Marketing Basics for Business Students
October 06, 2023
By Konstantine Kharchilava
You want to have superpowers, right?
Yes, yes you do. There is no getting away from it. Nevertheless, you don’t have any …
Why am I asking you this question then? Well, you are a business student if you are reading this. And what is the first step of building a business? Don’t think too hard. It’s to get an idea of what your business will do. What you will sell, offer, etc. Right? Of course! Now you are probably wondering what marketing has to do with this … and you’d be right to think so. Let me explain.
As a businessman you need to sell. The more money you want to earn, the more you need to sell. Pretty self-explanatory. Now to sell, you need to find buyers, thus, you need to do marketing. The more you want to sell … No! Not more marketing, better marketing. So now you agree with me that marketing is important. Let’s explain how marketing is going to give you business superpowers.
How to always know if the idea is good or not?
First of all … You have to solve a problem. If you just think an idea is cool but there is no inherent problem it solves -- it is bound to fail miserably. Yes, I would love to invest $500,000 to open a really nice jazz club and spend every evening of mine there like a mafia boss, but if there is nobody in my city yearning for such a place then I would just waste half a million without seeing any returns.
Now if you are interested in technology in some way shape or form you have probably seen a lot of companies with really cool and interesting products fail (it doesn’t only apply to tech or small companies, but it’s the most obvious there). Why? Because they didn’t think about marketing first. To know if your business idea is good, you should not only think about the product, the finances and everything that comes to mind when you hear the words “business idea.” You should think about marketing first. After all, you can have a wonderful product, but if your marketing is even a bit off … it will probably not work for a long time.
Before we go any deeper, let’s outline what we are going to be discussing next. This article is going to be a very basic outline of marketing, however it will give you a good base to work from:
- Size matters
- Solve rich people problems
- Oblivious readers
- How to think
- Size matters
I’m talking about market size. Look at your new idea. Now look at a person you imagine buying your product or service. What are the main characteristics of this person? OK. How many of them are there? A simple google search can give you the answer. It should be a lot, because you most likely will not sell the whole market, or even 20% of it. Is it a lot? Good.
What if it isn’t? Not to worry. There is a trick called positioning. Now we are getting into actual marketing. If your market size is not that big, you can do a simple trick of utilizing positioning. You have two options: niching up or niching down …
If you niche up, you need to sacrifice some of your initial customer base. You can’t be a “geeky” new company anymore, you need to appeal to more people, thus being less geeky. Let’s look at any software company. They start with a solution to a very specific problem someone had. But to sell a product to the masses and make proper amounts of money they had to expand their feature set just a bit (don’t go overboard with it or you will lose your uniqueness and your whole market) to sell software that is useful to a bit more people, that stays true to its origins while still solving the initial problem as a main unique selling proposition.
If you niche down you need to get more geeky, more specific, better. In this case you have a smaller market size, but you also have customers with very specific problems who are willing to give up more money to solve them. Let’s take a look at a more “niche” example … Apple’s latest Mac Pro. It is a computer that starts at $7,000 U.S. Compared to their $2,000 U.S. Mac Studio, the only difference is the ability to connect very specific high-cost movie production accessories. An average consumer is not going to buy this, but one that does movie production will fork over the $5,000 U.S. extra without thinking much about it. That’s because his problem is more specific, and not solving it will cost him more than the extra price he has to pay.
Now that we dealt with market size, let’s move further.
Solve rich people problems
If you think that you need to sell to a lot of people -- you are wrong. You only need to do that if your product is cheap. But let’s imagine that you want to sell heated driveways (the ones that melt the snow during winter). This is an expensive procedure, costing thousands of dollars. And only a few rich people can afford it. But unless you live in the middle of nowhere -- they exist. And now you just need to sell to them, and you don’t need hundreds of customers just to make a living. This is also similar to the “Apple Mac Pro” example.
Every time (yes, every single one) when a marketing campaign fails, it’s all due to positioning (unless you have a terrible product and don’t solve any problems). Wanna know how to not fail with it? Read carefully and remember what I say further.
When you think about positioning, you need to know two things: Awareness and Sophistication levels. I recommend every businessman reads these two books:
- "Breakthrough Advertising" by Eugene Schwartz
- "Great Leads" by Michael Masterson
They have been written by marketers who drove billions of dollars in sales over decades, and they dissect every topic inside of these books masterfully. They will teach you almost everything you need to know about advertising. These are truly must-reads for anyone who wants to sell a lot.
Awareness levels. What does it mean? Simple. How much your market knows about its problems. There are five of these levels:
- Unaware (they are oblivious to their problems)
- Problem aware (they know they have a problem)
- Solution aware (they know there is help out there somewhere)
- Product aware (they know about you)
- Most aware (returning buyers)
As for sophistication levels:
- First to market (you can make a simple offer)
- Not first to market (make your offer better than others)
- New mechanisms (you can’t make the same offer and need to find a new “mechanism” to sell, like a new feature or just a way to position it differently)
- Best of new (gight for the best one of the new mechanisms)
- Oversaturated (the market has seen way to many offers and mechanisms. To sell here you have to craft a story to make a person engage with you)
I won’t go any more in depth about them, as just knowing about these levels and remembering they exist already positions your mind in a better way to think about your customers. So when thinking about your business idea, take a moment to assess it from a positioning point of view. Can you position it in a way that is going to sell?
This is also the reason every “HORECA” (hotels, restaurants, cafes) place has a certain theme. Without it they can’t position themselves differently to others or even pick a niche. They also assess if people in the area are interested in such a theme. Some areas are more interested in fast food, some in upscale European dining, some prefer national dishes. If you see that there is no place for your idea in the market -- try adapting it toward niches that are already there, and then position yourself a bit differently to stand out.
How to think
Yes. Think. There are no shortcuts. No copying others. No templates. You have to think. Position yourself properly with your customers and figure out what to do next.
Back to your idea. Right … that’s where we started.
You now know the basics of positioning any product. Look at your business idea. Can you position it properly to not die off quickly? Can you even market it or do you need to adjust it? How can you turn it into something worth marketing? Keep asking yourself these questions. Think.
By learning to think you will learn to identify opportunities (or when there are none) or even create them out of thin air. You will be able to turn bad ideas into good ones, turn good ideas into great ones and see the forces of the public that drive markets in different directions. Truly a superpower for a businessman.
There are many other things that go into building a business, of course. If you choose a business course at Webster University, it will provide you with all the valuable knowledge that you will need as a businessman. Our professors are skilled and highly educated in their fields. So if you are in Tbilisi, don’t miss out on on an opportunity to get a proper American diploma without leaving the country of Georgia, and get opportunities to travel and study the USA, Europe and other countries without trouble.
Good luck on your journey!