“First impressions count” as the old cliché goes, and never is this truer than when it comes to the impression a new business makes on its customers and prospects during its first year of trading.
A company’s first year is, of course, a very formative time for businesses of all sizes, and the one that will set the tone and lay the foundations for the business’s future growth and success. For SMEs, what happens during the first year, the customers they secure and the impression they make can mean all of the difference between the business making it into year two on a solid footing, or failing to survive their first year of trading at all.
How your small business is marketed during this time is naturally integral to securing the business’s success, and few people are more acutely aware of this than the business owners. However, the pressure to get things right and the drive to do everything possible to get the business going as quickly as possible can actually hamper, rather than help your first year marketing efforts, particularly when it comes to how well they support brand loyalty and set the scene for a future of profitable trading.
This means that many SMEs every year fail needlessly as a result of poorly thought out short-term marketing approaches, and an inability to see the big picture and plan ahead. In this article, I will share six common marketing mistakes that many SMEs make during their first year in business, and how to avoid them.
Six common marketing mistakes for new businesses
1. Not focusing on presenting a cohesive brand image and building brand perception
Building brand awareness is about generating a sense of familiarity and trust in your new prospects and past buyers alike, so that when they are next in the market for goods or services you offer, they return to you directly rather than shopping around first.
But how important is building your brand image during your very first year of trading? Well, presenting a cohesive brand image can increase revenue by up to 23%, and 90% of consumers consciously expect their experiences with a brand to be consistent, regardless of platform. Failing to pay your brand image the appropriate gravitas in your first year can and will affect its chances of making it to year two.
What is your brand all about? What does it say to customers, what associations does it generate in their minds, what do they think of when they see your name? If you’re not sure about this, your prospects won’t be either.
To produce a brand image that is memorable for all the right reasons, consistency is key. The tone and style of your online and offline collateral, the shopper experience, and your ethos and approach all need to be consistent and work together seamlessly, to avoid incongruencies that ring a false note that prospects will find jarring, even if they can’t quite pinpoint why.
Building brand loyalty and presenting a consistent, plausible brand image is integral to the success of businesses today, and vital to turning one-off buyers into repeat customers, which in its turn is vital to the business’s ongoing survival.
Your branding should be evident in virtually every facet of your operation, from the choice of fonts and colours on your website to the approach taken by sales assistants in-store. Make sure that all of your brand collateral is telling the same story, and that the story is one that your prospects want to hear.
2. Failing to establish trust and authenticity
If your products or services aren’t up to scratch or don’t live up to expectations, people who purchase from you once won’t return, and they’re also likely to spread the word and serve to discourage other prospects from considering you too.
However, a common mistake made by many SME owners during their first year of trading is thinking that selling an excellent, unique or exclusive product is on its own enough to build momentum and drive growth – so you may be missing a trick.
If your business is relatively unknown or has just entered the market to compete against established brands as a newcomer, building trust and establishing your plausibility and authenticity are your first challenges.
Even if your offerings look great and beat all of the competition on price, without trust, many prospects will pass you by in favour of an alternative, out of concerns over your ability to fulfil your promises, or fear that a deal looks too good to be true.
Look at your customer journey and ask yourself why people might buy from you rather than someone else. If you can’t think of several good reasons, your prospects probably can’t either. Ensuring that people can find you when they’re looking for what you offer, presenting your products well and offering a competitive price and shipping arrangements are all essential, but they’re not enough on their own.
If you make specific claims about your products or services, these need to be backed up with research, testimonials and cold hard facts, to take the chance and guesswork out of the customer journey before customer loyalty can be achieved.
You have to validate your brand in the eyes of your prospects at every stage of the game, and there are a great many elements to doing this, many of which SME owners don’t even consider.
From the secure connection padlock on your website’s browser bar to showing easy-to-find contact details including a registered UK business address to sharing more information about who you are and what you do on an “about” page and across your website in general, building trust is key.
Reviews of both your products and your company are hugely important too when competing with others or trying to establish a new brand, as are positive word of mouth recommendations and endorsements.
Never neglect the value of building trust with your prospects – nor ignore the cost of failing to do so.
3. Prioritising short-term cashflow over establishing long-term revenue streams
Selling one-off goods or ad-hoc services is, of course, a vital source of cashflow for most businesses, and particularly during that first year, every penny counts. However, to be able to maintain and increase the business’s revenue streams to support growth, you have to sell more than goods or services – you also have to sell your company and brand, and validate it in the eyes of your target audience.
The drive to make immediate sales and balance the books often takes precedence for SMEs during their first year of trading, but this type of myopia can directly compromise your cashflow and revenue streams further down the line. This leaves you continually scrabbling around playing catch-up to find and attract new shoppers, who in their turn won’t be incentivised to return again in future without a similar effort made each time.
There is, of course, a delicate balance to be made between bringing in enough cash to keep the business afloat and building the foundations of future sales, but think of each purchase as the start of a customer’s journey rather than the end of it. Build your campaigns around your brand image and product and service quality, rather than treating these things as an afterthought to come back to further down the line.
4. A lack of personalisation
Personalisation is one of the hottest marketing buzz phrases of the day, and one that even first-time business owners have drummed into them early on. However, understanding why personalisation is so important and how to execute it in practice is given much less airtime, and so often ends up being little more than a “put the prospect’s name in the email subject line” box-ticking exercise for all too many start-up SMEs.
Basic, surface-level personalisation of this type is no longer really effective because everyone is doing it, and this is what customers have come to expect today, rather than something new or special. In fact, 92% of prospects surveyed in Pure360’s 2018 research stated that the use of their name alone would hold no sway when it comes to incentivising a purchase.
Personalisation is about creating a personal connection with each prospect and generating an emotional response in them to help to incentivise brand loyalty and enhance the shopper experience. Prospects actively want more personalised content too, as long as it is meaningful for them – and businesses that can provide this gain an immediate edge.
When it comes to online sales, personalising your website’s product suggestions and complementary product offerings, sharing relevant, exclusive offers with set demographics, finding out as much about each prospect as possible and leveraging these insights to provide a personalised buyer experience are all good approaches.
For offline sales, getting to know the type of buyers that your store appeals to, setting the right tone and style to incentivise them, providing what they want in the way that they want it, and taking every opportunity to get to know shoppers personally are all winning approaches.
When you personalise content for a prospect, you make them feel understood and valued, and this helps to reaffirm their purchasing decisions, incentivise higher sale values, and encourage repeat custom.
5. Failing to invite and work with customer reviews and feedback
Customer feedback and reviews are valuable to shoppers and prospects, and frequently serve as the catalyst that makes a prospect who was on the fence choose one retailer over another.
Even for businesses serving customers from real-world retail units rather than online, online reviews are vital today, and for a great many reasons. 90% of consumers read online reviews before visiting a local business, and good reviews can also help your business to appear higher in search results too.
Getting a bundle of great reviews during your first few months of trading is excellent, and something forward-thinking SMEs aspire to achieving. But as you may have already found out, customers often lack the incentive to leave a review or provide feedback for you, even if their experience was excellent and they intend to shop with you again.
You can incentivise reviews and feedback by making sure customers know how and where to provide it. Offering a discount on a future purchase or another tangible incentive in return for a review can be very helpful, particularly if you’re trying to gather your first few reviews to help your business to compete with others.
Another common mistake that SMEs often make in year one even when they’ve gone to the trouble of inviting and incentivising reviews and feedback is failing to act on the information received. Getting a lot of feedback is great, but it is only of value to your company if you do something with it, and use it to learn what prospects want, find out your weaker areas, and address them directly.
This not only helps to ensure that any creases get ironed out before they detract from a future customer’s journey with you, but it also lets the people who took the time to leave a review or some feedback know that they are being listened to, and that your company cares about their needs.
This in turn invests them in your success, and may serve to turn them into some of your most loyal supporters.
6. Concentrating too heavily on generating leads and not following through with conversions
One mistake that many businesses make regardless of their size is placing too much onus on lead generation, then dropping the ball when it comes to the customer’s journey through the sales funnel.
Few businesses would tell you that they aren’t looking for new leads at any given time, but concentrating too hard on generating leads in the first place without knowing what to do with them next, or even if the leads you are generating are qualified, is nothing more than a costly waste of time.
Focus on quality not quantity when it comes to lead generation, and once you’ve begun to get a better feel for who your actual customers are rather than looking at hypothetical buyer personas, start planning narrower, vertical lead generation campaigns rather than broad horizontal ones, to achieve the best ROI.
Then, work at identifying where in your sales funnels you’re losing prospects and why, and work to address this.
Another commonly overlooked facet of lead generation and successful sales funnels is effectively ignoring or writing off customers who have proceeded through the funnel to make a purchase as soon as their money is in the till.
However, turning one-time shoppers into repeat customers is vital to the success of any SME, to ensure stable, consistent revenue streams in future months and years without the correlating work and money involved in continually needing to identify and target new buyers.
After a sale has been completed, follow up – invite feedback, provide an incentive or offer to make a second purchase or spread the word, and thank your shopper for their purchase. Consider targeting past shoppers with automated online ads too, to keep your brand on their radar and remind them about goods they might already be considering buying.
Don’t continually spam past buyers with irrelevant, repetitive or overly frequent contact if you want them to keep coming back, but do remind them now and then that you’re out there, and waiting to serve them again in the future.
Being able to view the big picture and keep the value of repeat custom and successful conversions in mind at all times when your business is skirting perilously close to the edge of the balance sheet is never easy. But losing sight of these things does mean that any uptick in revenue you achieve today will only serve as a temporary fix, and the start of a vicious cycle of continually struggling to chase revenue rather than setting the scene to allow it to come to you.
Best practices for forward-thinking SME marketing during year one
Few things can be more stressful, emotionally laden or important than trying to get a new business off to the right start. Even business owners who plan meticulously and fully understand the importance of taking the long-term view often begin to lose sight of it when the realities of running a business day-to-day kick in.
The uniting factor within all six of the common first-year SME marketing mistakes I’ve mentioned above is that they’re all concerned with the here and now, the immediate need to bring in revenue, and the desire to grow and expand as quickly as possible.
However, by focusing too narrowly on what’s happening today in the ongoing struggle to compete and survive, you might effectively be negating your chances of future growth, alienating viable prospects, and dropping the ball when it comes to incentivising the repeat custom that will carry your business forwards in years to come. Here are the core takeaways to bear in mind:
- Always think about how your marketing endeavours will pay off in the medium to long term, and not just today. Analyse the success of campaigns and judge their ROI on their long-term value, and not just in terms of the uptick they might achieve for you today.
- Assess your marketing, sales funnels and lead generation campaigns to identify anomalies between engagements and leads that don’t result in sales and conversions, and work to strengthen weak areas or consider alternative approaches. This will help to ensure that you chase only qualified leads, and don’t needlessly waste them when you have them.
- Never lose sight of the value of repeat custom, and work hard to provide an excellent, personalised customer experience once you have brought people into your store or website. Generating repeat custom is much easier and cheaper than chasing new prospects, and pays for itself many times over in the course of your buyers’ longer term relationships with you.
- Regularly review your brand’s collateral across every facet of your operation to ensure that it is cohesive, plausible, adds trust and authenticity, and is a good match for your buyer demographics.
- Finally, know your customers, keep up with your buyer demographics, and make sure that if put on the spot, you could always present an accurate and up to date summary of who buys from you and why – and what you’re doing to ensure that they continue to do so and that you can target more prospects like them.