Marketing Strategy for SMEs: Where to Start
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Ask an SME owner about their marketing strategy and you will usually hear a list of activities: "We do LinkedIn, we send a newsletter, and we're thinking about Google Ads." Those are tactics. A strategy is the set of choices that tells you which tactics to use, who they are aimed at and what they are meant to achieve. Without it, marketing turns into a series of reasonable-sounding experiments that never quite add up.
The good news is that a useful marketing strategy for a small or medium-sized business does not need to be long. Most of the ones that work fit on two or three pages. What they need is honest answers to a handful of questions, asked in the right order.
It is worth the effort. According to the government's business population estimates, there were around 5.7 million private sector businesses in the UK at the start of 2025, and more than 99% of them were SMEs. Most compete with firms that look broadly similar to a customer. Strategy is how you stop looking similar.
1. Start With the Business, Not the Marketing
What does the business need marketing to do?
Marketing strategy follows business strategy. Before thinking about channels, be clear on what the business is trying to achieve over the next two or three years. "More revenue" is not specific enough. Is the aim growth from existing customers, a new region, a new service, better margins, or less dependence on one large client? Each of those needs different marketing.
Then look at the numbers you already have. Which customers, products or services generate the most gross profit? How do most new customers find you today? Roughly what is a typical customer worth over the time they stay with you? You do not need perfect data. A spreadsheet built from your accounts and invoices will usually tell you a lot, and it is common to find that a minority of customers produce most of the profit while the marketing has been aimed somewhere else.
2. Understand Your Customers Properly
Talk to them, not about them
The most useful research an SME can do is also the cheapest: talk to customers. Pick eight or ten good ones, a few recent ones and, if you can, a couple you lost. Ask why they chose you, what nearly stopped them, who else they considered, and how they would describe the problem you solve.
Listen carefully to the language. Customers rarely describe a business the way its website does. If three customers independently say "they actually turn up when they say they will", that tells you more about your position in the market than any brainstorm.
It also helps to think about the moments when someone starts looking for what you sell. Researchers at the Ehrenberg-Bass Institute call these "category entry points". For a commercial cleaning firm they might be a move to new offices, a poor inspection or a facilities manager who has simply had enough of the current supplier. Knowing those moments tells you where, when and how to be visible.
3. Choose a Position You Can Defend
Why should anyone pick you?
Positioning is the choice of where you sit in the customer's mind relative to the alternatives. For most SMEs it comes from a combination of who you serve, what you are especially good at and how you work.
A useful test is to complete one sentence: "For [target customer] who [need], we [what you do], unlike [main alternative], because [evidence]." If the finished sentence could describe three of your competitors, it is not finished. Do not be afraid to narrow your focus. Specialising in a sector or type of work usually makes marketing easier rather than harder, because the message is sharper and you know where your customers gather.
Be wary of positioning on price unless you have a genuine cost advantage. Someone can almost always undercut you, and customers won on price tend to be the first to leave when a cheaper offer comes along.
4. Set Objectives You Can Measure
Keep it to a handful
Turn the business goals into a small number of marketing objectives. Good ones are specific and tied to commercial results. "Win a dozen new clients in our chosen sector at or above our current average order value" is far more useful than "raise awareness", because you can tell whether it has happened.
Alongside those outcome measures, choose two or three leading indicators you can check each month, such as qualified enquiries, quotes issued or repeat orders. They give you early warning of whether the plan is working, long before the year-end accounts do.
5. Pick a Few Channels and Do Them Properly
Depth beats breadth
Only now is it time to talk about tactics. With a clear customer, position and objective, the channel decision is usually easier than expected. Where do your best customers already spend their attention? Where do they go when one of those entry points comes up?
For a B2B firm the answer might be a mix of direct outreach, a well-structured website that ranks for the problems you solve, a few carefully chosen trade events and a regular email to past and prospective clients. For a local consumer business it might be a well-maintained Google Business Profile, local search, referrals and a visible presence in the community that keeps the name familiar.
Two principles apply almost everywhere. First, look after the customers you already have; repeat business and referrals are usually the cheapest growth available. Second, do not abandon brand building in favour of short-term promotions. Research by Les Binet and Peter Field for the IPA found that, on average, campaigns combining longer-term brand building with short-term activation outperformed those focused on activation alone. The right balance varies by sector, but the principle holds for small firms as much as large ones.
6. Set a Budget and a Calendar
Make it something you will actually do
There is no correct percentage of turnover to spend on marketing; it depends on your sector, your margins and your ambitions. A more practical approach is to estimate what a new customer is worth in gross profit, how many new customers you need, and what you can sensibly afford to spend to win each one. That gives you a defensible starting budget, which you can adjust as real results come in.
Then put the plan into a calendar. A plan that lists "content marketing" without saying who writes what, and by when, tends not to happen. Give each activity an owner and a review date. For most SMEs, a 30-minute monthly look at the numbers and a fuller quarterly review is plenty.
Common Mistakes to Avoid
- Copying the competition. If you market like everyone else in your sector, you will look like everyone else.
- Changing direction every few weeks. Most marketing takes months to work. Give a plan a fair trial before judging it.
- Outsourcing the thinking. Agencies and freelancers can do excellent work, but they need a clear brief. The strategy should belong to the business.
- Measuring only what is easy. Likes and impressions are easy to count; enquiries, orders and profit matter far more.
Where to Go From Here
Work through these steps and you will have the bones of a marketing strategy: a clear business goal, the customers who matter most, a reason for them to choose you, measurable objectives and a short list of channels to focus on. It does not need to be polished. It needs to be clear enough that everyone involved understands it, and honest enough to act on.
If you would like a second opinion, our marketing consultancy for Lancashire SMEs starts with exactly this kind of review. If the marketing questions turn out to be part of a wider growth issue, our business consultants in Preston can help with that too, and owners who want regular support while they put a plan into practice often choose business mentoring.
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