Running a home based business is a lot of work and it is a growing trend among young professionals and stay-at-home moms.
The positives are endless; low overhead, time with family, freedom of work, no dress codes and no boss. But running a business out of your home creates a lot of pitfalls. Marketing your business may seem like an incredibly impossible task. You may not understand all the insider language, protocols, or expenses. Hiring a marketing or advertising consultant can often be very pricey. Advertising agencies take an average commission of 15% when placing your advertisements. That can add up to hundreds of dollars you could have saved if you knew how to place these ads yourself. Marketing does not have to be daunting when you understand some of the basics the professionals use.
What is marketing exactly?
Marketing is a total system of business designed to plan, price, distribute, and promote a product or service.
Marketing takes into account the whole process, not just advertising. Taking a look at each element can help break down the process.
Plan: Planning when, where, and how to release your product is often an overlooked element.
Many great ideas never caught on because it was the wrong area or the wrong message that was released. By understanding what is unique about the area and about your business will help you better plan how to release the product. What is your product or service? How is it different from the competition? Does it require anything specific? You would not want to sell Avon in an area saturated with beauty stores. It is critical to find an area where you will be unique and new.
Understanding your demographic is also important.
Demographics are the vital statistics of the population in an area. Who lives in your town? What do they earn? What is their education? All of these factors play a role. For instance if you live in a low income area and you are selling what is termed a luxury item, you are probably not going to do well since the people who you expect to be buying from you have little disposable income. You can get demographic information for free from the US Census Bureau at www.census.gov and clicking on Census 2000. Knowing what the population is like around you will also help you evaluate media outlets.
Planning a budget is also very important.
By knowing how much you can spend ahead of time will save you from spending too much in one place. Budgets can be as large as 10k or they can be as tight as 1k, but knowing that ahead of time lets you use every penny efficiently.
Price: When setting the price of an item most often business owners have not taken into account marketing costs or customer demographic.
Most products have a few pennies added on to their price to cover future marketing costs. For example, an item or service that you are selling for $150.00 has a profit of 10%, meaning that it costs you $135.00 to make or provide the service and you earn $15.00 in profit. By adding only .5% or $.75 on to the cost you will be able to put aside money for future advertising and marketing without raising the price too high.
Price promotions are another way of using demographics to your advantage.
By adding price promotions (BOGO, Buy one get one half off, Free shipping, etc) you can attract more customers by offering them an incentive to buy from you and not your competition. If your product or service is not the cheapest in the area offering an incentive can help get the ball rolling on sales.
Distribute: How will people get your product? Do they order it online? Do you sell it by appointment? Do you offer a service?
How you get the product or service to the general public is important, it can influence your image with your customers. Always thoroughly research each and every distribution avenue. How that company that will be selling your good looks and operates reflects directly on you, the business owner. If the store that is selling your goods on consignment is dirty and does not treat their customers well it will ultimately affect your business. This also applies to service businesses. If you are relying on word of mouth from people, be careful whose mouth it is coming from. People with shady public pasts, or bad reputations will usually hurt your sales no matter how thick their Rolodex is. There is an old adage, any publicity is good publicity. Not true.
Promote: Promotion is the last and largest stage of marketing.
Now that you know the area, you have set your price and you have distributors lined up, how are people going to know you exist? By creating a timeline of what you want to do and when you want to do it, will help you stay on track and on budget. Get all your information first. Identify your local print media outlets. Print media, like newspapers and local magazines are often a very good investment. They have a wide demographic of readers and are much more cost effective. Purchase a few copies of their publications and see the style they employ. Are they targeted to business people? Families? Religion? Identify the outlets that are targeted to the same audience that will be your best customers, and who fit your product. You would not want to advertise skin cream to a publication read mostly by business men. In each publication there is contact information. Identify the person or persons in charge of advertising and give them a call. Get their Media Kit or Media Package. These are kits of information the publication uses to promote itself to potential advertisers like yourself. These usually include samples, ad sizes and prices as well as their reader demographic information. Make sure their readers match your customers. Once you have chosen the right outlets the advertising reps at the publications are your best resource. They can help you order advertisements and understand the process. Most publications also have in-house design staff that will design your ad for you at no additional cost. Keep in mind with any advertisements, less is more. Don’t try and fit your whole life story into one ad. All you really need is your name, your product and how your customers can find out more.
Many free or low cost promotions should also be included in an advertising budget.
Some avenues include Trade shows, Chambers of Commerce, co-marketing with other businesses, press releases, open houses, charity work, coupons and speaking engagements. Press releases and free products are often the best way to create free buzz for your business. Send a free product to your local news outlets with an informational letter about who you are and your business. You can find contact information on press websites. Journalists love getting free items and are always looking for a new or interesting story to catch readers attention.
Never miss an opportunity to promote yourself. By keeping your eyes and ears open to possible promotional opportunities you can excel at creating buzz about your business.