Entrepreneurial approaches to Marketing: driving business growth, ensuring sustainability

1. Entrepreneurial approaches to Marketing: driving business growth, ensuring sustainability Dr Rosalind Jones, MBA, PhD, PGCertHE, Chartered Marketer MCIM. Lecturer in Marketing Bangor Business School abs822@bangor.ac.uk

2. My background • ‘Chartered Marketer’ Ambassador of Small Businesses- CIM North Wales Region • Co-Chair of the Entrepreneurial and Small Business Marketing Special Interest Group, Academy of Marketing • Strategic marketing experience- public/private/voluntary sectors • Marketer/consultancy in SME firms • Research in industries such as technology, hospitality/tourism

3. Why is SME Research Important? • Micro, small and medium-sized enterprises (SMEs) are socially and economically important, they represent 99 % of an estimated 23 million enterprises in the EU • They provide around 75 million jobs representing two-thirds of all employment. • SMEs contribute up to 80% of employment in some industrial sectors, such as textiles, construction or furniture. • Important for the NW Wales Region- socially & economically deprived

4. SME growth and Entrepreneurial Marketing • This presentation presents ideas for growth strategies for Small Businesses based on current research and, key concepts and theories • The focus of this presentation is on small businesses and, • Using Entrepreneurial Marketing (EM) approaches • As such we challenge traditional notions of marketing & management theory and practice. • How? • The presentation reports on the issues for small business; and addresses some of the issues facing business owners, managers and marketers in contemporary business environments.

5. Small Business Constraints • Lack of time to manage- • Lack of business resources- finance, employees, marketing experience • Difficulty in predicting future market changes-market research costs-marketing & business planning- especially in fragmented/highly competitive markets • Limited geographic scope in large markets because of size

6. The Entrepreneurial Marketing perspective- • Global research in different sectors and markets • Globalization, developing regions, new economies, sustainability through economic crises, e-business. • We have learnt from what successful growth focussed firms do- i.e. differentiation of products/services, niche markets, blue ocean strategies

7. 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

8. Gardner (1994, p. 37) : ‘‘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.’’

9. Traditional Marketing- • Perception of Marketing- the 4 Ps of Marketing- produce, price, promotion, place. • Successful marketing in SMEs is different! • Common perception of marketing-advertising and promotion- fliers, newspaper advertising, exhibitions etc. • Here- we cover key salient points for SME Marketing-

10. Entrepreneurial & SME Marketing • Relationship Marketing • Getting close to your customer/markets • Leading customers- co-creation- incremental/ radical innovations • Networks- business, innovation, marketing, industry, personal contact networks (PCNs) • Opportunity seeking- new markets, extended product/service lines, shared opportunities, partnering, alliances • Reputation effects- branding for small business

11. Cost-effective Marketing Strategies • Most new ventures and small firms have limited budgets for marketing (finding new business) • Interesting approaches for cheap, aggressive marketing techniques (Schindehutte et al., 2009- examples of guerrilla marketing etc.) • Most small businesses are highly customer oriented particularly if the market offering is service based.

12. Relationship Marketing- • Can be a positive benefit- long term relationships bring stable, regular income, repeat custom and word-of-mouth (e-marketing- word-of mouse!) • Also-it is cheaper to retain current customers than find new ones • Use of websites and Customer Relationship Management (often under used)- customer feedback provides very useful market research (!), regular customer contacts for new promotions etc • However too much focus CAN be a risk if not carefully managed (costs your firm money, can inhibit creativity and innovation) • Power of the customer- example- retention of long terms contracts/ renewing/ public sector and the small business • Service Dominant Logic (SDL) Vargo and Lusch, (2004) consider the effect of other stakeholders and customers on the consumer experience i.e. destination marketing-hotels.

13. Market emersion • Advantage of SMEs- do not have to be artificially close to your customer as with large firms • Large firms now emulating what small firms do- i.e. same contact person on the phone etc. • Can respond swiftly to customer preferences (unlike large firms) • Local, technical knowledge developed over time- retention of tacit knowledge in your company • Local ‘embeddedness’ in industry networks

14. Leading customers • US and Scandinavian research (large scale). Found that those high growth firms ‘lead’ customers • Examples- co-creation- development of bespoke products for business customers- resell to other similar businesses- the customer an advocate, agent or re-seller • Adaptations to current products/services- retains customers, extends product portfolio, reaches new markets and new customers (i.e. same product new market, same market new product) • Replication- can you easily replicate your product or service for other new customers to reduce development costs?

15. Networks • Resource leveraging- valuable to small businesses and new ventures- networks- found to increase business, innovation, marketing in small firms. • Personal contact networks (PCNs) • Example- a qualitative study of 45 entrepreneurs in Ireland & Australia-industries: engineering, textiles & food. • Networks with competitors & customers • (Gilmore, Carson & Grant, 2001)- Marketing Intelligence & Planning 19, 1, 6-11.

16. Networks-Gilmore et al., 2001 • Managerial implications: • Marketing by networks improved by, learning by experience • Social networks rely on entrepreneur’s intuition • Later, more strategic business networks rely on rigorous, structured, experiential knowledge • Therefore: networking can be harnessed into a proactive marketing infrastructure & • Network competence can be learned, refined & developed by experience

17. Opportunity seeking- • Shared opportunities, partnering, alliances • Opportunities- new markets/customers; new and/or extended product/service lines • Industry networks-business partnerships, alliances, i.e. partnering with a larger well known company- provides a well known established ‘brand’ and opportunities for cost-sharing, knowledge sharing and co-branding of products/services. An indicator to customers that the SME is an established market player= credibility

18. Reputation- branding for SMEs • Branding may be less or more important depending on product/ service/ sector • Formal branding is prohibitively expensive • Awareness of branding messages, colours, strap-lines etc on all business & marketing material and web-sites • The owner-manager is often the representative of the culture and ethos of the company – as with famous CEOs i.e. Richard Branson who is indistinguishable from the Virgin brand and what this means. • Reputation for delivering ‘customer value’ -often quality and reliability and the notion of ‘trust’ is key

19. Question & Answer Session