Small the contact development by networking, especially on

Small and medium- sized enterprises (SMEs) are key part of
international and local economy, and have important impact on economic growth (UK
Department for Business, Information and Skills, 2013). As marketing holds
important role in it, studies suggest that traditional marketing literature is
not always useful for SMEs (Gamble, 2011) as marketing theories are focusing on
planning, advertising and implementing the marketing mix in the large
enterprises with bigger financial capabilities. SMEs have their own unique
characteristics and transferring models from large organisation marketing have
been criticised (Gamble.,2011, Gilmore, 2001) as SME have smaller resources and
no of marketing expertise (Hubert, 2013). Marketing in SMEs has been already recognized
almost 20 ago by researches as a problematic area (Siu and Kirby, 1998), in practice
it has been done mainly in combination of relationship with customers, suppliers,
networking (Gilmore, 2001; Brodie, 1997), and/or internet marketing (Chaffey
2000) and e-commerce which is raising on its popularity.

It is believed that SMEs does not act like the big
enterprises, due to their structure and management style. Biggest difference
appears in presence of the owner-manager who are responsible for both ownership
and managerial functions. Company characteristics then are based on
owner-manager vision (Bercher, 2001). They tend to be more innovative, creative
(Carson 2003), simple(Hill, 2001) and entrepreneurial(Day 1998), problem
solving and action oriented(Thorpe, 2006) but at the same time they are likely
to be more chaotic, informal, loose, and spontaneous than big organisations(Gilmore
2001). They are promoting their business through the contact development by networking,
especially on the local basis (Dimitriadis, 2005; Sweeney 1996), as they believes
that close relationship with the customers gives a business the leverage over
the large organisations (Harrigan, 2011; Stokes, 2000). SME owner-managers with
entrepreneurial personalities have individual management styles and with luck
of the marketing plan they are “self-marketing” to promote their business on a
daily basis. Self-marketing, or self-branding can be defined as “varied activities undertaken taken by
individuals to make themselves known in the marketplace” (Shepard, 2005, p.

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590) what links with SMEs owner-managers concept of promotion (Ward and Yates,
2013), which branding literature recommend as crucial for the business to grow (Horan,
2011). The key principle of branding is to be unique from competitors (Mitchell,
2012) and researches has established, that if the company is eager to invest in
the brand development, profit may rise, and cost of customer acquisition may
fall (Calabro, 2005). Other research has shown, the owner-manager often
personifies the brand and the brand in upon their beliefs and vision (Osajalo,
2008).

 

“The
European Commission defines a micro-business as one which has fewer than ten
employees and a turnover or of less than €2 million. 95% of the 4.4 million
SMEs in the UK had fewer than 10 employees (BERR, 2006).”

      https://www.brentonline.com/documents/ofgem-defining-micro-businesses-180308.pdf

 Resnick, Simpson and Lourenco have evaluated
four owner-manager models in the UK business sector based on research based on
20 UK based companies with 95% of majority of SMEs of participating businesses
and 50% of them as a micro business. Gender ratio of business owners were 11:9
male/female and the average age 45-54 years.

Owner-managers perceptions of marketing:

(1) 
Personal branding:
where the owner-manager was personifying the company through his/her
personality, customer relations and set of unique skills

(2) 
Perseverance:
built up and long term maintained (often for many years) customers
relationships

(3) 
Practice: where
instead of planning marketing activities focus is on executing separate tasks

(4) 
(Co)production:
 goods and services are developed and
produced in close collaboration with the customers to their specifications

 There were no marketing department, no formal
responsibilities assigned to managers within the sample of SMEs. All of the
marketing decisions and activities were undertaken by the owner-manager on the day
to day customer interactions rather than based on company’s marketing plan.

Traditional
marketing advertisement in newspaper or television and PR were perceived as
expensive, ineffective, insincere and some SMEs didn’t wish to be associated
with them. 90% of the businesses had their websites but they have had more
informational and contacting purpose rather than marketing. Word of mouth and customers
recommendations emerged as a the most important marketing activity and
fostering long term relationships which allowed close collaboration with
customers on a new product or service was articulated as a crucial marketing
activity. As mainly the intuition was explaining why something happened; the
thinking over a business problem was seen as marketing and planning came as reliance
on owner-manager intuition, time and impulse and time.

To the SMEs
owners marketing had no clear definition and asked about meaning of the
marketing answers vary from “nothing” to descriptions of the whole process;
from networking and engaging with the customers to generating positive feedback
about the company. These themes supports fundamental marketing theory around
customer orientation, however secondary theme was that owners of the business
defined themselves as “the marketing” – personification of the owner-manager as
a personal branding concept (Shepherd, 2005). Biggest issue of the concept of
the owner as “the marketing” was reliance on skills of one person in one place
and the time limiting growth of the company. However  SMEs marketing in not well understood and it
is problematic to fully understand how SMEs are actually marketing
themselves.(Simpson, 2005). Recognition and visibility in very competitive “attention
economy” will remain a challenge for the SMEs but the long term relationship
with the customers may allow survival and growth (Gilmore, 2006; Harris, 2012).

Without formal marketing planning business owners worked hard on high
satisfaction of the customers and suppliers, where perservence and consistency
of the business would keep regular flow of the new customers rather than
unaffordable to limited funds and time marketing campaigns.

 

Small business
owners are their own emplyees out of luck of funds in the ealy stag eof the
company, and luck of time and expertise downgrade their priority on marketing.

 

Practice of
marketing in these SMEs owners focuses on daily tasks, which are based on
solving customers problems. Planning is not understood as following of the
marketing concepts but emerges from customers needs and interactions with the
outside world. 

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