Some years ago when the accounting profession was riding high, partners at the big CPA firms liked to say they marketed their services by "answering the telephone." This smug approach to marketing, common among small and midsize companies, can lay the seeds of disaster. By relying on impromptu or ill-conceived marketing strategies, companies often find themselves losing market share to smart and aggressive competitors.
"Many companies invent a marketing approach and then stick with it, good, bad or indifferent," says Lloyd Highbloom, president of a Mount Kisco, N.Y.-based firm that audits companies' marketing programs to identify their strengths and weaknesses. "When this happens, mistakes and inefficiencies built into the program at the outset tend to become institutionalized.
"Take the case of the entrepreneur who uses radio advertising to launch his new company. If the business survives, he sticks with radio exclusively, not because the medium delivers exceptional results but because he is comfortable with it. Stuck in the rut of his original approach, he fails to explore newspaper, magazine or billboard advertising -- options which may generate greater sales when used independently or combined in an integrated campaign."
The failure to explore all options is one of the marketing blunders that can weaken a company, depriving it of maximum sales potential. Consider these other common mistakes:
* The Wishy-Washy Personality: Just like the people who run them, companies are best known by the personalities they exhibit to the world. The most successful avoid the commonplace by developing a personality that is fresh and innovative and that gains a critical edge in the marketplace.
"Take the case of a New York-based equipment-leasing company that found its customers were turned off by the complex and voluminous contracts long associated with leasing transactions," Highbloom says. "The way the marketplace viewed it, leasing companies had all the personality of a minefield.
"To change this, the New York leasing company huddled with its lawyers, seeking ways to transform its standard contract from seven pages of legalese to something friendlier without reducing the company's legal protection.
"The result was a one-page plain English document that removed the major complaint about doing business with leasing companies. Armed with a competitive advantage, management touted its new contracts in advertising and publicity campaigns, using the tag line 'See how simple financing can be.' This gave the company a clear-cut personality that distinguished it from the competition. In short order, sales took off."
* Marketing By The Numbers: All too often, small companies base their marketing expenditures on a set figure calculated as a percentage of sales, and then view this number as a benchmark for establishing marketing budgets year after year. But when you think about it, this approach is backward. Management is simply picking a number out of the air and insisting that it work, even if it is too little or too much to meet the company's marketing objectives.
A much wiser approach is to start with a thoughtful review of the company's goals. Are you seeking to increase market share, to expand into a new market or to grow revenues by 15 percent? With the goals identified, you are in better position to assess what it will take in terms of advertising, publicity and sales promotion to achieve the stated objectives.
* The "Now-You-See-It-Now-You-Don't" Syndrome: The hardest lesson for entrepreneurs to learn is that effective marketing takes patience and consistency. Although action-oriented business people like to see an immediate payback for every investment they make, this impatience can take its toll on marketing programs, the best of which build impact over a sustained period. Killing marketing programs within weeks or months after they are launched means the efforts are sandbagged before they have the chance to sink in with customers.
In general, companies will want to give marketing programs at least a year to establish their full impact in the marketplace and hopefully to have a positive impact on sales and profits.
"Remember the saying that 'Good luck is the result of good planning,' " Highbloom advises. "This means those companies that take the time to examine and fine-tune their marketing programs stand the best chance for success."