Samples Chapters Of:
"How To Market, Advertise And
Promote Your Business Or Service
In A Small Town"

by Tom Egelhoff

Section One: Chapter One

The Small Town Marketing Plan
Getting Started

Now that we know a little about small towns and how they work, from the Small Town 101 section, let's create some marketing strategies for your business.

What is a marketing plan anyway? "I thought I just needed a business plan." A marketing plan is a part of your overall business plan. I usually recommend that 30% of your business plan should be devoted to how you are going to market your business. Your marketing plan is one major area that investment bankers take a real close look at before lending you any money. They are very curious how you will attract customers, make sales, make a profit and pay them back on their investment in your business. We will use some of the information from the business plan in our marketing plan, but the marketing plan is usually its own entity within the business plan. If you don't have a business plan started yet, do that first. S.C.O.R.E. (Service Core of Retired Executives) can offer free help to get you started. Find them at the Chamber of Commerce. Also, check out your local Small Business Development Center.

Once you have your financial statements and projections together you can move on to the marketing plan.

Where do we start? We start with you. You need to sit down and really look at yourself and your business as you never have before. This is the most difficult part of the marketing plan. We never let anyone really see the "real us". You must be completely honest with yourself about who you are and where you're going.

A Little Information Is A Dangerous Thing

Before customers enter into a relationship with a business, they quite naturally, want to know something about that business. That's where a marketing plan starts.

Who Are You? Why would I want to do business with you? In addition, you need to know every aspect of your business before you can prepare your advertising and target your customers. Here's how to start.

If you were looking for a job and saw an ad in the classifieds, what questions would you ask yourself? The first question would probably be- "Am I qualified to do this job based on the job description." If the answer is yes- you put together a resume and request an interview to present your qualifications to your prospective employer.

Business is no different. You need a resume (or complete description) of your business that can be presented to qualified customers (your target market) in the form of an advertising message. This "resume" is sometimes referred to as a business review or background review.

In the next chapter, I'll give you suggestions for a few things that should be included in your business resume.

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Chapter Two:

Step 1: Business Resume

Ask yourself the following questions as though you are a customer of your business.

1.) How long have you been in business? If you're a new business, what experience do you have in this field? As a customer, would I feel comfortable that you can do the job, or provide the level of service I am accustomed to? Are special machines needed in the production of your product? Could importing materials put the company in jeopardy if they weren't available? Will training be required of employees to produce the products? What are the company's -long and short- term goals? Are there existing sales goals? What is your mission statement or company philosophy?

2.) Who are the principles in the business? What qualifies them to start or operate this business? What special skills do they have? What is their education or training in this industry? Are they members of any associations in this industry? Is city or state licensing required for this business, and if so, have they complied with all local regulations?

3.) What purchase rates or buying habits are related to your product or service? Would I buy it once a week, a month, a year? What is the demand for your product or service? Is it seasonal? Is it hard to use? Are there multiple users? Are there going to be heavy users of your product? What percentage of your total sales will they be? Is your basic industry growing or shrinking? Is the customers base in your city or county growing or shrinking? Is your product a luxury or a necessity?

4.) What about awareness and attitude about your product or service? Does your product harm the environment in some way? Is it fun or useful? Is your product well known or will the public need to be educated about how to use it? Are you the next Hula Hoop or Pet Rock?

5.) Most businesses have some form of about yours? Who is your principle competition? (Ask all the questions in #2 above about the competition.) How big are they? What can you do that they can't do? Can you specialize in areas they can't? If you are competing against a large public company (i.e. Wal-Mart, Costco, etc.) buy some of their stock. You'll receive their annual report, and as a stockholder, a lot of information will be available to you. Warning: Do not skimp or gloss over this business resume section. It will be very valuable later on when we deal with positioning your business.

6.) How's your pricing compared to the competition? Can you be competitive or are you going to have to ask a higher price? Is the lowest price always the best? Of course not. Customers place a value on products based on their perceptions of that product. They base those perceptions on the information they get from you and other sources and comparisons. If I said, CD player, a dollar figure jumps into your head based on advertising you've seen or input from friends or any of 100 different sources.

7.) You can't have a business without customers. You must identify your target market. Who are the people most likely to use your business? Their age? Sex? (Most books refer to this as gender... Gender is language, not is people...look it up). Occupation? Martial Status? Home Ownership? TV shows they watch? Newspapers and magazines they read? Average household income? Education? Lifestyle? Number of children? All the stuff you find on a warranty card when you buy a vacuum cleaner or a blender. In addition, do some secondary research.

For example, if you are lucky enough to be in a town large enough to have a library, they should have census information for your state and county. This will give you a profile of the average person living in your county. The Chamber of Commerce may have the demographics of your city. Start with these and be prepared to adjust your business as needed. A good library will have a copy of the Rand-McNally Commercial Atlas and Marketing Guide.

You'll find retail sales data for your state and county. What did people spend on food? Housing costs? Clothing? Automobiles? It's a great thumbnail source of information about people in your state or county. I'll cover how to reach these folks in the advertising section coming up later in the plan.

Who are the "end users" of your product? For example, I ask my wife to pick up some beer when she goes to the store. She makes the purchase, but she is not the end user of the product, I am. If I recommend a brand name I influence the purchase, if not, she will probably get something "light" or on sale.

8.) How much business is really out there? In a small town this becomes very important. I grew up in a small farm town in Illinois. The population was 5,200 people. Yet, in a three block area, there were 6 gas stations. These stations all stayed in business during my grade school to high school years. That's twelve years in business.

When we create a business plan we must know if there are enough paying customers to support our business. Forget the competition (not entirely) for the moment. Each one of those gas stations needed a customer base of at least 5,200 total customers to survive. Some customers only went to one station for all 12 years, some went to all stations for 12 years, and the rest a combination of the two.

The point is; each station needed X number of customers per day, week, month, year, to survive in this market.

Could a seventh station go in this market and survive? The answer is yes. Would it be easy, the answer is no. If you were going to open a new gas station in this market you would need to know the answer to three questions:

One: Can you develop new customers who do not go to any of the other stations? (New people moving to town, people just turning 16 and getting a drivers license.)

Two: Can you take customers away from your competitors? (People unhappy with the service, unhappy with the quality of the product, unhappy with price.)

Three: Can you develop enough of both to make a living?

If the answer to all three questions is yes, I would advise you to continue constructing the marketing plan. Please keep in mind we are only in Part One of a 10 Part Plan.

This example with the gas station is greatly simplified for demonstration purposes. There are a lot more things that have to happen for that seventh gas station to survive than just those three questions . If the answer is no, then I would advise you to stop and regroup.

This process is commonly called a Sales and Market Share Analysis. How many sales; and how many people for the business to survive? I will tackle this in more detail as I go through the rest of the marketing plan.

9.) Next, let's talk about distribution of your product or service. What is your service area? The whole town? The whole county? The state? Is it delivered? Do customers pick it up? Can or does it need to be shipped? Will you need delivery vehicles? A shipping budget? FedEx account? UPS? Is it an intangible item: Life Insurance? Office cleaning? Groomed dogs? Do customers come to your place of business or do you go to their home or business? In small towns you may be required to travel to rural or farm areas for business. How much of this will be necessary and what is the cost of that travel?

10.) How is the product or service going to be sold? Where do customers of your product shop now? Will this change in the future? Will you need to hire salespeople? Will it be sold off the shelf in stores? Mail-order? Internet? 800 number? Do you know what the cost of sales of the product or service will be? If you have to pay a commission to a sales person, that will certainly take part of your profit.

11.) If you are in a common industry like shoe stores, or construction companies, CPA's, real estate, etc. study how these companies are advertising in your area. Are they on radio? TV? Newspapers (what section what days?) In San Diego (not a small town, I know), construction and remodeling companies comprised almost all the ads in the weekly newspaper TV listings. Why? Because it hung around the house all week.

Now that we have the answers to these questions, it's time to move on to Chapter Three and find out what we do with this information and how to begin to construct our marketing plan.

Authors Note: In the following chapters is a step-by-step marketing plan that will guide you through the process of creating a plan for your specific business. If you have questions or need direction, that's the purpose of the website.

Contact us if you are having any problems following the plan or if your business is outside the norm. Our articles will reinforce the directives of the book and complement them.

For a complete table of contents for "How to Market, Advertise And Promote Your Business Or Service In A Small Town", click here.

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