Posted at 1:00 am on 08/06/2014 by Dr. Rahul Razdan
Large enterprises with
significant marketing budgets can afford to pull together a coherent marketing
plan which coordinates branding, promotion, and advertising.. They do so
internally or by hiring traditional advertising agencies. However, most small
and medium sized entities (SMB) cannot afford a marketing agency. They are left
with three significant issues:
Complexity: The sheer choice of available promotion opportunities is mind
boggling. These include opportunities ranging from physical marketing materials
(business cards, brochures, etc), media (magazine, radio, TV, newspaper, etc),
outdoor advertising (billboards, signs, etc), and most recently, the Internet
(website, search, social media, etc).
In most cases, SMB staff do not have the expertise to pull together a
coordinated marketing plan which matches their business needs, and access to
mix of resources (analytics, design, creative) needed to execute that plan.
SMB enterprises are constrained on time/ resources. They do not have the time
to meet/evaluate the various alternatives much less drive a disciplined
Overall, these issues lead to a
situation where the person-to-person consultative model is the only one
effective in reaching most SMBs. For the providers of the various marketing
services, they face the daunting challenge of reaching a large customer base
which is uninformed, so timid to invest. Also, since each marketing service
typically has its own sales channel, the situation is ripe for selling the
customer something which they may not need. The bad experience causes customers
to be even more fearful, and makes the job of selling them what they do need
even more difficult.
Interestingly, other industries
such as insurance and financial services have similar characteristics. These
industries have developed a distribution model based on the idea of an advisor
as an intermediary. For the customer, the advisor is the main interaction point
who understands their needs and connects them with the appropriate services.
They add real value with expertise and advice which aligns with the business
owners objectives. For the service providers, the advisor serves as a much more
efficient distribution channel.
Does the marketing services
world need a marketing services agent? Our sense is that the answer is a
world of SMB marketing services is a massive market which is incredibly
An advisory based distribution
channel would add great efficiency for all players. What is required?
- A trusted brand
which can reasonably stretch into this space (ex. staples, office depot, ups
store, fedex kinkos, clear channel, The Hartford, etc).
around distribution and compensation from the service providers. The cost of
customer acquisition is so high that most have standard lucrative reseller
Cloud-based internet portal for these services. The itunes for this world (ex Ocoos).
Today, over 50% of SMBs do not
even have a website. Ironically, an old fashioned agent might be the best way
to get most businesses on the internet!