Asbe association for Small Business & Entrepreneurship




НазваниеAsbe association for Small Business & Entrepreneurship
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Limitations and Further Research

The sample of this study was chosen from among the SME entrepreneurs in Bangkok, Thailand. Further comparative works may be conducted across different industries, regions in Thailand, and countries/cultures. In addition, as this study is a cross-sectional quantitative study, which employs only correlation analysis for hypotheses testing, our understanding of the phenomenon under examination could be improved by engaging a longitudinal qualitative–quantitative research employing more sophisticated statistical techniques. The more recent generation of SME entrepreneurs in Thailand might have some unique entrepreneurial behaviors and characteristics. Furthermore, classifications of SME entrepreneurs in previous studies have been made with reference to personal characteristics such as personality traits, motivations, behaviors, education attainment, work experience, and family background. As entrepreneurial competencies are identified as a higher characteristic level, which are closely linked with SME entrepreneur performance, this suggests using entrepreneurial competencies as a basis for classifying SME entrepreneurs for research concerning entrepreneurial education and training.

References


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Chusimir, L.H. (1988), “Entrepreneurship and MBA degrees: How Well Do They Know Each Other?, Journal of Small Business Management, July, pp. 71-74.


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Greenbank, P. (2001), “Objective Setting in the Micro-Business”, International Journal of Entrepreneurial Behavior and Research, 7(3), pp. 108-27.


Johnson, S. and Winterton, J. (1999), Management Skills, Skills Tasks Force Research Paper 3, SKT8, London: Department for Education and Employment.


Judge, T.A., Cable, D.M. and Boudreau, J.W. (1995), “An Empirical Investigation of the Predictor Of Career Success”, Personal Psychology, 48(Autumn), pp. 485-519.


Kirzner, I.M. (1979), Perception, Opportunity and Profit, Chicago: University of Chicago Press.


Lau, V.P. (2002), Developing And Validating The Entrepreneurial Career Success Scale And Testing Its Antecedents And Consequences In The Context Of Southeast Asian Values, Unpublished Ph.D. dissertation, The Hong Kong Polytechnic University.


Melamed, T. (1996), “Validation of A Stage Model of Career Success”, Applied Psychology: An International Review, 45(1), pp. 35-65.

Nabi, G.R. (1999), “An Investigation into the Different Profile of Predictors of Objective and Subjective Career Success”, Career Development International, 4(4), pp. 212-224.


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Parasuraman, S., Purohit, Y.S., Godshalk, V.M., and Beurell, N.J. (1996), “Work and Family Variables, Entrepreneurial Career Success, and Psychological Well-Being”, Journal of Vocational Behavior, 48, pp. 275-300.


Simachokedee, W. (1999), SMEs the Main Pillar of Industry (in Thai), Technology Promotion Association (Thailand-Japan), Bangkok.


Tapaneeyangkul, P. (2001), Government policies in assisting SMEs for sustainable development, White Paper on SME 2001, Institute of SMEs Development, Thailand.


Wasuntiwongse, M. (1999), Need and Characteristics of A Sample Of Micro and Small Enterprises in Thailand, Micro and Small Enterprise Development and Poverty Alleviation In Thailand Project ILO/UNDP: THA/99/003, Working Paper 5.


AN EXPLORATORY STUDY OF SMALL BUSINESS

MANAGERS’ PERCEPTIONS OF ADVERTISING SERVICE PROVIDERS


Robert E. Stevens, Southeastern Oklahoma State University

Paul Dunn, University of Louisiana at Monroe

Henry S. Cole, University of Louisiana at Monroe

David L. Loudon, Samford University


Abstract


This manuscript reports the results of a national survey of small business managers to determine their perceptions of advertising service providers. The mail survey to a random sample of 500 businesses resulted in 45 returned questionnaires from a diverse group of small business managers. The study revealed that a significant number of small business managers believed that media representatives were not helpful nor a good source of advertising information. Advertising agencies were believed to be too expensive for small businesses by a majority of managers.


Key words: small business advertising, advertising, small business managers, small business and advertising strategy


Introduction


It is generally agreed that most, if not all, small businesses need to advertise. Hodgetts and Kuratko (1998) said, “In fact, it is virtually impossible for a small businessperson to sidestep the use of advertising.” Siropolis (1997) stated that advertising is the centerpiece of efforts to reach and influence customers, and Ryans (1996) said that advertising is “a key activity to the success of any business.” Therefore, developing an advertising strategy is an important aspect of a small business manager’s marketing management responsibility.

If advertising is important to the well being of small businesses, then managers and owners of these businesses should be knowledgeable of advertising and understand the development of advertising strategy. However, while acknowledging the importance of advertising, many small business people appear to feel uncomfortable developing their advertising strategy and recognize the need to engage outside assistance. Most entrepreneurs may not be advertising experts, and outside sources have the potential to improve advertising strategy development if chosen well and used properly. “Most small businesses must rely on others’ expertise in creating promotional messages” (Broom, Longenecker, and Moore, 1983). Popular outside sources are advertising agencies and media sales representatives.

The purpose of this paper was to examine small business managers’ perceptions of advertising agencies and media sales representatives. This study was exploratory in nature and, hopefully, will lead to a more expanded investigation of the topic. Small businesses, advertising agencies, media organizations, and educators may benefit from this study.

Background


While some small business people think they should do as much as possible for themselves (Hodgetts and Kuratko, 1998) and that an ad agency is a luxury, others believe that better results are often possible with outside assistance (Sullivan, 1977). Either way, the small businesses manager should be active in the advertising program (Anderson and Dunkelberg, 1993). Even if a small businessperson decides to use outside assistance, he/she should still have knowledge of advertising and should be in control of the program (Hatten, 1997).

Ad agencies can make substantial contributions to the advertising strategy of small firms. However, the quality of advertising assistance depends on the competence of the ad agency personnel and their willingness to work with small businesses. If the quality of advertising assistance is poor, the small business would not benefit fully from the agency’s help.


The quality of advertising agency assistance is often related to splits between clients and agencies. Buchanan and Michell (1991) pointed out that unmet expectations from the client viewpoint caused the failures in the relationships. Dissatisfaction with the performance of the agency was cited as the most common reason for agency changes (Michell, Cataquet, and Hague, 1992). Poor communication (Bourland, 1993) and a good personal relationship (Wackman, Salmon, and Salmon, 1987) were found to be related to a client’s satisfaction with its agency. Beard (1996) found that client role ambiguity is significantly correlated with client satisfaction in client-agency relationships.

Korgaonkar et al. (1984, 1985) surveyed advertising agency executives and advertiser executives concerning factors correlated to successful advertising campaigns. They found that correlates of successful campaigns vary with intended outcomes and that the groups’ responses had similarities and differences. Both groups believed message, media, resources, and agency-client relationship were factors significantly related to successful campaigns. The groups differed in their views as to the significance of product uniqueness and competition.

Murphey and Maynard (1996) studied the cognitive conflict between ad agencies and their clients by comparing judgment profiles concerning attributes each group typically wanted to see in a good advertising campaign. The findings indicated that agencies and clients “think very much alike,” but “they often believe they do not.”

Some small business people choose to deal directly with media representatives and receive advice and suggestions from them. Arens (1999) defined media as the communication vehicles (such as television, radio, newspaper, magazines, etc.) that are paid carry the advertiser’s message to the target audience. Media, however, go far beyond this traditional role of delivering the message. Media personnel may perform other duties such as creating ad copy (Bolen, 1981). Most media representatives assist the small businessperson with advertising planning (Sullivan, 1997). They may also provide an audience profile of their media and cost figures compared to their competition (Harmon, 1997). Engel (1980) said that effective media sales representatives can be inspirational, informative, and creative, and that they can be a “free advertising bonus.”

The media function of advertising has expanded in recent years so that today “media personnel must be experts in a number of area” (Russell and Lane, 1996). Whether it is a radio salesperson becoming a marketing consultant or a newspaper performing marketing research, media personnel must increase their knowledge and expertise to be competitive in the marketplace.

While the market and competition are driving media representatives to improve, solve problems, and create value, some representatives may lack objectivity. Bluntly, they get paid to sell advertising time or space, not to perform related services (Bolen, 1981). In other words, they increase their personal income by selling advertising, and they do not increase their income by creating unique ad copy. As Warner and Buckman (1993) said about broadcast and cable salespersons, their primary objectives are to retain present business, to develop new business, and to maximize revenue.

Unfortunately, many media representatives have little or not training or education in advertising and lack the expertise required to develop successful strategies (Bolen, 1981). Thus, the small business owner should not automatically assume that the representative is an expert. Although local advertiser tend to expect good service from media (Nowak, Cameron, and Krugman, 1993), the quality of advertising advice and assistance should be an important concern to the small firm and should be carefully evaluated.


Methodology


A national sequential probability sample of 500 sample businesses with less than 100 employees was drawn from USA Business Directory. A letter that requested assistance and provided instructions, a questionnaire, and a postage-paid envelope were sent to the sample. The letter requested that the manager respond.

Respondents were asked to express their degree of agreement or disagreement with each statement on a four-point scale (with 1=strongly agree and 4=strongly disagree). The statements sought opinions about media representatives and advertising agencies.

A total of 45 small businesses responded to the survey, a response rate of 9 percent. The low return rate was perhaps due to time constraints of small businesspeople and to a hesitancy to reveal information about their businesses.

Table 1 states the descriptive statistics, including experience, education, types of degree, age, sex, number of employees, and gross sales. The types of businesses that responded were retail/wholesale (35.3 percent), manufacturing (11.1 percent), and services (46.7 percent). Some businesses (6.6 percent) did not fit into one of these categories. Responses were tabulated and analyzed using SPSS.

TABLE 1

Respondent Characteristics






Small Business Managers


Experience

Less than 10 years

More than 10 years



42%

58%


Education

Some college

College degree

Advanced degree



33%

33%

27%


Degree Type

General business

Communications

Other



22.1%

6.6%

26.4%


Age

30 or younger

31 to 50

51 to 70



6.6%

59.7%

31.1%


Sex

Male

Female



68.9%

31.1%


Employees

10 or fewer

11 to 20

21 or more



57.7%

19.9%

22%


Gross Sales

$250,000 or less

$250,001 to 500,000

Over $500,000



50%

16%

34%


States Represented


21

Findings


Small business managers were surveyed about media sales representatives, advertising agencies, and the responsibilities of the small business person when dealing with advertising agencies. The findings are reported below.

The first item stated that media sales people provide good help when formulating an advertising plan. Media sales representatives are often cited as advisors to businesses purchasing a particular media. Many media people are very professional and provide excellent services. There is the danger, however, that the media person is more interested in selling time or space than assisting the client with an overall advertising strategy. Small business respondents were roughly divided on this item. About 44.4 percent disagreed with this assertion (when adding the disagree and strongly disagree responses).

The next item stated the media sales people are an important source on advertising. Approximately 58 percent of the small business respondents agreed with this assertion. However, over one third disagreed. Apparently, some small business respondents do not think media sales people are good sources of advertising information. Again, such a significant number of possible customers having a negative view could be problematic.

Item 3 asserted that advertising agencies are too expensive for most small businesses to use. Most small business respondents (75.6 percent) agreed with this statement. This result means that most respondents felt that small businesses could not afford to get help from advertising agencies. This percentage appears to be dangerously high.

The final assertion was that even if advertising agency personnel are trained in creative message planning, the small business manager should be clear about what is to be communicated to the audience. An overwhelming majority (93.3 percent) agreed with this assertion. Agency personnel should work with the small business advertiser in the formulation and implementation of message and media strategy, but hiring an agency does not relieve the small business advertiser from having a clear understanding about what needs to be done. Evidently, some small business people (6.6 percent) disagreed, indicating that they think that others know better.

Chi-square tests were run to examine if statistically significant differences existed between the responses based on respondent characteristics. Only one characteristic produced any differences. The test indicated significant differences (at the .05 level) on the second and third items when age was considered. Older managers have a more positive opinion of media sales people as a source of advertising information and of advertising agencies as being affordable than do their younger counterparts.

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