Download Osmanagic-Antighechian_ Word-of

Wor d-of-Mouth as a Communication
Mar keting Tool for Micr o Companies in
Ser vice Industr y
Anel Osmanagic
Mar al Antighechian
0
Authors
Anel Osmanagic & Maral Antighechian
Supervisor
Peter Gustavsson
Title
Word-of-Mouth as a communication marketing tool for micro
companies in service industry
Abstr act
Background and pr oblem statement: Small and medium enterprises stand for 99,8 %
of all the companies in Europe. Small firms are Europe’s cornerstone and their
importance is crucial for today’s society. These small firms have though some problems
with their survival on the market. It is estimated that 70 % of small firms face
bankruptcy in five years after their business start. This big percentage is partly due to
the communication marketing strategy that these firms apply. According to Brown et.al
(1999) bankruptcy in these small firms mainly depend on the lack of communication
marketing. According to his study it reveals that 40 % of all problems that small firms
encounter are based on deficiencies in marketing.
Pur pose: The purpose of this study is to see whether small firms are using the most
known communication marketing theories in their daily businesses and if not, how they
perform their communication marketing.
Methodology: In order to answer the purpose of this thesis the authors conducted
interviews with 10 companies. All companies are classified as micro companies and are
settled in Norrkoping and Linkoping. A great attention has been paid to conduct the
interviews in a proper manner in order to achieve significant credibility. This thesis’s
researchers have chosen a qualitative method with phenomenographic approach which
is the most suited method to answer this case purpose.
Fr amewo rk: To reach the purpose with high validity, the theoretical framework is
constructed by that sense that only the most known communication marketing theories
and models that exist are cited in chapter three of this dissertation These theories and
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models have later been used to analyze the findings and to reach a conclusion that
answers the purpose of this thesis.
Result and conclusions: This thesis has shown that micro companies are mainly using
word-of-mouth as their communication marketing tool. In this study among all observed
communication tools, word-of-mouth stands for 75.6 % which makes it the most
important aspect of micro companies’ communication strategy. On second place there is
customer service with 4 % followed by internet and signage with about the same
percentage. The conclusion is that micro companies in service sector are not using a
communication marketing theories due to their timely and money-consuming
characteristics. The results are clear that word-of-mouth is either used conscientiously
or unconsciously. Word-of-mouth is by far the most prominent aspect of micro
companies’ communication marketing and has a vital role for companies’ survival.
Fur ther r esear ch suggestion: It would be interesting to see if the result of this research
would be the same in other sectors rather than just service industry. Further suggestion
can be the observation of small and medium enterprises’ communication marketing and
to find out whether there is a similarity between this thesis results and conclusion for
micro-sized companies with SMEs.
Keywor ds:
Word-of-mouth, micro companies, SMEs, small firms and communication marketing
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Acknowledgement
Herewith this dissertation’s authors would like to take the opportunity to thank all the
people who have helped them.
Under six months the researchers have been studied if micro companies in Sweden use
the most known communication marketing theories and if not then how do they perform
their communication marketing. This would not have been possible without support
from all the people who supported us.
With this acknowledgment the authors would like to thank the interviewed companies
that kindly offered an interview time and also for their feedback of this study. Great
appreciation goes to the supervisor Peter Gustavsson for all his valuable assistance and
tutoring during the period of writing. Last but not least, thanks also to all opponents
and classmates that heir valuable opinions contributed to a well written thesis.
In the end, special thanks to the family with their heartwarming supports.
Linkoping 30 May 2011
Anel Osmanagic & Maral Antighechian
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Abbr eviations
AIDA model
Attention, Interest, Desire, Action
B2B
Business to business
B2C
Business to customer
CEO
Chief Executive Officer
EU
The European Union
HR
Human resources
IMC
Integrated marketing communication
MBA
Master of Business Administration
MC
Marketing Communication
PR
Public Relations
SEK
Swedish kruna, the currency of Sweden
SME
Small and Medium Enterprises
WOM
Word Of Mouth
WOMM
Word Of Mouth Marketing
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Table of Contents
Abstract ......................................................................................................................................... 1
Acknowledgement......................................................................................................................... 3
Abbreviations ................................................................................................................................ 4
Table of Contents .......................................................................................................................... 5
List of Figures ............................................................................................................................... 8
List of Tables................................................................................................................................. 8
1.
Introduction ........................................................................................................................... 9
1.1 Background – The present situation .................................................................................... 9
1.2 Area of interest .................................................................................................................. 10
1.3 Problem statement ............................................................................................................. 11
1.4 Research question.............................................................................................................. 12
1.5 Thesis outline .................................................................................................................... 12
2.
Methodology ....................................................................................................................... 13
2.1 Topic of choice .................................................................................................................. 13
2.2 Quantitative and Qualitative method of phenomenographic approach ............................. 13
2.2.1 Choice of approach..................................................................................................... 15
2.3 Research approach............................................................................................................. 15
2.4 Data collection .................................................................................................................. 16
2.4.1 Primary data ............................................................................................................... 16
2.4.2 Secondary data ........................................................................................................... 18
2.5 Interview technique ........................................................................................................... 18
2.6 Validity and Reliability ..................................................................................................... 20
2.6.1 Validity ....................................................................................................................... 20
2.6.2 Reliability ................................................................................................................... 20
2.7 Litterateur review .............................................................................................................. 21
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2.8 Target audience of the research ......................................................................................... 22
3.
Theoretical Framework ....................................................................................................... 23
3.1 Introduction and definitions .............................................................................................. 23
3.2 Developing marketing communication mix theories ........................................................ 24
3.3 Communication Marketing theories .................................................................................. 25
3.3.1 4Ps model ................................................................................................................... 25
3.3.2 Seven Promotional mix by Paul Smith....................................................................... 26
Sales Promotion: ................................................................................................................. 26
Advertising: ......................................................................................................................... 27
Direct marketing: ................................................................................................................ 28
Public relation: .................................................................................................................... 28
Sponsorship: ........................................................................................................................ 29
Corporate identity: .............................................................................................................. 29
3.3.3 Marketing Communication Mix ................................................................................. 33
3.3.4 Word-of-Mouth .......................................................................................................... 34
3.3.5 Uses and gratification theory...................................................................................... 37
3.3.6 Integrated marketing communication......................................................................... 38
3.3.7 Communication Theory.............................................................................................. 39
3.4 Entrepreneurial Marketing ................................................................................................ 41
4.
Empirical findings ............................................................................................................... 46
4.1 Reventia............................................................................................................................. 46
4.2 Smedjan Ekonomkonsult AB ............................................................................................ 48
4.3 Lawyer firm Birger Edelberg ............................................................................................ 50
4.4 Synective Labs .................................................................................................................. 51
4.5 More Time Economy Byrå ................................................................................................ 53
4.6 Bokföring och Rådgivning ................................................................................................ 54
4.7 Cityrevisorerna .................................................................................................................. 55
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4.8 Gastro konsult ................................................................................................................... 57
4.9 Berits Byrå in Norrkoping AB .......................................................................................... 58
4.10 Mobipro AB .................................................................................................................... 60
4.11
Result of the interviews ............................................................................................... 61
5.
Analysis ............................................................................................................................... 65
6.
Conclusion........................................................................................................................... 77
7.
Discussion ........................................................................................................................... 79
Appendix ..................................................................................................................................... 84
Interview questions ................................................................................................................. 85
Demographic questions company: ...................................................................................... 85
Demographic questions interviewee: ................................................................................. 85
Interview questionnaires ......................................................................................................... 86
References ................................................................................................................................... 87
Books and articles: .................................................................................................................. 87
Internet sources: ...................................................................................................................... 92
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List of Figures
Figure 1. Kotler 4Ps model (2003) .............................................................................................. 25
Figure 2. AIDA model (Elmo Lewis, 1898) ............................................................................... 28
Figure 3. Lovelock and Wright Marketing communications mix for services (2002) ................ 33
Figure 4. Lasswell Comminication model (1948) ....................................................................... 39
Figure 5. Shannon-Weaver model (1949) ................................................................................... 40
Figure 6. Schramms communication model (1955) .................................................................... 40
Figure 7. Entrepreneurial marketing behavior is determined by entrepreneurial thinking (Hills et
al. 2006)....................................................................................................................................... 43
Figure 8. Communication elements in percentage (by the authors) ............................................ 66
Figure 9. Communication marketing model for micro companies in the service industry (by the
authors)........................................................................................................................................ 81
List of Tables
Table 1. Interviews' timetable ..................................................................................................... 17
Table 2. Paul Smith Communication tool (1998)........................................................................ 32
Table 3. Lovelock communication mix table (by the authors).................................................... 63
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1. Intr oduction
This chapter is intended to give the primary information for this dissertation by
introducing the background, area of interest, problem statement, research questions
and outline of the thesis in order to clarify the front path for the reader. In this chapter
you will find the introductive information about small firms in Sweden which are
activate in service industry and their marketing strategies’ approaches specifically,
Communication Marketing.
1.1 Background – The pr esent situation
Small firms are Europe’s business core, and 99.8 percent of all companies are to be
found in the category of small to medium sized enterprises (EU Commission, 2008).
According to Berthon et al. (2008) small and medium size enterprises (SME) are mainly
crucial in the society due to their contribution to the gross domestic product, national
employment, and export performance to a country.
The biggest problem for small businesses is marketing and related reports shown that 70
percent of SMEs go bankrupt in 5 years (Romano et al. 1995). This number is big
enough to ask for more attention and observation. But surprisingly at the same time, the
statistics show that the popularity of starting up new firms is not decreasing and still
many entrepreneurs are eager to start their own business in the local market of Sweden
(despite the cited bankruptcy percentage). Reading this dissertation may take two hours
and it would be really interesting to know that while you are reading this research,
according to Swedish economic facts 1, in Sweden 201 companies are registering their
business and 140 companies are forced to shut down at the same time because of
unprofitability or similar problems. According to the marketing table that developed by
Brown et al. (1999) 40% of small businesses problem is seated in their marketing and
other areas of problem such as product development (6.7%) or production management
(8.6%) have much smaller percentages in comparison with marketing. The reader can
find the table in the appendix. To know more about small businesses in Sweden Sundin
(2008) cites that, it is necessary to be aware that there are some niches in the local
market that can be filled with innovative ideas of the small businesses entrepreneurs or
1
www. ekonomifakta.se
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owners. That’s why the number of new small firms facing a great growth. At the same
time the importance of service industry in Sweden should not be neglected. Service
industry (intangible product providers) and the way that they lead consumers to
differentiate them from others (their brand image) are the areas of attention in this
dissertation. Moreover it is really important to bear in mind that many small businesses
and the highly growing number of them cannot be the proof of anything by itself
(Sundin 2008). This raising number can be representative for many reasons e.g. many
people in Sweden wants to be their own boss, there are a lot of inefficiencies in big
businesses that promote people to attract to the small ones and so forth. But the reasons
for small firms’ creation are not our area of attention. Here first and foremost, the target
of the authors is to find out while many small firms are existing in this country and the
economy is dependent on them (more than 90% of Europe business core), how these
corporations organize their communication strategies in a business to customers (B2C)
context.
1.2 Ar ea of inter est
The above-mentioned points were all the introduction of small businesses and their
nature and the reasons of their creation but our area of interest lays just in a specific part
of this category. Herewith we want to raise another interesting facet of small companies
in the service industry which is promotion strategies of the firm and its needs and
derivatives. Companies must ask not only “How can we reach our customers?” but also,
“How can our customers reach us?” (Kotler, 2009, p.564) According to Kotler (2009)
the 4Ps model consists of four marketing decision variables: product, price, place and
promotion. Each of these variables also has their derivatives which our scope of
attention lays in Promotion derivatives. Promotion consists of Advertising, Sales
promotion, Personal selling, Public Relations and Direct Marketing. Based on Kotler
(2009) communication marketing strategies fits in this area and our aim is to see how
micro-companies manage their advertising. Communication marketing has a special
place in leading companies through the competitive path with their rivals so it deserves
a special attention. It can be considered that today’s communication is an interactive
dialogue between the company and its customers that it happens during all the stages of
pre-selling, selling, consuming and post-consuming. Moreover Kotler claims that
technological advances had a great impact on the means of communication. People can
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communicate through traditional media (newspapers, radio, tv…), as well as through
newer media (computers, internet…). “By decreasing communication costs, the new
technologies have encouraged more companies to move from mass-communication to
more targeted communication and one-to-one dialogue” (Kotler, 2009, p.564) Sundin
(2008) claims that Sweden economy is often described as being extremely dependent on
a small number of big, dominant companies. This can be correct from many
perspectives but at the same time many see Sweden as the land of small businesses.
Regarding to the observations that she claims the major part of this country is covered
by small businesses. In this paper the main focus is on the small companies in the land
of Sweden and its local market. After all cited points maybe this question comes to the
mind of the reader that what is our exact problem statement and research question and
why we want to work more in the small businesses, service industry and marketing
communication areas.
1.3 Pr oblem statement
Regarding our search on articles that are related to small-sized corporations and their
marketing strategy at the same time; we came to the idea that the main problem of small
businesses (the key actors of the market related to their percentage of existence in
Europe) is their marketing especially, communication marketing. They are weak in the
area of marketing and the knowledge toward strategies is insufficient (Brown et al.
1999). Our pilot study is another indicator to show the proof of our raised problem
discussion. In our pilot study which is based on interviewing three small consultancy
firms, we came up to the idea that marketing theories that developed by credited
management theoreticians are not that much used by these firms although the business
owners are aware of them, they are not interested to apply those strategies in their daily
business. The findings show that especially in the area of communication marketing few
factors are elaborating. In other words “Word of Mouth” has the most influence on
decision-making process of customers of small firms in the service industry. As
previously mentioned, According to Brown et al. (1999) 40% of small businesses
problem is seated in their marketing. This big number raised a lot of questions in our
mind especially when we performed the pilot study that triggered us to do the
dissertation further with the attention on marketing communication and small firms in
service industry.
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1.4 Resear ch question
We believe that most of the marketing strategies are developed for big actors of the
market; and small firms especially in the service industry call for more specific attention
from theoretical stand point (theory-based models and etc.). “Marketing issues and
implementation of marketing decisions are not exclusive to large-firm settings. Small
and emerging firms face marketing issues critical for their survival and growth.”
(Romano et al. 1995) Based on our search on articles and books it seems that small
enterprises demand more attention in choosing their marketing strategies because
somehow it seems that their strategies are not that precise or have a theory-based
support. In this paper we are going to observe micro firms’ marketing approaches
specifically from communication aspect and realize to what extent their activities rely
on theories. In other word the main research question would be:
 Are micro firms using the most known marketing communication theories in
their day to day business?
 How do micro firms perform their marketing communication with their
customers?
By small corporations we mean:
Microenterprises: The category of small and medium enterprises is micro enterprises
which they are businesses with fewer than 10 employees (Summaries of EU legislation).
1.5 Thesis outline
In this paper you will face different sections that aimed to be organized in the most
convenient way for the reader. The second chapter after introduction is going to be the
methodology and its different approaches. Next is the theoretical framework and the
most credited and relevant theories regarding communication marketing, small
companies and the service industry. Further is the empirical part and the interview’s
finding that led us to get closer to the optimum result. Final steps are going to be the
analysis and discussion of theories and empirical findings at the same time. Finally the
last part is conclusion which includes the communication marketing model for small
businesses in the service industries that developed by the authors of this dissertation.
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2. Methodology
This chapter aims to define and clarify the details that have been conducted through the
process with the emphasis on validity and credibility of the sources. Also it targets to
clarify the phenomenographic approach for the reader that was the main tool for
conducting this research.
2.1 Topic of choice
Many researchers have covered the field of marketing in general and more especially
marketing communication. Ever since Philip Kotler published his book “Marketing
Management: Analysis, Planning, Implantation and Control” which is the most widely
used marketing book in business schools around the world 2, this topic has been fairly
covered. Scholars have especially focused on the connection between big companies or
corporations and the relations of marketing theories. Not much has been said about
marketing communication in small and micro companies. The traditional assumption is
that small businesses should use the same principles as big companies and therefore not
much research has shred light over relation between big companies and small
companies and the impact of marketing communication theories (Gumbert, 1981).
According to Romano et al. (1995) 70 % of all small companies go bankrupt in five
years after their initial start. If we combine the facts that 99.8 % of all companies (EU
Commission, 2008) are under the category of small to medium enterprises and that the
main issues that they are under the category of marketing makes this topic not only of
great interest but also of great importance
2.2 Quantitative and Qualitative method of phenomenographic appr oach
Quantitative and qualitative methods of research are two well-known approaches in
social science. It is not easy to place the actual research in one of the two approaches.
This is hard to do because of several reasons. One of the reasons is that researches
normally tend to mix the both approaches in order to get a broader and deeper
understanding about the issue. Another reason is that quantitative and qualitative
methods are only separated in theory; in the real world it is more that they overlap each
other. Third and last reason is that these two approaches are only a distinction when it
comes to how data should be treated, rather than research method (Denscombe, 2008).
2
www.kellogg.northwestern.edu
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Below follows more detailed information about the distinction between quantitative and
qualitative approach and what characteristic applies to them. It is often said that
qualitative research has words as its main background rather than numbers and statistic
like for quantitative approach. Another characteristic for qualitative approach is that it is
often based upon small scales of studies which also apply for our study, where the
authors are going to interview a small number of companies. In contradiction to
quantitative approach where the focus is on reaching a bigger number of audiences,
often based on surface data. In quantitative approach the aim is to separate the research
in separate factors in order to study the specific variable. This is called for specific
focus, where researches take apart the issue in order to only study the specific factor of
interest. Opposite of specific focus is holistic perspective and is associated with the
qualitative approach. Instead of isolate factors the aim is rather to see how these factors
are dependent on each other and how they interact (Denscombe, 2008). This means that
qualitative research has a tendency to study things in their context and is also often
called for the naturalistic approach. Like Lincoln and Guba (1985) say research happens
under the presumption that social reality cannot be understood if they are isolated from
each other. The qualitative method fits our approach in this study but is not our choice
of approach. Reason to that is the existence of a third approach so called “qualitative
method with phenomenographic approach”, which is elaborated more below.
The qualitative method stands for describing properties of something, how that issue is
designed. The uniqueness of qualitative method is to find the characteristics of the point
of interest and to put that in center (Larsson, 2006). When our thesis questions are stated
in the since that we are going to find the answers and conclusions through our
respondents the qualitative method with phenomenographic approach fits well to our
approach. Phenomenographic is traditionally associated with the qualitative method and
stands for getting knowledge about human phenomenon. Beside human phenomenon
the aim is also to understand people’s perceptions, experiences, feelings, beliefs,
expectations, motives and attitudes that are how the world is perceived by someone
(Paulsson, 2008). This research’s authors tend to find if and to which degree companies
uses marketing communication theories, further described in the frame of reference
chapter, and to do so the respondents of this case their perception about the theories
should be studied As Larsson says (2006) that the phenomenographic approach is
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characterized by researchers’ tendency to find how phenomenon is perceived by people.
This means that the phenomenon itself is in the center and by using this method it
culminates in describing the perception of people off how something is perceived, rather
than how something is. One of the biggest advantages using this method is that
opportunity to collect the different perceptions and peoples arguments about it.
2.2.1 Choice of appr oach
In order to answer the research questions and to come up with a conclusion it requires a
set of personal and deep interviews made with the respondents. The aim with the
interviews is to ask open questions and to have a good discussion with the respondents
in order to really get the true meaning of respondents view and position. This thesis is
based upon the empirical findings and that means that the authors are going to describe
how respondents through their companies use marketing communication theories and
what impact it may have. The perception of what communication marketing is and how
it is applied by the interviewees are something that is very individual. Highly personal
interviews will help researchers to answer the research questions stated in this thesis.
Therefore the qualitative method with phenomenographic approach is the method that is
the most appropriate to answer the purpose of this research (Jacobsen, 2002).
2.3 Resear ch appr oach
There are two main approaches for a researcher to choose from when it comes to
connecting theory with reality, namely deduction and induction. The characteristic of
deduction is that researchers from the beginning already have a clear theoretical position
even before data is collected. Then the next step is to through empirical research
compare findings with the theoretical framework that the researches started with
(Jacobsen, 2002). The inductive approach is contrary to deduction in that since that the
theory will be developed first after the data collection. This means that the inductive
approach does not have a defined theoretical framework and it would require deep
prefund knowledge about the field of interest in order to continue with the inductive
approach (Saunders et. al, 2007).
The deductive approach’s main characteristic is the ability to generalize to the whole
population. In order to do so, it requires that the sample size need to be of good
proportions (Saunders et. al, 2007). The researchers tend to interview 10 micro
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companies in the area of Norrkoping and Linkoping town. In Sweden 914,043
companies exist by the year of 2010. The proportion for micro companies is 96.2
percent of the total 3. This means that there is a population about of 879 310 companies.
With the 10 chosen companies that all of them are from the same region of Sweden
makes it impossible to make a generalization. Even so if the authors did 20 or 50
interviews there would be insufficient data to make a generalization. Therefore, writers
of this case don’t aim to make a generalization with the thesis; instead the aim is to
show that there a pattern can be existed instead of a generalization. Due to the nature of
this research questions and the fact that this research has a well-defined theoretical
framework. the authors tend to choose the deductive approach. This does not mean that
the inductive approach is rejected. Like any other good master thesis there would be
elements of the inductive approach as well, in order to get a profound conclusion of the
issue.
2.4 Data collection
There are two ways in how researchers can obtain data, namely primary and secondary
data. Primary data is what researchers derive from. Secondary data is used to support
primary data and can be in various forms. Obtaining data is crucial for every research
and therefore good data is vital for conducting a good and valid research (Dalen, 2008).
Below is information about this thesis primary and secondary data that researchers of
thesis used.
2.4.1 Pr imar y data
Primary data in qualitative approaches as this thesis represents, often obtained by
interviews or observations. For this thesis the authors obtained its primary data from 10
interviews. Of 10 interviews 7 of them where conducted in downtown of Norrkoping
and the remaining 3 in Linkoping. Companies that where subject for the interviews are
classified as micro companies in services industry. All of interviews were conducted
during the period between 4-Apr-2011 and 25-Apr-2011. In order to achieve great
validity and reliability the writers aimed to conduct interview with only CEO´s or other
staff members who has deep knowledge about the industry and the company itself.
Information about companies name, names of the interviewees, location, date and time
are stated below.
3
www. ekonomifakta.se
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Reventia,
Joakim Samuelsson
Smedjan Ekonomconsult AB,
Rose-Marie Bidenäs
Birger Edelbergs Law firm,
Birger Edelberg
Synective Labs AB,
Magnus Peterson
More Time Economic Bureau,
Ola Lindgren
Bokföring och Rådgivning,
Parisa Majidi
Cityrevisorerna,
Maria Johansson
Gastro Konsult,
Jonas Skepp
Berits Bureau,
Berit Johnsson
Mobipro AB,
Micael Dahlgren
Norrkoping
2011-04-04
8.30 A.M
Norrkoping
2011-04-11
9.30 A.M
Norrkoping
2011-04-12
11.00 A.M.
Linkoping
2011-04-15
13.00 P.M
Norrkoping
2011-04-18
13.00 P.M
Linkoping
2011-04-19
9.30 A.M
Norrkoping
2011-04-20
9.00 A.M
Norrkoping
2011-04-21
13.00 P.M
Norrkoping
2011-04-22
14.00 P.M
Linkoping
2011-04-25
10.00 A.M
Table 1. Inter views' timetable
In addition to interviews the authors conducted also a series of questionnaires which
aimed to strengthen findings from the interviews. The questionnaires were made during
the interviews with the 10 interviewees. The goal was to first have pervading interviews
and then at the end of the interviews the respondent did also answer the questionnaires
which the reader can find in the appendix. The questioners served the authors as an
17
indication of how much of the companies budget was dedicated to communication
marketing and how the amount where distributed. This information will help authors to
see how micro companies are actually communicating with their customers and also to
show if and how much resources are placed in different marketing communication tools.
The researchers believe that this is a good approach due to the nature of this thesis
questions to combine well-constructed questions and deep going interviews with
questionnaires where the very same respondents will also answer the survey questions.
2.4.2 Secondar y data
Secondary data is data gathered from already existing printings. Secondary data can be
found in newspaper, journals, articles, internet, books etc. (Hart, 1998). Writers of thesis
extracted most of secondary data from journals downloaded from schools database.
Other secondary data where gathered from books also gathered from schools library at
Linkoping University.
2.5 Inter view technique
After choosing the qualitative approach as a method, the following steps are often taken
by the researches by constructing and undertaking a set of interviews. At a first glance
interviews seem like a logic and easy way of finding empirical data that researches tend
to find (Dalen, 2008). As Denscombe (2008) says, to carry through an interview you
will only need a notebook, tape recorder, and researches natural ability in conducting a
conversation. But the reality is far different. In order to follow through a series of
interviews with high credibility and notion of that the researcher pose the right
interview technique to get the true meaning from its respondents, demands that the
interviewer are well prepared and trained before conducting interviews (Trost, 2010).
There are several ways in how the interviewers can prepare themselves to accomplish a
successful interview. The researchers can do several training interviews that performed
with their friends, colleagues, relatives and family. This is a good approach for the
researches to get in the role as interviewers. The feedback from the training interviews
will be the basis of looking for improvement in interview technique. When the
researches are happy with the practice interview result and feel ready to carry out
interview with real respondents an interview plan will be developed to reinsure the
quality of the interviews (Banaka, 1981). Researchers of this thesis will follow the
above mentioned steps in order to follow through interviews in a proper way. Interviews
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are like previously mentioned foundation of this thesis and therefore much preparations
and explanations need to shed light upon in order to achieve great validity in this thesis.
Preparations before the interviews will consist of a strategic plan to make sure that the
vital questions are asked and properly answered. The strategic plan consists of a
checklist that is going to be followed before and after every interview. By doing so, the
risk of absence of vital information will be reduced and reinsure that the interview
technique is good. Most important is that the authors aim to have continuous approach
on every interview so that the data can be easily collected and analyzed (Denscombe,
2008).
According to Dalen (2008) the best approach when implementing interviews is to
record the conversation, if the respondent gives his or hers approval to that. Then the
interviewer can without stress focus on asking questions and to maintain the right
interview technique throughout the whole interview. Though in this case there are two
researchers in this thesis, one of them will lead the interview and the other will make
notes of what has been said. This arrangement will shift for every interview so that both
of the researchers will go through both steps in the interview process. The final step of
good interview technique lies in choosing right approach in conducting interviews.
There are three choices for a researcher to take, structured, semi-structured and
unstructured interviews (Denscombe, 2008). Though in this research the authors’ aim is
to find out how micro companies communicates with their customers and how well the
theories of marketing communications is used by the same companies. The authors are
going to use both semi- constructed interviews and questionnaires. The researchers
believe that by using two methods that are different, more information and
triangulations point of views would be gathered. This will allows the authors to show
the same result with different methods, therefore the end up result will be doubtless
(Trost, 2010). Semi-constructed interviews give opportunity to the respondents to speak
their mind but still be bounded in the subject that the authors tend to question about
(Denscombe, 2008). Combining that with questionnaires where there is more quantified
data will help the authors to determine research questions.
19
2.6 Validity and Reliability
Under this section there are information present about this thesis validity and reliability.
The researchers are very keen to present how the validity and reliability are conducted
during this thesis in order to reinsure the reader that this dissertation has high-quality
implementations.
2.6.1 Validity
The researchers of this thesis aim to make a contribution to all stakeholders that this
thesis may have. In order to do so, there are several aspects that this thesis must
undergo. One of them is to have great validity and reliability. This is highly important
so that a reader or other stakeholder can be sure that this thesis is valid and its
conclusions and result also have high reliability.
Validity is easiest to explain by saying that validity is a measurement of how well the
authors examined what should be examined (Rosengren & Arvidsson, 1997). In this the
writers will investigate how micro companies are handling their communication
marketing and if they are using any of the most known theories. Great validity are
archived in this thesis though respondents who are CEO´s or other staff members with
high knowledge about the subject where interviewed. The respondents were selected
with great care and they are the most suitable subjects for this thesis. The interview
questions are constructed with high validity in mind so that the respondent are well
aware of the questions’ aim and that the perception of the questions are the same as the
authors have in order to get answer of the questions in mind without any doubt of
confusion. As Rosengren et al (1997) says it is not enough to ensure that data must be
validate in different stages of data collection and processing is carried out correctly. Nor
is it enough that the respondents answer recorded accurately and correctly and properly
transferred to the database. It is also important that the collected responses also need to
really say something about what the investigator intended to measure
2.6.2 Reliability
Reliability is about quality in the measurements. Reliability is high when the same
result or patterns are shown independent of who the researchers are. High reliability
does not provide high validity automatically but high validity provides high reliability
(Rosengren & Arvidsson, 1997). The authors believe that this thesis has a strong
20
reliability because all of the 10 conducted interviews are showing the same results. All
interviews are also completed in the same manner so all eventual errors in the
implementation are eliminated. By having received results from the interviews that all
are showing in the same pattern with high validity though all companies and all
respondents are highly suitable for these thesis empirical findings leads to high
reliability.
2.7 Litter ateur r eview
Literature review is important to show the reader similar studies on the subject and to
present what other scholars have said about the subject in matter. This include, in this
thesis as well to study books, articles, journals, magazines and also newspaper (Hart,
1998). This thesis’s authors made extensive literature research to find all available
information about marketing communication. This topic is not new, lot has been written
about marketing communication as theories and application models. But, little has been
covered about how marketing communication is developed for micro companies. This
will not though a disadvantage for the authors, the aim is to use the valid information
about marketing communication and test them on the respondent of micro companies.
One of the main used resources is Philip Kotler’s Marketing Management book which is
very well-known in marketing area. Other used books in this thesis are from Lovelock,
Hillsl and others who are equally important in the small and medium enterprises
segment that the authors have studied closed. For other literature research journals and
articles have been used from Linkoping University library’s database. Through schoo’ls
library the authors have access to several databases, such as Emerald, JSTOR, EBSCO
Publishing, European and Journal Seek. Words that frequently used in this theses are
related to the literature research such as communication, marketing, micro companies,
marketing model-theories, with different combination to easier access the literature of
the topic of choice.
21
2.8 Tar get audience of the r esear ch
When researches start to write a thesis or when scholars are undertaking to research a
topic there must be a motive behind this. According to Saunders (2003) a research is
something that researches undertake in order to find the answers to the questions that
are stated. This answer must be responded in a systematic approach and that the end
user will gain knowledge about the subject in question. The authors tend to conduct this
thesis in a systematic manner and to explore if micro companies use marketing
communication theories developed by scholars. Therefore this thesis’s target are fellow
colleagues studying economic and even other students with social science focus. The
authors of this thesis also believe that micro companies will be an end user and that this
thesis will contribute to expand their knowledge about marketing communication. This
case conclusion will help micro companies appreciate which marketing communication
model or theory will be to their advantage.
22
3. Theor etical Fr amewor k
This chapter is intended to introduce the reader with basic information about marketing
and communication marketing and the known related theories in order to make a better
understanding of communication marketing approaches that micro companies are using
in their daily transactions. Moreover in this chapter, one part is belonged to
entrepreneurship concept, as long as many small business owners are entrepreneurs;
some details about these phenomena considered relevant to the subject of this
dissertation. First the eight theories will be introduced and then the last part is
dedicated to entrepreneurship.
3.1 Intr oduction and definitions
Small firms and their importance is obvious due to their great number in the European
market, as an example the 98.2 percent of the European companies belong to this
classification (EU Commission, 2008),
which means small firms can be seen as
Europe’s engine. In this condition, in order to stay competitive small firms should
consider many aspects of their activities which one of the main is their marketing
approach and especially the communication marketing. Small firms should have a good
plan for their communication marketing in order to have the most benefit out of their
communication with the customers or other businesses. (B2B or B2C context).
“Marketing is still relatively unknown for the owners of small-scale businesses”
(Kinsey, 1988) He adds that the firms often call for education in this field; it is therefore
probable that small-sized businesses are using marketing without being aware of it. The
proper communication gives the ability to small firms to present themselves toward
their customers through a reliable and confident path with the goal to create the best and
most credited image in their customers’ perspective. To have a brighter idea about
marketing and communication marketing first we will present the general definitions of
marketing.
Kotler (2005) cites that marketing is about discovering needs and wishes of the market
where the firms are operating while trying to satisfying those needs. Firms categorically
are aiming for improving their competitiveness and this will be achieved by long-term
relationships with customers and a good communication. Another idea is also cited by
Kotler (2005) which shows that marketing is focusing on exchange. Exchange presents
23
the idea of return of satisfied customer after his first purchase. More satisfied the
consumer is, more coming back to the same product or service provider is probable.
Satisfied customer is the central core of marketing and is important for the creation of
more exchanges that in the long-term will lead to success for the company.
3.2 Developing mar keting communication mix theor ies
Generating a successful marketing mix that lead to an optimum result, usually calls for a
market research and market observation. There are many methods that developed by
credited scholars that can be employed both in person and the use of objective
presenting. The key is to not always depend on one mix and try to explore other paths.
The integration and coordination of these elements might be more effective than
depending on one. The communication marketing mix model should arrange all
components toward a certain goal, so that the potential consumer is not being received
unclear or mixed messages that may cause confusion. The raised question is: “Do all
factors include the same message?” As an example it is crucial for a company to have a
certain promotion plan when it serves a niche market. Company’s product is produced
toward the needs of the market then the price should be set according to the budget of
that market and distribution and other services should be coordinated as well. So
promotion is one of the main elements that can find solutions for the problems that a
company would be encountered from its first steps. As it can be seen here promotion
can be the key of success for many companies and their communication approaches. In
other words the key of success in different aspects are consisted of how they allure
customers, how they gratify them and how keep them for the future and this can happen
in many markets from small sized to the global-sized. The aim here is to define the
communication marketing theories and try to mix the theories in order to develop an
effective marketing communication mix for micro firms in the local market of Sweden
in the service industry, indeed.
In order to guarantee the existence of the companies in the future using marketing
communication mix can play a vital role for the companies that imply them in their
daily businesses. As it mentioned before, regarded to Romano et al. (1996) a great
number of small firms (more than 40%) after few years face bankruptcy which means
that they could not continue their business in the market anymore which brings them
huge amount of debts and financial liabilities.
24
3.3 Communication Mar keting theor ies
Effective marketing strategies are built on an in-depth understanding of the market
environment of the business, and the specific characteristics of the market (Aaker,
2000). Herewith the aim is to represent different marketing and marketing
communication models to the reader in order to create a better understanding of present
situation of small firms in the service industry in the local market of Sweden and their
communication marketing approaches.
3.3.1 4Ps model
The 4Ps model of Kotler consists of four marketing decision variables: product, price,
place and promotion (Kotler, 2009). Product can be tangible or intangible service that is
produced to the market based on customers’ needs and wishes. Price is the amount of
money that customers pay to acquire the desired product or service. Place represents a
location that product can be purchased which can be physical or virtual as well. The last
one is promotion which represents all the different approaches that marketers use in the
market to present the product. Promotion has four distinct elements: Advertising, Sales
promotion, Personal selling, Public Relations and Direct Marketing. Based on Kotler
(2009) communication marketing strategies fits in this area and our target is to see how
small firms manage their advertising. Kotler (2009) cites that a company must decide
how many ideas to relay in its positioning to its target customers while they are using
the 4Ps. Many marketers advocate promoting only one central benefit.
Figure 1. Kotler 4Ps model (2003)
25
3.3.2 Seven Pr omotional mix by Paul Smith
Paul Smiths theories and models are from his book “Marketing communications – an
integrated approach” (1998). He is talking about the marketing mix which consists of 7
Ps. The 7 Ps are an extension of the original 4Ps developed by Philip Kotler. The
additional Ps are People, Process, and Physical evidence.
Paul Smith has divided communication mix into more subsidiaries, as it appeared
below. According to Paul Smith (1998) Promotion is consisted of following stages
(different organization of promotion’s subsidiaries):
-
Sales Promotion ( Sample drop, Competition, Collection)
-
Advertising ( TV- Press)
-
Direct Marketing ( Mail shot, Telesales)
-
Publicity ( and PR )
-
Sponsorship
-
Exhibitions
-
Packaging
-
Point-of-sale and merchandising
-
Internet
-
Word of Mouth
-
Corporate Identity
This is called the “communication mix”, and is the ingredients of Paul Smiths
communications model. Herewith there are further descriptions for the most used and
important subsidiaries, begging with sales promotion.
Sales Pr omotion:
Sales promotion is by definition a short term initiative to encourage buyer to purchase a
product or a service. When using sales promotion includes several communication
activities. These activities are used for providing additional value to the customers and
to stimulate and endorse further sales. These activities can be in forms such as; coupons,
samples, premiums, rebates, sweepstakes, and point of purchase (Smith, 1998). Now
when the activities are clear the next step is to decide how to reach out to the customers
with those chosen activities. There are three ways in how companies can use sales
promotion strategy. Push, pull or a combination of the two strategies are choices
26
companies can undertake.
Push strategy means that companies are pushing their
products or services through distribution channels to the final customer via sales
promotions. These sales promotions in push strategy´s consist typically of allowances,
buy-back guarantees, free trials, contests, specialty advertising items, discounts,
displays, and premiums. Pull strategy is contradictory to push strategy and means that
companies tries to make the customers pulling (asking) for their products and services
(Fill, 1995). These can be done by using samples, coupons, cash refunds and rebates,
premiums, advertising specialties, loyalty programs/patronage rewards, contests,
sweepstakes, games, and point-of-purchase (POP) displays. Companies adapt their
marketing in that sense that the goal is to simulate, interest and most important make a
demand that the product or service will provide a fulfillment to the end user. This
strategy is mainly used when the market is reaching saturation. Companies attempt then
to grasp customers to choose their products instead of their opponents by offering the
above mentioned methods (Smith, 1998).
Adver tising:
Advertising means by definition the non-personal communication of information
usually paid for and usually persuasive in nature about products, services or ideas by
identified sponsors through the various media" (Bovee, 1992). Goals of advertising are
to inform, remind and to persuade the customers. The goal is typically reach by major
media in form of; radio, magazines, yellow pages, newsletters, newspapers, television,
direct mail, brochures, telephone, internet and outdoor (billboards, blimps, etc.) These
types of communication channels are called “mass communications”. This means that
by using this channel companies are reaching masses.
One of the most famous models in advertising is AIDA model. AIDA stands for action,
interest, desire and action. The point with communication channels is in to get attention
from the buyers, then hold the interest, create or bring desire, to finally make the buyer
to act and buy companies product or service ( Engel, 1994).
27
Figure 2. AIDA model (Elmo Lewis, 1898)
Dir ect mar keting:
Direct marketing differs from ordinary marketing in the sense that no channel
intermediaries are existed. There are no distributors, retailers or wholesalers which
mean that the company in question has a direct contact with its customers. Direct
marketing usually is carried out through telephone (telemarketing and telesales), direct
mail (brochures, catalogs, flyers), direct-response broadcast advertising (television &
radio), online computer shopping, and cable television infomercials, door drops,
coupons, inserts in newspaper and magazines and home shopping networks (Smith,
1998). Direct marketing is more frequently used past decade mainly because of the
technology progress with internet and new media. More and more companies have
direct marketing as a business model to ensure to reach out and supply their customers
at all the time (Engel, 1994).
Public r elation:
Public relations or just PR is a concept where market activities aim to raise public’s
consciousness about that company´s product or service (Smith, 1998). PR is used to get
the public get better understanding about the company and its products or services they
provide. PR can use all the same communications tools as in other areas of marketing,
but what makes PR special is the goal when using PR. The goal is not as in other
28
communication tools to increase sales or other measurable aspect. Instead the goal is to
generate purposeful communications with its public. Public is company´s stakeholders
and PR is used to have a good connection and communication with company´s
stakeholders. Goal is to build and maintain a positive perception of the organization in
the mind of its publics.
Sponsor ship:
Sponsorship is in many ways like PR, because of the fact that the goal is to generate
positive feelings about the company at first place, and in other place to make a
statement and to show presence of the company to the audience of the sponsorship (Fill,
1995). When company is using sponsorship it is important that the link between
company which is the sponsor and the event it is sponsoring be cleared. If the link is not
clear, then the sponsorship will have none or little affect. Choosing right events to
sponsor is crucial in order not to harm the company´s image. There are four aspects a
company must realize when dealing with sponsorship and those are:
•
The sponsorship must be economically viable; it should be cost-effective
•
The event or organization being sponsored should be consistent with the brand
image and overall marketing communications plans.
•
It should offer a strong possibility of reaching the desired target audience.
•
Care should be taken if the event has been sponsored before; the audience may
confuse the sponsors, and you may be benefiting the earlier sponsor (Smith,
1994).
Corporate identity:
Corporate identity or branding was at the beginning a concept of how to make the
customers recognize company´s products. Nowadays the concept is much larger and it
contains aspect such as creating emotional attachments to the company or its services.
To make the customers feel the extra quality and a sense of intangible qualities that
make up the brand name or the symbol the company has. It is not an easy task to
develop and maintain a good brand image, but those who do it successfully have a
competitive advantage against their competitors. Successful branding gives the
company not only the awareness of the services and products they are offering, but also
and mainly keep the interpretations about quality and loyalty against competitors
29
(Murphy, 1987). There are several important benefits when having successful brand
image and it is no surprise why branding is one of the most important aspect in
marketing communications. The list below show what companies aims to achieve with
corporate identity based on Olins (1989).
•
A strong brand influences the buying decision and shapes the ownership
experience.
•
Branding creates trust and an emotional attachment to the product or company.
This attachment then causes the market to make decisions based, at least in part,
upon emotion-- not necessarily just for logical or intellectual reasons.
•
A strong brand can command a premium price and maximize the number of
units that can be sold at that premium.
•
Branding helps make purchasing decisions easier. In this way, branding delivers
a very important benefit. In a commodity market where features and benefits are
virtually indistinguishable, a strong brand will help customers to trust the
company and create a set of expectations about the products without even
knowing the specifics of product features.
•
Branding will help the company to fence off the customers from the
competition and protect the market share while building mind share. Once the
company has a mind share, customers will automatically think of that specific
product first when they think of the product category.
•
A strong brand can make actual product features virtually insignificant. A solid
branding strategy communicates a strong, consistent message about the value of
the company. A strong brand helps to sell value and the intangibles that
surround the products.
•
A strong brand signals that the company wants to build customer loyalty, not
just sell product. A strong branding campaign will also signal that the producer
is serious about marketing and intended to be around for a while. A brand
impresses the firm's identity upon potential customers, not necessarily to
capture an immediate sale but rather to build a lasting impression of the
company and its products.
•
Branding builds name recognition for the company or the product.
30
•
A brand will help articulate the company's values and explain why certain
actors are playing in a target market.
Paul Smiths (1998) introduced a communication tool where it is based upon a matrix
where above stages are divided into 12 months. The idea is that companies should use
this matrix to point out how much money, time and manpower are spending on every
element for each month. This will give companies an overview what methods where
used and how much resources was consumed.
This aims to give companies an
understanding of how communication with its customers is developed and to what
degree the feedback is given by each approach (Smith, 1998).
31
Jan
Feb
Mar
Apr
Maj
Advertising
*TV
* Press
Sales Promotion
* Sample drop
*Competition
*Collection
Direct Marketing
*Mail shot
* Telesales
PR
Sponsorship
Exhibitions
Packaging
Point Of sale
Internet
Word Of Mouth
Corporate
identity
Table 2. Paul Smith Communication tool (1998)
32
Jun
Jul
Aug
3.3.3 Mar keting Communication Mix
By looking at the model of marketing communication mix for services by Lovelock
(2002) it can be seen that each of the promotion subsidiaries again breaks into more
subordinates.
Figure 3. Lovelock and Wright Marketing communications mix for services (2002)
Thrassou et al. (2006) mention that Lovelock and Wright deal specifically with services
marketing and broadly communication marketing. Lovelock and Wright work on
communication marketing and services though is prospected and apprehended in light
of
their
overall
services
marketing
management
theory.
By
dividing
the
communications mix (above figure) into personal and impersonal tools, Lovelock and
Wright inherently place a more prominent comparative weight the former, chiefly in
relation to complex services e.g. the ones under the study of this research. From their
perspective the factor that has a great importance is the requirement for a
communications interface channel e.g. the role of a consultant or account manager.
Moreover they emphasize on customer service and customer training which are some
examples of direct contact methods through the communication channel.
Furthermore, Kotler claims that companies must ask not only “How can we reach our
customers?” but also, “How can our customers reach us?” (Kotler, 2009, p.564). In
33
other words he stresses on the importance of communication marketing between
company and its customers. He also adds that today’s communication is an “interactive
dialogue” between the company and its customers that it takes place from the very first
stage to the last one. These stages are pre-selling, selling, consuming and postconsuming. Moreover Kotler claims that technological advances had a great impact on
the means of communication. People can communicate through traditional media
(newspapers, radio, tv…), as well as through newer media (computers, internet…).
“By decreasing communication costs, the new technologies have encouraged more
companies to move from mass-communication to more targeted communication and
one-to-one dialogue” (Kotler, 2009, p.564)
3.3.4 Wor d-of-Mouth
Word-of-mouth marketing is defined in Business Dictionary 4 as below:
“Oral or written recommendation by a satisfied customer to the prospective customers of
a good or service. Considered to be the most effective form of promotion, it is also called wordof-mouth advertising which is incorrect because, by definition, advertising is a paid and nonpersonal communication.”
In Financial Times Lexicon 5 word-of-mouth marketing definition is:
“Word-of-mouth (WOM) marketing refers to promotional activities that leverage social
interactions and word-of-mouth between consumers.”
Ardnt (1967) describes word-of mouth marketing as:
“ Oral person to person communication between a receiver and a communicator, whom
the receiver perceives as non-commercial, concerning a brand, a product or a service.”
Bolen (1994) states that it is crucial to recognize that categorically all customers can do
and say negative comments as well as positive ones about a business. J. Wilson in his
book Word-of-Mouth Marketing (1994) stresses that:
“Good, normal or adequate service or experiences will solicit little or no word-of
mouth statements from customers. Service or experiences with bad quality, on the other
hand, will promote negative word-of-mouth statements while high-quality service or
4
5
www.businessdictionary.com
www.lexicon.ft.com
34
good experience from a specific product or service provider will encourage positive
word-of-mouth responses.”
As Santo (2006) cites word-of-mouth cuts through and rises beyond the noise since it
has been sending from a source such as a friend, a co-worker, an expert on the subject
and etc. Receiving a message through explained path which is objective make the
received message even more reliable from customers’ view than an advertising agency.
While customers know advertising agencies job is to be paid by different businesses in
order to promote their product or service in the market. He adds that:
“What everyone doesn't know yet is that companies often hire advertising agencies to
help them generate WOM. Just as not all search engine marketing is organic, neither is
all word of mouth.”
“ WOM is a consumer-dominated means of marketing communication where the sender
is independent of the market. Therefore it is perceived to be more trustworthy, credible,
and valid by consumers compared to firm-initiated communications” (Schiffman et al.
1995). Word-of-mouth marketing (WOMM) is the universal impacting of consumer-toconsumer communications with the help of professional marketing methods (Kozinets
et al. 2010). Godes et al. (2004) mention that consumers are desired to be influenced by
their social interactions with others at the time of purchase decision-making process.
Brooks (1975) cites that word-of-mouth influences the great number
of purchase
decisions of the customers, that is why word-of-mouth has a special place in marketing
theories thanks to its impact on consumers’ point of view. The power and significance
of word-of-mouth in daily life lies in the mutual speakers’ lack of product involvement
or material concern.
Ditcher (1966) claims that:
“When customer feels that an advertisement is used more as a sale tool rather than an
informative device, he feels threatened and tries to reject the advertising claim.”
He explains that in an effort of finding a solution for the purchase problem and
customers’ decision-making process, one of the most predicted approaches is word-ofmouth. He defends his statement by adding that when the customer notices that the
advertiser conversation with him is like a friend or an impartial authority, trying to
35
create a word-of-mouth atmosphere, the customer feels secure and is more intended to
receive the third person advice or suggestions (Ditcher, 1966).
Word-of-mouth can happen in two different forms based on Ditcher (1966): predecision and post-decision. These two does not have the same focus and each occurs in
different criteria depended on the market, marketers and customers conditions.
Moreover Ryan et al. (1943) suggest that buyers’ conversations were more significant
than marketing communications in affecting purchase decisions. Ditcher (1996)
emphasizes that if marketers desire to totally seize the influences of their WOMM
(Word-of-Mouth Marketing) strategies, observing the measures of communication
widespread presence or valence and contemplate its content is crucial. Cotherl (2000)
mentions that word-of-mouth can happen in different forms such as active or passive.
Active word-of-mouth activities mostly call for giving free samples or free promotions
in order to impact customers right at the place or another way is to hire the professional
marketers to promote a specific brand, product or service.
Passive WOM marketing activities usually consist of reviews and observing
conversations about a service or a product that happens in a virtual environment
(internet). It should be considered that WOM has changed during decades and evolved
to more sophisticated models, for instance word-of-mouth can be existed in the virtual
world. Such as nowadays on-line word-of-mouth can be seen in a form of reviews when
a certain product’s users share their ideas with others in a virtual ambience with others
who are interested in the same product. Cothrel (2000) cites that:
“Consumption-related online communities essentially represent WOM networks, where
individuals with an interest in a product category interact for information such as
purchase advice, to affiliate with other likeminded individuals, or to participate in
complaint or compliment interactions”
Moreover Chen et al (2008) express that the information technology and its elements
such as internet and e-commerce have created opportunities for companies to
successfully facilitate word-of-mouth communication by permitting buyers to post
consumer reviews related to their individual experiences on companies’ web sites or
36
even by allowing reviews from the third parties such as Epinions 6 website (Chen and
Xie 2008).
3.3.5 Uses and gr atification theor y
This theory developed by Katz et al. (1973) in attempt of describing that
communication receivers have different needs, such as requirements for information,
knowledge, and understanding. These wants can be fulfilled by different
communication channels, to a different extent. As an example, tv advertisements are
more entertaining rather than informative comparing to print media e.g. newspaper in
the means of transmitting of message to the targeted receiver (Danaher et al. 2009).
Katz et al. (1973) break down several communication channels into different attributes
and rank them on their accomplishment of these elements. The features then become the
connecting bridge between receivers’ needs, and how senders of communication can
receive these needs. Gratification theory tries to explain that consumer’s base on their
needs and desires can have different interpretations of the received message by
marketers. In this mean different components compose the communication channel
(promotion) such as print media or word-of-mouth and so forth. Also the theory
includes that audiences are responsible for choosing media to meet their needs. The
approach suggests that people use the media to fulfill specific gratifications. Then this
theory would indicate that the media compete against other information sources for
receivers’ gratification (Katz et al., 1974). Uses and Gratifications Theory is a method
to understand mass communication. The theory puts more emphasis on the consumer
instead of the current message itself by asking “what people do with media ” rather than
“what media does to people” (Katz, 1973). It can be interpreted that audiences are not
passive; instead they have an active role in interpreting the received messages of media
and its implementation into their lives.
Uses and gratification theory from media point of view:
Katz (1974) states that there are different ways of using media by different people
according to users’ various tastes. Additionally he thinks that there are as many reasons
for using the media, as there are media users. Regarding to the theory, media users have
a free will to decide how they will use the media and how it will affect them. Katz
6
www.epinions.com
37
values are visible by the fact that he believes that media consumers can determine and
choose the impact that media has on them as well as the notion that they can prefer
other media alternatives for shaping their taught (the media users’ free will). It can be
added here that Katz can also put into note the unintentional or unconscious effects of
media on people taught and lives. Customers’ gratification is the optimist’s view of the
media. In today’s life media has many other features besides gratifying media users’
needs and desires.
3.3.6 Integrated mar keting communication
This model developed by Kitchen and Schultz in 1999.
“IMC begins with the customer and looks for the most appropriate and effective
combination of channels through which persuasive programs can be used to build
relationships with customers and other stakeholders” (Kitchen et al., 2004). Danaher et
al. (2009) in an attempt of explaining integrated marketing communication cite that
IMC synthesizes elements of the communication mix in order to create an offset
between strengths and weaknesses of different channels. In other words, strength of one
channel will be used in order to make a balance between other channels that have
weaknesses. That is, synergy which is created between different communications
channels to submit a single unified spot. Kitchen et al. (1999) point that using outsidein thinking in integrated marketing communications is a data-driven approach that
emphasizes on recognizing consumer point of view and developing a strategy with the
right (online and offline combination) channels to increase a more powerful brandconsumer relationship. This involves knowing the right touches points to use in order to
reach consumers. Moreover it is important to be aware that how and where they
consume various types of media. Strokes (2008) claims that integrated marketing
communications tends to guarantee the consistency of message and the complementary
use of media. The concept consists of online and offline marketing channels. Online
marketing channels include any e-marketing campaigns or programs, from search
engines, email, internet to tv and so forth. He continues that offline marketing channels
are traditional print (newspaper, magazine), public relations and etc. A company
expands its integrated marketing communication program by using all the elements of
the marketing mix (product, price, place, and promotion). Integrated marketing
38
communications plans are necessary in order to achieve success. The reasons for their
significance arise with the outburst of information technologies.
3.3.7 Communication Theory
Lasswell’s (1948) classic definition of communication defines:
“Who (source or sender), says what (message), in which channel (medium), to who
(audience or receiver), with what effect.” In other words this model is about process of
communication and its function to society.
Figure 4. Lasswell Comminication model (1948)
Target customers (receivers) have particular preferences for the message channels.
Discrete types of messages are received differing in their various use; furthermore the
ways that receivers could respond to these messages or those senders of messages will
occur in different paths, depend on detached preferences (Westmyer et al., 1998). The
classic model of effective communication recommends the highest impact of the
message that the sender sends occurs when the sender has thoroughly understood the
demands and desires of the receivers. In other words, as Shannon and Weaver
claims(1949):
“When the sender’s encoding of the message corresponds with the receiver’s decoding
of it” (Shannon and Weaver, 1949). Message is the main target of the Shannon-Weaver
model of effective communication. To make it clear, Shannon-Weaver model is about
inter-personal communication that composed of eight principal components that are
needed for information transmission or communication to be occurred: source, encoder,
message, channel, decoder, receiver, noise and feedback.
39
Figure 5. Shannon-Weaver model (1949)
Schramm (1963) is another researcher and his model is a modification of ShannonWeaver model where he emphasizing on the process on encoding and decoding. Here
the same basic assumption lies in that there is a sender of the information. This
information or message that sends must go via a channel in order to reach the receiver
that is called “target of the message”. This flow of direction is called a "single step
model”. In reality the flows of information are much more complex and exist of several
more stages. As well as in Shannon-Weaver model, Schrammn´s model exist of a
sender who first needs to encode his message in an appropriate way through a media
channel. Then if the message gets through all the noise represented by disturbance in
choosing the right media channel, the message will reach the reader. The reader also
needs to decode the message in order to receive the right information that was send
originally by the sender. The receiver sends then feedback to the sender. This feedback
is indirect from the sender to receiver and can only be appreciate by sales or other
quantified measurements (Schramm, 1963).
Figure 6. Schramms communication model (1955)
40
3.4 Entr epr eneur ial Mar keting
After mentioning some theories regarding marketing and marketing communication,
herewith there would be some information about entrepreneurship and entrepreneurs.
Schmid (1999, cited in Sundin 2008, p.214 ) noted different types of business
classification: “This category includes four groups as: first are the self-employment
which is the people who employing themselves while they are waiting to be employed,
the second are the professionals who sell their expertise in the market with their own
management skills. Third are the skilled-workers and professionals like lawyers and the
last group are firm owners who are more leaders than entrepreneurs.”
Herewith it can be seen that entrepreneurs shape one category out of the four
classifications. Herewith first the reader would be introduced to some basic definitions
about entrepreneurs and entrepreneurship. In Webster dictionary 7 an entrepreneur
defined as a person who organizes, manages, and assumes the risks of business or
enterprise. In other words entrepreneurship is the act of being an entrepreneur. As Shane
(2003) cites the act of entrepreneurship can be the response to a considered opportunity
in new organizations or part of reviving mature businesses. He adds also that the most
obvious form of entrepreneurship is in the form of start-up companies which has
assumed a leading factor in accelerating economic boost in developing and developed
countries. In this paper the main focus is on the small businesses that mainly shape the
business heart of Europe; so it considered relevant to talk a little about small firms’
founders and it seems that entrepreneurs are one of the main shapers of the body of
small businesses. There are several definitions for entrepreneurship from different
scholars’ point of view.
The first example can be Schumpeter’s view regarding entrepreneurship:
In
Schumpeterian view, an entrepreneur is a person who is willing and able to convert a
new idea or invention into a successful innovation (Schumpeter, 1942). For
Schumpeter, entrepreneurship happened in the form of new businesses but also it can
happen in the way of new combinations of currently existing inputs. For Knight (1921)
entrepreneurship is about taking risk. The behavior of the entrepreneur represents a type
of a person who is eager to put his career and financial credit in jeopardy of taking risks
with the tendency to pursue a new idea or to spend time as well as capital on an
7
www.merriam-webster.com
41
uncertain venture. Knight (1921) tried to classify the three types of uncertainty in the
entrepreneurship concept:

Risk, which is measurable statistically.

Ambiguity, which is hard to measure statistically.

True Uncertainty, which is impossible to estimate or predict statistically
After the above-mentioned points regarding entrepreneurship and its requirements, it
seems crucial to drag the attention to the entrepreneurial marketing and its relation with
micro firms. Collinson et al. claim (2001) that entrepreneurial marketing is the interface
of the two research fields entrepreneurship and marketing. They cite that
entrepreneurship is a scholarly concept that continues to develop more and more. They
represent that entrepreneurship is a concept that is growing by quantity and quality form
both theoretical and empirical aspects which is leading to expands knowledge frontiers.
Marketing and entrepreneurship definitions can differ markedly, so it can’t be expected
find one single definition of entrepreneurial marketing that coats everything. Morris et
al (2002) represent a contemporary definition that encounters the present horizon in
which entrepreneurial marketing is:
“The proactive identification and exploitation of opportunities for acquiring and
retaining profitable customers through innovative approaches to risk management,
resource leveraging and value creation.”
Hills (1995) writes that:
“It was widely assumed in academia even till 1990s that SMEs just required a simplified
version of the more sophisticated marketing practices used by the largest companies.
Now it is becoming apparent that marketing in SMEs is fundamentally different and
more successful in SMEs than in large firms (not just a simplified version of the more
sophisticated marketing practices used by larger companies). This is partly because
marketing implementation can be more important to success than planning and
strategy.”
As Carson (1993, cited in Diane 2009, p.394) identifies there are both homogeneity and
heterogeneity between formal marketing planning and entrepreneurial decision-making.
Intrinsically entrepreneurial decisions are casual, unplanned, inventive, opportunistic
and sometimes either reactive or proactive; in contrary marketing decisions tend to be
formal, organized, consecutive, systems-oriented and disciplined. Hills et al. (2006)
42
mention that marketing managers and entrepreneurs, in contrast of above mentioned
dissimilarities, have some similarities in the construction and use of personal contact
networks. In an equal manner, some of the needed skills by entrepreneurs are alike to
those which asked by capable marketing managers, as an illustration these skills can be
judgmental and positive thinking, innovation and creativity. Hills et al. (2006) add that
the reason is that some of the significant features of entrepreneurial marketing are not
performing in the same path as managerial marketing are occurring even yet firms
might be remarkably successful. Based on Hills et al (2006) entrepreneurial marketing
theories contribute valuable and additional knowledge that enriches the existing view of
how marketing is to be performed. To put it very simplistically,
“It is not the concept of the 4 – 7Ps that is different in entrepreneurial marketing, but
the content and the combination of the Ps applied to the market by entrepreneurs as
compared to managers”.
The below figure that developed by Hills et al. (2006) shows that in some business
environments, such as highly competitive and unstable markets, entrepreneurial
marketing approach may be more suitable than in markets which based on the logic of
scale of economies.
Figure 7. Entrepreneurial marketing behavior is determined by entrepreneurial thinking
(Hills et al. 2006)
Hills et al. (2006) discuss that entrepreneurial marketing from some scholars’
perspective perceived as being synonymous with small business marketing. Such as
Kotler and his definition of entrepreneurial marketing. Kotler (2003) determines that
entrepreneurial marketing is based upon how marketing practices becomes more
43
formalized. He also adds that the three stages of marketing practice are identified as
organizations growth. Kotler (2003) mentions that the first stage is entrepreneurial
marketing.
“Most companies are started by individuals who live by their wits. They visualize an
opportunity and knock on every door to gain attention” (Kotler, 2003)
Kotler (2003) continues:
“As small companies achieve success, they inevitably move toward more formulated
marketing. Finally, organizations get just too much of the formulated marketing
practices.”
In other words, marketing practices developed in a more mature stage. Regarding to
Kotler (2003) those mentioned companies suffer from the lack of vision and innovation
of the avant-garde marketers in the entrepreneurial stage. In this matter the factor that
makes a huge difference is adding value to the customers’ lives which can come true
through entrepreneurial marketing. As an illustration, marketers and the brand managers
need to get out of the office and feel customers’ needs and desires from close distance.
Hills et al. (2006) interpret some Kotler’s sayings about entrepreneurial marketing and
entrepreneurship. It can be assumed that there is a significant difference between SMEs
and entrepreneurial businesses but essentially the difference is related to entrepreneurial
behavior mostly. They cited that
“Many firms start small and stay that way as the owner/manager is neither motivated
nor oriented towards growth. Such firms are sometimes called lifestyle firms, because
their business behavior is related to the manager’s personal motivation in terms of
money and lifestyle. When personal goals are fulfilled, the motivation for further
expansion is lost, and the firm maintains its level of operation” (Hills et al. 2006).
Moreover they add that although entrepreneurial companies may still be entrepreneurial
and apply entrepreneurial marketing, on a way to grow and expansion of their activities
they need to practice formalized routines as well. Moreover the same difference can be
true about SME-marketing in comparison to entrepreneurial marketing. Reflecting on
growth and entrepreneurial behaviors, small firms marketing strategies is related to the
marketing behavior in SMEs regardless of their entrepreneurial status (Hills et al. 2006).
Entrepreneurial companies actually often show marketing behavior which is very
different compare to classic textbook approaches (Hills et al., 2006). He cites that:
44
“Entrepreneurial marketing often relies on interactive marketing methods often
communicated through word-of-mouth rather than a more traditional marketing mix;
monitoring the marketplace through informal networks rather than formalized market
research, and generally adopting more entrepreneurial approaches to marketing
activities.”
Moreover he adds that marketing has a considerable significance in developing, creating
and selling products or services and at the same time on increasing capital and leading
recruiting efforts.
45
4. Empir ical findings
In attempt of having a better understanding of this thesis’s research questions, different
interviews with micro companies in the service industry in the area of Linkoping and
Norrkoping have performed. Additionally to the interviews a questionnaire is also filled
by the interviewees. This questionnaire is based on Lovelock and Wright Marketing
Communication Mix theory in order to lead the interviewers to a better analysis and
understanding of small companies’ situation in Swedish market. It considered that
having all the interviews in detail is mandatory due to the further use of the data in the
analysis part. As an example the work experience of the firm owners in different
companies before settling their own businesses, has provided many contacts for them in
the name of future potential customers. Herewith there will be the detailed interviews in
the order:
4.1 Reventia
Reventia is originally an accounting and auditing firm, but has the latest years moved
more and more into consulting. The services they provide are; auditing, accounting, tax
consultancy, business transfers, general administration and economical consultancy.
Reventia is a family company with 6 employees where Joakim Samuelsson is the CEO.
He started the company 2006 together with his father and has every year since then
grown steady. The company lies in the center of Norrkoping town and operating mainly
on the local market. The company had a turnover of 4 million SKR at the end of 2010
and a budget of 20 000 SKR (less than 1 %) dedicated for marketing.
Joakim Samuelsson born in 1981 has a MBA degree at Kalmars University where he
specialized on music management. He is musician himself and 2005 he wanted to start a
record label company. Instead he started Reventia through contacts in the music
industry where he heard that there is a huge need for skilled and specialized tax and
accounting services. Reventia has still its original customers, i.e. musicians but has
expanded their business segment into more B2B customers. Their focus is on family
business, mostly micro companies but has also some private clients that mostly use their
tax consultancy services. Joakim is responsible for human resources (HR) and for
marketing as well as he does some tax and business consultancy for his clients. As
already mentioned Reventia has only a fraction of its turnover devoted to marketing,
46
less than 1 %. This percentage is divided on their website, an advert on Eniro and
sponsorship for a musical festival in Norrkoping. Why they sponsor the musical festival
is just because Joakim is interested in music himself and it has not really a marketing
value or purpose. Joakim explains further that they don’t have the resources to hire or
buy marketing services from a marketing firm. He also says that he doesn’t believe it
would generate any greater benefit for Reventia. At this point they don’t have any
ambitions of growing in higher speed that they have done these past years and therefore
it would be unnecessary to hire a marketing firm. When it comes to their marketing
strategy it can be said that they only focus on Word-of-mouth. It has proven to them to
be the most effective marketing strategy and Joakim estimates that more than 90 % of
all their new customers comes through Word-of-mouth. Joakim continues on the same
path and saying that it is essential that the company does more than only a good job.
They have to do more than the customers expected and this is even more important for
their new clients. Joakim argues that by always completing jobs above customers’
expectations give you the best marketing tool and strategy you can get. Reventia’s
strategy is all about Word-of-mouth and Joakim says that it is a good strategy to follow
because it is cheap to execute, the result gets much better and customers are always
happy and loyal because you only focus on making them satisfied in order to reach new
customers through companies’ customers.
Though Joakim is responsible for all HR he explains that all employees have a genuine
interest and ability to take care of their customers. Because Reventia is operating within
micro company´s which are mostly family owned it is crucial to have a good
communications and relationship. As Joakim says, employees of Reventia often take
care of all the money the family owns. Pensions, life savings, mortgages, other loan etc
are all factors that play a great role in how Reventia does its business. Therefore Joakim
stresses that all employees know first that how important is doing a great job because of
the impact that it has on current and future customers which lead to get new customers
through your own customers. It was not so long time ago when Joakim finished his
MBA education and therefore he is familiar with most of the theories used when
managing communication strategies. Why he is not using the theories and models that
are covered in previsions chapter is because he feels the theories are to square-a-like. He
perceives them as being oversimplified and not easy to imply on the real world. He does
47
not work active with the models but he emphasizes on constantly making the company
be in motion so that his customers always are updated with the latest information within
its business segment. He summarizes that the “strategy” in marketing that Reventia is
using is Word-of-mouth and keeping the company in motion. He also says that in the
future he would like to make Reventia as a bigger brand. The aim is to make people
associate Reventia as a company that stands for security, flexibility, confidence and
seriousness.
4.2 Smedjan Ekonomkonsult AB
Smedjan Ekonomkonsult AB is an accounting firm with 10 employees. The company
started its business in 1998 by the CEO Rose-Marie Bidenäs. They offer services such
as; general accounting, financial control, accounting work for declaration services. They
also provide temporary staffing in finance and accounting. Smedajan offer also not only
services but they are also resellers of Visma SPCS which is a accounting program suited
for small and medium companies. Smedjan operates in just SME´s with focus on the
local market in the town of Norrkoping, even though that they have some clients in
other regions. Company has a turnover of 5.5 million SEK and a budget of 100 000
SEK devoted to marketing ( 2%) As a notice the company is since 2009 a “Green
Office” which means that they active try to reduce their load on the environment.
Rose-Marie is the founder and the CEO of the company. Before she started Smedjan she
was working on the accounting firm KPMG for 8 years. There she worked mainly with
auditing and consultancy. After that she has also worked on Carlsson Rings law firm
where she mainly worked with receivership. Rose-Marie who is well connected with
many local firm in Norrkoping after her session at KPMG and Carlsson Rings law firm
took the natural step and started her own firm 1998. Rose-Marie works primarily with
financial and tax issues, and still largely with bankruptcy issues. She also works as an
advisor to small and large companies and also gives advice to the CEOs of these
companies. She also works with the training of future accounting consultants who goes
qualified education. Smedjan primary customers are B2B SME´s but especially last year
had more and more private clients who need tax consultations. The company has grown
organic since the beginning and it is on the verge of hiring more employees because of
the bigger client list. Rose-Marie explains that there is no actual pronounced strategy in
the firm regarding marketing communication. Instead the company has relied on
48
phenomenon Word-of-mouth. It has been sufficient for them using and realigning on
just the concept of Word-of-mouth. The company has a website and has at one point
used an advert in the local papers. But it was just because they moved their office to
another location and wanted to spread the information faster to its customers and others.
Otherwise non advertising or other media communication is used to cover
communication strategy on regular basis. Rose-Marie is responsible to arrange new
customers and she does this with the help of lots of contacts that she has gathered
during her carrier. She says that the competition has begun to harden and she has last
month hired a marketing specialist from a consultancy firm to work 10-15 hours per
week. The aim was to try to see if the marketing specialist will generate any positive
effect for Smedjan. The contract with the specialist is based on monthly revision. This
means that Rose-Marie will each month estimate what effects the marketing strategy
would have on the benefit of the company. If the results are not satisfying, the contract
will not be prolonged. Rose-Marie continues by saying that there are more actors on the
market and she will now try hiring a marketing firm for the first time to see if there will
be any positive effects.
Company has all this year’s relied on word-of-mouth as an indirect strategy in order to
see how to generate new customers. It has been proven very effective and not at least
very cheap way of attracting new customers. Rose-Marie says that the resources that
could be invested in marketing have been invested in her employees instead. She has
increased their salary and benefits in order to make them feel happy and satisfied. This
is the most important aspect in her company she says, to have satisfied employees.
Because she works so tightly with her customers it is vital that her employees do a good
job and that her customers are happy with the relationship. If the employees are
appreciated they will do a better job which in the long turn will give Smedjan more
satisfied customers. This contract with the marketing firm is as already said only on
probationary basis, just to see if marketing will really help them prosper more than just
using word-of-mouth as a marketing communication strategy. Rose-Marie is familiar
with the basics of marketing communication thinking, but it is nothing that she or her
ordinary employee’s work active with. She believes that the model and tools provided
by scholars are not anchored in reality and that these models are not suited for her
company. Therefore there is no strategy that is pronounced in the company that
49
Smedjan needs to follow, not yet she says at least considering what the outcome of the
marketing firm will generate. Word-of-mouth will continue to be the “strategy” to use
because of its simplicity and the positive effects it brings. Rose-Marie will continue on
focusing of making her employees happy and investing more money on them rather
than pure marketing. She also says that she has never published an advert for job
employment, even though she has 10 employees. Instead she has via contact headhunted
people that she would like them to work for her company; in other word she seems this
way the best path of making only the most suited work for Smedjan.
4.3 Lawyer fir m Bir ger Edelber g
Lawyer firm Birger Edelberg is a small lawyer company located in the center of town
Norrkoping. The firm has 3 employees where the CEO and the founder Birger Edelberg
is lawyer himself. The firm has also one administrator who takes care of all company´s
organizational work. The third employee is also a lawyer who works as a assistant
lawyer though he is fresh out of school. The company has two ways in how they get job
inquiries. They either get jobs from the Norrkopings district court or they find job
themselves. When they get jobs from the council of Norrkoping it is cases that they
themselves do not choose, it is random assigned by the council to all registered lawyers
in the council of Norrkoping. Birger law firm offers services in all areas of legal right
such as; legal disputes, consultations, establishment of estate, contract establishments
etc. for both companies and private persons.
Birger Edelberg is a certified lawyer since 1985 and he started his law firm at the
beginning of 1998. After he completed his studies he worked at a law firm as assistant
lawyer before he got his title as registered lawyer. Birger is responsible with all job
requests and customers contacts. He is also responsible deciding how the workload is
divided through his firm. Beyond this his job is about to represent his clients in the
above mentioned legal services his firm provides. After studying to lawyer and after
finishing his assistant probation time it was a natural step to open his own law firm. The
firm has stable income of job inquiries and the ratio of his clients is approximately 6040 where B2B stands for 60 % and the remaining 40 % is in B2C. Birger explains that
he has not since the firm was established used a marketing company to help him with
his marketing communications. He continues explaining that by having steady job
requests from the district court he didn’t have a need for using any marketing methods.
50
But, since the market has changed last decade he has more inquiries from company´s
and private persons to offer them services they need it has become more interested in
using marketing as a tool to reach out to his customers. Birger estimates that he is
devoting around 1 % of his budget to marketing. This percentage is mostly used for
printing business cards, décor sign in the office and such small organizational
marketing. Birger explains that he gets new customers through his contact that he made
throughout his carrier and from his satisfied customers. He says that when you are
operating in a local relatively small town it is important to tie contact that you can
benefit from later in the time. Birger who finished his law studies many years ago is not
familiar with any marketing theories or tools. He doesn’t have a strategy in his company
and don’t stresses to importance to those things. He believes in just making a good job
from the job inquiries he gets and the rest will solve itself. The advantages ones again
living in Norrkoping is that people is good spreading the word to their friends and
relatives and Birger says that this phenomenon is what makes his firm go around.
Without Word-of-mouth he would only rely on jobs from the district court and that
would not be sufficient to run a company with 3 employees.
4.4 Synective Labs
Synective Labs is a consultancy company in the area of special software and program
(FPDA system) consulting which has two branches in Linkoping and Gothenburg with
10 employees who are separated between these two offices. Synective Labs has started
its activities in 2003 when few computer specialists gathered and decided to make a
change in their environment. They aimed at providing consulting for a special target
group of customers with the goal of speeding up computations in normal computers that
use FPDA system like firms and institutes that work with large calculations and
computer clusters.
The company based on the group of consultants at the time of initiation and Magnus
Peterson the interviewee is the half owner and marketing manager and one of the
consultants of the company. Peterson and his colleagues main point of forming of a
service company is to serve customers and their desired needs through their profession
which is consulting and advising in a very specific narrow area in computer programs.
The main customers of Synective Labs are purely other businesses like firms inside or
companies outside Sweden. The ones which are located in the local market of Sweden
51
mostly consisted of large companies such as SAAB, Volvo, Ericsson etc that need
special service of Synective Labs but the ones outside Sweden are mainly medium-sized
or small-sized companies. Marketing strategies that are performing in this company are
arranged by Peterson mainly but activities like printing leaflets or designing a website
or logo of the company usually are be done by external companies which are hired by
Synective Lab with the aim of being better known by desired customers. The
company’s budget that is dedicated to marketing estimated a very small amount by
Peterson which is roughly around 5 percent of the total budget. He claims that for a
small company like Synective investing more money in marketing doesn’t seem logical
or needed and that small percentage covers the company’s promotion’s expenses in the
current time. Peterson has roughly an idea about Communication Marketing theories as
long as he has never studied the theories at university while he was an engineering
student. He mentions that regarding they are a very small company he doesn’t think
having knowledge about specific marketing communication theories would help them in
growing while in the niche market that they are active, Word-of-Mouth has the greatest
impact. So repetitively by Peterson the main marketing strategy is Word-of-Mouth
indubitably, and the reputation that a company is gaining in the competitive
environment is through this phenomenon. He cites an example for making his statement
more clear; he says that most of the time there is a company which is in need of the
special consultancy in computer systems and maybe they required this service from
another company in Sweden (like Ericsson) but as soon as the referred company sees
that the area is related to Synective labs services’ expertise, they refer the company in
demand to Peterson and his colleagues. In other words, Peterson means that many times
it happens that other larger companies e.g. Ericsson, SAAB, Volvo are acting as an
intermediary which refer customers to Synective Labs when they confront special
services that they do not have resources for and this is really beneficial for Synective
Labs because these large companies have thousands of customers who need different
services. In order to promote the continuation of this process, Synective labs consider
some compensation for the mentioned intermediaries like some discounts and so forth.
The main element in providing a good reputation for the company from Peterson’s point
of view is Word-of-Mouth doubtlessly more than any other factors such as public
relations, direct marketing and etc. The company tries try to spread the word more by
participating in different seminars, exhibitions … in order to be in the list of skilled
52
companies that offer special service in the computer industry in a global scale with the
aim of being trusted by the potential customers. Peterson also adds that sometimes
word-of-mouth can take different parts. As an illustration he adds that sometimes
having skilled employees who are well-known in the local market of Sweden plays a
great role in success and reputation of the company. In other words he meant by
collecting the staff that has a remarkable reputation in the market, the company can
enjoy the benefits because these kinds of staff would be more in demand because of
their reputation (Word-of-Mouth). So as a conclusion it can be seen that the impact of
Word-of-Mouth is extreme in any scales and in Peterson’s view is the one and the main
factor that affect their business and its future growth.
4.5 Mor e Time Economy Byr å
More Time Economic Bureau is a franchise chain which acts as a consulting company
in the area of finance and auditing financial statements with five employees that started
its activities in 2006. Ola Lindberg decided the owner and CEO of More Time decided
to start up his own business after gaining precious experience by working many years in
finance and accounting. More Time is located in Norrkoping with the aim of providing
reliable financial and accounting services like tax revisions, balancing financial
statements for the customers in demand.
Lindberg as the head of his company manages his five staff and the activities that are
happening in the company toward accounting and auditing in a reliable way. Lindberg
adds that toward his specialty in the financial area he has chosen the service industry as
long as his expertise is related to this area. More Time main customers are consisted of
both companies and individual people but not in an even scale because almost 90
percent of the customers are other businesses and firms. More Time economics’
employees do not focus on customer relationship. Only the CEO of the company is
responsible for the contact with customers. The employees work systematically in
providing book keeping services to their customers but the end product that they
provide to them does not require any greater amount of relationship and
communications. More Time economic is a pure accounting firm where the employee is
responsible for book keeping. According to the CEO of More Time the only time when
employees get in contact with its customers is in the beginning of the work when the
books are traded among employees and customers or when a certain problem occurs.
53
Since More Time has grown and still is growing in a relatively fast pace some
organizational patterns has changed in order to be more creative and effective. More
Time doesn’t have any external company for arranging marketing and advertising,
regarding the small size of the company these marketing activities seem unnecessary
especially costly to the CEO and More Time is just known in the market by Word-ofMouth in the present situation. In estimation only 2 percent of the budget of the
company is belonged to marketing which proves the mentioned claims of the CEO and
also shows marketing doesn’t have an important position in More Time strategies.
Toward Communication Marketing and its theories the CEO doesn’t have any specific
knowledge, although they have some marketing strategies like offering sponsorships for
students in high school in Sweden (very limited) or have outdoor advertisements in a
football stadium (just because Lindberg is interested in football), brochures etc. More
Time activities are not based on scholars’ specific theories. As he said he has some
ideas about Kotler’s 4P model based on what he had studied many years ago at
university but those theories are not company’s marketing decisions’ guide lines. As the
CEO mentioned the company due to its small size is not in a need of marketing certain
approaches while they are in a niche market of Sweden and offering a special service
which is needed by special customers. In his idea comparing between many points of
marketing strategies word-of-mouth is the greatest factor in providing a good reputation
for the company and its impact on the company’s success and status is outstanding.
4.6 Bokför ing och Rådgivning
Bokföring och Rådgivning is an accounting company which provides financial
statements, tax declaration documents and budgeting for the customers. The company is
located in Linkoping and has only one staff who is the owner and accountant herself as
well. Bokföring is a very young company that just established a year ago with the aim
of providing good and reliable service in finance and accounting.
Parisa Majidi is the owner of the company who arranges all the services from receiving
the demand from customers, working on the financial statements and tax statements and
finally delivering the in-request documents to the customers. She believes she can serve
people in a mutual benefited way by providing accounting services which is also related
to her expertise and university degree by starting a business that has not called for a big
capital from the owner of the company at the start point. The main customers of
54
Bokföring are both companies and individuals, but mainly the service is requested from
the owners of the companies who are in need for their budgeting strategies or auditing
their statements for paying taxes. Majidi doesn’t believe in marketing or its role in
developing her business because till now she is just known in the market by the people
who have used her service and then recommend it to other potential users (spreading the
word one by one). As she additionally said she doesn’t think marketing will affect the
growth or success of her business while word-of-mouth is the most powerful element
that plays a role. A very small amount of company’s budget is dedicated to marketing,
around, 1-2 percent which is used for printing business cards as one of the main
marketing expenses. About using external marketing companies, Majidi mentioned that
they can be useful if the company has the intention to grow and broaden its business
area and as while as her company is very young she has not considered specific
marketing strategies yet. Majidi has a good knowledge about Communication
Marketing and its related theories but she would not use them in her company yet due to
her previous mentioned reasons. Moreover she thinks that most of marketing strategies
are costly and even without investing in promotion approaches a company like hers can
be successful and allure customers by just relying on Word-of-Mouth. In her opinion
Word-of-Mouth is a crucial factor in acquiring a reputation for a small accounting
company and as long as she tries to provide trustworthy financial statement for her
customers she can attract more and more potential service users. In the end she added
that she would consider marketing strategies in the future if her business goes well and
broadening a company seems a logical option.
4.7 Cityr evisor er na
Cityrevisorerna is an accounting and auditing firm settled in the center of Norrkoping
town. The company was established year 1998 by Torgny Nillson who also is the CEO
of the company. At the beginning Torgny was the only employee who offered auditing
services for small companies. Nowadays the company has 5 employees and the range of
services has increased. Cityrevisorerna offers services such as; Closings, Annual
reports, declarations for individuals and businesses, formation and rearrangements of
business, acquisition and selleings of companies, consultations in tax and business lax,
business analysis and business planning.
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Torgny Nillson is like previously stated CEO and the founder of the company. This
interview is not implemented with Torgny though he was sick when the interview toke
place. The interview was instead conducted with Maria Johansson who acts as deputy
director when Torgny is not around. Maria Johansson has worked longest at the
company of all the others employees and is also the one with most knowledge to help
the researchers of this paper to get the answers needed for the interview. Maria has a
MBA degree from Kristianstads University and works mainly with financial statements,
tax returns, current accounting and also auditing in small and medium - sized
businesses. Maria starts by saying that Torgny worked long time with auditing at a firm
callad LRF Revison AB. This company was shut down and soon after that Torgny
started his own company. It was a logic step to continue with auditing and accounting
though he has long background within the sector and also a MBA education with
auditing as focus. Maria estimates that the company works mostly with B2B customers
with the ratio at 70 % to 30 % to B2C. She also point out that the trend is that more and
more private people are using their services in form of constructing and helping them
with tax declarations. The company has not hired a marketing firm to help them with
marketing strategies, but they have a consultant that is responsible for taking care of all
companies telemarketing. The consultant is not an employee of the company, he works
independently and his services are only used when Cityrevisorerna gets offers from
other companies by phone or other direct media. The consultant is than responsible to
estimate if the company in question is a suited company client for Cityrevisorerna and
handles the matter after instructions from Torgny. Cityrevisorerna has also this year
bought addresses from SEB Bank. SEB Bank has a pool of address from all companies
in the area of Norrkoping. Cityrevisorerna bought the rights to use addresses of small
companies in the area around Norrkoping where Cityrevisorerna is operating. Maria
also estimates that the company is dedicating around 3 % of company’s budget to
marketing. This percentage is distributed by handling the website, sending out flyers
and other informative papers to companies from SEB Bank and also publishing advert
in the local newspaper. Maria who has finished her MBA studies are aware of some
marketing communication theories but says that the company are not actively using any
of them. The firm has not a strategy for their marketing and nobody within the company
puts any thoughts on this. Reason for not using strategies or marketing communication
tools is because the lack of time she says. Another reason is because some of the
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marketing that they have tried recent years has not given them any greater results. Most
lately she says the advert they have in the local newspaper has not given them any new
customers. They have been published the advert every week in a period of six weeks.
This local newspaper is the biggest paper in the region of county Ostergotland. The
company relies instead of Word-of-mouth but this is not a stated strategy in the
company. Maria explains that the focus is on making customers happy by first of all
offering them services to a lower price than the big auditing companies do and second
to make a good job so that customer is feeling happy with the services they are buying.
Maria continues by saying that it is a price- sensitive market where customers first of all
are focusing on paying as little as they can. Their main customers are small family
companies and then the focus is to cut their costs as good as they can and accounting
and auditing isn´t something that they wish spend a lot of money on. Therefore Maria
says that Cityrevisorerna needs to adjust to this price-sensitive market by offering good
services to low costs, which means that they don’t have the resources to elaborate their
communication strategy. She feels however that communication tools and strategies
could help them if they invested time and money on it, but as it seems now there is no
priority in such, instead Word-of-mouth continues to be the only “strategy”
Cityrevisorerna is relying on.
4.8 Gastr o konsult
Gastro konsult is a part consultancy company and part time reseller company with 4
employees. The company is established 2008 by Jonas Skepp who is the CEO and
consultant in the company. Gastro consult offers consultancy to restaurants, coffee
shops, diners and other areas where professional kitchen supply is needed. The
consultancy they offer is by planning the flows of the machinery in the kitchen area and
designing the overall environment in the restaurants in question. They are also reseller
of all professional kitchen equipment restaurants needs. They are combining
consultancy with reselling but they put emphasis on consultancy services because they
often provide more job and income. Jonas Skepp explains that they are providing
hardware as well so that the customer can buy the whole deal from consultancy to
installation of equipment. The company is settled in Norrkoping town but is doing
business across whole Sweden.
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Jonas Skepp is like previously said the founder and the CEO of the company. He works
as a consultant, seller and are also responsible for communications with customers. He
has previously owned 6 restaurants and have also an education within consultancy
services. Therefore he know the market well and are well versed in what the business
want and needs. The reason for starting his company was because he found a need on
the market for consulting other restaurant businesses how the flow and design of the
machinery should be like. All 4 of his employees have experience from restaurants
business and also works as sellers and consultants. Company’s main customers are
mainly B2B because they are providing professional tooling within the restaurants
business. The company has until now not engaged a marketing company to help them
construct a marketing strategy. Reason for this is first of all lack of financial resources
and also lack of time. Jonas estimates that the company is using about 3 % of
company’s budget to marketing. This percentage is mostly spend on companies
representations when Jonas is meeting future clients and on their website. The company
have also some advertising in trade journals which are sold across Sweden.
Jonas has good knowledge about communication strategies though he has owned 6
restaurant in the past. He is also quit familiar with the tools and models that are
represented within marketing communication though he has used them on his
previously owned restaurants. The company has not any marketing strategy because
Jonas feels that the best way of promoting his business is when customers are spreading
the word to other customers. It is the most effective way Jonas says to focus on Wordof-mouth and it is also the one giving most benefit to the company. Most of his
customers comes by Word-of-mouth and the website acts mainly just as an information
site where phone numbers and etc. are stated so that customers can reach out easy to
Jonas and his employees. He is planning though to develop the website further so that
the customers can order and buy equipment directly from the website but this is a
project which Jonas estimates will work fully in one year or more.
4.9 Ber its Byr å in Nor r koping AB
Berits Byrå is a accounting firm settled in the downtown of Norrkoping. The company
started its business 2008 by the owner and founder Berit Johnsson. Company provides
services in auditing and some consulting within finance. The companies customers are
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small family firms in the region of Norrkoping. The company has at this point only one
employee, the owner herself Berit Johnsoon.
Berit Johnsson is certified accountant and has since her graduation worked with
accounting and some auditing throughout her entire career. Before she started her own
accounting firm she worked on one of Sweden biggest auditing and accounting firm.
She worked there for 11 years and gathered a lot of knowledge and contact within the
market. She decided to start her own business though she wanted to try out how it was
being her own boss. With her good contact line she quickly had more jobs inquiries than
she could manage. Berit has not used any services from a marketing firm and does not
plan to do so either. She believes that it is unnecessary for her because she has already
big workload. She also mentioned if she would hire people working for her and make
the company grow she would have no problems get more clients though she has good
connections within the bank sector and other accounting firms. Berit estimates that
around 1 % is of companies turnover is dedicated do marketing. This percentage is
distributed on companies website, printing business cards and other small printings e.g.
pens with logos, flyers etc.
Berit is not familiar with any communications strategies and she does not have a
strategy for her own company. Models and marketing tools that are described in the
framework chapter (4.0) in this thesis isn´t anything that Berit are actively using and
don’t plan to put any emphasis on it either. She explains that when you as company
already have great number of clients that you gathered only throughout your contacts
strategy and communications marketing tools is not necessary for you to use. Berit says
that all of her new customers is from her old or current customers. Customers are very
good at spreading the word further when they are happy with the service you are
providing. This is the best communication tool she says. You don’t need to invest a lot
of resources to increase your customer stock, your only need to focus on making a good
job for you current customers in order to attract new ones. Berit says that the purpose of
her website is not to attract new customers with, because the chance is on BAC level
that any new customer will contact her through only her website. Instead it acts like an
information site where current customers have available contact information where they
in they turn submit to their contacts. Berit pronounces very clearly that Word-of-mouth
is the only method that is actually needed for small companies like hers. The restraints
59
by time and resources make it hard to use communication tools and they are not well
anchored in micro company’s reality.
4.10 Mobipr o AB
Mobipro is a small company that offers professional services and products in the fields
of information technology and mobile data communication. Professional services is the
most prominent aspect of Mobipro’s line of business. This company’s business covers
different areas such as internet technologies, XML, Object Oriented software
development, and project management. Moreover Mobipro provides the delivery of
complete software solutions and components. Mobipro is located in Linkoping and
Micael Dahlgren is the CEO and the owner of the company who decided to start up his
business in 2000 with three employees. Micael Dahlgren besides of being a CEO of the
company has other job titles as well as marketing manager and consultant. (In this
interview the focus is on the service part of the company’s activity and not its product
part.)
The main reason that Dahlgren started his business in the service industry was due to his
previous job experiences as well as his employees, who always worked as software
consultants in different companies. Software developing companies mainly are the
service users of Mobipro which need their consultancy advices. Mobipro has tried
hiring an external marketing firm in order to their promotions but the result was not that
successful, as an example there was no significant raise in sale and etc. besides the high
expenses of hiring a marketing agency, convinced Mobipro to save its capital and
continue marketing activities by using internal resources to avoid extra expenditures.
Marketing activities of the company are so limited and totally is around 1% of the total
capital but as the CEO claimed, they try to expand their marketing up to 5%. Dahlgren
had some courses about marketing many years ago at the time of his studies at
university but he can barely recall any specific theory now. The main marketing strategy
that Mobipro is following is through personal contacts and partners but in their products
they have some strategies which are not in the interest of this research. The CEO insists
on word-of-mouth as the most powerful element that helps its business in different
ways. He cites that by offering good, reliable and high quality services, one can raise his
reputation in the market in a way that in the future the previous users can recommend
that certain person or company to others who are in the same need.
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4.11 Result of the inter views
In this research 10 micro companies within the service sector have been interviewed.
The received results are unanimous. Before developing the results further it is important
to show the reader how and why the researchers of this thesis constructed the interview
questions in the manner as it was done.
The researchers find it important to ask the interviewees first the demographic questions
about their company because it is a significant difference if the company has 2
employees or 10. Moreover the desire here is to illuminate several aspects of how micro
companies tend to communicate with their customers. This is important to make the end
result and conclusion; unquestionable, though this research’s aim is to make a
contribution to the stakeholders of it. Another aspect that needs to be further explained
is why many questions have been asked about the founder of the company and his/her
background. The researchers believe that there is a strong relation with what the
interviewee has for educational background and his/her previously jobs’ experience.
Their history is vital because the CEOs of micro companies are extremely pivotal for
the company, and it is not unusual that the CEOs undertake several or in some cases all
job tasks. So as the researches assumed, there is a close connection between the
founders’ background and presence which will be further discussed. Below you will
find the table of how the 10 interviewed companies of this thesis have replied the
questionnaire. This questionnaire is based on Lovelock and Wright communication mix
theory (2002) which its components can be used when companies are tending to apply
communication marketing approaches.
The writers of this thesis have done the questionnaire in the manner that all 10
companies where asked first how much of their budget is dedicated to marketing. The
result is showing that between 1-3 % of companies turnover is devoted to marketing.
Later, the interviewees have been asked in the questionnaire to present which one of the
subsidiaries they are using with Yes or No and explanations of why and why not
answers which will be appeared in the analysis chapter in detail. The table below shows
how many of our 10 companies are or is not using each of the 31 subsidiaries. Though
considering 10 companies, it is easy to show in percentage how companies are using
these communication tools. In order to clarifying the content of the table, an example
will be presented so the reader would be easier understanding the thinking path of this
61
thesis’s authors. Under Personal Communication tool, the first subsidiary is: Selling and
in this research out of 10 companies there is only 1 company that is using selling as a
communication tool therefore 10% is representing that company in the table.
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Per sonal Communications
Yes
No
* Selling
10%
90%
* Customer Service
100%
* Training
100%
* Word Of Mouth
100%
Adver tising
* Broadcast
100%
* Print
100%
* Internet
90%
* Outdoor
10%
100%
* Retail displays
20%
80%
* Cinema Theatre
100%
* Telemarketing
100%
* Direct mail
10%
90%
Sales Pr omotion
* Sampling
100%
* Coupons
100%
* Discount
10%
90%
* Sign up rebates
10%
90%
* Gifts
10%
90%
* Prize Promotions
100%
Public Relations
* Press releases
50%
* Press conferences
50%
100%
* Special events
30%
70%
* Sponsorship
20%
80%
90%
10%
Instr uctional Mater ial
* Web sites
* Manuals
100%
* Brochures
60%
40%
* Software ( CD´s )
10%
90%
Cor por ate Design
* Signage
100%
* Interior decor
100%
* Vehicle
100%
* Equipment
100%
* Uniforms
100%
Table 3. Lovelock communication mix table (by the authors)
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The empirical findings have provided the same result for all 10 companies and it shows
that the companies’ founders are educated people with at least a master degree in their
education. They have also worked before a couple of years in other bigger companies
where they gathered knowledge and good contacts with other firms. Therefore all of
them started business by their own as entrepreneurs in the business segment where they
previously worked. All companies are settled in and around the center of Norrkoping
and Linkoping where also most of their clients is operating. The interviews have shown
that these companies’ main customer base is within B2B, but the trend indicated that
B2C market has increased in recent years. Just one out of 10 companies has hired a
marketing company to help it with marketing strategy. Two companies have in other
forms used parts of consultancy services within communication strategy; but the
outcome was so insignificant that it does not reckon as they hired an external marketing
firm. The researchers have also come to the result that the budget which is dedicated to
marketing is low and it is around 1-2 % of companies’ turnover. It is also important to
show that most of the budget for marketing is distributed on the website, printing
business and other small printing signage jobs within corporate design e.g. pens,
brochures, flyers etc. It has been realized by the authors that the interviewees have
good knowledge about the theories and tools that can be used in communication
marketing. But none of the companies are actively using models and tools that are
provided by scholars. Companies don’t also have any clear stated strategy that they are
following. Instead the result shows that all 10 companies are relying on word-of-mouth
strategy which is an indirect consequence while companies are only focusing on making
the customers gratified. Furthermore the researchers found out those in-attention
companies don’t use a lot of resources on communication marketing because the
outcome (increased selling) is not that significant or profitable to cover up the expenses.
Another factor is the time issue; companies don’t have so much time in elaborating with
communication strategy though they have a lot to do in a limited time span which
causes a great pressure. Word-of-mouth is the most important component for these 10
micro companies and without the word being spread from their customers they will be
forced to either change their way of operating or to declare bankruptcy. All 10
companies agree that word-of-mouth is by far the most efficient tool for marketing in
order to be prosperous in the Swedish local market.
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5. Analysis
In this chapter the reader will face the analysis of the findings of the interviews and
questionnaire together with theoretical framework. This analysis will lead to a
conclusion and then further a discussion and a communication marketing model that is
developed by this research’s writers.
Herewith there is an analysis based on the findings of interviews and the questionnaire
and their connection to the theories of communication marketing. The chapter starts
with a graph that shows how the respondents of this thesis have answered of what the
most important aspect of communication marketing is. This graph is based on the
questionnaire that is previously presented where only the subsidiaries are taken into
account that companies actually are using. The results have been weighted with how
companies have answered in relation to why they are not using some of the subsidiaries
in order to calculate the divisions of importance of the 31 subsidiaries. Results below
show that word-of-mouth with its 75 % is by far the most prominent aspect in how
micro companies are using communication tools. Further below each of the subsidiaries
in this graph will be in detail analyzed.
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* Signage
* Software ( CD´s )
* Brochures
* Web sites
* Sponsorship
* Special events
* Press releases
* Gifts
* Sign up rebates
* Discount
* Direct mail
* Retail displays
* Internet
* Print
* Word Of Mouth
* Customer Service
* Selling
0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00%
Figure 8. Communication elements in percentage (by the authors)
It has been found that the results are common for almost all of the interviewed
companies. Just one company out of 10 is using selling as a communication tool. Gastro
consult have active sellers who are hired just to sell companies products. Gastro consult
is different from other companies though they provide their services together with the
hardware and therefore they are in need of active sellers. Like CEO of the company says
they would have it very hard to compete on the market if they only provided services
and left the customers without the hardware. Therefore they need sellers who can assist
consultants with hardware which enables to complete the deals with their customers.
Other nine companies have none active selling in their day to day business. Like Joakim
Samuelsson from Reventia says there is no need for us to have sellers promoting our
services, customers are well aware of what they get from our company. Other
companies are following the same argument saying that if you have a law-firm or
accounting and auditing firm there is no need to hire a seller to promote your services.
Clearly Knight (1921) statement can be seen here that entrepreneurship is about taking
risks like this case that the company founders are taking a risk of not having an external
marketing agency. These companies stat that customers are well aware of the services
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you can provide and this is supported by the uses and gratification theory of Katz et al.
(1973) when they state that receivers of communication have different needs.
Requirements are different and the knowledge and understanding of the customer base
is also different and therefore companies need to adjust their marketing communication.
Maria Johansson who works on Cityrevisorerna says that their customers always ask
first how much money services costs. She explains that the customers are only
concerned of how to reduce their own costs when they are using their services, because
all other information that the customers need they have already gathered. The
researchers of this thesis also agreed with the interviewees that it would be unnecessary
for micro companies in service industries, as those the thesis based upon, to put
resources on selling when the knowledge and understanding about the industry are very
high by their present and potential future customers.
Not surprisingly all of ten companies are emphasizing on customer service. As all
companies are very depended on word-of-mouth, customer service is something that
goes hand by hand with word-of-mouth. As Kitchen et.al (1999) explain about benefits
of integrated marketing communication, companies must put their clients and future
customers in the driver’s seat and conduct the most appropriate and effective way of
creating a relationship in order to have good communication with customers. As Ola
Lindgren, More Time CEO says, they only rely on word-of-mouth. He says in order to
keep your current clients and to attract new ones you will need to have a good
reputation. Ola adds that word-of-mouth is everything for them and without the word
spreading by clients they would be forced to change their whole way of working or to
shut down the business. Rose Marie from Smedjan says that she as CEO prefers to
invest all available resources on her employees because if they are satisfied, they will
provide a high quality service to customers, then the positive word will transmit to
future potential customers. As Joakim Samuelsson from Reventia says word-of-mouth
is only applicable when you as company provide services that extends customers
expectations. This is supported by Jerry Wilson (1994) that good, normal or adequate
services will provide little or none word-of-mouth effects. Though when customers are
experience great services they will most likely encourage positive word-of-mouth
response. These statements by interviewees are in accordance Hills et al. (2009) when
they claim that entrepreneurial marketing often relies on interactive marketing methods
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which mostly communicated through word-of-mouth rather than a more traditional
marketing mix. As Maria Johansson from Cityrevisorerna says they have a powerful
weapon in lower prices when they are competing with large corporations within same
industry. She says that most of Cityrevisorernas customers are companies who are
family owned and belongs to the category of micro companies. This is also supported
by all of other interviewees, that their customers are mainly micro companies which are
family owned. A good customer service is vital in order to make customers happy,
Joakim Samuelsson says. He also says that when you are consulting a family firm you
really need to go the extra mile. Family firms have so much more in stake than other
bigger companies and they are often responsible for not the company’s business but also
the families’ economics. Therefore the word-of-mouth gets even more effective when
customers are experiencing great service. Santo (2006) writes that word-of-mouth is
most effective when the word is spread from a source such as a friend, co-worker,
family etc or categorically from a satisfied customer who received a high quality service
and the satisfaction is more trustworthy than when the word is spread by an agency
which can be paid to spread positive word-of-mouth. Schiffman et al. (1995) support
this argument by saying that word-of-mouth is depended on the market and consumer
dominated behavior which means that it is perceived to be the most trustworthy,
credible and valid communication.
Considering all the above statements by the
interviewees the entrepreneurial marketing approach from hills et el. (2009) point of
view, is apparent in this case. When they state that what makes the difference in
entrepreneurial marketing is not 4-7Ps themselves but is the applications of the Ps by
different content and combination and authors of this case in accordance with
interviewees and scholars statements believe that the interviewed companies have an
entrepreneurial marketing path of thinking in their actions.
Second angle of Lovelock communication mix theory is advertising and its subsidiaries.
None of the ten companies have broadcasting as their promotion tool. They believe that
broadcasting is more proper for the businesses that target a big number of customers
and put a lot of money and attention in that area, but for small businesses having a lot of
customer is not as important as having a certain number of customers but with a high
loyalty and satisfaction from the received service. Regarding Katz et al. (1974) uses and
gratification theory, the theory is for understanding mass communication which mostly
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consists of media and its users who have different wills and tastes to decide about what
they see and hear in a way that advertisements try to promote different features of
various products. But it can be seen that this theory doesn’t have application for small
businesses because they have limited number of users who are sure about what they
want and need. As a result, mostly small firms see no point in putting money in mass
communication when they are not looking for attracting different type of people to their
offered service. Katz et al (1974) adds that there are as many reasons for using the
media, as there are media users but seemingly none of this type of customers are in the
in-attention category for small businesses. Small firm owners or marketing managers of
the ten interviewed companies thinks that broadcasting as an advertising tool is the
waste of money and they can invest that money in promoting the quality of their service
or in other different areas. Furthermore the role of entrepreneurial marketers based on
Carson (1993) naturally entrepreneurial decisions are casual, unplanned, inventive,
opportunistic which leads entrepreneurial marketers to be more pioneer in taking casual
decisions in comparison with traditional marketing managers.
Print as the second subsidiary of advertising can happen in different ways from business
cards to flyers, brochures or catalogues which all of the ten interviewed companies have
this type of advertising but in different styles. As an example Bokföring och Rådgivning
company owner just has business cards as the company is a young and start-up
company; but she has some plans in mind to broaden her marketing activities. On the
other hand, in More Time Byrå the company has different types of print in order to get
accustomed with its customers. As a total it can be seen that due to the limited amount
of budget that is dedicated to marketing, just certain types of activities are happening for
promotion in a print category. In other words it can be interpreted that through prints
regarding Lasswell communication theory (1948) the message is the information that is
printed and acts as an corresponding tool between senders and receivers of the message
who are service providers in the consultancy firms and their customers and here the
message needs to be decoded by the receivers, who are customers of small companies in
service industry. Base on Katz et al. (1974) gratification theory tries to explain that
consumer’s base on their needs and desires can have different interpretations of the
received message by marketers like this research that customers can interpret the prints
they see in a way that they prefer personally.
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Internet is the third subsidiary of advertising which also can have different types which
in here means how the interviewed companies use internet as their communication or
promotion tool. In this case almost all of the interviewed companies except one are
having websites and customers can find basic necessary information about the company
and its activities in them. Based on Kotler (2003) that technological advances had a
great impact on the means of communication, it can be seen that through websites and
the use of internet customers can gain information about the companies that they want
to be their users without a direct contact.
The fourth element is outdoor as an advertising tool which can be in many different
types of promotion displays like the billboards in highways and streets, transit posters or
placements in stadiums and arenas which all contain a message for the public. In this
research a very few numbers of the interviewed companies are using outdoors, although
it can be expensive regarding their small advertising budget but it is happening. As an
instance More Time company has outdoor placements in football stadium in Norrkoping
which promotes the services of the company. Lindberg, the CEO believes that this is a
very effective way because many people like him are interested in football in Sweden
and this ad can be seen by many people who may convert to potential customers. Or
another example is Reventia company which is sponsoring the music festivals in
Norrkoping and has a lot of ads in the festival place which are be seen by the people.
For Samuelsson the Reventia owner his preferences are prior to the logic of
advertisement which means the main reason that his company sponsors the music
festival is his personal interest in music like Lindberg who is interested in football. The
founders personal interests in leading their marketing decision-making can drag
attention to the entrepreneurial marketing approaches that stated by Hills et al. (2006)
that many small firms are called lifestyle ones because their owners/managers behavior
is in terms of money and lifestyle. Reventia and More Time can be recognized of being
lifestyle companies from some perspectives. But to conclude in this section most of the
companies do not believe in outdoors due to their high expenses but few companies are
using them as a promotional tool but mainly due to their entrepreneurial decisions such
as personal interest in sports or music but not advertisements logics.
Retail displays is another factor of advertising which is used in just two of the
interviewed companies in a very limited way.
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Cinema and theater as advertising tools can be very interesting, informative and money
consuming at the same time which is not appropriate for the small businesses when they
have certain types of customers. Cinema and theater like media and mass
communication tools are appropriate for a great crowed of people who have different
desires and different interpretations of the ads that they watch and hear in order to
choose between various competitors that offer their preferred product or service as Katz
et al (1974) pointed. All the ten interviewed companies claim that they do not have
convincing reasons to put money and power in this area.
Telemarketing is an advertising tool for selling which many companies may use it to
promote their products or services but here the case is different. As Peterson in
Synective labs claims there is no use of telemarketing for the companies like he has
because they already have their users or mostly the future customers are referred to
them by word-of-mouth. He adds that sometimes their big clients such as Ericsson refer
the clients to them because they do not have the demanded service that their customers
want but this type of referring customers cannot be fit in telemarketing category. Based
on Santo (2006) word-of-mouth is coming from a reliable source like a co-worker or a
friend which trusting upon his words is much easier than telemarketers as the
interviewed companies claimed. Based on Ditcher (1996) and the findings from the
interview it can be considered that the clients of consultancy and law firms which are
in-attention in this case rely on word-of-mouth when they feel secure and not threatened
by the marketers such as telemarketers who just want to sell. The company owners
believe that using this type of marketing in their business has more negative than
positive effects and they prefer to invest in higher quality service that will augment the
word-of-mouth for them.
Direct mail as the last component of advertising has similar situation with telemarketing
from most of the interviewees except one. More Time is using direct mail as its
promotion tool in order to increase information about their service for potential
customers.
Sales promotion as the third component of the theory also has its different subsidiaries
which here are going to be discussed one by one based on the findings from interviews
and the communication marketing theories that cited in this research. The firs subsidiary
71
is sampling which is promoting the product for the customers by offering some samples
for free which represents the special features and characteristics of a product. But here
for the service industry actors using sampling seem irrational and unnecessary because
they cannot transmit their desired message to the user. Based on Lasswell (1946) the
message should be encoded by the sender and then decoded by the receiver in order to
transmit the wanted meaning which in this case is impossible.
The next one is coupons as promotion tools which are based on pull strategy they can
attract different people to the offered service or product but it is not used by the
companies which interviewed in this case because they believe using coupons are for
more competitive markets or for the businesses which have many powerful rivals. In the
service area due to the special service that these companies provide and their reliability
on the word-of-mouth that is spread by the satisfied customers, they are not interested in
use of coupons as a promotion.
Discounts as another component can play a crucial role in attracting customers but in
this research most of the companies except one don’t believe in discounts because they
think that anyway they are one of the best specialized in their category and even without
having promotions such as
discounts or coupons the customers has no option except
them if they want to receive a high quality service. So the interviewees prefer to spend
their money again in a way that increases the positive word-of-mouth as Synective
Labs, Reventia or Mobipro stated.
Sign up rebates as a promotion tool is not applicable in service industries that
interviewed based on what they stated and just one company is considering sign up
rebates for its customers in this research which is Gastro Konsult. As Peterson in
Synective Labs states these type of advertising is not proper for the service that they
provide and these sorts of promotions are more suitable for the businesses that have
mass consumers.
Gifts are the next subsidiary which like other components of sales promotion category
has almost the same function and characteristics. Gifts can happen in forms of free
samples for representing the company’s product or service. In this research just one
company believes in gifts and other business owners think that gift is not a useful
72
promotional tool for a service industry and it can be fitted more for product
advertisings.
Prize promotions as the last element of this category is not using by any of the
interviewed companies. As a total it can be seen that sales promotion tools due to their
characteristics and requirements are not popular between service companies of this case.
Most of the owners believe that in the service industry free samples and gifts have a
minor effect on customers mind in comparison with word-of-mouth. As Brooks (1975)
states it is very important to know that the power and significance of word-of-mouth in
daily life lies in the mutual speakers’ lack of material concern or product involvement
and the marketers in this research also think the same as Brooks. They believe when the
word is spread about their great performance in the market there is no need to use other
types of promotion tools. In other words they mean that in any way they have their
customers and they attract more customers by their credit in the market; so they are not
intended to put extra money and effort in the sales promotion channels. In their belief
sales promotion channels has no significance in increasing their selling when the main
element to rely on is the word-of-mouth for small companies in the local market of
Sweden in the service industry.
Upcoming category in communication mix theories is public relation and its
subsidiaries. Based on Smith (1998) public relation is used to help the public to have
better understanding of what the company does and its products and services. Also he
states that the goal is not the same as in other communication tools to increase sales or
other measurable aspects. Instead the goal is to generate purposeful communications
with its public. Press release is the first element which in this research half of the
interviewed companies are using it. They have some ads in the press as an informative
tool. The ones who use press releases also believe that this type of advertisement
doesn’t ask for a great amount of money as a promotion tool and by spending a few
amounts they can generate communication with the public as Smith (1998) claims also.
Press releases seem to somewhat popular between the interviewed companies because it
does not call for a great amount of money while it can spread the word in a vast number.
Press conferences the second subsidiary is not happening in any of the interviewed
companies due to the belief that these type of conferences are occurring for big
73
businesses with a great amount of spectators and in this case the small firm owners say
that these type of PR is unnecessary for them. Lindberg in More Time says that he
wishes to arrange this type of events on a case of broadening the activities of the
company in the future but in the present situation and regarding the limited number of
employees and customers these kind of activities will end with bringing high expenses
to the company.
Special events are the succeeding subsidiary of public relation which is sometimes used
by the interviewed companies. Three out of ten companies have held special events
regarding a specific occasion in order to introduce or promote a current or new service.
The last factor is sponsorships which are happening in two companies in this research.
Sponsorship is one of the advertising techniques that happen in Reventia in a form of
music festival sponsorships and in More Time in Norrkoping football team support.
Also if the scholarships can be fitted in the category of sponsorship the More Time
considered a special kind of scholarship for the students at high school in accounting.
Meaning that if a student can pass the required courses with the highest grades, he can
attain the company support in order to work and then be hired. In More Time already
one employee found his path to the company in this way.
Instructional material is the following category in Lovelock mix theory and the first
subsidiary here is websites which can be very close to internet in advertising although
internet covers all types of advertisement that can happen in the virtual world but
websites are just informative pages about what a company does as previously explained
in this case. As the name of instructional material represents the websites can also play
an instructional role for the users in order to introduce them to the preliminary
knowledge that they should know about a specific company. Just one out of ten
companies that interviewed does not have a website which its owner, Parisa Majidi tries
to cover this area in the shortest notice in order to become more reliable from
customers’ point of view, she thinks.
The next subordinate is manuals which definitely fit in the category of instructional
material which contains all the instructions for using a certain device (product often). In
this case none of the interviewed companies do not have manuals because they don’t
74
believe it is something useful in their service area and they think their offered service is
complete and the customers do not need any manual to benefit from the service.
Following material is brochures which seems popular between half of the interviewed
companies. As an illustration More Time has some leaflets for its new services that
recently added to their service category and the CEO believes that colorful and
informative brochures can be interesting from the eyes of customers and they can be
easily spread between people at the time of special events, seminars, etc. So the current
or future customers can get some information by reading the leaflets. It can be referred
also to Shannon and Weaver model (1949) that using brochures can be a way also for
transmitting the desired message from the sender to the receiver in a printed form and
the receiver by decoding the message can understand what is happening in specific
companies. Furthermore based on uses and gratification theory (1946) the customer can
decide whether his needs going to be satisfied by the offered service or not. As Katz et
el. (1946) claim there are different channels for advertising and there is finally the user
who decides which channel to use and in what way. So in this case half of the
companies seem positive toward using brochures due its cost-effective and informative
characteristics.
The last element is software which does not have that much function in the service area
from the perspective of the interviewed companies. Just one of the companies has
special software for specific cases, namely Reventia. They are using a special software
program on their website so that their customers can sign in directly on internet and use
some of Reventias’ services online. As it can be understood software’s also have the
instructional role for the users which usually more fit in the product industry like
software of using a special program.
The last dimension of Lovelock mix theory is corporate design which the first
subsidiary of it is signage. Signage categorically includes the logo and the main visual
designs that a company is recognizable in public’s eye. In this case all the ten
companies have their own signage and they believe this is one of the first and foremost
characteristics of any company. Signage design usually is done by an external company
and it is not costly that much for the company and because it is often needed to be done
75
once; companies are ready to pay for it in order to have a proper logo which usually
they keep it for a long time.
Interior décor, vehicle, equipment and uniforms are the rest of the subordinates of this
category which none of them are being used by the interviewed companies because the
owners think that due to their small size and limited number of offices and staff these
kinds of expenses seem unreasonable. The companies in this case prefer to invest their
money in increasing the quality of the service that they offer the customer. They claim
that higher quality service will increase the positive word-of-mouth for them which lead
to higher profitability in the future. Or they intend to invest in hiring the consults with
the high reputation in the market in order to attract more customers because of their
credited staff. Herewith the Wilson’s (1994) statement is visible that the service or
experiences with bad quality will promote negative word-of-mouth statements while
high-quality service or good experience from a specific product or service provider will
encourage positive word-of-mouth responses.
76
6. Conclusion
In this chapter the results of this thesis will be presented. The chapter’s aim is to answer
the research questions that appeared in the first part of this dissertation.
In order to have a conclusion, herewith after analyzing the empirical data based on the
marketing communication theories and the findings based on Lovelock and Wright
communication mix theory table; the main research questions of this dissertation are
being reminded:
 Are micro firms using the most known marketing communication theories in
their day to day business?
 How do micro firms perform their marketing communication with their
customers?
This research has been conducted by these two questions which are made based on the
preliminary findings of the pilot study about small firms and their marketing. The pilot
study triggered these questions that what is happening toward micro firms in Sweden
and their communication with their customers. The conclusion here is made based on
the answer to these main questions:
After interviewing 10 micro companies in Norrkoping and Linkoping which were
activate in service industry e.g. consultancy or law firms some deductions are reached
by this research’s authors. Most of the company owners who were often the main
decision makers for many activities of a firm such as marketing have a fair knowledge
about marketing known theories e.g. Kotler 4Ps, Smith 7Ps etc. but based on some
limiting factors none of these companies are applying the marketing communication
theories to improve or broaden their circle of contacts with their customers. The
foremost burden first of all is the limited budget of small companies that doesn’t let that
much maneuver in the area of marketing. The CEO of these companies who are usually
the consultants and marketing managers of the firm at the same time see no benefit to
put so much power and capital in the area of marketing while they have certain number
of the customers and they have no attention in expanding their activities or the size of
the company. Regarding to some of their claims even using external marketing experts
for marketing planning doesn’t really affect the profitability of the firm while small
77
firms are usually depend on other factors especially word-of-mouth. These other factors
are mainly about the credit of the company or the credit of the employees that attract the
customers (word-of-mouth). They believe that in small companies, customers’ needs
and desires are cleared and the small firm’s staffs do their best in order to gratify those
demands. So the answer to the first question is NO. Micro firms are not using known
marketing communication theories in their day-to-day business not because they are not
aware of them but due to their timely and money-consuming features of them while by
just depending on one element which is word-of-mouth they are satisfy and successful.
The second question is about how these firms perform their communication marketing.
After conducting the face-to-face interviews and filling the questionnaire by the
interviewees the outcome was very interesting. Based on the table that developed in
percentage relied on the findings of the questionnaire (Lovelock and Wright
communication mix theories) word-of-mouth is the most used element as one of the
personal communication aspects in marketing. Word-of-mouth stands for more than
75% of companies marketing strategy of the interviewed firms. They think that wordof-mouth is the most powerful component of the body of their marketing and it almost
covers whatever they need in the mutual contact between them and their users. They put
energy, time and experts on spreading the positive word-of-mouth in the market. They
believe that as long as they gratify the demands of their users by offering them the high
quality consults which needs special knowledge and know-how from the consultants,
the customers would be satisfied and this process would end with happy customers who
will suggest these firms’ service to others who are in need of it. Word-of-mouth even
affect these companies’ recruiting process and they try to hire the consultants who
obtained a high reputation and credit in the market, because they know many users are
following the people who their service is trusted and qualified. To sum up, the second
question’s answer is word-of-mouth doubtlessly. Word-of-mouth is the definite way of
communication marketing in micro firms and they rely on it as the principle aspect
which impacts all other areas in their business.
78
7. Discussion
In this chapter the results of the interviews and analysis will be discussed in order to
clarify the veracity of the findings and actions that have been taken to obtain those
results. Moreover a communication marketing model for micro companies in the service
industry in Sweden will be presented.
In order to present the result of this thesis a discussion is important to shed a light upon
some aspects that are observed by the authors during the period of writing. Some
questions must have been asked here regarding this thesis. Why did the authors get the
result as they did? And why did they divide the question statement into two separate
questions where they aimed to answer ” if micro companies are using the most known
marketing communications theories in their day to day business” and “how do micro
firms perform their marketing communications with their customers”
The results of this thesis show, as already mentioned; that micro companies do not use
most of the theories and models presented in chapter 3, theoretical framework. They
focus mostly on word-of-mouth phenomenon which is the way that they perform their
communication marketing. The division of these two questions was made because the
authors had an assumption that micro companies do not use the above mentioned
theories because of the findings that realized from their pilot study. Therefore the aim
was to further investigate if this is the case in a larger study and to show how micro
companies are managing their communication marketing. The authors believe that
micro companies do not use theories, models etc. first of all because of the founders.
The founders of these micro companies are alpha and omega to the company and their
experience and knowledge set the limits for their companies’ activities. All of the 10
interviewed respondents have great experience from their previously work on the
market in question. All of them have also started their own business in just the specific
area of their experience and knowledge. Considering the career history of the founders
with their already established contacts in the market, becomes even more important
when their operating area is on a relatively small market e.g. local in Norrkoping and
Linkoping. These cities are the average-sized cities of Sweden that can be represented
for the local Swedish market’s actors and somehow it can be seen that the use of
communication marketing theories for small companies in these towns is superfluous.
79
These companies from the first day that they start their business has already established
customer stock which makes them focus on delivering high quality work for their
existing customers. Another factor why companies are reluctant to use the well-known
theories is because they don’t plan to expand their business. There is no or little need to
increase the customer stock and no plan either to develop the company itself with e.g.
more employees or more offices in other regions. Micro companies are often family
business; where the founder has a previous profession within the same market and
already at the start of their business, there is a sufficient customer base. The companies’
entrepreneurs are happy with their current business situation which makes the use of
theories and models that are presented in this research, unnecessary for them. In this
thesis the authors have came across 10 different companies with as many different
founders but the result is homogenous for all of them. This similarity can be interpreted
due to two reasons. First, because of the small study of only 10 companies there is no
possibility to make a generalization, but there is strong evidence to point at a direction
that all micro companies in Sweden tend to use word-of-mouth more than any other
theories or models that are presented in the third chapter. Second, because of the
unanimous result from all respondents, this thesis has a strong generalizability. The
writers are convinced that even if more interviews were been conducted the result
would still remain the same. In order to achieve a qualified conclusion with high
validity some selected measures have to be cleared. One of these measurements is that
all of the interviewed companies are companies with good profitability and with a
strong imprint on the market. This is important because the companies that targeted for
this study should be represented companies for all micro companies in Sweden. Writers
believe that this thesis has selected the average micro companies in Sweden which
strengthens this thesis credibility even more. Another measurement is the opportunity
that the interviewees had to stay anonym but none of the interviewed companies chose
it. So it can be interpreted that the respondents answered the questions in an honest way
with no meaning to distort the truth. There is also no evidence that the interview
questions have been answered with a self-interest intention from the respondents.
Furthermore, all published data, considering the interviewed companies in this thesis,
are approved from the respondents themselves.
80
The contribution of this paper consists of a model that developed by the authors. The
model is called “Communication marketing model for micro companies in the service
industry”. This model represents a rain drop in the sea where the strongest impact of the
drop is the core that later wads away into ripples on the water. Ripples consist of three
other factors that are important for micro companies’ communication marketing
strategy.
Figure 9. Communication marketing model for micro companies in the service industry
(by the authors)
The first ripple is Customer Service, followed by Internet and Signage. The core is
Word-of-Mouth and that is a fundamental factor for micro companies. They either
depend on it consciously or unconsciously, active or passive, but either way the fact
stands that micro companies are very depended on positive spread of word-of-mouth.
Without it companies would be forced to either change their way of doing business or
face the fact of going to bankruptcy. All of the 10 interviewed companies realize the
importance of word-of-mouth but only a few are actually using it as a pronounced
strategy in their business. This means that by just focusing on performing a good service
81
as possible for their customers, automatically leads to a positive spread of word-ofmouth and the companies have no bigger need in developing any clear strategy in how
to handle this phenomenon. The core need though some help in pushing the word
forward in a positive path and the ripples represents that. customer service which is the
strongest ripple after word-of-mouth stands for micro companies’ need to take care of
their customers in a more personal matter. This is the case though micro companies in
services industry tend to have customers that are also micro companies or SME´s. When
being in a market as above mentioned situation, the work goes beyond boundaries of
being professional or personal. The results have shown that micro companies often
handle their customers’ private business as well because these companies are in many
cases so small that there is no difference in their personal or professional financial
position. Therefore it is vital to have a good relationship with the customers to gain
confidence that is necessary in order to make the customers satisfied. Customer service
is precisely the word that summarizes all that.
The following ripple is Internet and this study has shown that all companies have at
least a website where all necessary contact information exists. As technology develops
in a rapid pace especially in information technology it is crucial or even standardized to
have a website offering the very least information about the company and contact info.
This study has also shown that more resources are devoted to just internet. Almost all
companies are represented in internet search engines such as Eniro 8, Gulasidorna 9 and
Hitta 10 . These search engines enable companies to be appeared in the virtual world
when potential future customers are searching in internet for a none specified company
in the specific area of business. In this thesis, those companies which are not cited in the
search engines planning in a near future to invest on that advert. A few companies in
this study has also developed their website even further where customers can sign in
online and buy services directly on internet. These kinds of services are planning to
increase more and more in order to customers realize the benefit of internet based
business and communication. The last ripple is Signage where the fact shows that all
companies are using some kind of signage. Business cards are the most usual ones but
also flyers, pens and different material with corporate logos on. This type of marketing
8
www.eniro.se
www.gulasidorna.se
10
www.hitta.se
9
82
is very subtle and the goal is not to increase the knowledge company’s customers but
the aim is instead to remind customers that the company exists and if demand exists the
customer can come to realization to use services of that particular company.
These four factors are the most used elements by micro companies in the service sector.
This study has shown that none other theories or models are used by the companies in a
larger sense. With this model contribution, the writers aim to help newly started micro
companies in how and what they need to put their focus. This is especially helpful for
companies which the founders have none or little background in the market and are
uncertain which models and tools should be used to bring the company customers’ trust
and profitability. Also, a contribution is made for scholars to see that the most of the
theories of communication marketing are not applicable for micro companies in the
service sector in local market of Sweden.
83
Appendix
Brown et al. (1999)
84
Interview questions
Demographic questions company:
1. Name of the Company
2. Number of Employs
3. Business area
4. How many years in business (start-up date)
Demographic questions interviewee:
1. Name
2. Title
3. Job description
•
Why did you choose service industry?
•
Who are your main customers? (B2B, B2C)?
•
Have you hired or do you hire marketing firm to do your marketing? If yes, why
and how? If no, why?
•
How much of the company’s budget is dedicated to marketing?
•
What do you know about Communication Marketing and its theories?
•
Do you have marketing strategies in your company? If yes, which ones? If no,
why not?
•
What is the most important element in providing a good reputation for your
company? (PR, Word of Mouth, Direct marketing etc.)
•
In your opinion to what extent Word Of Mouth has an impact on your business?
85
Interview questionnaires
Per sonal Communications
Yes
No
Why
* Selling
* Customer Service
* Training
* Word Of Mouth
Adver tising
* Broadcast
* Print
* Internet
* Outdoor
* Retail displays
* Cinema Theatre
* Telemarketing
* Direct mail
Sales Pr omotion
* Sampling
* Coupons
* Discount
* Sign up rebates
* Gifts
* Prize Promotions
Public Relations
* Press releases
* Press conferences
* Special events
* Sponsorship
Instr uctional Mater ial
* Web sites
* Manuals
* Brochures
* Software ( CD´s )
Cor por ate Design
* Signage
* Interior decor
* Vehicle
* Equipment
* Uniforms
86
Why Not
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