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Welcome to Seminar – Unit 4 Audio will start promptly at 9 pm. If for any reason there is technical difficulty….stay online. If you can see the screen, please share with your classmates the following: If I could turn back the hands of time, I would go back to age ? …because …. AB209 -- Small Business Management Agenda • Brief Review of Chapter 7, 14, and 17 • Questions Unit 4 Outcomes • Identify the components of a formal marketing plan. • Explain the different methods of forecasting sales. • Define customer relationship management CRM) and explain its importance to a small business. • Understand psychological and sociological influences on the consumer. • Identify advertising options for a small business. Chapter 7 The Marketing Plan Small Business Marketing Small Business Marketing – Business activities that direct the creation, development, and delivery of a bundle of satisfaction from the creator to the targeted user and that satisfy the targeted user. The three Levels of a Product/Service Augmented Product/Service (the basic product/service plus any extra or unsolicited benefits to the consumer that may prompt a purchase. Actual Product/Service (the basic physical product/service that delivers those benefits. Core Product/Service (benefit or solution sought by customers) Market Analysis Market Analysis – The process of locating and describing potential customers QUESTION? Based on the business you have or aspire to have, what would you do to locate potential customers for your business? The Marketing Plan •Market Analysis •The Competition •Marketing Strategy •Product/Service •Distribution •Promotion •Pricing Steps in the Marketing Research Process 1.Identifying the Informational Need 2.Searching for Secondary Data 3.Collecting Primary Data 4.Interpreting the Data Gathered Question for all As you think about your business idea or current business, what sources of secondary data will address your needs? CHAPTER 14 REVIEW What is Customer Relationship Management (CRM)? A company-wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups. The Importance of CRM to the Small Firm 1. 2. 3. 4. 5. Acquisition costs for new customers are high. Long time customers spend more money than new ones. Happy customers refer their friends and colleagues. Order-processing costs are lower for established customers. Current customers are willing to pay more for products. Question: Think about a time when you experienced great customer service. What did the business do to make you feel this way? Question for all: In your opinion, do you believe customer complaints can cause a business to make a change? If so, have you ever made a complaint, as a customer, and the business took action? Sign posts to extraordinary service: 1. 2. 3. 4. 5. Doing business of a first-name basis Keeping in touch Finding ways to help Customizing your service Addressing problems promptly Customers as Decision Makers Stage 1: Problem Recognition Stage 2: Information search and evaluation Stage 3: The purchase decision Stage 4: Post-purchase evaluation Does CRM put more emphasis on current or potential customers? Why? Understanding Psychological Influences on Customers Needs – The starting point for all behavior Perceptions – The individual processes that give meaning to the stimuli confronting consumers. Motivations – Forces that organize and give direction to the tension caused by unsatisfied needs. Attitude – An enduring opinion based on knowledge, feeling, and behavioral tendency. Understanding Sociological Influences on Customers Culture – the behavioral patterns and values that characterize a group of customers in a target market. Social Class – Divisions within a society having different levels of social prestige. Reference groups – Groups that an individual allows to influence his or her behavior. Opinion Leaders - A group member who plays a key communications role. Marketing Mix • Highlights areas that must be addressed by a firm’s marketing strategy. “4 P’s” • Product – How to transform the product or service into bundles of customer satisfaction? • Place – How to deliver the product or service to the customer? • Price – How to set the appropriate pricing levels for the product or service? • Promotion – How to communicate the necessary information to the potential customers? Chapter 17 Review Promotional Planning Promotion: Getting the Message Across Personal Selling Advertising Marketing communications that inform and persuade consumers Sales Promotional Tools © 2010 South- 17–24 The Communication Process in Promotion • Communication Process Components -Source—the message sender -Channel—the path the message travels -Receiver—the recipient of the message • Forms of Promotional Communication -Nonpersonal—advertising -Personal—personal selling -Special forms—sales promotion © 2010 South- 17–25 Determining the Promotional Budget • “How much should a small business spend on promotion?” 1. Allocating a percentage of sales 2. Deciding how much can be spared 3. Spending as much as the competition 4. Determining what it takes to do the job © 2010 South- 17–26 Personal Selling: Prospecting • Prospecting -A systematic process of continually looking for new customers • Prospecting Techniques -Personal referrals -Salesperson initiates customer contact through referral by another party known to the customer. -Impersonal referrals -Information on potential new customers developed from public records and published sources. © 2010 South- 17–27 Overcoming Customer Objections I had problems with a similar product before and don’t want to go through that again! Yes, I understand your attitude, but have you considered . . . ? I’m too busy. That’s why I want to explain how I can save you time by . . . I like what you have said, but I need to wait. Let’s figure how much you can save by acting now. Your product sounds just like your competitor’s. There are similarities, but we have . . . at a better price. I’m not sure I can risk a changeover to your product. Let me tell you how a competitor decided to buy from me. © 2010 South- 17–28 As we reviewed the list of customer objections, as you think about situations in which you’ve been sold something, what did the sales person say that “really” convinced you to make a purchase? Have you ever had a situation in which you were the sales person and either did well, or did not do well in convincing your customer? In retrospect, what would you have done differently, if you didn’t convince them, and what did you do right, if you did convince them? Web Advertising • Basic Web Promotions -Banner ads -Advertisements that appear across a Web page, often as moving rectangular strips -Pop-up ads -Advertisements that burst open on computer screens -Direct e-mail promotion -Advertising delivered by means of electronic mail -Spam: unsolicited e-mail © 2010 South- 17–31 Web Advertising (cont’d) • Basic Web Promotions (cont’d) -Web sponsorships -A type of advertising in which the firm pays another organization for the right to be part of that organization’s Web page. -Linkages -One firm pays another to include a click-on (clickthrough) advertising link on its Web site. © 2010 South- 17–32 Web Advertising (cont’d) • Basic Web Promotions (cont’d) -A corporate Web site on the Internet -Creating and registering a site name -Building a user-friendly Web site -Promoting the Web site -Blogs -An interactive website in which an individual can maintain a personal online journal, post comments and reflections, and provide hyperlinks. © 2010 South- 17–33 Exhibit 17.4 Website Design Tips Tip 1: Know your purpose Tip 2: Think like your customer Tip 3: Make it easy to navigate Tip 4: Reduce the load time Tip 5: Avoid surprises Tip 6: Document everything Sources: Gary Klingsheim, “How to Create an Attractive, © 2010 SouthUser Friendly Website,”17–34 March 20, 2009, Exhibit 17.5 Options for Getting Your Website Listed in Search Engines 1. Use a free submission service 2. Use a low-cost, automated submission service 3. Do it yourself by manually submitting your website to individual search engines 4. Use a professional search engine consultant 5. Use submission software 6. Pay for inclusion. © 2010 South- 17–35 Any questions? Thank you for joining me today! I look forward to joining you next week!