Marketing to SMEs
- Time for some Bigger Thinking
Speak to most marketers with experience of business-to-business marketing and they’ll tell you that one of their biggest challenges is reaching and selling to small and medium sized businesses (SMEs).
According to the Federation of Small Businesses there are over 4.5 million such companies in the UK at the moment. So why isn’t selling to them the marketing equivalent of ‘shooting fish in a barrel?’
A key problem is that every major company has its own idea of what a small business is. Their definition invariably revolves around the number of employees or turnover. Yet this is such a crude approach. Small companies are not a homogenous group. To be defined simply in terms of the size of your workforce or bank balance is to miss the many nuances of such a company. I’ve met some SMEs owners who had masses of ambition and spending to match and I’ve known lots of major companies with no vision or willingness to invest.
Another problem is that big companies trying to sell to small companies invariably want to do so ‘on the cheap’…That’s because the average order value from such smaller companies is lower and so, to make their margins, the cost of sale has to be driven right down. This encourages them to try crude, low cost, mass marketing techniques…
My office receives at least 6 unsolicited telesales calls each day on this basis – trust me world, these people WILL NEVER be put through to me! You’re wasting your money.
Furthermore this is a dangerous approach to adopt when targeting SMEs as they already feel that no one understands the specific challenges they face, no one listens, or cares about them or takes them seriously. Furthermore the people running such businesses are under immense time pressures. Their time is money. So an approach from either an untrained telesales person or a poorly targeted piece of direct mail is doomed to fail at best but possible insult too!
Indeed, our own research among smaller businesses bears this out:
• 53% of SMEs in our annual SME study said large companies don’t know how to target them
• 51% said they don’t understand them
• 39% said big supplier brands were arrogant on social media, not interacting with them properly but simply trying to ‘broadcast their stuff’ at them
So what’s the answer?
For a start, let’s have some focus; split your database down in a much more granular way. Then get to know the audience properly, interact with them on social channels, have some conversations, stop assuming people want to listen to you.
Then harness these insights to come up with an approach which genuinely talks about the small businesses you are targeting and actually addresses their issues and needs (rather than simply your business model).
Approaching to SMEs in this way does not require bigger budgets, but it does require some bigger, smarter thinking.