Marketing for small-to-medium enterprises 763
channels, to price within certain known and
expected parameters, to provide certain expec-
ted levels of quality and service, and so on. To
step too far away from any of these norms will
require the SME to have some significant
differentiation in some aspect of its business.
Such circumstances are rare in the extreme.
Most SMEs can only hope to attain some
marginal differentiation to exploit and because
of this must conform to the industry customs
and practices in presenting this differentiation.
Take a few examples by way of illustration, if
normal distribution channels rely on inter-
mediaries such as trade distributors, an SME
which by-passes these will meet with a variety
of resistance unless it achieves differentiation.
Retailers or end users will be wary of doing
business for fear of upsetting the wider indus-
try supply channels. Consider also, price/profit
mark-up and margins. An SME failing to offer
prices that fall within expected parameters,
either positive or negative variance, will meet
with query and resistance. Too low a price
margin/mark-up and interest is spurned, too
high margin/mark-up and suspicion and credi-
bility doubts arise.
There are only a few circumstances where
industry norms may not apply. One is where a
large dominant player within a close knit market
community decides to ‘break-the-mould’ by
some act of marketing variance, others will be
forced to follow. Such an option is not open to an
SME unless it possesses a huge differentiation in
relation to product or technological innovation, a
rare circumstance in normal everyday trading,
although history will record many examples.
Another circumstance is where a market enters a
period of dynamic change, such as technological
developments or consumer attitudinal shifts. In
such circumstances opportunities will exist to
break and create new industry/market practices.
Such dynamic change occurs only occasionally
but when it does occur it is significant. For
example, in the tourist industry when the advent
of cheap air travel created a huge new market
expansion and many new entrants, and cur-
rently in the financial services industry where
de-regulations and greater consumer awareness
and spending power allow many new ways of
doing business, such as ‘service direct’ concepts.
In both of these circumstances SMEs can actually
be more dynamic and effective than large
established organizations who can sometimes
find it difficult to break away from their long
established and traditional practices.
In summarizing the nature of SME market-
ing, we have acknowledged the inherent
influence of SME characteristics and the entre-
preneur/owner/manager. In addition we have
highlighted two other factors of significance,
the SME stage of life cycle and the industry/
market norms by which most SMEs must
conform, except in an few exceptional circum-
stances. A model of ‘situation specific’ market-
ing serves to illustrate and integrate this
discussion (see Figure 29.1).
Marketing principles, concepts and theo-
ries at the most general level can apply to SMEs
as much as in any other domain. However, to
actually perform marketing certain factors must
be taken into account, perhaps to ‘filter’ and
‘refine’ marketing towards the unique and
individualistic character of an individual SME.
Some marketing theories can contribute to this
process, for example, the theories and principles
behind goods/services marketing or industrial/
consumer marketing. Taking account of the
inherent characteristics of any of these contexts
will automatically guide marketing frame-
works. Obvious illustrations are provided by
services marketing being characterized by
aspects of intangibility and industrial marketing
being characterized by aspects of relationship.
In a similar way, (discussed earlier), any
firm’s marketing will be influenced and charac-
terized by the nature of the industry or market it
exists within. Although service firms or indus-
trial firms may have inherent characteristics of
influence dictated by the characteristics of
services and industrial marketing, they will also
be characterized by the nature of their industry
or market. So, for example, service firms in a
particular food sector will all behave in a similar
fashion which is dictated by the industry/