Planning for Growth

... From Biz2Biz NWA April 2009

The Business of Promotion: Planning for Growth

By Maxie Carpenter / MVC Advisory / Bentonville

Most business experts conform to a theory of “thirds” – of all small businesses, a third eventually turn a profit, a third break even, and a third never leave a negative earnings scenario. According to a recent study by the U.S. Small Business Administration, only two thirds of all small businesses survive the first two years and fewer than half make it to four.

Why? Within the top ten reasons for their demise is ineffective marketing and self-promotion. In my opinion, marketing is the most misunderstood activity in business because it too often is confused with advertising. The two are very different activities. Knowing the difference can be the distinction between failure and growth.

Advertising, by definition, is “the paid, public, non-personal announcement of a persuasive message by a recognized sponsor for products or services.” Marketing is “the systematic planning, implementation and control of a mix of business activities intended to bring together buyers and sellers for the mutually beneficial exchange of products or services.”

The critical distinction is that one activity is focused on selling and the other is focused on building a relationship. How a business goes about developing this relationship and image is the process of “branding.” This is the single most important process in growing a business.

To me, marketing is promoting yourself in the marketplace in such a specific, intentional and consistent fashion that when the need for your service or product arises, you are the first company the client will think of.

That said, it is essential to have a plan that encompasses all the activities necessary to bring the relationship forward. The key word is consistent. There must be consistency across the business model as to how your business is marketed – from the signing of the business and its physical presentation to collateral materials such as business cards, brochures, stationery, direct mail; sales support materials, such as telemarketing scripts, answering messages, invoices, flyers; and even with uniforms, company vehicles and websites.

Consider a “Marketing Plan” versus “just advertising your business,” an overall approach rather than just an ad budget. If marketing is not your forte, consider hiring a professional. Even then you’ll need information only you (or members of your team) can provide.

The cost of doing business is hard to control operationally, and growth hard to achieve without a plan. Recent marketing studies indicate the majority of small business growth comes from 65% of its existing client base, meaning referrals. There is a direct correlation between this fact and the actual cost of marketing and advertising. As your business matures and achieves a significant, recognizable presence in the marketplace, marketing and advertising costs can be reduced each succeeding year of operation until it stabilizes annually at less than 1% of revenue. Without a plan, marketing for growth and profitability are difficult to realize.


Author/ expert Maxie Carpenter is Founder and President of MVC Advisory Resource, Inc., “Your Guide to Successfully Managing Your Business.” He is the author of” I Didn’t Ask You to Dance!” and “Managing Difficult People in the Workplace.” You can reach Maxie at www.mvcinc.org.