?SME is a phrase commonly used amongst business marketing executives to refer to
Small medium enterprises. The definition of small medium enterprises can vary
considerably from company to company. In general, small enterprises refers to
companies that may have fewer than ten employees or under five million in revenue.
The term medium enterprises will typically refer to companies employing less than
500 employees and having revenues no greater than twenty-five million annually.
These terms will vary considerably, but the above figures can be used as an overall
benchmark. What is truly of importance is to understand how large companies attempt
to market their products and services to this market. The sme channel represents a
large and relatively untapped market that attracts the attention of Fortune 1000 and
large companies. On its surface, it appears to be an easy target, but most find it the
most challenging and difficult market to truly penetrate.
The challenge of marketing to small medium enterprises lays in the fact that most
large company marketing and product departments treat the market as if its one
market. In reality, the sme channel is composed of numerous fragmented sub markets.
Marketing departments that are accustomed to marketing to the government sales
channel, large enterprise channel, or even retail sales channel, can comfortably use a
uniform set of products or services to deliver to their respective customers. However,
the sme channel is not as simple because of its diversity. For example, not all retailers
in the small medium enterprises channel are equal. A restaurant, dry cleaner company,
flower shop, and shoe repair store have distinctly different needs in terms of the
products and services they purchase. Thats only one of many verticals and each
vertical within the sme channel has its own set of differences.
This level of diversity is often overwhelming to marketing and product departments as
they are used to directing a homogenous product or service to a large group. When
they realize the complex nature of this channel, they will often engage the services of
a small medium enterprises consulting company. It is the consultants job to help large
companies navigate this complex channel. The ultimate goal is to help the company
drive more incremental revenue as a result of these sme customers purchasing more
products or services.
One of the most common recommendations to large companies attempting to market
to small medium enterprises is for the organization to attack the market in a two prong
manner. The first approach is to find a broad product that is applicable and will
potentially be purchased across various vertical markets within the sme channel. An
example of this may be to sell search engine optimization services or email marketing
campaign platform software. These are items that are applicable to a wide number of
verticals. The second approach is to find specific products that are only applicable to
very specific verticals or companies within a vertical. An example here may be to sell
neon signs that will be purchased by retailers or by restaurants within the retails
vertical market. The consulting firm will typically recommend that both approaches
be taken concurrently.