Hummingbird Creative Group was founded in 1995. It’s a full-service branding agency that helps local, national, and international companies in entering and succeeding in a chosen market.
Dan Gregory, Vice President and General Manager of Hummingbird Creative Group in Cary, NC shared the insights into target marketing and positioning of a product or a service on the market.
What should an entrepreneur look for when selecting an agency?
One of the first things that entrepreneurs need to think about is where are they in the business process? Are they in start-up mode? Are they in maintenance mode? Are they in a transition? A lot of it is going to depend on where that business is in their cycle. The second thing they’re going to need to look at is what expertise do they need.
If I’m an entrepreneur looking for an agency, I want to have an agency that understands pretty much business 101. What is it that I’m trying to accomplish? Who’s my target market? What are my key messages? Then help me build and sustain a brand because, when the day comes that I want somebody to either buy my business or I sell my business, I want to move on, it’s one thing to have a business that’s transaction based, “I did this much revenue,” but if I have value beyond my brand, then I can get a premium for my business. When I’m looking for an agency, I want someone that has that business acumen experience and the ability to think strategically but respond to the tactics – whatever that may be.
To you question, “How do you find them,” first of all, you’re talking to other business owners and people that they use, and you’re searching the web. Then you’re validating. You decide you have a need; that discovery piece. The awareness. Usually, there’s a network of people that you’re associated with or that you collaborate in sales with, so you’ll talk to them, you’ll do your research on the web, and then you’ll begin to have conversations.
When should an entrepreneur start a marketing campaign for his, not yet operating, company business?
It depends on the kind of business and what the need is. If it’s like a retail shop opening up a business, then there’s prior to going into business, you want to build some energy, some excitement, talk about the grand opening and do all those kinds of things. That would be an earlier onset of what I would call marketing. In some cases, most business probably should get or have some kind of brand consulting in the beginning. From a campaign development perspective, they need to be able to deliver the campaign. If you go too early, you may generate interest but not be able to deliver, or deliver the way that you want to deliver. Then your brand suffers from it.
It’s kind of like a new restaurant goes into town, comes in, and for the first two or three weeks, it’s kind of hit and miss. Service is hit and miss; the food is hit and miss; so they have to be careful that they don’t get a reputation of, “Oh, the food is cold,” or, “the service is disorganized,” because they’re getting started. You have to offset that with some kind of intensive for the customer to go through that experience otherwise, if you’re charging a premium price and talking about a premium service and you don’t deliver against that, then your reputation or your brand takes a hit as far as in the community.
The campaign has to come along with the organization’s ability to deliver against it. We don’t want to run too terribly fast, or we’ll put our brand at disadvantage.
Based on your experience, are there types of advertising that work more efficient than others to reach the target market?
There are different kinds of advertising that can target demographics better than others. Like Facebook for example; you can get age bracket, gender, all these kinds of things through that medium. If your product or service is very specific to a target market, an advertising campaign that can identify those components of that target market serves you best. There’s not necessarily a silver bullet, one thing fits. Used to, back where I started my career, the talk was three to five messages would get you a conversion. That number today is anywhere between seven and sixteen messages before you get a specific sales opportunity. As a whole, the public has been desensitized to marketing messages that were very dismissive about them. They don’t register.
It’s more about frequency to the right target market with the right message, and that can be on a billboard and be just as effective as Facebook depending on what it is that you have to offer. That’s where, whenever you look at an agency, you need to make sure that they get that nuance. There’re people all over Facebook, and Google, and everything else, but there are other places too. We don’t want to forget about them. Even word of mouth, creating campaigns and experiences that help refer a friend and word of mouth; very, very powerful marketing tools and ways to promote businesses especially small businesses that are geographically based, but we don’t want to loose sight of the old school things.
What is the minimal budget an entrepreneur has to put to market his company?
From my school days, it was seven percent of revenue; was the number that we generally used when we’re talking about setting aside a marketing budget. The way that I look at it is, typically, on any product or service, there’s what we would call a thirty percent cost of sale. That includes things like the advertising and marketing, sales commissions, all that sales administration, contracting; all that comes into play. When you talk about specific medium like a Pay Per Click campaign; Google’s going to tell you, “You need to spend fifteen hundred dollars a month or six to seven months before you’ll see any kind of return on a Pay Per Click campaign.”
For us, primarily, we tell clients that they need to have about a three-thousand dollar a month spend to make our time effective with their business. That would be a combination of Pay Per Click campaigns, and SEO, and just different things and services that we would be providing in order for that business to get a return on investment sufficient to prime the pump and get things moving. A lot of it just depends on, again, where they are in the business cycle.
I will tell you that a lot of entrepreneurs get caught up in the, “I want to ramp up faster and grow revenue faster, and so I want to spend more money.” The reality is that that doesn’t happen very often. Think of it as a continuum. Businesses need to understand that everything is moving. The market is moving, their business is moving, and there’re different jumping end points. One of the first things that businesses have to realize is that they need time, just time, to mature in the market. It’s going to take five to seven months before a new local business gets all the way through the local directory ecosystems in a market. What that means is that things like Yelp, Best Of The Web, all these local directory kinds of services that help you find things on your phone when you do searches that are geo-tagged and geo-located, all those services kind of feed off each other and it takes quite a bit of time for a business listing to make it through that eco-system.
How long does it take to conduct positioning of a product or service on the market?
If it’s a new business and we’re doing a market research project, I would say six to eight weeks, typically, provided that we have a target market defined. If a business has existing customers but is lacking a direction, usually about three to four weeks. We can do customer interviews and find a common thread like a fault, an, “Ah ha,” that we can leverage and brand to make the needle move as far as sales go. It just really depends on, again, where they are in that process. For the most part, the shortest time frame is going to be four weeks. The longest time frame could be two to three months worth of research. Some can go on, and on, and on. If you’re a big pharmaceutical company, it’s years.
Are there any specific types of business you enjoy working with?
I really enjoy working with businesses in transition. What does that mean? There’s a point when an entrepreneur says, “I can’t do it all, and I want to grow my business,” and then they start looking for subject matter expertise that helps them grow their business to the next level. That, to me, is a dangerous spot because that’s usually when everything goes off the rails if you don’t do it right. With the right planning and the right vision, it’s a way to leapfrog the competition and really change a lot for the business owner, and the employees, and the organization. Tire shops and restaurants and things of that nature get really complicated in that. You have to constantly be coming up with different kind of campaigns, and different offers, and different initiatives all to stay relevant because you don’t just win the day and then stop, or somebody else will come in and eat your lunch, take it or take over. You constantly have to be on the ball with that.
