How can SMEs gain marketing knowledge with low-budget?
Many experts agree that the Finnish products are made well, people are smart and have high education. Why does then the Finnish economy struggle?
The center of attention is often in SMEs since they are important components of the Finnish economy and drivers of growth. It seems that one of their major problem areas is marketing. For many SME managers, achieving a marketing mindset seems to be a problem. A tempting excuse seems to be that we do not afford to invest in marketing and the expected revenues are too far away in the future. Financial factors raise concerns since it seems that SME mangers are not aware of other, less expensive alternatives. Here’s how some forerunner SME managers gain marketing knowledge with less expenses.
Figure 1. Means for gaining marketing knowledge with low-budget
Be active – reduce uncertainty
“Um, some of it is probably… (pause) I must have picked it up from somewhere I’m sure. Um but a lot of it is probably just interaction with other groups. I find that when I go to conferences; that kind of thing, I get an idea of what people are doing and then try and emulate those things.”
The findings in my research indicate that knowledge about marketing and branding strategies may first come from outside and raise the motivation to learn more. An SME manager can be active and seek for information from communication channels. He/she wants to gain information in order to be able to reduce uncertainty about the advantages and disadvantages. It is possible that the unfamiliarity of marketing leads to passive behavior and thus, more information may facilitate the motivation and awake the need towards marketing activities.
Network among many industries
Forerunner SME managers seem to regard networking as the primary source of marketing information. This is an interesting viewpoint since traditionally marketing has been seen internally-driven process. By networking, SME managers can reach many industries, not just the industry that the company is in. Moreover, due to networking individual managers may have more knowledge at their disposal than they think. Networking is important especially in a new context since it can be a source of new information.
It seems that managers value all types of knowledge gained in the situation. Although networking takes plenty of time, and the results are difficult to show, managers want to take the time and effort in order to communicate in different contexts. As the prior research has stated, highly trained entrepreneurs in growth-oriented companies tend to have wide networks.
Be creative in network building
Managers can be very creative in building networks and therefore can find innovative ways of developing and maintaining relationships. Networks develop in the course of time, and to whom ones talks seems to be more important than where the discussion takes place. Preferably, one should have an interest in or have something to gain through what the company is trying to do. However, managers are conscious of how much they can ask of people. Finding the right people is not easy and building up and maintaining networks take time. Moreover, they require personal communication skills. The most common networking places are trade shows and exhibitions. In addition to knowledge, networking enables personal experiences. One respondent described a trip to the USA as a turning point of their marketing. By observing the presentations of other companies, more advanced in terms of marketing and branding, he understood the advantages more clearly. All in all, networking is a marketing competence and that as such is a way of implementing marketing in SMEs.
Seek experts without charge
The feedback from experts or so called “change agents” can awake a need to invest in marketing. Many parties fit into the definition of a change agent: universities, universities of applied sciences, private consulting companies, public organizations (such as Tekes and Ely in Finland), business mentors, other companies in the supply chain, other entrepreneurs (sharing the same attitude) and advertising agencies. Marketing experts and public organizations can play a vital role in communicating about marketing advantages, strategies and the effects they are likely to have. Unfortunately, many managers seemed to lack competencies to evaluate the quality and the relevance of the advice compared against the cost. Most SMEs will not deliberately seek formal sources of support unless they are introduced to them through their existing informal networks in which they have developed confidence and trust. Hence, the experts need to build close networks and meet the entrepreneur’s needs.
Limited financial resources force managers to utilize resources immediately available for little or no cost. Nevertheless, a manager is able to extract more work from unpaid sources than paid sources. One company discovered a very innovative solution for this challenge:
“We have a lot like those – in the world there are people, cannot say believers, it is the wrong word, but people who believe in our case and what we can give to them.”
The company formed relationships where some of these advisors were unpaid. They called these people “supportive group of people”. Perhaps the motivation of this group of people to help the companies lies in their conscience. It is often the case that the innovations that SMEs are trying to commercialize can improve the standard of living or ease the lives of many people. In fact, the companies have a very true and good story to tell about what their products can do. This story can make such a great impact that some people are willing to share their expert knowledge just to help and do not expect any money in return. Their reward is being able to help people in need.
The challenge that the companies face is how to find these people. Some online funding platforms are available for people so that they can fund what they are passionate about or what matters to them (for example Indiegogo). However, public organizations could also take an intermediary role in linking the companies and experts who voluntarily want to take part in facilitating the success of an innovation.
Utilize online material
The development of online materials has noticeably altered the use of written documents. What makes Internet so popular is its ability to provide topical, exact information at once for a need at hand. In particular, you search material on the Internet when you need information to do something for a specific occasion, for example how to give a presentation. However, not all information from the Internet is relevant and sufficient. Therefore public organizations could offer more virtual marketing services with reasonable costs aimed at SMEs.
Heidi Neuvonen, JAMK University of Applied Sciences, School of Business, heidi.neuvonen (at) jamk.fi