Entrepreneurship Marketing in Small Businesses - Essay Example

Entrepreneurship Marketing in Small Businesses TABLE OF CONTENTS Topic Page Introduction 3 2. Literature review 3 3. Analysis 4 i) Entrepreneurial marketing 4 ii) Marketing challenges 7 iii) Entrepreneurial marketing methods 8 iv) Relationship Marketing 9 4. Conclusion 9 5. References 11 Introduction Marketing-entrepreneurship in small firms has generated many interests from various corners especially in the entrepreneurship and marketing fields. Specific elements of marketing approach and orientations can be fundamental in the development of various entrepreneurial processes. Similarly, entrepreneurial behavior and orientation facilitate marketing performance of a business operating in a dynamic environment (Crick, 2004 p 167). Entrepreneurship in definition is the process of value creation through consolidation of the unique set of resources to achieve an economic goal. The process consists of a set of various activities that help in the identification of opportunities, evaluation, business definition, acquisition of necessary resources and management in the verge of achieving business goals. Entrepreneurship is an organization orientation that emphasizes on innovation, proactive orientation, and taking risks in a calculated manner (Gilmore, 2011 p 137). Literature Review The paper takes an extensive view of entrepreneurial marketing, and focuses on how small businesses can improve on marketing. According to Crick, (2004 p 169), it is worth considering entrepreneurial marketing as an organizational function and a well-laid set of processes for the creation, communication, and delivery of value to customers through managing the relationship in channels that benefit the business. Uslay & Teach (2008 p 70) noted that for a startup business to succeed in its new venture, the entrepreneur needs to consider various factors before engaging all the resources in the investment. It is necessary to engage in a market study and weigh various challenges in order to design a competitive product. Through many startup business are full of innovative ideas, marketing usually possess a major challenge to most of them. It is, therefore, necessary to put reasonable effort and resources in creating a strong and reliable market through suitable marketing strategies such as relationship marketing. The case of New Ink business helps analyze ways in which small business can compete effectively in new markets through employment of various entrepreneurial and marketing strategies. The study helps in analyzing how innovativeness, invention, and good marketing skills can help small business maneuver in new ventures. New Ink Company started its business of selling cartilages some years ago. John the company owner saw unexploited business in his locality and decided to venture in the sale of ink cartridges. He attributes his success on well-laid procedures to venture in a new business. He based his success on clear thinking, creativity, innovativeness, structured business plan, and suitable marketing strategies. John claims that though start a business and making it operational is a challenge, marketing poses the greatest challenge in every business venture. He also claims that to be a successful entrepreneur, it is important to possess skills to manage and organize various activities associated with change and innovation. Thus, it is necessary for every small business getting in the market, to be well equipped with marketing-entrepreneurship skills to succeed. Discussion Marketing entrepreneurship entails the concept-marketing angle in the process of adapting to new environmental conditions through which businesses operate (Gilmore, 2011 p 137). The ability of startup business to operate and grow in the current challenging business environment proves important in the society and the nation. This is bearing in mind the complexity of entrepreneurial marketing that proves a headache to many businesses. For small business to manage in a new venture it is important for entrepreneurs to understand the scope and dimensions of entrepreneurial marketing. These are proactivity, value creation, resources leveraging, opportunity focus, innovativeness, and the ability to risk calculatedly. Integration of these qualities would eradicate the notion that small businesses are good only in innovation but less effective in markets (Crick, 2004 p 179). The recognition of an opportunity and the pursuit of the opportunity form the critical part of success in small businesses (Uslay& Teach, 2008 p73). The ability of a business to identify the right opportunity determines its success. It is necessary as entrepreneur to look forward and possess the will to be pioneers to serve the unsatisfied needs of the customers before other competitors emerge. New Ink Company saw the opportunity of unexploited field and capitalized the opportunity to create a large customer base. Proactivity seems to intertwine with opportunity focus, but it is more inclined on the stable tendency of an entrepreneur to effect environmental change in the business. Proactivity mainly reflects on the entrepreneur willingness to take dominance over competitors through combination of various aggressive and proactive moves (Kraus et al., 2010 p 19). For example, introducing new services and brand in the market indicates proactivity. John introduction of cartridges compatible with most printers was a proactive move, as many customers need cartridges that would be compatible with most printers. Thus, small business venturing in various markets must be in a position to discover and satisfy the latent and unarticulated needs of customers via collection of information based on customers. For a business to be complete in entrepreneurial engagement, risk taking is a necessary move. They must be willing to use substantial resources to exploit different opportunities in the market. Firms need to understand that venturing into new business in the current technological, social, and economic environment is an issue of uncertainty (Uslay & Teach, 2008 p 73). However, without risk taking success may not be achievable. New Ink move to put most of its resources to marketing was a risky move, but worth trying. It is the fear of losing that pulls various businesses out the market, as they are not able to put challenges up to the task. One of the major challenges in marketing for most new businesses is the scarcity of personnel and financial resources (Crick, 2004 p 234). Resource scarcity calls for strict monitoring of various market costs; this creates a restriction on the marketing activities that new business may be able to pursue. It is necessary for entrepreneurs to alleviate the problem early before registering a negative image to the customers. They may tackle the problem through acquiring resources from other areas such as banks. They may also try to achieve maximum effect from the scarce resources through tactics of reducing amount of resources spent in less productive areas. Value creation forms the focal point in the entrepreneurial marketing (Gilmore, 2011 p 137). It entails innovative value creation, which is the prerequisite step in marketing relations. The main task in marketing is to discover the undetected sources of customer value and form a unique resource combination that produces value to customers. John’s superior ability to tap and exploit opportunities has created the path his business success. Firms therefore need to discover and exploit available opportunities to standout in the market. The scope of customer intensity places itself as the propelling force of marketing in businesses. Employing a customer centric orientation helps create, build, and retain customer relationships (Uslay & Teach, 2008 p 75). Many successful businesses show significant efforts in customer orientation. Thus, it is worth noting that customer orientation forms the pillar of business marketing. New Ink’s ability to make it in the market as John claim attributes to the focus on customer relations. It is therefore necessary for small businesses to develop strategic customer networks to bolster marketing of their products. Marketing challenges in small businesses Small businesses are subject to various challenges in their start up efforts. They are usually vibrant with new ideas, but getting in to the market happens to be challenging. Their small size and newness in the market forms the major challenge in an attempt to compete with well-established businesses. They are, therefore, subject of liability of newness and smallness (Crick, 2004 p 187). Liability of smallness refers to ground that small businesses possess limited human and financial resources. The smallness nature of these businesses also means that they have limited market power and the customer base is small. In most of these businesses, the entrepreneur is the focal point of all the decisions, implying that marketing may occur at a compromised manner due to worry of resources. Thus, the small nature of the business may lead to various consequences such as low formalization in marketing that may affect entrepreneur’s capacity to market (Kraus et al., 2010 p 19). Newness liability implies the lack of well-established and strong relationship with market partners. It can also imply the lack of suitable routines in the business. These challenges affect marketing in that customers do not have trust in the products. The lack of trust may be due to brand name, lack of track record and little experience and expertise in marketing. In order to counteract the challenge small ventures need to try to build and win customers first. New ink, for example, provided free delivery of cartridges to its customers in an effort to win their trust. Entrepreneurial Marketing Methods in Small Businesses Small business can apply various techniques in entrepreneurial marketing in an effort to place them at competitive position in the market. These techniques include the ability to use relationship marketing, various promotion channels, and development of a suitable marketing mix (Kraus et al., 2010 p 21). The successful application of these marketing strategies would mean customers have adequate information about services or products in the market thus placing the business to advantage. Bearing in mind the nature of limited resources, use of buzz marketing, guerrilla marketing and viral entrepreneurial techniques would be more appropriate for small business (Gilmore, 2011 p 138). According to Kraus et al (2010 p 22) guerrilla marketing is bootstrapping, leveraging, and creative technique that involve use of available resources in marketing. The technique attempts to achieve a wide range of results with minimum utilization of resources. It gives small businesses that are short of resources a suitable platform to enter in the market comfortably. The technique aims at capturing the receiver of the message in a manner that stimulates a willingness to speak of the product or service. The Vodafone emblem on the naked body of a striker in an Australian football match where he was arrested creating media and attention provides a suitable and successful example of guerrilla marketing. Buzz marketing involves the word of mouth as a way of advertisement. It takes advantage of customers’ criticality in relation to classical advertising (Grichnik, 2011 p 103). It aims at stimulating recipients of information of a business or product so that they are subject of discussion. The method provides that a business should create a buzz about a brand or product and leave customers to the actual advertising. For small business, whose products are mainly exciting and innovative buzz marketing works the best. Small businesses can also use viral marketing to create awareness and to promote their products or brand. Viral marketing entails the use of social media to draw attention of customers (Kraus et al., 2010 p 20). The strategy involves spread of information as a virus. Customers voluntarily communicate to others about the brand thereby promoting the business. The success of this form of marketing lies on whether the client gains through forwarding the marketing message. New Ink, for example, used few customers, who indeed distributed the information in their social sites and to their relatives, and there was an evident impact. Relationship Marketing Relationship marketing can also be helpful to small businesses. Relationship marketing calls for small businesses to communicate and interact with clients to gather information (Grichnik, 2011 p 98). It may be on social media or even direct interaction. Through dialogues with customers, small business can be in a position to develop products the way customers’ desire. Through listening to the customers, new businesses can develop their own flare thus creating uniqueness to customers. New Ink Company’s unique cartridges that would be compatible to many printers gained popularity within a short time. Conclusion Though small business shows a more innovative and creative nature than they do on marketing, it is worth to note that they face various challenges in the creation of competitive strategies. However, with employment of the various entrepreneurial marketing strategies these businesses can be in a position to develop a success platform to compete in the market. The move would help alleviate the notion that small businesses are less effective in marketing than they are on innovation. Small businesses should therefore, embrace marketing interfaces that try to involve entrepreneurial skills towards achieving a competitive advantage in the market. The interface should comprise of three aspects: identification and exploitation of opportunities, orientation to change, and orientation towards innovation (Uslay & Teach, 2008 p 71). It is necessary for small business to employ entrepreneurial marketing strategies to create a successful and a strong competitive ground. References Crick, D 2004, Qualitative research at the marketing/entrepreneurship interface. Bradford, England: Emerald Group Pub. pp. 167-236 Gilmore, A 2011, Entrepreneurial and SME marketing. Journal of Research in Marketing and Entrepreneurship, Vol 13, No.2, pp.137-145. Grichnik, D. 2011, Entrepreneurial Marketing. Wiesbaden: Gabler. pp. 77-108 Kraus, S., Harms, R., & Fink, M. 2010 “Entrepreneurial marketing: moving beyond marketing in new ventures,” International Journal of Entrepreneurship and Innovation Management, Vol. 11, No.1, pp.19-23 Uslay, C., & Teach, R. D 2008, “Marketing/entrepreneurship interface research priorities,” Journal of Research in Marketing and Entrepreneurship, Vol.10, No.1, pp.70-75. Read More