SME marketing: Avoid a faulty approach

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Bikky Khosla | 07 Feb, 2012
Marketing is the toughest challenge in any business, and when it comes to small and medium enterprises (SMEs), this is the area where they lack most. Resource constraint is cited time and again as the underlying cause, but I think there is another major challenge to deal with â it is their myopic vision about marketing.

Although our SMEs go for some form of marketing or other, their conception is, in general, too limited and substantially different from that proposed by academics or adopted by large firms. Informal organizational structure, resource constraint, high level of risk aversion, and lack of marketing knowledge and specialised expertise push most of them toward adopting a marketing approach that is loose, unstructured and spontaneous. This, in turn, leads to decision making in a haphazard and chaotic way, and as a result, the marketing results usually suffer.

To some extent, however, the simplicity of this marketing approach helps SMEs fill the voids arising from the approach's limitations. For example, high level of flexibility resulting from their informal organizational set-up helps SME owners make most decisions on their own, making the decision making process highly efficient. Also, the reactive nature of their marketing approach assists them to respond quickly to current opportunities and circumstances. In fact, more often than not, these benefits have remained key factors for our SMEs to energize their marketing in a simple but cost-effective way.

Given this phenomenon, should small entrepreneurs continue with their primitive conception of marketing? I think, they shouldn't. Due to some emerging drivers of market change in the recent years, particularly with increasing competition from global players and diffusion of IT in business, this traditional SME marketing concept has lost its relevance to a great extent. In this scenario, Indian SMEs can no longer afford to cling to this somehow-useful approach.

Of course, there is no doubt that resources, particularly those dedicated to marketing, are often tight in SMEs, but instead of continuing to complain about it, they should make every effort to adopt a marketing approach that suits todayâs growing challenges. It is crucial for them to get rid of the misconception first, and then broaden their marketing knowledge and develop a marketing culture that emphasises innovation and risk-taking.

And fortunately, this can be done without spending much.