'If you're not on Facebook, you're toast': marketing mantras for SMEs

The idea to provide cheap accomodation for like-minded startup and small business founders came to Vikram Bharati last October. Just three months later, he held a soft launch for the first prototype of Tribe Theory, a new ‘hostel for entrepreneurs’ concept in Singapore, keeping costs down by building everything by hand and relying on his networks to spread the word.

“I basically decided to build a venture through a lean startup methodology, where you have your proof of concept, build a prototype, put it out on the market, test it, learn from it—and do it all fast,” says Bharati, a former venture capitalist with the Reapra Group in Singapore. “That’s the methodology we always teach startups—don’t try to make everything perfect on the first prototype. You need to put something in the market to learn whether or not it is something that customers want or don't want.”

Fortunately, Bharati’s idea turned out to be something people did want—a lot. Three months on from the official launch in March, Tribe Theory has opened three further hostels in Bali and Bangalore, and direct bookings are up 30%—all without Bharati spending a dollar on marketing. The company’s decision to accept bitcoin as a payment option, the first hotel in Singapore and possibly the world to do so, thinks Bharati, has attracted headlines in both regional and international news outlets and word about Tribe Theory is spreading organically via bloggers and social media. Bharati’s long-term plan is to make the concept global, opening hostels in every major city in the world.

The venture is still under a year old and has just seven core staff members at present, but Tribe Theory already has all the makings of an Asian success story. It proves how powerful a good idea implemented by a high-functioning team with a minimal marketing budget can be. The same strategy is being replicated by small businesses across the region. But how many are succeeding?

The state of Asia-Pacific’s SME scene

The definition of what constitutes an SME varies by country and sector, but usually refers to companies with under 100 or under 500 employees (the sheer scale of enterprise in China makes SME definitions there significantly more complex). Several estimates state that SMEs make up around 98% of all businesses in Asia Pacific, employing half of the total workforce. In certain regions they play an even larger role: 99% of businesses in Singapore are SMEs, for instance, employing 70% of the workforce.

The latest CPA Australia Asia-Pacific Small Business Survey, which polled almost 3,000 participants across eight Asian markets (Australia, China, Hong Kong, Indonesia, Malaysia, New Zealand, Singapore and Vietnam) points to various SME trends in the region, some more encouraging than others. Business conditions across APAC were “slightly” more positive for SMEs in 2017 than in 2016 in most markets, with a minor increase in the number of businesses reporting that they grew: these improved conditions were expected to continue this year.

Above: a video released by the UN on June 27, World SME Day, showing women weavers in Nepal

SMEs from Indonesia and Vietnam, which also reported the strongest small business confidence in their local economy, were the most likely to record growth, while their counterparts in Singapore and Australia were the least likely to do so. And businesses that focus on technology, exporting and innovation were “significantly more likely” to have grown in 2017 and expect to grow in 2018, regardless of which market they are operating in, finds the report.

In the face of these somewhat precarious conditions, one of the biggest elements that defines whether a small business will survive or die in 2018 is simply its ability to get itself seen and heard.

Marketing on miniscule budgets

"Mobile and the internet are transforming how small businesses work," says Gilberto Gaeta, head of Google Marketing Solutions for Singapore, Malaysia, Philippines and emerging markets. "It’s never been easier to reach potential customers, but not every small businesses is a digital expert, and it can be hard to know where to start. They key is making simple tools to help businesses get started."

Google's new 'Smart campaigns', introduced last week and rolling out globally in the coming months, are designed to help with this, he explains.

"We re-imagined our ads for small businesses looking to get started," says Gaeta. "You don’t need to be an expert to find success with it. Smart campaigns takes the innovation and technology of Google Ads and tailors the experience for simplicity. Smart campaigns are designed to be simple, save time and drive real results. Businesses just choose their goals—like making the phone ring, driving sales to their website or visits to a store—and machine learning goes to work to deliver results.

"We know that SMEs spend a lot of time on basic functions (Deloitte estimates as much as 64% of their time) such as accounting, payroll, marketing. By providing more simple tools, we want to help SMEs to spend more time on their business, letting technology do the heavy-lifting for their marketing campaigns."

“[Marketing] is one of the pain points” for SMEs agrees Rosie Keller, regional manager for Asia at Seedstars, which supports entrepreneurial ventures in over 65 emerging and developing markets via its Seedstars World competition and a series of incubator and academy programmes. “They don’t have a lot of resources. How can they reach customers without spending a lot of money?”

Asia also has a wider variety of social-media platforms, apps and services than any other global region, she says, making it harder to achieve broad recognition. “Asia is interesting—there’s a high density of different platforms here which means a very diverse ecosystem and localised solutions.” The lack of a broad common language is a further hurdle that makes regional communication difficult, she says.

Learning from Myanmar

Social media platforms certainly do help companies reach new communities of customers but a few sectors in Asia, such as agriculture and education, still “desperately need disruption” in this regard, continues Keller. “In Southeast Asia there are a lot of sectors like agriculture where they have to do a lot of offline marketing, going out on the ground talking to their customers to get them on board. They have to do in-the-field work to really get the message out there and that’s a challenge for them with the limited resources that they have. It means very high customer acquisition costs.”

There are a few new ‘ag-tech’ firms that are starting to change this. Keller points to Green Way by Greenovator and Impact Terra by Golden Paddy, local digital services platforms in Myanmar that connect farmers with agricultural specialists to answer questions and provide advice. Apart from a mobile app and web app, Golden Paddy also runs a Facebook page, with a huge monthly reach of 2 million farmers.

Such a high level of dependency on Facebook is in fact relatively unique to Myanmar, where state media reported last year that 60% of the country relies on the platform for news. This makes it critically important for SME marketing, says Keller. “In Myanmar, everything happens through Facebook so if you don’t have a good Facebook presence, you’re pretty much toast.”

William Murray, co-founder of the professional development firm Edify Myanmar, agrees. “The main social-media platform is Facebook. We don’t run Facebook promotions but twice a day we post interesting content related to what we do, related to the industry, related to the particular audience we’re trying to get in touch with.”

In Murray’s case, this is a mix of businesses and job seekers: Edify Myanmar offers executive search, staff development programmes, HR consulting and other professional services. “Because we’re a startup, we have to be quite careful about how much we spend on anything but marketing is one of the areas that we do allocate a relatively healthy budget towards,” says Murray.

In an attempt to get their name out beyond Facebook, where everyone else is also plugging their own products, Edify Myanmar’s marketing strategy includes CSR activities, giving free talks on professional advice to anyone from students to government groups; event sponsorship; creating free video content to drive traffic to their website and, just as Bharati is doing with Tribe Theory, networking at every available opportunity. “There’s a networking event just about every day,” says Murray. “I’m a big believer in doing things face to face and at some stage we will be designing seminars and events where we can invite professionals along to talk, make a day that’s really interesting for people to come and see instead of trying to ram content down their throats via Facebook.”

Hacking the system

Getting your SME noticed without spending money has become such a critical question that there’s now a whole ecosystem of new small businesses dedicated to answering it, says Keller. “There are more and more startups in the marketing space trying to solve pain points not just for corporates but for other startups as well, because they recognise that this is an issue.”

One of the cheaper marketing solutions such firms offer is customizable chatbots, hailed by some as the “future of customer engagement”. According to a survey Facebook commissioned with Nielsen, more than 330 million people connected with a small business on Facebook Messenger, which allows companies to run their own customizable bots, for the first time in 2017.

Other firms have graduated from helping companies make Messenger bots to building their own chatbot apps: Alakazam is a Sri Lankan company launched last year that uses a bot to help small businesses ‘demystify marketing’ by measuring engagement, offering weekly insights and planning content that aligns with a firm’s marketing objectives.

Alakazam is a marketing assistance bot

In theory, bots can help SMEs save resources by automatically replying to consumers’ questions, polling them for feedback and launching marketing campaigns. However, Keller says the majority of the bots in the market still need refining before they are completely reliable. “I think there are a lot of chatbot solutions out there and it’s come to a stage where we’re seeing what is working and what is not. It will come to a point where we can narrow down what is viable. There are a lot out there now that are not necessarily a good fit, and not up to the standard.”

Other Asian startups have come up with different marketing solutions for SMEs. GliaCloud, a startup founded in Taiwan in 2015 by Taiwanese Canadian entrepreneur David Chen, uses AI to ‘videolize’—convert articles and other content into video—content in just a few seconds and link the results with social media channels. Lokol, meanwhile, is a Hong Kong firm that specialises in connecting SMEs to influencers.

Sometimes, however, making noise as an SME simply comes down to thinking up an idea so unusual it can’t help but capture headlines. Tribe Theory tapped into this almost by accident when it started accepting bitcoin in exchange for hotel rooms. Another company, Treepex, went a step further, creating a cumbersome device that, it claimed, could be worn in the nose to clean the air we breathe. Thousands questioned the odd-looking product, allowing the founders to reveal it was, in fact, a fake and to explain their true purpose: planting trees to combat air pollution.

However creative the marketing strategies and however novel the product, the ultimate lesson is that SMEs have no chance if they don’t have belief in their own offerings, says Bharati. “The main thing I’ve learned in marketing is that how you tell the story of who you really are is the most important. You can't make up who you really are, you really have to enjoy it to be passionate about what we are doing. If it is just a gimmick, people find out.”