Marketing and sales are related but different. Marketing looks at everything to do with getting a product or service to customers, from development to pricing, place and promotion.
Sales focuses on place and promotion, to make sure that where and how you sell are right for your customers.
Marketing is an umbrella term for the co-ordinated process of getting a product or service into the hands of customers.
Marketers use what they know about the target customer to shape the four Ps of their marketing strategy:
These four elements make up your marketing mix. For example, you’d want to make sure your leading product is priced, placed and promoted correctly for your market.
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Sales is made up of:
Place and promotion are equally important parts that should work together in your marketing plan. For example, you may decide to sell your product or service directly on your own website, instead of sharing your profit with a wholesaler or retailer. But if you later find that advertising and attracting customers to your website is too costly, you might reconsider using a wholesaler or retailer.
Look at your whole marketing mix before making promotion decisions, even common decisions like special offers and discount vouchers. Check that the promotion is suitable for your product or service.
Marketing plans are based around the marketing mix, but to optimise each of the four Ps, marketers first carry out market research in several key areas.
Marketers study the market (customers) to determine demand for a new product, and identify target markets so products can be marketed more effectively to the right type of customers.
One of the most common mistakes businesses make is assuming their product or service will appeal to everybody, but that’s never the case. Your offering will always appeal more to some types of customers and demographics than others. Focusing on the types that they appeal to is the most cost-effective way to find success.
The trick is accurately identifying your target markets through surveys, discussion groups and other common market research methods.
After you’ve been in business a while, you might want to expand where you do business, the “place” part of your marketing mix. You might want more customers to grow your business. You might want to be less dependent on one or two markets, so you spread your risk. Or you might want to offer a slightly different product or service that’s more suited to a different market.
You could grow domestically. Already have a shop in Christchurch? Why not open another in Wellington? Growing in the same country means you already know the culture, language and laws. You’ll be in the same time zone, so you don’t have to think about time differences when you arrange meetings. Want to visit the shop? Just book a flight or drive over.
Draw on government funds and support for businesses that expand into different regions of the country.
Explore Kānoa – Regional Economic Development & Investment Unit(external link) — Ministry of Business, Innovation and Employment
Discover New Zealand’s regions(external link) — New Zealand Trade and Enterprise
Growing internationally is more challenging. Even if you open a shop “next door” in Australia, you’ll have lots to wrangle. Sure, they speak English too, and the culture is similar. But they have different laws and regulations.
When you set prices and budgets, you’ll need to think of currency fluctuations too. Depending on how exchange rates change, you might earn less (or more) than you expect.
But you can usually overcome such challenges by doing research, and by being prepared to learn and adjust. Success will be rewarding, and will take your businesses to new heights.
Wherever you grow, you’ll need to plan for it. You’ll need to think about why you want to expand, and which market is right for your product. Even if you “just” grow within New Zealand, you’ll need to do your research.
Which place works best for your other Ps (product, price and promotion)? Will you need to adjust your marketing mix? You might not be able to create an exact copy of your business in the new place.
How will you finance your growth? Doing market research, setting up a shop or an office, recruiting staff, and so on all take time and money. Depending on your business, it could take a few years to earn back that money.
Can you find advisors who understand the market and culture? Will you be able to recruit the staff you need? If a lot of your business comes from foot traffic, is there enough foot traffic throughout the year?
Identifying threats is an important part of marketing. Often your biggest threats are competitors.
Find out your competitors’ strengths and weaknesses to compete effectively. You could create a special deal or make a special offer to compete. Or you could identify their strengths and make sure you improve in those areas, to close the gap between you.
You could research your competitors online, or through mystery shopping. (Mystery shopping is when you get someone else to shop with competitors to find out more about them. They look for detail on things like products, pricing, deals and customer service).
SWOT stands for “strengths, weaknesses, opportunities, and threats”. A SWOT analysis is a great way to assess what your business does well, and where you’ll need to improve. It can also help you identify ways you can exploit opportunities, and to identify and prepare for potential threats to your business success.
Businesses often use a SWOT analysis to develop their plans and approach, including their marketing goals.
Your analysis can start as simply as drawing a large square and dividing it into four smaller squares. Fill in each square with one element of the SWOT analysis: your strengths, weaknesses, opportunities, and threats.
For example, a SWOT analysis might help you identify that:
You might now decide to enter a new market to improve your position in all four areas.
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