In the earlier chapters, we discussed about an entrepreneur's journey to identify a viable business opportunity and prepare an effective business plan to ensure a sense of direction to the project he or she has undertaken. It should be noted that the initial phase of an entrepreneur's business project is very critical and complex to handle. The reason is that there are a lot of unforeseen situations and events which he or she would not have thought of but they do come. This means that an effective business plan will not be sufficient work for the success of the project but a more scientific approach is required to overcome the hurdles that might come in his or her way. The most important of all of this is marketing. The success of marketing effort will determine the height of success of the business venture.
In this chapter, we will discuss about enterprise marketing which a more scientific and organized approach to the marketing effort. There two words included in this concept "Enterprise" and "Marketing". The word enterprise means a project or venture which involves some complexity and risk. The word marketing means activities of the organization associated with buying, selling, distributing, promoting the product or services of the company. Hence, enterprise marketing is a broader concept which aligns the marketing efforts with overall business strategy and gives a more scientific approach to the marketing. Marketing is known to be an art of developing a product and selling it in the market while enterprise marketing is science which seeks to develop processes which could fill the gap between the developments of product and selling it in the market. These processes may be in the form of Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) etc.
You must be wondering what relation does enterprise marketing has with entrepreneurs. The answer is very simple; entrepreneurs want to launch a product or service which involves complexity and element of risk. Enterprise marketing reduces the level of complexity and risk and gives a clear cut direction in the form of systems and processes which would help to achieve broad business objectives. As said earlier, enterprise marketing is over and above business plan as a business plan gives a strategic direction to the business while enterprise marketing provides tactical and more details plans to achieve objective.
The goal of the business is derived from the broad business strategy. For example, if the strategy of the business is to attain 30% profit margin in next 3 years form current level of 15% then the goal should be set in terms of how much of sales should be achieved from different products or services to generate that margin. Also, it includes goal of minimizing cost which also contributes to the higher profit margin. In this section, we will concentrate on sales oriented goal as a component of enterprise marketing.
The Process of Goal Setting
A goal setting is key to success. It applies to business; hobbies and life itself. Every successful entrepreneur is incredibly goal oriented. Successful entrepreneurs determine their goals and focus intensely on achieving them.
The goal setting process requires a written goal which defines what needs to be achieved and in what timeline it should be achieved. Entrepreneur should decide the destination where he needs to reach in a given timeline and then work back wards to align small steps with timelines which will help him reach the goal. No doubt, it is easier said than done process. You have to be very careful in devising an effective goal as there are many factors which will run you down along your journey and you have to have strategy to get out of those problems.
The goal process starts with thinking broad objectives, breaking it down to smaller interlinked objectives, assigning timelines to each objective, assigning resources to achieve them and monitoring the progress on achievement and disachievement of plans. It also involves taking corrective action if something planned did not work and some alternative has to be worked put so that the broad level goal remains on track.
Smart Goals
One of the most important characteristics of a goal should be that it should be SMART goal which means Specific, Measurable, Attainable, Realistic and Timely. Entrepreneurs are expected to follow the principle of SMART goals to ensure an effective goal for the business.
The components of SMART goals are discussed as follows:
When you look at an advertisement by Sony brand or Samsung brand or any other brand what impression do you get? You can relate these names with something of value and something you would wish to possess. This is what brand is all about. We feel good to have them and envy the people who already have it. This is what an entrepreneur should also do. He or she needs to ensure that the product or service on the offer should have some brand value. Branding is a key marketing strategy for an entrepreneur to be successful in a competitive market. It is required irrespective of size and nature of business you engage in.
A brand is entrepreneur's promise to the customer for a product or service which provides value and satisfaction. It tells them what they can expect from your products and services, and it differentiates your offering from your competitors'.
A good logo is distinctive, appropriate, practical, graphic and simple in form. It conveys the owner's intended message. There are five principles for good logo which should be followed:
(i) Simple: A logo should be simple so that it is recognizable, versatile and memorable.
(ii) Memorable: This is very much like simplicity which automatically makes it memorable like McDonald's logo.
(iii) Timeless: A logo should have long shelf life and should not become redundant after 10, 20 or 50 years.
(iv) Versatile: The logo should have look and feel that it looks good both in print media, visual media and any other media for its promotion.
(v) Appropriate: A logo should be appropriate for the target audience or customers. For example, a child-like font and color scheme would be appropriate for a logo for a children's toy store, not so much for a law firm.
For example, Airtel tag line "Express Yourself" is aimed the younger generation of India which should use airtel network for all their communication needs. This tag line attracts youngsters who will become customers of the brand for a long time and add to the brand value.
Entrepreneur must come out with an integrated promotion strategy to ensure the market share of the product improves. The promotion strategy in its most basic form is communication with the perspective customers to educate them about the product feature and create a need in their mind to have it. Promotion strategy includes the following:
Advertising: It includes the process of dissemination of product information and feature through electronic or print media.
Packaging: Packaging provides a description of the packaging strategy. It includes any labels, trademarks or service marks should be included.
Public relations: Publicity strategy includes a list of media that will be approached as well as a schedule of planned events.
Sales promotions: It establishes the strategies used to support the sales message. This includes a description of collateral marketing material as well as a schedule of planned promotional activities such as special sales, coupons, contests, and premium awards.
Suppose you go out to buy a pair of shoes with your mother and reach a shop in your neighborhood. Your mother asks for the price of a pair of shoes then you get the reply that it is ₹ 850. Suddenly, you start walking away and the shop keeper asks how much you are willing to pay madam and the reply comes as ₹ 700. Shopkeeper says ₹ 800 and so on. At the end you buy the shoes for ₹ 750. You must have observed that the final price paid for the product was neither the one your mother was willing to pay (₹ 700) nor the one shopkeeper was willing to accept (₹ 850) but the deal has happened at a mutually agreeable price (₹ 750). This is what is called negotiations.
Negotiation is a process where the buyer and seller discuss the deal and arrive at mutually agreeable terms on price, quality, service etc so that neither party loses or gain too much in the end. The basic principle of negotiation is that you should be willing to give something to the buyer and also get something out his interest in your product.
An entrepreneur should have good negotiating skills which is an important part of carrying on the business. Negotiations are required for both buying and selling a product. However, in the context of this chapter, we will discuss it from seller's perspective so as how an entrepreneur can increase his or her sales through better negotiation skills.
The importance of an entrepreneur's negotiation skills can be understood in following paragraphs:
The following are the methods of negotiations:
An entrepreneur is required to ensure a good Customer Relationship Management (CRM) to expand market share of his or her product or services. CRM entails all aspects of interaction that a company has with its customer, whether it is sales or service-related. CRM is a business strategy that enables businesses to:
Importance of CRM
The following are the points for importance of CRM:
An entrepreneur has to manage his employees and vendor in such a way that the broad objectives of his business organization are met. Employee management is internal part of the organization while vendor management is external to the business. We will discuss both employee management and vendor management separately in this section of the chapter. Let's discuss employee management first.
Employee Management
When we talk about employee management, the first thing we should understand as who is an employee? An employee is someone who has agreed to be employed, under a contract of service, to work for some form of payment like wages, salary, commission and piece rates. An employee may be home workers, people who have been offered and have accepted a job, fixed-term employees, seasonal employees, casual and part-time employees and probationary and trial employees. An employee is not a self-employed or independent contractor, a volunteer who does not receive a reward for working. However, in general, there are either Fixed term employees or Casual and part-time employees.
Let's now discuss about employee management as we are now aware of who is an employee. An entrepreneur has to ensure that he hires the best talent in his organization and nurture them in such a way that they contribute to the growth and prosperity of the organization. Employee management has two aspects namely hiring of best talent and grooming them to become future leaders.
Retaining and Grooming the Future Leaders: The second part of the employee management is retaining and grooming future leaders. Retention of employees can be achieved by providing financial and non financial incentives. Financial incentives include bonus, rewards, group insurance etc. Non financial incentives include recognition, rewards, motivation etc. Also, employees should be groomed in terms of training and counseling so that they can become future leaders. The talent should be identified and grown in such a way that a constant flow of leadership pool is maintained and entrepreneur can achieve the needs of his growing venture.
Hence, an entrepreneur must strive to create entrepreneurial employees who bring innovative and path breaking ideas to grow the business. Such employees are assets for any organization and regarded as the growth engine of the company.
Vendor Management
Vendor management is an important aspect of an entrepreneur's business. We need to understand who is a vendor before talking about vendor management. In very simple words, a vendor is a seller of goods and services and a seller is a person who promises to supply certain goods or services in exchange of money as consideration. The buyer needs to pay for the goods and services and in the eyes of the buyer the seller is a vendor. This means that the buyer has the option to buy goods from different vendors or sellers. Hence, under vendor management, the buyer or entrepreneur should follow some well laid out principles of vendor management which we will discuss in the coming paragraphs.
Vendor management is a three step process:
The following essential points should be considered while finalizing the contract with the vendor:
(i) All contracts should be in writing.
(ii) To the extent applicable, contracts should cover expectations and responsibilities.
(iii) The scope of work and fees should be mentioned in the contract.
(iv) Type and frequency of reporting on the status of work involved should be part of the contract.
(v) Process for changing scope of work should also be mentioned.
(vi) Ownership of any work product.
(vii) An acknowledgement that the vendor is subject to regulatory review, privacy and information security.
(viii) A process for ongoing monitoring, and supervision and dispute resolution.
(ix) Legal counsel should review all significant contracts.
A common problem with many vendor contracts is that the expectations and responsibilities of the vendor and the financial institution are not adequately communicated. When problems develop, resolution becomes very difficult, as each party insists that the other is responsible.
The vendor's policies relating to internal controls and security should be reviewed and some method of determining whether the vendor is following such controls should be developed.
An entrepreneur has to be very careful about the quality, timeliness and customer satisfaction pertaining to the product or service he or she is providing in the market. As a new entrant in the market, it is important that he or she leave a good impression on the minds of the customers. This helps him to publicize his product or service in an easy way. Good quality and level of customer satisfaction is a sure shot way of achieving a good business impact. An entrepreneur must devise a strategy to ensure that the objectives of quality, timeliness and customer satisfaction are met without any exceptions.
What is Customer Satisfaction?
Customer satisfaction is nothing but customer experience derived out of the product or service availed by him or her. Any process or activity on the part of the entrepreneurial organization that affects customer experience directly affects customer satisfaction. Processes or activities may be regarding product and service quality. Several ways by which a company interacts with its customers can give it a chance to continuously exceed customer expectations and earn long-term loyalty as a result. The following are the factors which have impact on customer satisfaction:
We generally avoid to discus about a topic like failure. In fact, we hate the word "failure" as it shakes our confidence and creates more trouble than we had it earlier. However, failure does happen in entrepreneur's business but it does not happen without any reason. The following may be the reason for business failure:
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1. What is enterprise marketing? |
2. How does enterprise marketing differ from consumer marketing? |
3. What are the key challenges in enterprise marketing? |
4. What are some effective strategies for enterprise marketing? |
5. How can enterprises measure the success of their marketing efforts? |
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