What are the most effective marketing communication tools for small medium enterprises (SME’s) which refers to companies that have turnover of less or equal to €50 million.
Kotler. P, 2012 identifies eight main models of communication:
2. Sales promotion
3. Events and experiences
4. Public relations and publicity
5. Direct Marketing
6. Interactive marketing
7. Word-of-mouth marketing
8. Personal selling
Now that we know what the promotional mix tools include you can already begin to gauge which tools are appropriate on a cost basis for your organisation. However lets go more in depth. I highly recommend anyone interested in marketing to experiment with Integrated Marketing Communications (IMC). This refers to the idea that all promotional mix tools should integrate with each other. It is important to ensure the IMC is carefully coordinated to deliver a clear, consistent, and compelling message about the organisation and brand.
I will ask you a quick question. Are your customers one-off buyers? For example, if you are an estate agent you will undertake more transactional marketing as oppose to relationship marketing which is more applicable to organisations that develop a relationship with customers that returns financial benefits such as repeat purchase?
IMC is tailored towards relationship marketing. It is important for SME’s to keep their customer base as it is cheaper than acquiring new customers. The aim of relationship marketing is to hold the customers hand throughout the model displayed in figure 1 below, the loyalty ladder.
Figure 1: The loyalty ladder
Figure 1 gives a brief description of each of the stages. Now you may be thinking how is this useful to me?
KEEPING CUSTOMERS IS CHEAPER THAN ACQUIRING NEW CUSTOMERS!
Now we need to know how are we going to do that in a marketing campaign suitable for relationship marketing and deploying IMC? First we need to analyse which promotional mix tools are suitable? Figure 2 below shows the relative strengths and weaknesses of each.
Figure 2: The relative strengths of the promotional mix tools (Baines et al, 2008 pg 491)
Now that you have an more informed idea of which tools you may which to deploy (I would recommend writing a list of the above promotional mix tools in order of suitability 1-high, 5-low). Now apply this shortlist to figure 3 below which shows how effective each promotional mix tool is at each stage of the customer buying process.
Figure 3: The power of integrated marketing communications throughout the consumer buying process (Smith & Taylor, 2004)
Figure 3 represents the idea of IMC well; you want to take the customer through this process by first raising awareness and interest, leading to a desire for the product, resulting in preference for your product/service compared to competitors and finally a sale! In the repeat purchase phase relationship marketing can be deployed by sending an email to enquire whether the customer is happy with their purchase? Important to re-inform the customer of the benefits of your product to help reduce any doubts they have about the product/service.
Please comment and try and think of any businesses that have tried to do relationship marketing with you!