Soft sell

Entrepreneur, Sept, 1998 by Mark Henricks

That's not a good sign, says Doescher. "They forget the rule that says they should [cultivate past] customers," he says. "That's the best place to find new business."

You can do a better job of prequalifying by paying close attention to your marketing costs and determining what it costs you to market to a poor prospect. "You don't want to pay $10,000 for something when you don't know if it's going to work," says Gioia, who recommends test-marketing as a relatively inexpensive and focused way to prequalify prospects and measure the effectiveness of your marketing materials.

MARKETING MEANS

The "big three" small-business marketing channels are referrals, advertising and direct mail. Referrals and advertising are used by about half the companies surveyed, while direct mail is used by only one in four. Just 1 percent admitted to using controversial unsolicited e-mail - also known as "spam" - to market goods and services.

Doescher applauds the spare aversion but is less complimentary about the fact that only 8 percent of surveyed firms said they marketed through a Web site. "It's not that expensive, and a Web site brings in business," he says, a stance supported by the marketing experts.

Ettridge, however, disagrees with the experts on this point. His firm has an extranet (a restricted Web site for existing customers) and doesn't market through a public site. Firms that do, he feels, give away so much information about service offerings, pricing and even customers that their Web sites are often free lunch for rivals gathering competitive intelligence. "We get prospects from the Web," he says. "We don't give them."

DON'T JUST SIT THERE!

One of the most damaging failings identified by D&B's survey is the tendency of small businesses to react to incoming orders instead of proactively seeking them out. Small businesses are so passive, in fact, that walk-in retail traffic was the most popular sales method, cited by 44 percent. Next were telephone sales, used by 22 percent, and field sales, used by 18 percent.

Small-business owners may feel they're too busy putting out fires to be proactive, Doescher speculates. In fact, survey findings indicate that competitors, tight budgets and the difficulty of getting noticed by customers were cited as the biggest obstacles to proactive marketing.

Not all small businesses take a passive approach, however. Gordon Weinberger, founder and president of Top of the Tree Baking Co. in Londonderry, New Hampshire, spends most of his time traveling throughout New England in a wildly painted school bus promoting his fruit pies. He can often be found outside grocery stores, in mall parking lots or anywhere else people will gather to gawk at an oddly dressed six-foot-nine-inch entrepreneur imploring them to "Eat mo' pie!"

"We're extremely proactive," says Weinberger, 33. He's even gone so far as to organize letter-writing campaigns by consumers urging local grocers to carry his pies. And his efforts are working: The 10-employee company, near failure in early 1997, rocketed to profitability by year-end to the tune of $3 million in annual sales, largely because of Weinberger's manic marketing.