762 The Marketing Book
entrepreneur/owner/manager and the SME
itself. Thus, the inherent limitations of SMEs
and the resultant characteristics that they cre-
ate, coupled with the way entrepreneurs/
owners/managers take decisions will deter-
mine, indeed dictate, the nature of SME
marketing. These underlying factors are taken
into account later in this chapter; at this point
let us consider some other aspects of influence
and consequence in relation to the nature of
SME marketing.
The life cycle stage of SMEs
SMEs will perform marketing differently
according to their stage of life. A start-up SME’s
marketing will likely be characterized, indeed
dominated, by reactive marketing practices, in
terms of reacting to customer enquiries and
market changes. As the business develops,
much of the marketing will be characterized by
experimenting or tinkering with a variety of
marketing techniques, for example, the creation
of a brochure or a visit to an exhibition. As the
enterprise becomes established over a number
of years it will have developed its own market-
ing style and practice which it has learned and
shaped along the way. The enterprise will know
what works for it and what does not. It is
unlikely to accommodate wider or new market-
ing perspectives until it encounters a significant
change of some kind, for example, a new
market venture. In moving through the various
life cycle phases, an SME will progress from
what is sometimes an uncontrollable marketing
circumstance to one in which it feels that every
aspect of marketing it performs is controlled.
Again because of the inherent characteristics,
this ‘controlled’ marketing is likely to be quite
conservative and restricted to the tried and
trusted methods refined over the years. Thus,
whilst marketing activity is established, com-
fortable, affordable and apparently working, it
is also potentially complacent, dull, unim-
aginative and perhaps inefficient. However, it
feels safe, after the traumas probably experi-
enced at various times in the tinkering period,
nothing too radical or different is tried; caution
and conformity prevail.Conformity with industry norms
Generally, SMEs must ‘conform’ to established
norms in order to do business, primarily
because they are small and cannot hope to
‘buck’ established practices. What are the estab-
lished norms? Any industry or market will exist
within certain customs and practices outside of
which it is difficult to find acceptance. Examine
any industry and these ‘norms’ can de identi-
fied. For example, in the way products are
presented, where and to whom, the way and
when they are distributed, the degree of service
that is expected and provided, the price para-
meters, margins and mark-up that exist, the
hierarchical infrastructures, the traditions and
histories, the precedents and rules that exist
and which must be adhered to. These estab-
lished norms are so strong in most markets/
industries that they create their own distinctive
characteristics which determine how business
is done. The most striking illustration of these
established norms comes sharply into focus in
two areas. When an enterprise enters a new
export market, an emphasis is placed upon
understanding the culture of a region in general
and the culture of doing business in particular.
Of course this cultural understanding involves
much more than just sociological issues, it also
involves understanding of a variety of expecta-
tions and practices. A depth of understanding
is required before a business can expect to
successfully exploit opportunities previously
identified. Another, less common area is where
someone launches a new business in a market
area in which they have no prior experience.
Most of the initial period is taken up with
finding out how to do things, who to contact
and rely upon, what will please and offend,
what is expected as a minimum, what levels of
service, price, delivery, quality are expected
and how these all interrelate.
Such industry norms will require an SME
to use established and existing distribution