To truly run your business well, you must master online marketing. Stone does a nice job in this article of showing the difference between true online marketing, or simply promoting. |
Understanding
the Difference Between Marketing and Promotion
By, Stone Evans
Are you an online marketer? Or do you simply
promote affiliate programs? Marketing is truly the most misunderstood word in
use today on the Internet. Let me see if I can clarify this issue
just a bit.
In Marketing 101 at your local university,
marketing is actually the process of Product, Place, Price
and Promotion.
PRODUCT
No business can exist without a product or
service to sell.
In a nutshell, entrepreneurs are the people who
believe in a product, service or idea, so much that they
are willing to invest their lives into the development of
their dream.
Historically, every major corporation in the
world was started by an entrepreneur with a dream and the
drive to make it a reality.
However, there comes a time in the life of every
corporation when those who fear the gambling nature of
their founder, squash the entrepreneurial drive that made
the company a viable concern in the first place. The
entrepreneur will either submit to the careful nature of
the stockholders, or he will be forced to leave the
company he created.
The only entrepreneurs who withstand the
pressure to move more carefully are those who have
maintained majority control over their companies.
PLACE
In the offline world, place is defined by
location. On the Internet, place is defined by domain name
and the web hosting service chosen.
Both online and offline, place can make or break
a company without respect to the quality and value of the
product, service or idea.
PRICE
Selecting a price is determined first on a basis
of whether the company wants to be seen as a discount or a
value company.
Take for example Wal-Mart and Staples.
Wal-Mart is the lead discounter in the
marketplace. Staples on the other hand is the specialist
in office supplies.
Both sell a significant number of office
supplies despite the fact that the lowest price can
usually be found at Wal-Mart. As a value dealer, Staples
can afford to charge more for their products than
Wal-Mart.
So the question for you is whether you want to
position your company as a discount or value company.
Testing has shown that products and services can
be sold at any number of prices and still reach a
significant number of people.
The challenge of selecting the best price for
your product or service will require a certain amount of
testing.
UNDERSTANDING THE
PRICING EQUATION
Let's assume we are selling a product. Let us
also assume that we know that the product can be sold for
$10 or $50. Let us also assume that if the price dips
below $10 or rises above $50, then the product sales fall
off significantly.
Our challenge is to determine the best rate at
which to sell our product.
Testing has shown us that we can sell 1000 items
a week at $10. Testing has also shown that we can sell 500
items per week at $50. And testing has shown that we can
sell 650 items per week at $45.
At $10, our projected weekly earnings are
$10,000. When we sell the product at $50, we know that we
can earn $25,000 per week. Most importantly, we know that
we can earn $29,250 when our product is priced at $45.
With the imaginary testing we have done on our
imaginary product, we can easily see that selling our
product at $45 per item will earn us more money over the
long haul.
Thus, when we make the decision for a national
rollout of our product, then we will price our product at
$45.
Of course, this is a very simplistic analysis of
the point I am trying to make. Though simple, I believe
this analogy will help you understand the methods of
developing a product's prices.
PROMOTION
Promotion, on the other hand, is the process of
notifying the consumers for your product or service of
your availability to serve them.
Methods of promotion vary distinctly and should
be arranged to meet very specific goals.
As with product, place and price, promotion
should not be left to chance. You should test every ad,
every media, and every price point to determine the best
bang for your promotional dollars.
HEADS UP!
If you are an online promoter or marketer,
please factor in the most important element concerning the
cost of your promotions.
What element is that? Your time!
Value your time at a certain dollar amount, and
figure in your time into the cost of your promotional
accounting.
I say this because too many online promoters
lose sight of this concept and spend 20 hours to generate
one sale while using free advertising. Even if you rate
your time at the federal minimum wage, then you will have
invested $105 of your time for one sale that might only
net you a gross sale of $45!
ARE YOU TRULY A
MARKETER OR ARE YOU JUST A PROMOTER?
Most people who run a business on the Internet
call themselves marketers. Yet, most of these same people
are really just promoters wrapped in the label of a
marketer.
True marketers do not promote without a lot of
advance work. They spend time planning, testing and
measuring their actions and results to get the most out of
every dollar spent and earned.
Entrepreneurs finesse the art of marketing as
they build their company into a major enterprise.
If you are a promoter who does not keep an eye
on the total marketing equation, then you are bound to
fail.
If you do call yourself a marketer, then do what
a professional marketer does. Make sure that every dollar
spent is spent well. Make sure that every dollar earned is
put to good use. Market well so that when the people of
the next generation look at your life, they will see a
fine example of a successful entrepreneur that they will
strive to emulate.
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Stone Evans owns the "Home Business Resource
Directory" where
you can find everything you'll ever need to start, run and
grow
a home business at: http://www.Home-Business.com
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Pay-Per-Click Search Engines
By, Marlon Sanders
Promotion Techniques
By, Lori Redfield
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