Inside FutureM: The Future of Marketing for Small Businesses (and Why it Doesn’t Involve Daily Deals)

Posted by erik devaney

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The marketing landscape has changed considerably in the past decade. Instead of having to drop big bucks for billboards and TV advertisements, companies can now get their products seen and their messages heard using relatively inexpensive social media marketing, mobile marketing and local marketing strategies.

For the small business owner, diving headfirst into the realm of Facebook, Twitter, social coupons, daily deals, mobile check-ins and local listings may seem overwhelming. However, as I recently learned at a FutureM panel discussion Monday, small businesses have a great opportunity to take advantage of the rapid changes that are occurring in the world of marketing.

The Future of Marketing: How Marketing is Evolving for Small Businesses panel discussion was moderated by Gail Goodman, CEO of Constant Contact. The five panelists who took part in the discussion were Shelly Berman-Rubera, Founder and President of Small Business Results; Tom Burgess, CEO of Clovr Media; Dan Gilmartin, VP of Sales & Marketing at WHERE; Chris Mahl, SVP & Chief Brand Alchemist at SCVNGR/LevelUp; and Andy Miller, Founder & CEO at CardStar.

One of the main points that I took away from the panel discussion is that in this “wild, wild West” world of modern marketing, as Andy Miller referred to it, being small is actually an advantage. Unlike with a large, multinational corporation, which can take a long time to implement a new marketing strategy, a small business can rapidly implement a new strategy, such as a launching a loyalty program. “Big business is too big to turn on a dime,” said Tom Burgess.

The most surprising aspect of the panel discussion was the panel’s general disdain for daily deal programs, such as those offered by Groupon, LivingSocial and BuyWithMe. While the panelists conceded that the daily deal space is indeed growing, they were also very firm in their assertion that a daily deal is more likely to harm a small business than it is to help it.

As Chris Mahl commented, by establishing a daily deal, you can get a lot of people to come to your business and pay for a product or service at a heavily discounted price. But apart from getting your business’s name out there, what is the benefit? “It’s painful,” Mahl said, as people only have the incentive to show up at your business once to cash in on the big deal.

Shelly Berman-Rubera pointed out that while the daily deal can get a small business a lot of sales, it won’t make the business a lot of money (because of the discount) nor will it provide customers with the best experience (as employees may be struggling to accommodate all of the people coming in to take advantage of the deal). Dan Gilmartin drove the final stake into the heart of the daily deal when he stated that — statistically — after businesses run daily deal programs, the number of reviews the businesses receive go up; however, these reviews are primarily negative, which means the ratings for the businesses go down following daily deals.

As an alternative small business marketing strategy to the daily deal, the panel recommended the implementation of loyalty programs that create incentive for repeat business. Instead of a one-off deal that offers a massive price reduction of 60%, 70% or 80%, small businesses should reward customers with smaller price reductions, like 5% or 10%. Customers can earn points towards unlocking these reductions through frequent purchases of products or services.

Related posts:

  1. LivingSocial Offers Daily Deal on Kennedy Tour. Didn’t Know There Was One
  2. Google Strikes Deal to Acquire Daily Deal Service
  3. Done Deal: Facebook Kills off Groupon Competitor
  4. Conn. Price-Gouging Laws Take Effect in Emergency
  5. Providence Startup Nest4Less to Offer Deals for Homebuyers/Homeowners

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Posted by erik devaney on Sep 13 2011. Filed under Featured - For home page featured article, General. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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