Instead, many business owners rely on web-based ads, even though 70% to 80% of Internet users ignore paid ads online. Of course, there are large numbers of SEO marketers selling their services, so it’s vital to do your research before signing up with one.
Meanwhile, it’s important to engage in strong content marketing by creating and distributing content geared toward your target audience of existing and potential customers. Give them the breadcrumbs to follow right back to your products and services.
Market to current customers
Marketing is all about building your customer base, right? Wrong.
Marketing is about targeting the people most likely to buy your products, and using that process to build sales. And the people most likely to buy your products are those who already have. That may not help much when you’re just starting out, but once you get the ball rolling, it’s important to focus more of your attention on retaining customers and selling more to the ones you’ve got.
Who buys Stephen King books? Sure, he’s got a name—a personal brand—that sells to the curious, but many readers buy his latest novel based on their familiarity with his work. People buy their coffee at Starbucks and their burgers at McDonald’s over and over again because they know what they’ll be getting. That’s customer retention.
Increasing customer retention by just 5% can boost your profits between 25% and 95%. As well, finding a new customer can cost five times as much as retaining one you’ve already got. That’s a lot more bang for your buck. Retaining customers is the art of keeping them coming back for more.
Strategies like loyalty cards, email rewards, and coupons for secret deals can cement customer loyalty, as can something as simple as quality service and knowing your customers’ specific needs and tastes. Familiarity doesn’t breed contempt, as the saying suggests; it can spawn more business from customers who come to view you as trusted suppliers and even as friends.
Stay tried and true, but switch things up
If you can diversify your product line while maintaining your central focus, then you can maximize sales to existing customers and draw in curious newbies, too.
Your loyal clients will already know that you provide a good product through experience, so they’ll be willing to try something new. Fast food restaurants do this frequently: they’ll introduce a “limited time only” menu item to get people’s attention.
Customers who’ve come in before, but may have fallen out of the habit, get a reminder thanks to the incentive that there’s something new to try, while others who’ve never tried your product may be curious enough to give it a shot.
However, you’ll also notice that many of these “new” items are variations on what’s already on the menu. This is why it’s important to keep your focus. A restaurant that has built its reputation selling Mexican fast food is probably better off staying in its wheelhouse by serving up breakfast burritos than adding ravioli to its menu.
6 ways to fund your marketing
Get a loan
Many small businesses get started by taking out a loan, and there are several from which to choose: small business loans, personal loans, home equity loans, and more. You’ll want to get the best interest rate possible, which means it’s important to have good credit.
Build credit by paying all your bills on time, applying for credit judiciously, and maintaining your credit utilization ratio, which is the amount of money you owe on your credit accounts, divided by your credit limit.
Keeping your credit in good standing also means knowing what’s on your credit report, which is important in an era of increased threats from phishing and fraud. In fact, 34% among a group of 6,000 volunteers found at least one error on their credit reports, and 29% found errors relating to their personal information.
Take Advantage of free services
Small business development centers provide a host of free marketing services. Although the Small Business Administration doesn’t provide grants to start or expand a business, it does offer grants to nonprofits and community organizations that support entrepreneurs through counseling and training.
Other free services you should take advantage of include things like social media. You don’t need to buy ads; human interaction online can produce relationships that lead to word-of-mouth recommendations and referrals, which is still one of the most effective ways to grow your business.
Offer a stake in your company to venture capitalists in exchange for their support. Venture capitalists wouldn’t be loaning you money; they’d be investing in you. However, they’ll also want a piece of the action. If you can convince them that you’ve got a sound business plan that will make them money, then they may be willing to give you funds upfront to get you started.
Raise money through crowdfunding
Crowdfunding is a different kind of investing. Money isn’t offered for a stake in your company, but rather in exchange for a gift of some sort as a thank-you for their contribution. For example, artists might give numbered, autographed prints to someone supporting their gallery; writers might offer limited-edition signed copies of their books.
Bartering is an old-fashioned way of doing business that dates back to the time before currency was invented, but it can still work well today. If you have a skill you can offer to someone who has something you need, the exchange can benefit you both. If you’re in the business of making uniforms, for instance, then you can supply some to a softball team whose coach owns a sign shop; in exchange, they can make a sign for your business.
Pay with cash
Cash on hand is always a good way to pay because you can avoid debt. Cash can give you an advantage, too, because some people you do business with will provide you with discounts for paying cash upfront, and you’ll save money on the interest that can accrue with monthly installments.
Marketing is all about strategy. It’s about using the resources you already have to most effectively maximize your reach and appeal to your target customers. Whether you’re paying with cash or credit, finding investors, or using creative ways to fund your small business, the goal is the same: maximizing your reach and your sales.