The Marketing Bureau

Specialist Marketing & Communications Resourecs



Why SMEs Fail At Marketing

By Jeff Smith
First Published on

Small Business in New Zealand make one fundamental marketing mistake. They don’t systemise and treat their marketing like a well tested and well oiled machine

They don’t have a strategy.

To them marketing is the activities that surround random placed advertising. Usually this is poorly planned often carried out on a spur of the moment decision or a ‘once only’ offer through their local paper or radio ad salespeople.

These businesses may or may not know who their target market is but they don’t show it in their advertising message. They don’t follow the true tested Problem+Solution+Target Market formula and therefore throw away a lot of their resources and advertising budget.

They are generally all over the place with their medium, method and message instead of being focused on one target market and one problem and one solution at a time

They don’t know that advertising is not marketing

Yes I know Mr. Marketing Student 101 the 4ps are Pricing, Promotion, Product and Place. However promotion is only one element of the so called 4ps marketing mix. The reason that a lot of New Zealand small businesses concentrate on the advertising and gimmickry is because it’s the ‘sexy’ side of marketing.

They don’t have a big picture view of marketing and don’t start with the basics first i.e They don’t look at their positioning and targeting strategies based on their product or service and ideal customers. This way they don’t let that direct their pricing, promotion, and distribution strategies.

They are not different on purpose

Many New Zealand small businesses copy the same old rubbish that everyone else uses. This way they are guaranteed to get the same bad results. Even if the marketing is good for one business, it’s probably not going to be that great for their businesses. These businesses forget that they are not the same business so their goals, objectives, target audience, capabilities, etc. are not the same. Secondly – ‘me too marketing’ – does nothing to distinguish their businesses from their competitors. Why would someone buy from them if they are no different than their competitors?

Most New Zealand small businesses forget to give their customers compelling reasons to buy, by not demonstrating that they have something that their competitor does not. Be different on purpose. (Otherwise start the price battle!)

They are amateurs and DIYers

Small New Zealand business people are good at their craft. They are great plumbers, doctors, lawyers, store owners, beauticians, chefs, dry cleaners, accountants. Most of them don’t know anything about marketing- and don’t have the time or patience to learn. And that’s ok. It would cost them more to learn and do it themselves than it would to pay someone competent to do it for them. I don’t want to fix my own broken pipes, or operate on my own heart. I’m no good at it. But other businesses are. That’s why I pay them to do it for me. However, most Kiwi Businesses insist ion doing it them selves. They don’t learn the basics of marketing and don’t start with understanding their marketplace, or find a profitable niche, or define their product or service to serve that niche.

If they did this right, they would either find themselves with no true competition or you they would stand out head and shoulders above their competitors

Small businesses think they can have the same marketing impact as Coke and Macdonalds put together

The problem is most Kiwi small businesses don’t have the money to market like the big boys. The big companies can run branding campaigns and hire expensive Ad companies to produce visually entertaining and stimulating masterpieces that make you almost drool for that new Big Mac or the latest Ford Focus.

NZ Businesses cant can’t afford to run image only ads. Funnily enough, aggressive newspaper advertising departments tell them they can. They don’t realise that their ads have to work hard to create awareness and generate sales or leads.

Unfortunately most small businesses dont market wisely and don’t test and measure to ensure that every dollar they spend is an investment that will produce a measurable return.. NZ Businesses are especially hopeless at using ads that have a call to action to spur a visit to their shops, their websites, or generate phone calls.

Most of them don’t realise until its too late that to do anything else is to risk losing money and ultimately fail in business.

Its all over the place

They are trying random things not really knowing why or they are dabbling in marketing with no real goal, process, or system. As a result their marketing strategy and tactics are not connected to each other or working together in harmony. In fact, they might even be working against each other.

For example running a discounted promotional offer to their prestige clientele using their prestigious services

Tactics must be aligned with strategies and support your goals. Every piece of marketing communication must be integrated with your brand and marketing strategies to be consistent and produce desired results.

Its all over the place part 2 – No system, no processes

Most small businesses have no system in place for marketing. There is no plan for properly evaluating the marketplace and finding profitable niches. There is no system to help position or reposition their products or services to serve those niches. This is especially devastating when their marketplace is changing at a hundred miles an hour every day.

There’s no F.U.

Many Kiwi small businesses, have leads that go un-nurtured and un-converted. Not because they are bad leads but because they don’t follow up. Chances are, if the lead was not ready to buy right then or at least have a sales person talk or visit with him right then, the lead was pushed to the back burner and evaporated into space. Or the customer that visited their store once, or even purchased once, never returned and was never contacted with any type of follow up marketing by the business.

Kiwi Businesses don’t realise that if their business relies on generating leads to turn into clients/customers, then they need to have an automated follow up system in place. Most of them haven’t implemented a system to capture their contact information to send them follow up emails and newsletters and contact them by phone or in person to keep in touch with them and nurture their relationship.

Hard Work – Not automation!

Kiwi Businesses are terrible at making sure that their marketing tactics are not automated where they can be automated. This makes sure that marketing is a drag, a bore, and a chore and pretty soon business owners get so busy following up there is not enough time for doing and managing the rest of the business. These business owners are probably not taking the time to measure the results of their marketing so they don’t know what, results their marketing produces.

They get frustrated, anxious and wonder if marketing is really helping their business at all. They start questioning their time and effort spent on marketing and pretty soon they are doing no marketing at all. Which virtually guarantees their business will not grow- and makes it highly probably that it will not survive for very long.

Conclusion – New Zealand small Businesses

Tools are available along with the simple skills and rules in marketing to turn your marketing effort from a chore into an automatic measured series of tactics. Don’t delay, educate yourself today or get professional help with a business coach or marketing consultant. Invest wisely and get an ongoing return on your investment

Jeff Smith


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