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What’s the reason why businesses collapse and fail?

Well, the reason is still the same year in and year out: lack of marketing strategies.

Sure, the market is there. People are buying products and services everyday to meet their needs and wants.

However, it is the lack of strategies or the inability of the owners of these failed businesses to sell to their target market, to their niche, that is the main cause of business failure.

I’m always saying that marketing is the most important function of business, because without a market there is no business. Thus, to make your business survive, you need marketing strategies.

To make your business grow, you need marketing strategies. To make your business profitable, you need marketing strategies.

The following are the basic marketing strategies to help you grow your business and make it profitable.

1. What is your business? What is business mission?  Why does your company exist? What is its reason for existence? This is the basic question. You cannot handle any business unless you know what it is for.

Therefore, you must know why you have put up your business in the first place. This is the first step in designing marketing strategies.

2. Who are your customers? Your business is to serve your customers to generate revenue and profit.  It is important to have a niche in the market, that segment , class or groups of customers  who need your products and services, and serve them well.

In the face of competition, having a market niche is a key to business success.

3. What are your Strengths and Weaknesses? It is necessary to know your strengths, e.g. quality products and services, friendly customer service, good customer relations, competitive pricing, good location. It is also important to know your weaknesses, e.g. lack of funds, limited marketing knowhow, poor promotion, etc.

Knowing your strengths and weaknesses helps a lot in devising marketing strategies that work.

4. What are your Opportunities and Threats? Opportunities are those favorable factors outside of your business that can help you achieve your objectives, like increasing demand for your products and services due to increasing population, availability of funds for expansion.

Threats are those unfavorable factors outside your business that can hinder you from achieving your objectives, like intense competition, sluggish demand, economic downtown.

Knowing your opportunities and threats can help you devise marketing strategies that will maximize your opportunities and minimize your threats.

5. What will I do now? Having designed your marketing strategies, the best thing is to implement them. Take action. Your strategies are useless if you cannot implement them.

With the foregoing five basic marketing strategies as a guide, the rest is up to you how to grow your business and maximize profit.

     Many companies today seem to have forgotten the reason for going into business: to provide products and services to satisfy the needs and wants of the customers. In fact, the customers are kings and queens. Unless you know how to attract and keep satisfied customers who think they are getting their money’s worth and will come back to buy again and again, then your business is lost.

     Attending to customers’ needs is a business strategy that is synonymous with revenue and profit, because good service to customers means success. Without the customers there would be no sales, and no income.

     The following are the three pointers to attract and keep the customers.

     1. Serve your customers well. Poor quality service is always the cause why buyers and potential customers turn away from patronizing your business. It is only the quality of service that can give you an edge over your competitors. Customers always consider service, attention and support than product quality.  So, respond to your customers’ needs as soon as they arise.

     2. Always offer quality products to your customers. The reason why customers buy from you and not from your competitors is because they believed that your products have quality and provide tangible value and benefits to meet their needs. Do not sacrifice quality over quantity.

     3. Keep the customers first. Develop good relationships with the customers, always keeping in mind their needs and how you can satisfy those needs. Have personalized contacts, open feedback mechanisms and attend promptly to their complaints and suggestions. Satisfied customers can become your captured market, and in the face of competition, their loyalty can spell the difference between profit or losses for your business.

     A successful strategy is one that treats the customers as the company’s reason for existence, and provides for services that are responsive to their needs and expectations. Good customers’ service will always result to profit.

     However, in buying your product or service, the customers’ objective is to maximize their satisfaction by paying the lowest price. And unless you can differentiate your product from that of the competitors, it is a basic principle that customers will always buy a product with the lowest possible price.

     Therefore, how do you price your product or service in such a way  that you will generate enough profit, make your target customers buy your goods, while at the same time remaining competitive?

     Pricing is always a function of knowing your market, your customers, developing your brand or  image, and differentiating your products or services from that of the competitors.

     Having done these, you can now proceed to set a price for your goods and services. Basically, there are four pricing strategies, as follows:

     First, cost-oriented pricing. You set your price on the basis of your cost. This means you just add a certain percentage to your cost to get your target profit or mark-up. This is also called mark-up pricing or cost-plus pricing, which means cost plus desired mark-up or profit. If your business deals in retail, buy-and-sell, or distributorships, then this strategy is ideal.

     Second, demand-oriented pricing. You set your price based on the level of demand of your product or service. If the demand is strong, charge at a higher price, and if the demand is weak, then lower your price to stimulate demand and attract more customers.

     Third, competition-oriented pricing. You set your price based on what the competitors are charging. This is suitable if you and the competitors are selling the same or similar products. However, you can charge higher than the competitors’ if you have developed a brand for your business, or if you know how to differentiate your products and services by offering extras.

     Last, market-penetration pricing. You set your price lower to penetrate the market and capture a sizeable market share. This is suitable if the customers are price-sensitive, and if you want to discourage existing and potential competition.

     In the end, your pricing strategy must be a part of your business strategy to survive in the market, achieve growth, and generate more profit.