Crafting an effective Marketing Plan: Advertising

So we’ve been looking at general marketing tips and strategies over the past few posts.  Today we will kick it up a notch by looking at crafting an effective marketing plan for a startup company with the main focus on advertising.

Advertising is an audio or visual form of marketing communication that employs an openly sponsored, non-personal message to promote or sell a product, service or idea.  Importantly, Advertising is a paid activity.

As a new business, it is very important to draw attention to your business offerings and one of the best ways to do so is by advertising.  As you may not have a large advertising budget, it is important to know exactly where your targeted audience is so that the advertisements may connect with them directly.

We know that for millenials, i.e. the generation born between 1982 and the early 2000s, the internet and online sources are among the most common methods to reach them. This is the generation that is au fait with everything digital, from smart phones to iPads and the computer.

While there are Baby Boomers and Generation X-ers who are also knowledgeable about the internet and online sources, these persons tend to get their information from traditional sources such as print i.e. newspaper, magazine & billboards; and radio or television adverts.

So how does a startup like yours craft an advertising plan that allows you to be as effective as possible?  Firstly, it is important to approach advertising based on its value to your business rather than to focus on how much you have to spend.  Like all marketing activities, advertising should provide the business with a Return on Investment (ROI), therefore place your focus squarely on the quality of the returns.

Secondly, your advertising programme should speak directly to your target audience in a language that they can understand.  The same language used for millenials, will not necessarily work for Gen-X-ers. Likewise the same advertising methods used to connect with one group may not work with the next. 

It was American Businessman, John Wannamaker who said that “half the money spent on advertising by companies is wasted; trouble is, I don’t know which half” – critical market research coupled with a new way of thinking can assist startups with identifying where to spend their limited budget so that it connects directly to the targeted audience.

Current marketing trends suggest a move to more online platforms and strategic use of traditional media outlets.  The use of Google analytics and pay-per-click including a call-to-action on online ads will yield a more immediate response than placement of a print advertisement or radio commercial.

Use of other advertising channels such as mobile, email and other direct forms of advertising can also yield greater benefits because of its ability to target an audience specifically.

Maintaining the family’s business name

We should all be familiar with the concept of the family business: starts out small but through generations some become multi-billion dollar companies.  World-renowned companies such as Amazon and Mattel began in someone’s garage; the Nike brand which we now wear with ‘swag’ was co-founded in 1964 by the face of the company Phil Knight.  When he steps down in 2016, his son Travis will take up his position.

This is also the story of the many convenience stores, haberdasheries, hardware and small clothing stores located in communities across the world.  Someone in the family dared to dream and started an entrepreneurial journey which is carried on today by one or more members of the family

By definition, a family business is a company owned by one or more family members and may be the oldest form of business organization in the world.

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Now, not every family business will make it to the notoriety or the profits of the aforementioned companies but within their locales small family owned businesses can continue to make significant waves to maintain and build the family’s business name with these simple tips:

-          Get the children involved early – If it’s a grocery shop, let them pack the shelves, interact with the customers and learn the intricacies of the business such as inventory, accounting procedures & stocktaking.  This will teach them the specifics of the family business as well as provide them with invaluable life lessons in responsibility, general management and accountability.  Their introduction at an early stage will also help them to identify ways the business can remain relevant so that they can see increased profits for the generations to come.

-          Formalize the business (relationships) – Yes it’s your beloved child that is joining the family business but however strong the relationship, you may just have disagreements about how the business is being run.  Draw up a written agreement outlining their role as well as your expectations before they join the business to ensure that you are all on the same page.

-          But what if the children aren’t interested? – Succession planning is the next best thing.  The fact is that your children may not be interested or lack the talent to continue the business.  To ensure longevity, you are welcome to bring in talent from the outside.  These person/persons can assist in developing a more sustainable operation and establish new structures to ensure future prosperity.

-          Develop core values - Establish the business on core values such as integrity, excellent customer service, high quality products etc., This will definitely assist in carrying the business’s name through generations because customers will continually recommend family, friends, acquaintances etc., through the generations to support your business because of the core values to which the business subscribes.

Of course, this list is not exhaustive but it will go a long way in maintaining and preserving the family’s business name through the generations.

Building a business through referrals

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There is absolutely nothing more powerful than having your business being recommended by a satisfied customer.  A satisfied customer is one of the best assets that a startup can have in its marketing arsenal because that customer just by sharing his great customer experience can increase awareness about your company’s offerings thereby resulting in increased sales for your business.

For startup companies, referrals or word-of-mouth marketing as this activity is called, is critical to your business’s marketing strategy.   Referral Marketing or ‘word-of-mouth’ is the method of promoting products or services to new customers through a business' existing customer base, rather than through traditional advertising.

Referral marketing is also considered as one of the most effective methods of marketing.  Added to that, is also the fact that it is one of the least expensive methods because it relies heavily on the opinions and influences of someone else’s who share their good experience with other potential customers.

Referral marketing however works through customer engagement.  A business makes referrals a significant part of their business’s marketing by writing the element into their overall marketing campaign.  This means that the referral must affect every part of the marketing campaign i.e. sales, customer relationship management and anywhere else you can issue a call to action. 

Startup businesses are therefore encouraged to incorporate a referral marketing programme in their marketing campaign and to mention it whenever and wherever they can.  If you are producing a new ad or sending out an email blast include the offer and list the benefits.  Remember no matter how great the customer experience, customers are not always thinking of you.

Referral marketing is also boosted by the fact that consumers operate in the digital age where everything is ‘tweeted’ and shared via multiple online platforms.   We take advice from friends and associates about where to eat, where to shop and which smart phone is better; we look to the pop stars to see what they’re wearing and what’s trending. The response to your product may therefore be swift and this makes referral marketing an even more important factor in your business’s marketing campaign.

Referral marketing can be used by a wide cross section of businesses including restaurants, gyms and spas, retail stores and businesses in the hospitality sector.

As the method is dependent on good customer experience, the onus is therefore on the startup to ensure that the customer always has an outstanding experience.

Crisis Communication for Startup Businesses

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As a startup business, having a crisis communications plan may be the furthest thing from your mind, but in this world where anything can go wrong, one of the best precautions that a startup entrepreneur can take, is to have a prepared crisis communications plan handy.  It may not be on the scale of your larger counterparts but preparing for any eventualities can assist you in recovering from any mishaps in the shortest possible time.

A crisis communications plan helps a company to manage any situation that is threatening or could threaten to harm people or property, seriously interrupt business, significantly damage reputation and negatively impact the bottom line. 

The plan specifically addresses how the crisis will impact stakeholders such as your employees, customers, the immediate community in which the business operates, suppliers, shareholders, government and the media.  The plan is about managing the way the company reacts to the crisis and should help defuse the problem and get the business back to work in as quick a time as possible.

As a startup company, you may your business’s only employee/director but certainly what you do must affect at minimum one external stakeholder; your customer, your reaction could either bring the business down or show its resilience.

In writing the simplest crisis communication plan, it is recommended that the following actions are considered:

1.       Set-up a Team – As indicated, you may be your company’s sole director at this juncture therefore your team will require external buffering.  Employ the services of a skillful PR Specialist and have a lawyer on standby in case of any legal issues.  According to the industry within which you operate, consult with industry experts.  Look at how they address crises in their companies and scale to fit your operation.

2.       Get comfortable with the media; you are now your company’s spokesperson – One of the most important elements of an effective crisis communications plan is one, consistent voice.  And in this situation, yours is the best voice.  It is your business and therefore you should be able to articulate a message in a clear and concise manner.  Depending on the issue being faced, you should also be comfortable in front of large audiences.

3.       Establish a media policy – In this age of new media, there must be a policy which speaks to how the media will be addressed both offline as well as online.  Social media has changed the ways businesses respond because it is ‘now media’ and while news travels fast, bad news travels faster!  Also have a plan to address traditional media.

4.       Prepare a statement – Rely on the support of your PR Specialist to prepare a fulsome statement with the facts and your company’s plan to address the affected parties.  Be truthful and transparent. Don’t allow the media to ‘find out’ about the situation.  Address it upfront in a timely manner.  As I always say, in the absence of communication, there is perception and perception can either good or bad, right or wrong.  Also utilize your social media and website (if you have one) to disseminate information in a timely manner.

5.       Test the plan – You won’t know if the plan will work unless you test it.  And testing it in this scenario requires that you consider every possible situation and coin a response to each.  In other words, consider everything that could go wrong and design a strategy to combat each.  It will help your business to know what is required from both a communications perspective as well as a business planning perspective in the event of crisis.

The truth is, you may never use your plan because a crisis may never occur but in business it is much better to be prepared for an eventuality that never happens, rather than to be unprepared and the eventuality shows up unexpectedly.