Work smart to ensure your money survives.
WRONG, wrong, wrong," are the three words Marketing Institute boss Tom Trainor uses to sum up SMEs' understanding of marketing during a downturn, or marketing in general for that matter.
"There's a view that marketing is something that happens after you've got the product," he says. "You build a house and then it's 'I've got a house, now I need to do a bit of marketing'.
"That's all wrong. Marketing is much deeper, it should be there right from the point where you're trying to work out if you should build a house."
Go a layer deeper and marketing is about "identifying a need", or deeper still, about "creating a need where one hasn't been articulated", he adds.
"It's like (car-making legend) Henry Ford said: 'If I had asked my customers what they wanted, they'd have said faster horses'," says Trainor. "Marketing is about a vision to see deeply into what society wants and then sell it to them."
It's that holistic view of marketing that lends weight to Trainor's argument about the major role marketing can play in helping firms beat the recession, a concept he's hoping to hammer home at the institute's newly launched 'Beat the Recession' clinics.
The plan is to gather about 15 SMEs for a morning of general discussion on the "critical success factors" businesses should be honing on in a "tough environment".
Then, in the afternoon, the businesses will be broken into smaller groups where they can go through their real-life experiences and learn from the experience of their peers and the advice of a marketing expert.
"You can achieve a huge amount in one day," says Trainor, who hopes to run the clinics monthly if the idea "gains traction".
The most common problem Trainor expects to come across is SMEs who are out of touch with their customers' attitude to buying.
"People who 24 months ago would have died if they couldn't get the latest 2009 registration plate today would be embarrassed to have a 2009 reg because they don't want to have that car in their driveway when the neighbour across the road might have lost their job," says Trainor.
"Something fundamental is happening in customers' mindsets and it has to be understood."
Trainor suggests "focus groups" and "market research" as a good route to understanding where your customers are coming from. Even the smallest most cash-strapped businesses can "talk to their customers, hold on to them a few minutes longer and ask them what they'd like from you," he adds.
Some companies will do the legwork and find that the product or service they're selling simply doesn't have much of a market any more, bringing Trainor to an example of how more marketing work doesn't simply mean working harder on selling.
"If your market has disappeared, advertising more isn't a clever option," says Trainor.
"You need to get back onto a growth path, you do that by looking at your competencies and looking at what's happening in the market, and where there's a fit between the two.
"It's not just about pushing harder, it's about working smarter."
Take that approach, and Trainor says even companies in the most doomed-sounding industries can find salvation in their marketing department.
"We had a construction equipment hire company in the shake-up for the all Ireland marketing awards this year," he recalls. "They saw the bottom fall out of their market. They responded by saying 'we hire equipment, lets look at hiring different equipment'.
"They looked around and saw that with the recession people were doing more DIY, so they started hiring machines for DIY. Then they saw gym membership was on the way down and they started hiring out gym equipment. That company is booming now."
Another problem Trainor expects to come across at the clinics is the scatter-gun cost-cutting approach, where SMEs blitz whatever media they can access cheaply to save money. "You hear everyone saying 'I should be on Facebook', but not everyone's customers are on Facebook," he says.
Tools
"Companies should see marketing as a box of tools where you can bring various tools to address particular problems.
"You can't just empty the tools on top of the problem and say that's it."
Companies looking to cut costs from their marketing communications budgets should approach the problem with a "scalpel not a sledgehammer", Trainor says.
Cutting back on expensive brand building advertising in favour of cheaper promotions that drive sales immediately can help "get from quarter to quarter", while switching to more cost-effective medium like online can also pay dividends.
Abandoning marketing communications altogether to save money is never an option that should be considered. "If you do that, your customer base stops getting messages from you and they assume you are on the way out or gone," he says.
"Then you've left the field completely clear for another player to take your place."
- Laura Noonan