Lesson 1: Finding your target markets
What is marketing and how does it differ from selling? What combination of selling and marketing is appropriate for your business? How to determine which markets are accessible to you, which are accessible with a competitive advantage and how they should be approached.
Introduction
Every day my business gets flyers in the mail, telephone calls and tons of e-mail selling everything imaginable. Most of this effort is wasted because I don't need what they are selling. Most of the rest is wasted because I already have good suppliers for most of the things I do need. The few items which deal with things I actually need and don't know where to buy yet are usually not targeted properly - that is, I look at them but they don't appeal to me.
When I think of the almost 30 years I've been in business, both as an employee and independently, I can think of four times I have actually bought something which was marketed to me in this way. So it doesn't surprise me that, while there seems to be the odd business who stays around longer, most come and go never to be heard from again. It's a tremendous waste of resources and not good growth strategy. It's pure selling.
Instead, turn the whole thing around. It's not that you have something you want people to buy and your job is to persuade them. No. There are people out there who need things you have and all you have to do is find them. Now you're not a salesman anymore - you're someone who helps people out.
Let's say your business is computers. If you're selling them, you try to reach as many people as possible and try to persuade as many of those as possible to buy your computers. Why should they buy them? Because you're a good salesman - you tell them all kinds of things and talk fast and throw in deals and drop the price and there, you've made another sale. Boy, that customer sure fell for that little trick, didn't he? Perhaps that's exaggerating but it's an adversarial relationship and not a good basis for building a long term customer relationship.
Let's turn the example around like we said. Your business is still computers but, instead of trying to reach lots of people and persuading them to buy, you try to find people who need computers: perhaps small business people and professionals who need to keep books; perhaps families sending kids to university who need computers to keep in touch; perhaps retired people keeping in touch with their relatives through e-mail. You know people like this so you talk to them, you join groups of people like this, you develop lists of potential customers who may need computers for different reasons. Then you contact these prospective customers but again, you don't try to sell them your computers - you tell them you can help them with what they need; your computers will do their particular job.
That kind of approach takes more work up front but, once you get going, your success rate will be comparatively high. Why wouldn't many of these prospective customers buy from you - you have exactly what they need. Not only that, if you've done your job well they will keep calling you when they need anything else in your field. You won't have to sell - customers will call you.
There are many businesses which are successful at selling. They hire good salesmen and they sell a lot of products. Small business owners are often not good at selling and good salesmen are expensive and hard to find. Turning the process around and becoming customer and market oriented is a good alternative. I, personally, am more comfortable with that approach and I am also convinced it's more efficient.
