Article #31, February 28, 2005
The 4 Ps of Marketing Do Not Include Philanthropy!
When you are in the start-up stages of your business, you will need to spend 85% of your non-producing time (when youíre not actually providing your service or creating your product) MARKETING! Yes, I said 85%. We will talk more about what that includes, but what it doesnít include is bookkeeping, filing and educational activities.
Focus is one of the biggest issues my clients face in running their own businesses. Working out of our homes is difficult enough (the dishes call my name all day Ė I have learned to ignore them.), we also perform all the business functions a corporation does Ė administration, sales, finance - and marketing. However, if we successfully ignore the dishes and the laundry and spend all our time getting perfectly organized, answering every email we receive and analyzing every piece of data to which we have access, we wonít have any clients.
OK, I hear you, so what are the 4 Ps of marketing? They are: promotion, product, price, and place. Most people focus primarily on promotion, but the other 3 are equally important.
Product: Knowing that there is a market for your product and offering it to the right target is key. If the current marketplace is saturated with products in your category and you have not differentiated your product in any significant way, you will fail. If you market your product to the wrong people, you will fail. If you have more than one product, make sure you are selling each product to the right segment of the marketplace.
Price: You should know everything about your target market and your product. This research will guide you in setting your price and knowing if your price is too high or low. Look at what your competition is doing. Are you selling a commodity or is your product completely different from anything on the market? Pure commodities, like white sugar for example, compete strictly on price. If you are distinctly different from everything else, like Splenda, you set your price where your target will pay. (Donít think too small.) Also, what image are you projecting? Is your product the only one available to this market? Price accordingly.
Place: If you have done your research as mentioned above regarding your target, you will know where they are. Go there! Sell there! With some products, place determination will influence your price. If you are selling a grocery product and want to have a space on the regular grocery shelves, be prepared to invest a lot of cash. Specialty products have other avenues, but may not get the exposure. Selling on the internet? Where do your prospects gather virtually? Are they in chat rooms?
Promotion: The active marketing piece includes networking, advertising, telemarketing, face-to-face sales, direct mail, brochures, websites and more. Without the other Pís, this part of marketing falls flat. You must be able to connect with your future clients, which is impossible if you do not have the right product in the right place with the right price for your ideal customer.
But what about Philanthropy? Do you find yourself giving away your product or selling it much cheaper than anyone else? In case nobody ever told you, you are supposed to make money when youíre in business! Giving away a little is good marketing. Giving it all away will not only bankrupt you, but it will also give you a bad reputation. If you donít value your product enough to receive payment for it, why should anyone else?
Give a taste Ė make it enticing. In the beginning of my practice, I gave away a lot of second complimentary sessions. I learned a lot and needed to do this at the time to hone my craft, but realized after awhile that I wasnít getting a good return on my investment of time from a marketing perspective and stopped. (Wisely, I had put a deadline on this particular offer.) I have experienced that if itís free, itís not valued. Pro Bono and trade clients often donít show up for appointments or do their homework.
Now I give one complimentary session, a common practice among coaches, and I often call it a demonstration, because thatís what it is. I give a good taste of what my services might include, and each taste is different. This also gives me the opportunity to see if I want to work with this person. Although itís rare, I have had to kindly inform people that this is my business and I cannot do it for free. This is a difficult conversation to initiate, but the success of my business is more important than hurting the feelings of a very nice person who will not likely hire me. As I often say Ė itís business, not personal.