Omotayo Adeniyi Adegbuyi
Keywords: Customer needs, entrepreneur, focus group, innovation, marketing mix
particular, the influence of the owner-manager is seen as a key differentiator between small and large firms.
Oshagbemi (1983) put forward a personalized management style as a distinguishing feature of small enterprises, typifying it as personal knowledge of all employees, involvement in all aspects of management and lack of sharing of key decisions. Owuala (1999) however, attributed this concentration of management to the fact that the owner- manager of a small firm is more powerful, being subject to fewer checks and balances than a large firm counterpart. Given that the personal characteristics of the owner-manager are such a dominant influence, the marketing management of a small enterprise will depend greatly on the marketing competency of the owner. This led Ogunmuyiwa (1994) to describe entrepreneurship practice of marketing in terms of the experience, knowledge, communication abilities and judgment of the owner manager, key competencies on which marketing effectiveness depends. As small firm managers vary widely in their rating in each of these competency areas, so does the marketing performance of small firms.
However, entrepreneurial practice of marketing cannot be conceptualized solely in relation to the activities of owner-manager of SMEs. Entrepreneurial behaviour is not exclusive to owner-managers, nor can all owner-managers be considered as entrepreneurial (Ubom, 2003). Attempts to define entrepreneurship can be divided into two broad categories (Emmanuel, 2006):
(2) Behavioural approaches based on investigations into what entrepreneurs do and the processes used to carry out entrepreneurial activities. The trait approach has yet to provide us with the entrepreneurial archetype, although some common descriptors, such as opportunities, innovative, proactive and restless, have been suggested (Chell et al., 1991). There are more consensuses over what entrepreneurs do than who
they are. Early definitions of entrepreneurship defined the entrepreneur as an agent of change, someone who does not seek to perfect, or optimize existing ways of doing things, but searches instead for new methods and new markets. Others have developed this theme by defining an entrepreneur as someone who not only searches for change, but also responds to it in any innovative way, exploiting it as an opportunity (Drucker, 1986). The research into the practice of marketing by an entrepreneur reported her focuses on the second of the two approaches, as it investigates what an entrepreneur does, and defines entrepreneurial marketing in terms of the behaviour and activities that are typical of those involved in successful entrepreneurial ventures.
Kotler (2002:5) said that marketing is “a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others”. Thus, the word ‘exchange’ means communication, and also ‘value’ has a connotative meaning of quality or profitability. In a similar vein, Stanton (1993:10) referred to marketing as “total system of interacting business activities designed to plan, price, promote and distribute wants-satisfying products and services to present and potential customers”. The “marketing concept” first articulated in the 1950s, has special relevance to new and growing firms. The marketing concepts is a partial philosophy for starting and operating a business with the primary focus on adopting a customer orientation, integrating that orientation throughout the organization, and thereby achieving goals that transcend just sales, (most notably profit).
The main aim of the study is to provide a conceptualization of how marketing concepts
differ in entrepreneurial contexts. Traditional marketing concepts can be divided into four distinct elements (Achumba, 2000):
organization undertake information-related activities defined by Kohli and Jaworski (1990) as the “organization-wide generation, dissemination and responsiveness to market intelligence”.
Thus marketing can be defined in terms of organizational philosophy of market orientation, guided by segmentation, targeting and positioning strategies, operationalised through the market mix and underpinned throughout by market intelligence. The research was designed to permit investigation of entrepreneurial activities in each of these categories
Firms are asked if they are moving into “new Market”
or if they are developing “new Products”. Those well
Gibb (1990) concluded that the search for representativeness through large sample questionnaire surveys was frequently misplaced in researching the small firm sector, and he called for the use of more inductive reasoning based on grounded theory with greater emphasis on quality of data. Researchers investigating the marketing and entrepreneurship interface responded to such recommendations by using qualitative and longitudinal research to supplement the “snapshot”, quantitative profiles of entrepreneurs. This study is part of this body of work, and utilizes a combination of qualitative methods –depth interview and longitudinal focus groups.
respondents’ perception before asking for specific information, for example on usage of specific types of marketing activities and promotions. The open-ended questions typical of these interviews provide a greater depth of data than structure interview because they attempt to “understand the complex behaviour of members of society without imposing any priori categorization that may limit the field of equity” (Osuagwu, 2002). They are appropriate particular when it is important to understand the construct that the interviewee uses as a basis for their views or beliefs about a particular topic, a factor which was particularly significant in this research. Interviews were tape-recorded and later transcribed for analysis purposes.
Critical incident technique
picture presented by entrepreneurs. Focus groups offer the possibility of a shift in the power balance from the researchers to entrepreneurs, which may reduce this effect. They are particularly useful for learning about participants’ conceptualization of particular phenomena and the language they use to describe them (Stewart and Shamdasani, 1990), a particular objective of this research. Participants may be more candid because of the psychological security derived from group membership and the realization that what they say is not necessarily identified with them. The moderator requires sufficient skill to counteract the possible denomination of the group by one person or a small coalition of participants, a particular concern when researching potentially strong personalities such as entrepreneurs.
The groups reported on here were part of a series of focus groups held twice few months ago in five locations – Ota, Ijoko, Sango, Ojuore and Iyana-Iyesi. Each of the five groups typically involved between six and eight entrepreneurs, running successful small and medium-sized business. In each meeting with these groups they are asked to discuss their main sources for finding new customers and their strategies for keeping them; asked about the role of innovation and the development of new products and services in their business and some marketing issues were not left out.
Results: entrepreneurial interpretations of marketing
Marketing as an organizational philosophy
During the focus group discussions, entrepreneurs were asked about the process of new product or service development. Their responses indicated that they tended to start with an idea, and then try to find a market for it. Change was more prompted by the existence of a new product concept, or competitive pressure, than a researched, established need amongst customers. Marketing as an organizational philosophy indicated that an assessment of
market needs come before new products development. Entrepreneurs seem to do it the other way round, gauging customer reaction after the development of the concept. This was epitomized by one entrepreneur interviewed who defined marketing as “trying to find which market you fit into and then aiming publicity or information at that market”.
Entrepreneurs expressed a zeal for the development of new concepts and idea – an “innovation oriented” – rather than being dedicated to the principles of customer orientation as per the marketing concept. However, they did not always search for major breakthroughs and inventions. Most achieved growth through incremental adjustments to existing product and services or market approaches, rather than larger scale developments. These included stoking new lines, approaching a new segment with a particular service, or improving services to existing customers – in other words, incremental, innovative adjustment which together created a competitive edge.
Marketing as a strategy
This process usually involves both secondary and primary market research, with evaluation by specialists in each of the three stages. The participants in this research did identify closely with a specific group for customers whose needs were well-known to them, but the processes they used in order to achieve this did not conform to
the stages described above. The entrepreneurs described a bottom-up targeting process in which they began by serving the needs of a few customers and then expended the base gradually as experience and resources allowed:
The marketing mix
the unique selling point of the business they stressed the importance of personal relationships in developing customer base. Whilst this was particularly true of those in business-to-business markets, owners of retailing operations also emphasized the need to know their customers well. Sometimes, this involved the use of a customized database. Several owners stressed the amount of time they spent personally in contact with the customers. Others regretted that the growth of their businesses reduced their opportunities for direct customer contact.
The entrepreneurs agreed that it was important to monitor the market place, especially their competitors. Virtually everyone had strategies for monitoring competitive activity, which varied from a basic collection of price lists and literature to more elaborate method. Foremost, personal observation was the main method used for intelligence gatherings, as it was considered relatively easy and more likely to be up to date than other methods. However, the low level of any formal market research carried out by entrepreneurs underlined the largely unstructured nature of this information-gathering process. The reasons given for lack of formal research varied from believing it to be unnecessary, to thinking it was expensive or not very helpful. They preferred more informal methods of gathering market information; usually through networks of contacts involved in the industry or trade. They believed that their informal information-gathering techniques were sufficient to allow them to monitor their own performance in relation to competitors and to react to competitive threats. They were open to new ideas
and opportunities through a network of personal and inter-organizational contacts
This does not imply that all entrepreneurs operate like this; undoubtedly some do rely more on formalized research and procedures because of their particular backgrounds and experiences. However, the purpose of this conceptualization is to indicate that it is possible to develop different marketing practices, which play to entrepreneurial strength. For example, a bottom-up targeting process has advantages over the top-down approach for new ventures. It requires fewer resources and is more flexible and adaptable to implement. It does have corresponding disadvantages, which correspond to some of the marketing problems of small businesses. It is less certain of success because it is over-dependent on reactive rather than proactive marketing strategies. It takes longer to penetrate the market to full potential, resulting in a limited customer base. However, many successful entrepreneurial firms have found niche markets or gaps in large markets through this process.
Likewise, reliance on word-of-mouth marketing is not a bad thing for many entrepreneurs as it is more suited to the resources of their business. Referral incur few, if any, additional direct
costs:, most owner-managers prefer the slow build-up of new business which word-of-mouth marketing implies because they would be unable to cope with large increases in demand for their services. Word-of-mouth marketing has disadvantages that include the following:
There are inferences in some of the literature that marketing undertaken by entrepreneurs is somehow inferior to the more traditional marketing carried out by larger organizations. Critics assume that entrepreneurs market in this way only because of inadequate resources to carry out larger scale programs. However, the processes summarized here have actually worked in practice. They were described by entrepreneurs who had successfully grown their businesses using these methods. They could of course be improved but, rather than focusing on the deficiencies of entrepreneurial marketing, this research indicated that there is much to be built on from the existing practices of successful entrepreneurs.
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