Marketing & SMEs

1

CURTIN UNIVERSITY

SMALL BUSINESS PLANNING 200

INDIVIDUAL REPORT:

“LATEST RESEARCH AND PRACTICE

OF SMEs IN MARKETING FIELD”

BY

SOOPRAMANIEN SANDINI

Marketing & SMEs

2

EXECUTIVE SUMMARY This report entails the descriptive analysis of the latest research and practice of SMEs in

the marketing field and recommendations for Unity House. Section 1.0 introduces SMEs

and its importance to the economy. Section 2.0 comprises of the business profile of

Unity House and the current marketing strategies to be implemented. Section 3.0

explains broadly the significance of marketing for SMEs and the vital role played by

SMEDA in their success. Section 4.0 states what most researchers found to be the

ultimate marketing tool driving the success of small businesses. Section 5.0 gives a

detailed analysis of the hypotheses made by marketing experts related to the market of

Unity House. The marketing experts are Mr Khodabacus, Marketing and

Communications Manager for various small hotels and Mr Permal, owner of small

apartments. Two of these sections involve affiliate and digital marketing strategies. The

third section being 5.3 illustrates the information acquired through a sample survey

whereby two types of advertising were mostly used. Section 6.0 comprises of Mauritian

statistics whereby the Republic of Mauritius has recently decided to give SMEs more

support and subsidies in their marketing practices. Section 7.0 concludes stating the

emerging importance of digital marketing to SMEs due to their lack of finance.

Furthermore, it is seen that is the key to internationalization and desired visibility.

Section 8.0 outlines the recommendations by marketing experts, the chosen student and

a founder of an online newspaper. Prior to the appendix, the list of experts can be seen

in section 9.0.

Marketing & SMEs

3

TABLE OF CONTENTS

1.0 INTRODUCTION ......................................................................................................................................................... 4

2.0 UNITY HOUSE ............................................................................................................................................................. 4

2.1 DESCRIPTION OF UNITY HOUSE ................................................................................................................... 4

2.2 CURRENT MARKETING STRATEGIES OF UNITY HOUSE ..................................................................... 4

3.0 IMPORTANCE OF MARKETING FOR MAURITIAN SMEs AND SMEDA ................................................ 5

4.0 RECENT RESEARCH ON MARKETING SMEs .................................................................................................. 5

5.0 RECENT PRACTICES ................................................................................................................................................ 6

5.1 MARKETING EXPERT’S HYPOTHESIS.......................................................................................................... 6

5.1.1 AFFILIATE MARKETING ........................................................................................................................... 6

5.1.2 DIGITAL MARKETING ................................................................................................................................ 6

5.1.3 CUSTOMERS’ PERSPECTIVE .................................................................................................................... 6

6.0 MAURITIAN STATISTICS........................................................................................................................................ 6

7.0 CONCLUSIONS ............................................................................................................................................................ 7

8.0 RECOMMENDATIONS.............................................................................................................................................. 7

8.1 MARKETING AND COMMUNICATIONS MANAGER FOR SMALL HOTELS .................................... 7

8.2 OWNER OF SMALL APPARTMENTS ............................................................................................................. 7

8.3 CUSTOMER- FOREIGN STUDENT .................................................................................................................. 8

8.4 OWNER/FOUNDER OF ONLINE NEWSPAPER ......................................................................................... 8

9.0 LIST OF EXPERTS AND CUSTOMERS CONSULTED ..................................................................................... 9

10.0 REFERENCE LIST ................................................................................................................................................. 10

APPENDIX

Marketing & SMEs

4

1.0 INTRODUCTION Small and Medium Enterprises (SME) can be defined differently depending on the

diverse legalities of countries. This is due to the variances in the culture and economic

activity of countries around the globe and whether they are considered developed,

under-developed or developing ones (Cant 2012, 1107). According to Mauritian

Statistics, SMEs contributes up to 46 percent of total employment, 37 percent GDP with

a production output of 120 billion thus a backbone of the economy (Teeluckdharry

2013). Mauritius is categorised as a developed country with a unique set of criteria

established for SMEs. In Mauritian context, small and medium enterprises are defined

differently as small enterprises are expected to have an annual turnover not exceeding

10 million MUR whereas medium enterprises’ varies from 10 to 50 million MUR

(Industrial and SME strategic plan 2010-2013, 3). This report analyses the recent

practical study and successful practices on the marketing strategies of SMEs in

Mauritius and gives recommendations to UH on how to successfully reach its targeted

market. Indeed Mr Jim Seetaram has said that SMEs plays a crucial role in government

sustaining efforts in overcoming socioeconomic disparities (Le Roy 2013).

2.0 UNITY HOUSE

2.1 DESCRIPTION OF UNITY HOUSE

Unity House (UH) is a newly formed SME created by four partners. The idea behind it is

to close the gap between the increasing amount of foreign students and the high

demand of housing arrangements for them. UH strives to heighten the daily life of its

students by its strongest tool being the family atmosphere and the high quality services.

It’s a step to changing our world’s future as good study atmosphere has an impact on

student’s performance. And as we all know, students of this generation will be

tomorrow’s future. The building is situated in Ebene accommodating around 75

students. It is surrounded by countless facilities such as supermarkets, bus stops,

shopping malls and many more. The in house amenities as well are indeed appealing

including the student services, Wi-Fi, security and cleaning services, two kitchens, a TV

and playing room being some of them. Undeniably, marketing plays a vital role in the

success of UH as there is a strong link between UH’s survival and marketing strategies.

2.2 CURRENT MARKETING STRATEGIES OF UNITY HOUSE

UH seeks to benefit from a Niche competitive advantage since it is new on the market

targeting a single segment of the market (Lamb, Hair and McDaniel 2013). The target

market here is foreign students mostly from the age of 18 to 24 years old with an

affluent social background. The promotional strategies to be used would be via social

and digital media as well as leaflets in Universities. Price can be a determining factor

and drive customers towards the service or away from it thus should be well set. The

price set for one student would be 10000 MUR. The place where UH is situated is at

Ebene Cybercity.

Marketing & SMEs

5

3.0 IMPORTANCE OF MARKETING FOR MAURITIAN SMEs AND SMEDA "Small organizations waste so much time and money on 'random acts of marketing' that

get them nowhere, so more budget is not the answer,"

(“PR Newswire” 2014)

Ross argues that SMEs have to be smart in marketing their service. Indeed this applies

to all countries including Mauritius. They have to implement an effective brand strategy

that conveys the right message at the right time to the right people and this is done by

only a few effective strategies. Ross believes that marketing is the key to the stimulation

of small business growth. Indeed SMEs normally need the support of others thus one of

its main pioneers being SMEDA (Small and medium Enterprises Development

Authority) founded in 1998 (SMEDA 2014). In fact, SMEDA strives to increase the

competitiveness of SMEs and help them to face globalisation challenges. Undeniably,

SMEDA have been actively participating in the marketing development of SMEs by

opening an online platform to facilitate interaction and act as a competitive advantage

(Livecomm 2013). Moreover, it has also launched an open day from 20 to 22 june in

order to promote B2B activities (Le Roy 2013). SMEDA might be the UH first step to

market its services. UH would need to firstly acknowledge the strong correlation

between marketing and business performance in order to employ effective marketing

strategies rather that “random acts of marketing.”

4.0 RECENT RESEARCH ON MARKETING SMEs “….while billboards and newspaper ads are still prevalent, advertising is shifting toward

digital media, and experts say small business owners should keep up with that trend.

(Harrison 2014)

Harrison here has been an upsurge of demand in this area for the past few years.

Schwirck (2014, 86) seconds him by saying that Digital Marketing is believed to be

going through revolution and the key to internationalization of SMEs. Business

networking has become extremely influential on the market and as stated by many

researchers the key to globalisation. Social media has been targeting an expansive range

of expected audience together with potential new ones. Email marketing, a completely

free marketing being an effective tool if targeting the right audience. Email marketing

assistance can now be easily managed by ConstantContact, Vertical Response and

iContact (Harrison 2014).

Marketing & SMEs

6

5.0 RECENT PRACTICES

5.1 MARKETING EXPERT’S HYPOTHESIS

5.1.1 AFFILIATE MARKETING

Executive Marketing and Communications Manager and Market Advisor, Mr Samad

Khodabocus is actually marketing various small hotels. He is an expert in the marketing

field as he has 25 years of experience (pers com Mr Khodabocus). As a matter of fact, UH

doesn’t have any direct competitors however small apartments and hotels seems to be

its indirect ones. Affiliate marketing is made through third-party intervention whereby

commission is paid to the affiliate with each sale (Livadas 2014). Mr Samad has been

successfully gaining from this strategy. He affiliates the hotels with restaurants and tour

agencies to increase their visibility. He believes that the return on investment was

significantly higher thus offsetting the commission fees.

5.1.2 DIGITAL MARKETING

Mr Jean Marc Permal is the owner of small apartments and a senior Partner at Island

Administrators (pers com Mr Permal). He was interviewed on how he was advertising

his apartments and how much was the costs. His organisation is currently on

sharepoint.org and Lexpressproperty.com and admits that it is a flourishing strategy

with a good Return On Investment. He believes that an online marketing is effective in

his field as well as UH since the target market comprises mostly of international clients.

Undeniable

5.1.3 CUSTOMERS’ PERSPECTIVE

A survey was done with seven international students asking them to give the types of

marketing strategies appealing to them when they were in search of housing

arrangements during the two years they were here. As seen in the table, digital

marketing and Nepal agencies were the ones mostly suggested (See Appendix). Gokarna

Neupane is one of the students who elaborated more on why he was appealed to a

particular marketing strategy later on and what he would recommend UH to implement.

He talks on behalf of all Nepal students saying:

“ We had a really hard time figuring for a place to live and we have been shifting from one

place to another…this has not been one of our good experiences in Mauritius…..We wished

we had a place like Unity House….”

6.0 MAURITIAN STATISTICS The 2014 Budget specifies that SMEs would now be subsidised by 50 percent if website

systems cost more than 6000 MUR. Additionally a free website with the fundamentals

will also be offered to all SMEs for an enhanced presence and visibility on the market.

This initiative will act as an effective as well as efficient tool for UH (Grant Thornton

2013). Costs are low thus more financing would be based on other advertising methods

such as covering the costs of pamphlets.

Marketing & SMEs

7

7.0 CONCLUSIONS

In the light of the latest research and practices, it can be seen that digital marketing

seems to overtake all other types of marketing. Technology is advancing at a speeding

rate and SMEs should stay in the race if they want to survive successfully. As a matter of

fact, cost efficient marketing strategies such as digital, social media, viral and email

marketing are proposed to them due to their lack of finance. The Mauritian statistics

have proven that the economy is doing what they can to fully support them as seen with

the advantage of free website management system. SMEDA is continuously striving to

increase SMEs competitiveness by facilitating their marketing endeavours. The small

sample survey done also shows the types of mostly appealed strategies arised during

the past two years.

8.0 RECOMMENDATIONS

8.1 MARKETING AND COMMUNICATIONS MANAGER FOR SMALL HOTELS

Mr Khodabocus recommends that UH affiliates with University bodies in order to

market its services and pays the organisation a mutually agreed amount on each

student sent. This is so as the staff would be showing the pamphlet to the enrolling

students. It might be a win-win situation as the University would be giving one more

benefit to the newcomers. It will also impact greatly on the existing students as well

thus enlarging the market. Pamphlets and Posters would be made to advertise in the

institutes. According to Mr Hansvy Hurrynundon ,chief maintenance in Happy Rajah

Indian Restaurant cost of pamphlets would be 1 MUR each and Posters at 250 MUR each

at Northern Printing Limited (pers com Mr Hurrynundon). UH could put 1 poster per

university in order to regulate cost. This would increase the demand for UH significantly

as the distribution strategy reaches directly UH’s targeted market.

8.2 OWNER OF SMALL APPARTMENTS

His expertise in the field advises UH to incorporate internet marketing as one of the

main marketing strategies. The first strategy advised by Mr Permal would be to

reference UH on domestic as well as international property website such as

Lexpressproperty.com, Hostelbookers.com, TripAdvisor.com, Buildium.com,

AppartmentSearch.com, sharepoint.org and many more. This strategy is very cost-

efficient and reaches for the target market since foreign students are more technology

oriented nowadays. Some are completely free while registration and then paid a

commission fee of 10-15 % upon each finalized contract like HostelBookers.com. Some

have a registration fee of 50 MUR-300 MUR and no payment hereafter. Some indeed

comprises of both fees altogether and these might be the most effective one like

TripAdvisor.com. Constant management of these websites would enable UH to strive for

a long term sustainable success domestically as well as internationally. Also, he

recommends social media such as Facebook in order to make students aware since this

Marketing & SMEs

8

is their preferred platform. This online platform should be used fully by any SMEs in

order to make it their competitive advantage.

8.3 CUSTOMER- FOREIGN STUDENT

Gokarna Neupane recommends UH to use digital marketing which is one of the most

effective strategy since most students would google Mauritius before coming and if

referenced well UH might already be known to them in Nepal itself. Secondly, he

recommends UH contacting foreign agencies sending students to Mauritius and making

them their affiliate. This might encourage more students to come to Mauritius as UH not

only market its service but also its united family atmosphere. Thirdly, he points out that

posters and pamphlets in Nepal Agencies and Universities will eventually make a

significant impact on the students.

8.4 OWNER/FOUNDER OF ONLINE NEWSPAPER

Mr Jean Claude Le Roy is the founder of the online newspaper Maurice-Info.mu and is

renowned for its great visibility and one of the first to be appeared in search engines

(pers com Mr Le Roy). He has recommended putting a detailed article on the in-house

amenities as well as pictures of UH. This would enhance UH’s profile as a tab would be

created in the name of student’s housing arrangements. This would cost 5000 MUR one

shot for a long term basis.

Marketing & SMEs

9

9.0 LIST OF EXPERTS AND CUSTOMERS CONSULTED

Hurrynundon, Hansvy. Chief maintenance Officer was contacted for the costs of

pamphlets and posters on 10th May 2014.

Tel: 5739 0516

Khodabocus, Samad. Marketing and Communications Manager for various SMEs has

been consulted on 10th May 2014 to enquire about the type and cost of

advertising Tel: 5762 3195 Email: samad.khodabocus@live.com

Le Roy, Jean Claude. Owner/founder/Journalist/Marketing Officer of Maurice-Info.mu

was contacted to publish an article on Unity House on May 10.

Tel: 57117523 Email: jessy@maurice-info.mu

Neupane, Gokarna. Diploma in Tourism and Hospitality at Dimensions International

Education Group. He is a Nepal student interviewed on 6th May 2014 to know

about what type of advertisement appealed more to him while looking for

housing arrangements.

Tel: 5928 5297

Permal, Jean Marc. Owner of apartments in Grand bay as well as a Senior Partner at

Island Administrators: Professional Network of cloud administrators and

Accountants interviewed on 5th May 2014 to know about the costs and type of

marketing used for his apartments

Tel: 265 7786 Email: ida.corporate@outlook.com

Marketing & SMEs

10

10.0 REFERENCE LIST

Harrison J.D. 2014. “Maximising your digital media advertising.” The Washington Post.

April 21.

http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/1517921114?accou

ntid=10382

Industrial and SME strategic Plan 2010-2013. Nurturing Entrepreneurship and moving

towards a technology and Innovation-based Industrial sector : Ministry of

Industry Science and Research and Ministry of Business, Enterprise and

cooperatives.

Lamb Charles, Hair Joseph and McDaniel Carl, 2013. “MKTG: What’s inside” 7th ed.

United States: Nelson Education Ltd.

Le Roy, Jean Claude. 2013. “Jim Seetaram, minister des PME repond a la PNQ d’Alan

Ganoo.” Maurice-Info.mu July 19

http://www.maurice-info.mu/la-reponse-du-minsitre-des-pme-a-la-pnq.html

Livadas, Sheila. 2014. “Affiliate marketing help small firms increase sales.” Rochester

Business Journal. 29(44): 21

http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/1507798129?accou

ntid=10382

Livecomm. 2013. “SMEs shaping the future of Mauritius.” Accessed May 5

http://livecomm.mu/news/smes-shaping-the-future-of-mauritius/

Mauritius SME Portal. 2014. SME definition in Mauritius. Accessed May 5.

http://www.gov.mu/portal/sites/smeportal/smedefmain.htm

Marketing & SMEs

11

Michael Cant. 2012. “Challenges faced by SME’s in South Africa: Are Marketing Skills

Needed.” International Business and Economics Research Journal. 11(10): 1107-

1115

http://www.cluteinstitute.com

“Show Me the...Brand? Key to Stimulating Small Business Growth During Slow Recovery

is Not Just About the Money: Second Edition of Popular Brand Strategy Guide

Shows Small Businesses, Startups and Entrepreneurs How to Make Smarter

Marketing Moves on a Budget.” 2014. PR Newswire, May 5

http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/1511529863?accou

ntid=10382

SMEDA. 2014. About SMEDA. Accessed May 5

http://www.smeda.mu/English/AboutUs/Pages/Mission-and-Vision.aspx

Schwirck, Samantha. 2014. “Go Viral or Go Home.” Lightning Design +Application

44(6):84-87

http://search.proquest.com.dbgw.lis.curtin.edu.au/docview/1520562417?accou

ntid=10382

Teeluckdharry, Guru Dev. 2013. “BUSINESS NETWORKING, MARKETING AND

INDUSTRY ANALYSIS : A Proposed Framework for SMEs in Mauritius.” Le

Mauricien, Aug 21

http://www.lemauricien.com/article/business-networking-marketing-and-

industry-analysis-proposed-framework-smes-mauritius

Thornton, Grant. 2013. “Budget Brief 2014: Looking beyond Usual Horizon” Audit .Tax

.Advisory. Republic Of Mauritus Ebene: Mauritius

Marketing & SMEs

12

APPENDIX

Foreign Nepal Students

Digital Marketing

Leaflets in University

Nepal Agencies

Property Websites

Word of mouth

Newspapers

Renu Khadka

Gokharna Neupane

James Moktan

Anil Shresta

Narayan Poudel

Manoj Kumar

Sahil Sharma