Road to market for SMEs

By Olayinka Dada

Market access remains the life blood of any small business, a business that is not selling will soon close shop. Road to market is any SME involves the activities and platforms involved in getting the products to the marketplace, after the goods have been manufactured. For SMEs, RTM is very important because their survival depends on it, considering the other factors that are mitigating against a typical SME, like unavailability of  power, bad road and cheap funding.  

Oftentimes, we see small business owners focusing on product design and manufacturing, not taking into cognizance the anticipated reaction of the market and how they will get there. The road to market for every Business begins from conceptualization of the product to delivering the service of product to the consumer. The promoter of a business, must take critical look at the market and understand the needs of prospective consumers in that market, before the commencement of production of any commodity. One of the major reasons why SMEs fail, is due to poor product design and conceptualization for their desired market.

Small Business owners believe that market research and product design are for large multinationals, and that as small businesses, they cannot afford the luxury of market research, but market research is not about elaborate activities and big budget, it’s about walking through your designated market, and asking questions on how they will react to your proposed product. There is the need to understand the demographics and other factors, for you to design your product or services to suit the market peculiarities.

A successful road to market strategy for any SME,  requires the selection of appropriate channel of entry, you cannot enter a market if you do not know where your customers are, every small business owner or intending business promoter must know where his/her customers are firstly before designing the platform to reach them . Some business owners go ahead to rent physical  shops space , while their customers are online, small business owners pay for rents they will not  be able to renew, when they only need to reach out to their customers on either Twitter, Facebook or Instagram. With the change in habits and general lifestyle of consumers, your major marketing tool might just be your smart phone. Social media uptake is continually on the increase, and this act is changing the face of marketing, and creating advantage, especially for small business owners, this has made marketing budgets for Small Businesses manageable and is providing great returns.

Pricing for SMEs is very important, as they do not have the luxury of fighting price wars with established businesses, but you cannot price right, if you do not know the prevailing market price for your designated   market segment. This takes us back to information gathering, which is essential for any small business. Right pricing can kill any road to market initiative, any product or service can arrive dead in the market due to poor price planning. Pricing a   product or service too high or too low might be a killer of the product or service depending on the fundamentals of the market. Never plan to price too low to prevent poor product branding, so that your offerings are perceived to be too cheap, also never price too high, not to be perceived as too costly and unfriendly.

An effective road to market (RTM) must consider brand image and perception, what kind of product do you want to be perceived as in your market? Once again, the SMEs operators believe that it’s only the Big Players in the market that can consider branding their gods or services, but that not the case, as simple as choosing appropriate colors for your wrappers and designing a simple and catchy logo can win you the heart of prospective customers, asides from the look and feel, branding also consist of the experience of the customer when they engage your brand, do you project care, safety, value for money etc., these are some of the types feelings customer will like to experience when they use your product of engage your service.

SMEs owners do not need to break the bank to project this qualities, but they need to be aware of these brand elements and make a conscious effort in creating them for their brand. We can take a cue from the big brands of today, they all started out as small brands with little budget and no brand equity, but through conscious and tenacious effort they were able to establish their brand presence in the market place.

Branding for SMEs is a Marathon and not a Sprint, SME owners should not expect their brands to enter the market place and become a market leader overnight, any brand that enters a market and become an instant success, should be careful, except the aim of the promoters is just to enter the market and distort it and get killed, or they want to enter and get out immediately. Sudden brand Success is the neighbor to Sudden Brand failure!!!! Branding takes a gestation period and SMEs operators should learn to grow their brand organically.

Promotional Activities are necessary for any Road To Market Activity, consumers love free bees and they are always ready to buy one and get one free!!! SMEs  business owners should factors free samples and gift into their budgeting, Sales Promotional activities are one of the most effective strategies in entering any market, both Virgin markets and Saturated Markets, consumers are always looking for free promotional initiatives that will allow them save money and add value to their daily living.

SMEs need to understand the types of promotional strategies that will work for their product and services. They need to understand the size of the market dynamics of their target market segment, so they can know the appropriate promotional activity to deploy, this is not Rocket Science but just market intelligence.

Promotional Activities give consumers the opportunity to try out your product for free or at minimum cost, and this singular act might be the begging of a long term relationship. Promotion Activities for Road To Market should not be seen as a sales push strategy in entirety, but should be perceived as an activity to gauge the market and push for acceptability of the product.

Mechanism for Measuring return on Investment is necessary in developing a Road To Market strategy for SMEs, because you need to know how you are faring at every stage of the RTM strategy. As much as it should not be hasty, there is the need to keep your eye on the bottom line and keep your return on investment in focus, whilst developing your RTM initiatives.

For SMEs to enter the market successfully, they need to STAY ON THEIR LANE!

Dada is an SME specialist with a Nigerian Bank, where he oversees Capacity Building Initiatives and Intervention Funds for SMEs, he can be reached on [email protected] or 09090656935