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Startup Sales and Marketing
The main reason many people don’t go into their own business is they’re afraid of failing and because they think they don’t have enough sales. Put another way, they’re afraid that they won’t have enough sales of their product to survive. Like many fears this instinct is well grounded. If you business doesn’t produce enough sales/revenue you’re not likely to be in it very long. The key element to generating enough sales is a good sales and marketing strategy. Defining your strategy will help you decide which sales and market tactics you’ll use and how much startup sales revenue is going to be reasonably generated from each. Reasonably is important because no one wants to start a business and spend their money and time on a pipe dream, planning startup sales is essential.
Marketing ALWAYS comes before Startup Sales Generally, there are two types of people in the world; those who HATE sales and those who LOVE sales. Usually marketing is misunderstood by both types but understanding the difference will allow you to plan your startup sales.
Tip 9: You can’t have any startup sales without some marketing, so if you think marketing is an unnecessary waste of time… get over it!
What is marketing and how does it help plan startup sales? Anyone who has taken Marketing 101 knows about the four P’s: - Product (covered in the previous section) Click link here Until these key elements are defined for your company it’s hard to imagine you can sell anything. Many times however new business owners do little marketing planning and just start selling. Correct Pricing is KEY to Success For more information onplanning your product pricing download the FREE e-book on pricing!
Click here for your free e-book on product pricing! Let’s go back to DK Designs my friend jewelry company and look at what is included in her marketing plan:
Product: One-of-a-kind, hand made necklaces for women Pricing: Deanne has been selling her jewelry to friends and believes her price point is $60 - $120 per necklace. Establishing this price point determines many other things about her business. Who her target market is, how much she can spend producing her products, potential distribution sources and ultimately how much revenue and profit she’s likely to make from this business. Promotion: She has chosen to use word of month and she has affiliated with a small jewelry sight on E-bay that her friend uses successfully. Place/Distribution: Deanne’s promotional options have predetermined her distribution options. Word of month advertising is, by its nature, local. The small E-bay sight will have a different audience that may or may not suit DK Designs demographic and price point.
Alternative marketing plan for DK Designs What are some alternative marketing strategies that DK Designs could pursue?
Product: limited edition (not one-of-kind), hand made necklaces for women Pricing: $100 - $300 per necklace to insure adequate profits for her efforts Promotion: High quality marketing materials targeted at high end salons across the entire Chicago metro area and promoting the DK Designs brand. Her own website targeting her high-end demographic (working women over 35 making at least $100 K per year) Place/Distribution: High-end spas across the Chicago metro area, could ultimately expand to other regions based on growth and profitability of her company
See how relatively small changes in your marketing plan can make huge changes in strategy and profit?
Write down your Marketing plan Now it’s your turn. Using the Four P’s (Product, Pricing, Promotion & Distribution) create at least two alternative marketing plans for your business; one that is more of a minimalist approach and the other that’s more broad…more strategic. Doing this should tell a lot about your business and may even make you rethink your Mission, Vision and product definition.
Sales and Transition planning
Using your marketing plan as a guide you should now be ready to plan your sales efforts and set a sales & marketing transition timeline; i.e. when will you make your first sale. Review your marketing plan and list all the tasks that need to be completed prior to your first sale. Here is a task list for DK Designs using her Alternative Marketing Plan: - Create initial limited-edition necklaces so that they can be photographed for the marketing materials and website. - Do a cost analysis of each necklace and set pricing levels based on production costs - Work with a marketing company and create first marketing materials and matching website design (don’t spend your entire budget because these materials may have to be tweaked based on customer feedback) - Build website using canned templates Link to Site-Build-it for ideas -Begin sales process of contacting spa owners to determine their willingness to sell jewelry - Investigate hiring multiple manufacturing representative companies to handle line of jewelry as part of their inventory (may need to re-price jewelry for this channel)
This task list should help you establish your launch timeline because you understand the tasks that need to be completed prior to your first sale.
Get started To reiterate: Product then communication then sales… no other order works!! MONEY! How much money do you need to get started, how much money are you likely to make from this business and most importantly WHEN will you start making money? Product then communication (marketing) then sales… no other order works
Next steps Key to a successful financial plan (MONEY) and staying in business is enough sales before your startup money runs out. This should be obvious but is often overlooked much more often than you think! Please go to financial planning to finish your plan:
Once you have completed your Startup Sales plan click here to plan your Money
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