how to do market research

Brand devotion to Nike in Chiang Mai, Thailand

Easy Marketing Strategy

At last the winter gloom is retreating, along with the withdrawal of shop window ‘sales’ signs and the recycling of Easter egg boxes. In spring, brands large and small can harness their promotional calendar, seizing the season’s many events and bank holidays as opportunities to promote their offer and grow sales. This all must stem, of course, from a carefully honed marketing strategy…

What is a marketing strategy?

In this post, we will explore how your fashion or creative start-up can develop an easy marketing strategy. In laymen’s terms, this is how you – consistently, across all platforms – promote your products or offers to your consumer to entice them to buy. This ensures all your marketing and promotional activities are in sync, cohesive and with a consistent brand identity and tone of voice reflecting your brand so your customers come to recognise and trust it. Not, as we are all – unfortunately – familiar with, a rushed and regrettable scatter-gun approach which didn’t achieve what we wanted…

This blog post will take you step-by-step through three stages – identifying your business’s marketing mix, understanding the objectives of a marketing strategy and, going forward, considering your business’s direction.

Why do I need a marketing strategy?

Having a road map and plan for what marketing activities you will do and how and where you will promote these lessens the risk of wasting money and time, and missing – or worse, confusing  and alienating – your customer. Thinking your marketing through gives you the opportunity to keep a tight focus on your message, your visual identity, the tone and message of communications, and the objective – the goal – for either brand awareness or short term sales. All this ultimately leads to an ongoing and financially rewarding relationship with your customers = sales!

The Marketing Mix – the 7Ps

Right at the heart of any marketing strategy sits the Marketing Mix, or 7Ps: product, price, place, promotion, people, physical evidence and process. The 7Ps is a very simple and easy to use theory; in essence, it’s a framework for getting all your business’s ducks (or Easter chicks) in a row. I cut my marketing teeth on this some fifteen years ago from David Jobber[i] and still use it with my fashion and creative clients whether pre-start or more established SMEs. It’s that easy!

According to the Chartered Institute of Marketing, this is: “Successful marketing depends upon addressing a number of key issues: what a company is going to produce, how much it is going to charge, how it is going to deliver its products or services, and how it will tell its customers about this.”

So, any marketing mix must ensure offering the right product (or service) at the right price point, in the right place(s) for the customer, with the right promotion, with trained people (staff/after sales), considering all physical attributes (store, packaging, logo), with ease of consumer process.

This all serves to build that better relationship with your customers. So, in practice, this means getting to grips with:

Product – What is my product? Does the customer want it???

Price – How much will the customer pay? And how much do competitors charge?

Place – Where does the customer shop? Online or local?

Promotion – How will it be promoted and where? Is this relevant to my customer and will they see it?

People – Whether its trade fairs, pop-ups, galleries or department store concessions, who will be selling?

Physical evidence  – Spanning appearance, packaging and brand identity – this is the first thing your customer sees.

Process – Quick, convenient, easy, secure, and with good after sales/returns options. Remove the barriers and give them a good experience and reason to return!

Planning an easy marketing strategy

Now armed with a clear understanding of your own mix or offer, you can develop a simple strategy or guidelines from it. I would recommend my ‘what, who, how, where, when, why’ approach – your marketing objectives:

What – what is it that I am selling or communicating? The offer or product in your 7Ps.

Who – who is my customer? What do I know about them – age, gender, spending power, spending frequency etc?

How – how will I reach them? Through events, pop-up shops, or regular host website or stockist (the ‘channel’) – direct or indirect distribution strategy?

Where – where is my customer, are they local, online or reached via a catalogue, are they actual end consumers or stockists and retailers?

When – when will this start and how long will it last?

Why – why am I doing this? What am I trying to achieve? The marketing objectives – sales, new customers, brand loyalty building etc.

How (again!) – how will I measure the success of this? Customer feedback, sales and turnover, Google analytics, or feedback from the retailer, etc.

For your overall marketing, the above provides an overview and a guide to refer to. However, you should break this down further so that with each promotion that you undertake, you set out these objectives too – whether this is a social media competition campaign, or invitations to an event or pop-up. We will explore this in my next posts Easy Ways to Promote Your Business: Part 1 and Part 2.

What is vital in both instances is that you thoroughly know your offer (yes, this sounds obvious, but often this can be easily diluted when desperate for sales), you know your customer, and you are keeping tabs on your competitors’ activities. In my earlier blog posts on market research, customer research and competitor research, I have explored these issues, but this knowledge is again necessary to make sure your marketing really hits home. If you want to undertake more rigorous and full research, then take a look at The Design Trust’s [ii] recent post The Design Doctor: How can I do market research which is a helpful guide.

But what if you are a little further down the line with your business, or are just more confident in your marketing? Perhaps it is time to refocus and rethink, to reach out to new customers and expand into new markets, or develop your product range? Where should you begin? This is where Ansoff’s Matrix comes in.

Ansoff’s Matrix

Over sixty years old as a theory and practical guide for marketing, Ansoff’s Matrix[iii] from 1957 shows that no matter how you might develop your business, ultimately there are only four simple directions that you can go in. I always use this with my clients as it is great for clarifying direction and focusing, plus highlighting areas of risk – crucial for start-ups and SMEs.

Ansoff’s Matrix

ansoffs_matrix-1

 Source: business-survival-toolkit.co.uk

This means you develop your business in one of four ways:

Existing products in existing markets

Here, you don’t spend money on developing any new products or investigating new markets (regions or customers) but instead focus on promotion, perhaps in new ways to pique existing customers’ interest. This is the lowest ‘risk’ as you are sticking with what you know but you still need time and money spent on promotion.

New products in existing markets

You might introduce a new prints or homewares line to your current customers and overall market. You will have spent time and effort on product development and have built up inventory – you need to be sure to sell these products, will your existing customers want them? This carries some risk financially, and also risks potentially alienating customers.

Existing products in new markets

You might export your existing menswear accessories range anew to Japan or India, or to new age groups or genders in the UK. Here, you don’t develop new products but the market is as yet unknown (cultural differences, export taxes, exchange rates etc), so is still risky and costly.

New products in new markets

Here you would combine new products and expansion into new geographic or customer markets. This is the most risky and unknown combination. Be sure to fully research, take advice and build financial contingencies in here.

So, back to strategy and promoting your products or offers. To sum up, you will now have understood the different components of your own marketing mix and ensured that they are in sync – this creates a cohesive package that is more identifiable and less confusing for your customer.  You will fully understand who your customer is and where and how to reach them from your research, and also know your competitors and their activities inside out, again from your earlier research. You may even know your new direction – developing new products, or venturing into new markets.

Now your next steps are to start planning some promotions! And this I will cover next time in Creative Planning Next Steps 6: Easy Ways to Promote Your Business, Part 1 and Part 2 where we will look at the different types of promotion that are right for your business, where to get ideas, and how to plan them into a promotional calendar.

Until then, enjoy spring!

If you have any questions after reading this, or would like me to work with you on your creative business, then feel free to email me on hallandco@outlook.com, or drop a comment on the blog.

 

[i]Jobber, D. (2012) Principles and Practices of Marketing, 6th Edition, McGraw-Hill

[ii]www.thedesigntrust.co.uk

[iii] www.business-survival-toolkit.co.uk

 

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The journey towards home in Tokyo, Japan

The Right Strategy for Your Business

Strategy can be a bit of a scary word, I am told. 

It sounds ‘businessy’, probably not creative, possibly not relevant, and certainly daunting. It is one of those words which creative marketing people (such as yours truly) and less comprehensible business die-hards and textbooks bandy around. It has the air of the unachievable about it for most mere mortals, and is much, much easier just not to think about.

Not so! I view strategy as simply taking stock, taking control and making do-able goals for your business – in short, knowing where you are going. And the good thing about strategies is that they get you from A to B, step by step, how you want to do it. Oh, and it’s actually quite easy…

So, in this post, I will take you through how to define a strategy (or approach) for your business, that will underpin everything you do and how your customers or clients see you. This year, I am sure you have promised yourself, is the year you will make the business work, move it forward, and see the financial rewards.

Let’s get started.

What is a strategy?

There are different types of strategies, but they all aim to be solutions to existing problems and overcome challenges in the business. They are an approach for you to follow. They can be specific to functions of your business – perhaps distribution, marketing, sales, social media and so on. This is so that you can really focus on each area, come up with a way to manage it, and then follow it.

Also, the good thing about strategy is that it helps you be competitive in your direction. What this means is that you do well, if not better, compared to your competitors, and see sustainable profit and business growth as a result. In real speak, this means you can keep making and creating and designing and earn a living from it, plus branch into areas you want to go into because your customers or clients or buyers get it and want to come with you. For this, you first need clarity about how you want to operate – your business direction.

Overall, there are three main ways that you can operate, compete and grow as a creative business, whether it is fashion, ceramics, interior design or sculpture. Porter[1], in 1985, presented these as Cost, Differentiation, and Focus (or Niche, as I call it) Strategies. I mention this here, because I believe this knowledge about the direction of your own business will help clarify the next steps of developing individual function strategies. Many businesses I work feel they need this clarity to do this.

Which business strategy (approach or direction) to adopt

Cost strategy businesses operate on a low-cost (not necessarily low price) basis. They drive and keep all costs down, and produce products or service that can compete on price and/or large volumes and availability. Hard to do in a crisis-stricken economy and, as we tragically saw in Bangladesh, hard to do ethically. This isn’t for exclusive, high-end or quality orientated businesses – the main goal with these businesses is keeping costs low and mass production, quality is less of an issue.

A differentiation business is literally different, they innovative their product or service in some way. They have an added value, a unique benefit or feature perceived by the customer who is willing to pay a premium for this – they can’t get it elsewhere. The business can be more original, exclusive, more quality or luxury focussed, their offers aren’t available everywhere, but perhaps in selective outlets or bespoke and one-offs. Quality brings with it higher costs for the business, but be mindful that small designers’ higher sale prices can be undercut by better known and larger scale competition.

Lastly, a focus strategy business, or a niche business. This is where a designer or maker spots a narrow gap in the market and targets it. Products and services are developed for this new area – it might be a specific product like ties and pocket-squares, or interior floor tiles only, or a specific type of customer – over 60’s only, or babies. All the marketing of the business will be targeted to this particular customer or client segment.

How to work with Porter’s strategies

Obviously, the three different strategies above need to produce and market their offers in different ways, in different volumes and to different customers. The creative businesses I work with tend to fall into the latter two camps. I think as a creative business you have to offer something different or specialised – the high street is full of mass-market ‘me-too’ products. You need to stand out to gain awareness and build custom.

So, if you are a differentiation strategy business, exploit it! Know your market and customer, and be clear that the work you are producing is always unique and original, high quality and higher-priced, and build a brand identity around this. This business will be more selective in distribution, or even exclusive to one or two outlets.

Or are you a focus strategy business (niche)? Where perhaps you have a limited and very specialised product range or demographic, and push and promote this. You need to know your customer well, and target all your energies onto reaching them and not dilute this specific approach by moving into other products which might also suit other people. The costs here will also be higher, as your production runs may be smaller. But try it, stick to your guns and develop it as you go. And make sure you market and promote the product or service’s features.

Strategies to address business problems

Once you have decided what type of business you are (i.e. differentiation or niche), you then start to build individual function strategies, as mentioned before, from this. At this point of discussion with a client, I usually mention the five steps of strategy: you start with an external analysis, then an internal audit (yes, you’ve already done this!), before beginning to map out your function strategies for marketing or sales etc, then implementing them, and then, lastly, reviewing and monitoring.

If you want to be super-rigorous and do an external analysis, then this is a market, competitor, and economic review. But I think this level of depth is best left to the professionals, rather than hard working small businesses and entrepreneurs.

What I recommend you do instead is browse online and in the shops, see what other makers/designers are producing, how much they are charging for it, and how widespread they are selling it. Note whether stores are having lots of sales (i.e. consumers not buying full price products). Have an awareness of trends and shifts within your specialism, opportunities that may be developing, and likewise, areas that interest is dying off in. This way you can take the market’s temperature easily.

From the business review we looked at over the last two blog posts Taking Stock of Sales and Costs and Reviewing Your Business, you have – and congratulations once again – thoroughly got to grips with your own business, its strengths and weaknesses and areas for development. Armed with this, and your new market knowledge, you now know the areas you need to tackle, refine and improve internally. You also know the trends, gaps and opportunities that are out there, and what to avoid. Next, all you need to do, one step at a time, is develop your strategies.

I think that for businesses at your stage and scale, generally this will fall into distribution and sales, marketing, and social media strategies, and I will cover these in my forthcoming posts.

For your creative business, these are your next steps.

In my next post Creative Planning – Next Steps 4: Easy Distribution Strategy, I will guide you through different approaches to how and where you sell your work.

If you have any questions after reading this, or would like me to work with you on your creative business, then feel free to email me on hallandco@outlook.com, or drop a comment on the blog.


[1] Michael Porter’s ‘Three Generic Strategies’ in Competitive Advantage: Creating and sustaining superior performance, 2004, Free Press

Street market in Bangkok, Thailand

Do your research: the market

“What is your market?” Do you know the answer to this? If not, does it matter?

If you have been working creatively and so far have been receiving commissions and referrals, you probably haven’t needed to think about ‘what next?’ and promoting yourself out to new clients in the market. Or maybe you are just starting out and not sure where to start selling. Well, what comes next is market research…

This doesn’t sound terribly exciting, maybe doesn’t sound like it is relevant to you, and possibly is conjuring memories of dodging clipboard wielding researchers in the street. But I believe market research is vital to helping you grow your sales, and your business. And it is easier to do than you might think (with no clipboards).

Essentially, a market is where you sell your product or service. Your market might be based on the product, so fashion, ceramics, childrenswear, jewellery, millinery etc, or service – photographer, jewellery resetting, interior design or architecture. It might also be based on geography, so, locally in your own neighbourhood, your city or region. This might be online. Or this might be overseas, either if you have been successful e.g. in the UK and are planning to expand, or if you have had some sales from e.g. Japan and China and think there could more sales from these areas.

Your market might also be a specific market level or area. By this I mean luxury, mass market or bespoke commissions. Perhaps you have worked in the mass market and have been retailing to small pieces to high street chains, but now feel you want to produce a more upscale range for independent boutiques. Or perhaps you want to move into the ethical design or crafts market with sustainable and eco products or services.

And your market could also be trade. You might be selling your products via retail to the end customer – the actual customer who will be using it – or you might be selling your product to interior designers who work with clients, for example. Maybe jewellery setting services to jewellers, or embroidery services to fashion designers or crafts people.

Once you know what your market is – and you may have more than one, which is fine – then you already have a head start on how to grow sales by understanding:

  • the type of stockist or clients or end customers that you can work with
  • trends and opportunities for growth that you can capitalise on
  • the aspects that are in decline and best avoided
  • the new challenges that are arising and affecting the market
  • the type of successful businesses that are working – and competing with you – in this market
  • what it is that your clients, stockists, or customers want and how much they will pay for this

But why does all this matter to you? You have a product or service that either has been selling well enough, or is surely going to sell well enough, if not brilliantly! Isn’t it easier, quicker and a better use of time to just start trying to sell where you can rather than undertake any market research?

I think jumping in and trying to sell anywhere to get your business off the ground (or keep it afloat) makes sense and may bring you in short-term sales, which is important. But in the longer-term i.e. the following weeks, months or years since your recent sale, having more of a strategy and a focussed means of selling your product or service will be more time efficient and more lucrative. And hopefully will also give you the much needed sense of knowing where your business is going!

If you are just starting out, and you have samples or prototypes, or just single pieces of your product so far, then you would need to do initial market research. If you have already been selling and are expanding into a new market, such as one of those discussed above, you would undertake something more substantial, as there is a greater financial risk to it. In both cases, you need to do this in stages.

This will involve accessing the internet or library with notepad or iPad. Plus, if you are exploring your geographic market quite literally on foot, take a camera and a map so you can see how the shopping areas are laid out.

First, set some time aside for this and schedule it – think about whether you will visit a library, or you might want to try the internet first. But give yourself a goal of a couple of hours or one afternoon a week for a few weeks to work through this. Put it in the diary; this is also your work too, not just making or designing!

Then identify your market – look at the list above, which of these applies to you? There may be more than one.

Visit a business library – in London there are City Business Library, the British Library’s Business and Intellectual Property Centre, and Westminster Reference Library to name a few. All of these places will have librarians who will be happy to get you started and show you (either ad-hoc or if you make an appointment) their resources, databases, periodicals and reports relevant to what you are trying to find out, and they cater for small businesses – for free! Other cities will also have a good business section in their libraries. Often, once you have visited a library, they can set you up as a member so you can then explore their resources online from home.

Then read reports on industries, trends and market growth – these reports include Mintel (Market Intelligence), Keynote, Datamonitor and Verdict. And also Cobra (Complete Business Reference Advisor), and EBSCO business resources to help small businesses. At the British Library Business and Intellectual Property Centre, there are industry specific information guides such as fashion, or jewellery etc. In these reports, look at data for sales, turnover, numbers of companies, and indicators of growth and decline etc.

Now analyse what you have read and noted down – what are the trends and growth areas? How is the market structured and divided up into smaller markets? What areas or sectors have declining sales? Who are the main players and market leaders? How saturated is this market? – e.g. mass market womenswear will be more saturated with lots of similar brands than luxury accessories? What looks stable to you? What looks like a new and emerging area that you could capitalise on?

Consider the impact on your current product or service offer. It’s not a nice thought, but are the sales of similar offers in decline or heavily saturated with competitors? If so, how can you modify or innovate in what you are doing (or where you are selling it) to take less risk here? Or maybe the data shows that no-one else is doing something similar to you? That could highlight an opportunity, but also an indicator that there is no demand for it…

So now you have the data, it is time to visit the market yourself – if you can afford it. Are you selling handmade accessories to your local neighbourhood? Head out with your camera and photograph what you see by way of other stores, craft fairs, boutiques and department stores. If you are a small scale jeweller or designer, head round the museum shops and jewellery districts, plus the boutiques and departments stores (but don’t take photos inside!!!).

Are you expanding overseas – e.g. Paris or Shanghai? Take a budget trip to familiarise yourself with the districts, the stores, how the department stores are laid out inside, what looks busy, what is near underground and bus stops and other main attractions. This way you get an idea of what the location is like, where you want to be in that location, what else is selling, what types of other stores or brands are there already – who looks busy and who doesn’t?

Or are you moving into online sales? Are you setting up your own website and promoting it on your own social media platforms, or are you going to sell through a host platform e.g. Notonthehighstreet.com, Etsy.com, Asosmarketplace.com, or Culturelabel.com etc. Browse all the similar host platforms, then within each platform look at all the individual brands similar to your business. Monitor them and see who is selling best where. Keep an ear out (and eye) for feedback on other businesses’ (negative) experiences with such host platforms.

So, what your time spent on this research will have shown you is:

  • what the trends and opportunities to capitalise on in your market are
  • what is selling well and are growth areas = potentially more sales and profit
  • what is in decline, or will be more challenging and risky financially
  • who the main stockists or competitors are
  • how the market is structured – lots of large chain retailers and only a few boutiques, or mainly online sales
  • how saturated by similar offers the market is – the more saturated, the harder for you to gain a foothold
  • geographically, where you want to be in this market – the wrong end of the right street can be just as unfortunate as the wrong end of town; you want to be where the customers are
  • again, geographically – locally or overseas – this shows you a little more about customers’ buying habits and what exactly is selling well

For your business now, this will give you more direction and focus. It will help lessen you wasting your time (and money) trying to sell in the wrong place, or trying to sell the wrong offer in the right place. Ultimately, this will help you begin to capitalise on opportunities to make more sales. Which is what everyone wants…

Good luck with it!

If you have any questions after reading this, then feel free to email me on hallandco@outlook.com, or drop a comment on the blog.

Next Creative Planning Basics post: Customer research – who are they and what do they want? And is your dream customer your actual customer – if not, does this matter? Hint: yes, it does…