Entrepreneurs' Primer on Marketing, Advertising, and
Selling

By: Terry Collison, Blue Rock Capital

 

 

   

Advertising ABCs

10 ways that Advertising issues play a pivotal role in your venture

Marketing What?

Your Promotional "Cash Flow"

A Model of the Selling Process When the "Product" is You

Selling (and Silence)

A Model of the Real Selling Process – NO Ultimately Means YES

10 Marketing, Selling, and Advertising Tips

The First Rule of Advertising for Entrepreneurs

 

 

 

   

"People do not like to be sold but they do like to buy."
~ Dale Carnegie

 

 

 

   

Your Promotional "Cash Flow"

 

 

 

 

Marketing isn't advertisingSelling isn't the same as marketing.  And advertising isn't selling.  But no matter what your company does, it needs them all – at least in one form or another.

  Marketing Rainbow primer for entrepreneurs

 

 

 

To date this much actual cash has been spent to develop our product   $                                

Next year, we would like to have $                          from sales of this product.

Advertising.   In our industry, Advertising Age reports that established companies in our product/market area typically have an advertising budget that is equal to    % of their targeted sales.  Product introduction.   If we are introducing a new product, we believe (or we are advised) that we must spend           % more than this "steady state" ratio of advertising for Year 1.

Company positioning.   Especially if our company has not already advertised other products extensively (i.e., if our company is brand new),  then we believe (we are advised) that we must allocate                                  % on top of the above advertising budget in order to establish the company's credibility and visibility in the market.  This, plus other activities plus certain parts of our staff cost, define the company's Marketing requirement.

Overall promotional program.  We are willing and able to commit  $                        actual cash to next year's promotional program.  This will be used in stages as follows:

                                                                          1st quarter            $                             

                                                                          2nd quarter           $                             

                                                                          3rd quarter            $                             

                                                                          4th quarter            $                             

 

We will define target sales revenue results by quarter.  Here’s what we think should happen:

                                                                          1st quarter            $                             

                                                                          2nd quarter           $                             

                                                                          3rd quarter            $                             

                                                                          4th quarter            $                             

 

Cash-flow” for the year's sales program, therefore, should look something like this:

 

 

1st  quarter  

2nd quarter

3rd quarter  

4th quarter   

Year     

Targeted Sales Revenue  

$

$

$

$

$

Budgeted Marketing Expense 

$

$

$

$

$

Budgeted Advertising Expense

$

$

$

$

$

Budgeted Selling Expense  

$

$

$

$

$

 

 

 

 

 

 

Net Cash-Flow Contribution 

$

$

$

$

$

                                                                                                                              

Suggestion:  No later than 15 days prior to the end of each quarter, you should make a specific decision as to how you will continue your program in the subsequent quarter.  In other words, if it’s working, you may wish to accelerate your commitment of sales resources.  If your results for a given quarter are less than what has been targeted, you may or may not wish to cut back or terminate the effort in the subsequent quarter.  You could decide instead to increase your efforts.

But whatever you do will be the result of a conscious decision related to an explicit appreciation of the facts as they then exist.  You will not simply be drifting along and hoping for the best.

  1. Develop a product with specific utility – functions, features, and potential benefits that are relevant for an identified set of potential users.

  2. Identify such users as specifically as possible – in the form of an actual means for reaching them – names, titles, addresses, phone numbers, common "events" where you and they can be face-to-face, either individu­ally (an in-person “call”) or collectively (an industry conference) or through some intermediary (direct mail letter or via print-media or other types of advertisement). 

  3. Truly understand the issues that your intended users see as “hot.”

  1. Relate those issues to the functional capabilities of your product and then back to the potential benefits that users would realize if they were to start using your product.

  2. Figure out pricing and terms.  Figure out any additional “collateral” to be associated with selling/purchasing the product (added benefits, incentives, etc.).

  3. Communicate the simple facts that the product exists and that it is available for purchase and is ready to use immediately.

  4. Help the targets identify their own situation with the characteristics of the product.

  5. Motivate the targets to take some type of pro-active action (calling for more info, calling you to chat, inviting you to come see them, inviting you to call them, showing up to participate at an “event”). 

  6. Ask for the order.  It's amazing how many companies never actually ask their targets to make a purchase decision.

  7. Design and implement your sales follow-up program (1) to cement this present sale, (2) to establish that your company is the solution source (to support future sales opportunities), and (3) to get referrals and personal introductions to other likely sales candidates.