Most, if not all, local small businesses in Northwest Arkansas that are struggling or have failed can be attributed to their lack of marketing and advertising efforts, which becomes evident once you delve into the complete truth about them.
I know of a business owner in Northwest Arkansas who says he will shut it down any day due to a lack of business, yet who still will not make even a single free Facebook or Instagram post. He also doesn’t do any internet, radio, billboard or television advertising, nor does he use hangtags for doors, send out direct mail, do email blasts, use SEO or sponsor a Little League baseball team. There is just no marketing whatsoever.
I don’t think this situation is that unusual for many small businesses. Why is this the case? There are several reasons, including:
- The owners of these small businesses think they can’t afford it. They see marketing and advertising as an overhead expense, like rent or insurance, and if they can avoid spending anything there, it is money they can put in their pockets and take home to their families.
- They don’t believe marketing and advertising work. My experience is that if you spend “X” on marketing and advertising, you will get a certain number of sales or dollar amount of sales from it. So spend X, and get X times 10 or X times 20. What will that kind of volume increase do in terms of business viability and profitability? Think about your own business. But for this relationship to work, it takes consistent activity and spending. I have often heard, “We tried advertising, and it didn’t work.” You can’t do it once or twice and expect that to produce
results. It may not.
- These small business owners are hung up on the idea that “word-of-mouth is the best advertising,” so they do nothing. They forget that to get word-of-mouth, customers have to buy from the business or use it in the first place. Without marketing and advertising, you will never get the word-of-mouth flywheel going.
- They don’t know how to market. Most small business owners are good at something — they are good cooks, carpenters, sewing, or getting people to exercise correctly. That’s why they went into business in the first place. But what they don’t know anything about is marketing and advertising. So instead of going outside their business to find help, they give up. There are so many marketing companies and advertising sources that can help a small business, not to mention marketing students who would love the chance to work with a real business here in NWA, that there is no excuse for not being able to get help.
Let me conclude by saying that I am not someone who’s just done a lot of reading about this stuff and is now opining about it. In my businesses, I always invested in marketing. That’s how two of my companies got on the Inc. 500/5000 list — one of them three times. And today, the new and existing businesses I am involved with heavily invest in marketing and advertising and have a revenue growth curve that reflects that.
Contrary to what your CPA/tax advisor may tell you, a small business can be worth far more than what you can extract annually. The value of the business is directly related to the revenue growth rate, not to mention that a growing business tends to be more profitable than a stable (i.e., stagnant) business.
So now is the time for small business owners to stop handwringing and start investing in a consistent marketing and advertising program. Do it now before it’s too late.
Mark Zweig is the founder of two Fayetteville-based Inc. 500/5000 companies. He is also entrepreneur-in-residence in the Sam M. Walton College of Business at the University of Arkansas and author of the award-winning book, “Confessions of an Entrepreneur.” The opinions expressed are those of the author.