Entrepreneurial Entrepreneurial approaches to Marketing: approaches to Marketing: driving business growth, driving business growth, ensuring sustainabilityensuring sustainability

Dr Rosalind Jones, MBA, PhD, Dr Rosalind Jones, MBA, PhD, PGCertHE, Chartered Marketer PGCertHE, Chartered Marketer

MCIM. MCIM. Lecturer in MarketingLecturer in Marketing

Bangor Business SchoolBangor Business Schoolabs822@bangor.ac.ukabs822@bangor.ac.uk

My backgroundMy background‘‘Chartered Marketer’ Ambassador of Small Chartered Marketer’ Ambassador of Small

Businesses- CIM North Wales RegionBusinesses- CIM North Wales RegionCo-Chair of the Entrepreneurial and Small Co-Chair of the Entrepreneurial and Small

Business Marketing Special Interest Business Marketing Special Interest Group, Academy of MarketingGroup, Academy of Marketing

Strategic marketing experience- Strategic marketing experience- public/private/voluntary sectorspublic/private/voluntary sectors

Marketer/consultancy in SME firmsMarketer/consultancy in SME firmsResearch in industries such as technology, Research in industries such as technology,

hospitality/tourism hospitality/tourism

Why is SME Research Important?Why is SME Research Important?

Micro, small and medium-sized enterprises Micro, small and medium-sized enterprises (SMEs) are socially and economically important, (SMEs) are socially and economically important, they represent 99 % of an estimated 23 million they represent 99 % of an estimated 23 million enterprises in the EU enterprises in the EU

They provide around 75 million jobs They provide around 75 million jobs representing two-thirds of all employment. representing two-thirds of all employment.

SMEs contribute up to 80% of employment in SMEs contribute up to 80% of employment in some industrial sectors, such as textiles, some industrial sectors, such as textiles, construction or furniture.construction or furniture.

Important for the NW Wales Region- socially & Important for the NW Wales Region- socially & economically deprivedeconomically deprived

SME growth and SME growth and Entrepreneurial MarketingEntrepreneurial Marketing

This presentation presents ideas for growth This presentation presents ideas for growth strategies for Small Businesses based on current strategies for Small Businesses based on current research and, key concepts and theoriesresearch and, key concepts and theories

The focus of this presentation is on small businesses The focus of this presentation is on small businesses and,and,

Using Entrepreneurial Marketing (EM) approachesUsing Entrepreneurial Marketing (EM) approaches As such we challenge traditional notions of As such we challenge traditional notions of

marketing & management theory and practice. marketing & management theory and practice. How?How? The presentation reports on the issues for small The presentation reports on the issues for small

business; and addresses some of the issues facing business; and addresses some of the issues facing business owners, managers and marketers in business owners, managers and marketers in contemporary business environments. contemporary business environments.

Small Business ConstraintsSmall Business ConstraintsLack of time to manage-Lack of time to manage-Lack of business resources- finance, Lack of business resources- finance,

employees, marketing experienceemployees, marketing experienceDifficulty in predicting future market Difficulty in predicting future market

changes-market research costs-marketing changes-market research costs-marketing & business planning- especially in & business planning- especially in fragmented/highly competitive marketsfragmented/highly competitive markets

Limited geographic scope in large markets Limited geographic scope in large markets because of size because of size

The Entrepreneurial Marketing The Entrepreneurial Marketing perspective-perspective-

Global research in different sectors Global research in different sectors and marketsand markets

Globalization, developing regions, Globalization, developing regions, new economies, sustainability new economies, sustainability through economic crises, e-business.through economic crises, e-business.

We have learnt from what successful We have learnt from what successful growth focussed firms do- i.e. growth focussed firms do- i.e. differentiation of products/services, differentiation of products/services, niche markets, blue ocean strategiesniche markets, blue ocean strategies

Cows, after you’ve seen them for a while, are boring. They may be perfect cows, attractive cows, cows with great personalities, cows lit by beautiful light, but they’re still boring.

A Purple Cow, though. Now that would be interesting. – Seth Godin, 2002

‘‘the interface of entrepreneurial behaviour and marketing is that where innovation is brought to market. Marketing’s role in innovation, then, is to provide the concepts, tools, and infrastructure to close the gap between innovation and market positioning to achieve sustainable competitive advantage.’’

Gardner (1994, p. 37) :

Traditional Marketing-Traditional Marketing-Perception of Marketing- the 4 Ps of Perception of Marketing- the 4 Ps of

Marketing- produce, price, promotion, Marketing- produce, price, promotion, place.place.

Successful marketing in SMEs is different!Successful marketing in SMEs is different!Common perception of marketing-Common perception of marketing-

advertising and promotion- fliers, advertising and promotion- fliers, newspaper advertising, exhibitions etc.newspaper advertising, exhibitions etc.

Here- we cover key salient points for SME Here- we cover key salient points for SME Marketing- Marketing-

Entrepreneurial & SME Entrepreneurial & SME MarketingMarketing

Relationship MarketingRelationship Marketing Getting close to your customer/marketsGetting close to your customer/markets Leading customers- co-creation- incremental/ Leading customers- co-creation- incremental/

radical innovationsradical innovations Networks- business, innovation, marketing, Networks- business, innovation, marketing,

industry, personal contact networks (PCNs)industry, personal contact networks (PCNs) Opportunity seeking- new markets, extended Opportunity seeking- new markets, extended

product/service lines, shared opportunities, product/service lines, shared opportunities, partnering, alliancespartnering, alliances

Reputation effects- branding for small businessReputation effects- branding for small business

Cost-effective Marketing Cost-effective Marketing StrategiesStrategies

Most new ventures and small firms have Most new ventures and small firms have limited budgets for marketing (finding new limited budgets for marketing (finding new business)business)

Interesting approaches for cheap, Interesting approaches for cheap, aggressive marketing techniques aggressive marketing techniques (Schindehutte et al., 2009- examples of (Schindehutte et al., 2009- examples of guerrilla marketing etc.) guerrilla marketing etc.)

Most small businesses are highly customer Most small businesses are highly customer oriented particularly if the market offering oriented particularly if the market offering is service based. is service based.

Relationship Marketing-Relationship Marketing- Can be a positive benefit- long term relationships bring stable, Can be a positive benefit- long term relationships bring stable,

regular income, repeat custom and word-of-mouth (e-regular income, repeat custom and word-of-mouth (e-marketing- word-of mouse!)marketing- word-of mouse!)

Also-it is cheaper to retain current customers than find new Also-it is cheaper to retain current customers than find new ones ones

Use of websites and Customer Relationship Management (often Use of websites and Customer Relationship Management (often under used)- customer feedback provides very useful market under used)- customer feedback provides very useful market research (!), regular customer contacts for new promotions etcresearch (!), regular customer contacts for new promotions etc

However too much focus CAN be a risk if not carefully managed However too much focus CAN be a risk if not carefully managed (costs your firm money, can inhibit creativity and innovation)(costs your firm money, can inhibit creativity and innovation)

Power of the customer- example- retention of long terms Power of the customer- example- retention of long terms contracts/ renewing/ public sector and the small business contracts/ renewing/ public sector and the small business

Service Dominant Logic (SDL) Vargo and Lusch, (2004) consider Service Dominant Logic (SDL) Vargo and Lusch, (2004) consider the effect of other stakeholders and customers on the the effect of other stakeholders and customers on the consumer experience i.e. destination marketing-hotels. consumer experience i.e. destination marketing-hotels.

Market emersionMarket emersion Advantage of SMEs- do not have to be artificially Advantage of SMEs- do not have to be artificially

close to your customer as with large firmsclose to your customer as with large firms Large firms now emulating what small firms do- Large firms now emulating what small firms do-

i.e. same contact person on the phone etc.i.e. same contact person on the phone etc. Can respond swiftly to customer preferences Can respond swiftly to customer preferences

(unlike large firms)(unlike large firms) Local, technical knowledge developed over time- Local, technical knowledge developed over time-

retention of tacit knowledge in your companyretention of tacit knowledge in your company Local ‘embeddedness’ in industry networksLocal ‘embeddedness’ in industry networks

Leading customersLeading customers US and Scandinavian research (large scale). US and Scandinavian research (large scale).

Found that those high growth firms ‘lead’ Found that those high growth firms ‘lead’ customerscustomers

Examples- co-creation- development of bespoke Examples- co-creation- development of bespoke products for business customers- resell to other products for business customers- resell to other similar businesses- the customer an advocate, similar businesses- the customer an advocate, agent or re-selleragent or re-seller

Adaptations to current products/services- retains Adaptations to current products/services- retains customers, extends product portfolio, reaches customers, extends product portfolio, reaches new markets and new customers (i.e. same new markets and new customers (i.e. same product new market, same market new product)product new market, same market new product)

Replication- can you easily replicate your product Replication- can you easily replicate your product or service for other new customers to reduce or service for other new customers to reduce development costs?development costs?

NetworksNetworks Resource leveraging- valuable to small Resource leveraging- valuable to small

businesses and new ventures- networks- found businesses and new ventures- networks- found to increase business, innovation, marketing in to increase business, innovation, marketing in small firms. small firms.

Personal contact networks (PCNs)Personal contact networks (PCNs) Example- a qualitative study of 45 Example- a qualitative study of 45

entrepreneurs in Ireland & Australia-industries: entrepreneurs in Ireland & Australia-industries: engineering, textiles & food.engineering, textiles & food.

Networks with competitors & customers Networks with competitors & customers (Gilmore, Carson & Grant, 2001)- (Gilmore, Carson & Grant, 2001)- Marketing Marketing

Intelligence & Planning 19, 1, 6-11.Intelligence & Planning 19, 1, 6-11.

Networks-Networks-Gilmore et al., 2001Gilmore et al., 2001

Managerial implications:Managerial implications: Marketing by networks improved by, learning by Marketing by networks improved by, learning by

experienceexperience Social networks rely on entrepreneur’s intuitionSocial networks rely on entrepreneur’s intuition Later, more strategic business networks rely on Later, more strategic business networks rely on

rigorous, structured, experiential knowledgerigorous, structured, experiential knowledge Therefore: networking can be harnessed into a Therefore: networking can be harnessed into a

proactive marketing infrastructure &proactive marketing infrastructure & Network competence can be learned, refined & Network competence can be learned, refined &

developed by experiencedeveloped by experience

Opportunity seeking-Opportunity seeking- Shared opportunities, partnering, alliancesShared opportunities, partnering, alliances Opportunities- new markets/customers; new Opportunities- new markets/customers; new

and/or extended product/service lines and/or extended product/service lines Industry networks-business partnerships, Industry networks-business partnerships,

alliances, i.e. partnering with a larger well alliances, i.e. partnering with a larger well known company- provides a well known known company- provides a well known established ‘brand’ and opportunities for cost-established ‘brand’ and opportunities for cost-sharing, knowledge sharing and co-branding of sharing, knowledge sharing and co-branding of products/services. An indicator to customers products/services. An indicator to customers that the SME is an established market player= that the SME is an established market player= credibilitycredibility

Reputation- branding for Reputation- branding for SMEsSMEs

Branding may be less or more important depending Branding may be less or more important depending on product/ service/ sectoron product/ service/ sector

Formal branding is prohibitively expensiveFormal branding is prohibitively expensive Awareness of branding messages, colours, strap-Awareness of branding messages, colours, strap-

lines etc on all business & marketing material and lines etc on all business & marketing material and web-sitesweb-sites

The owner-manager is often the representative of The owner-manager is often the representative of the culture and ethos of the company – as with the culture and ethos of the company – as with famous CEOs i.e. Richard Branson who is famous CEOs i.e. Richard Branson who is indistinguishable from the Virgin brand and what indistinguishable from the Virgin brand and what this means. this means.

Reputation for delivering ‘customer value’ -often Reputation for delivering ‘customer value’ -often quality and reliability and the notion of ‘trust’ is keyquality and reliability and the notion of ‘trust’ is key

Question & Answer SessionQuestion & Answer Session