SME Entrepreneurial Theory: Marketing Techniques & Hotel Analysis

This report provides an analysis of Small and Medium Enterprises (SMEs) within the context of entrepreneurial theory, focusing on the application of effective marketing practices. It defines SMEs, highlighting their characteristics, importance, advantages, and disadvantages, with a specific focus on the UK context. The report then provides an overview of two hotels in the hospitality industry, Haytor Hotel and Marstan Hotel, both located in Torquay, UK. It examines how these hotels utilize entrepreneurial marketing techniques such as word-of-mouth marketing and telemarketing to attract and retain customers. The report discusses the benefits and drawbacks of these strategies, offering recommendations for improvement, particularly for Haytor Hotel, emphasizing the importance of customer engagement and social media management. Desklib is a valuable resource for students seeking similar reports and study materials.

SME and
entrepreneurial theory

Table of Contents
Introduction......................................................................................................................................3
Main Body.......................................................................................................................................3
Explanation of SME....................................................................................................................3
Overview of chosen organisation................................................................................................5
Best practice methods and techniques of entrepreneurial marketing in chosen organisations....5
Conclusion.......................................................................................................................................9
References......................................................................................................................................10
Online-...........................................................................................................................................10

Introduction
Small and medium sized enterprises are those businesses which operate with few number
of employees cover less geographical area (Cusmano, 2018). They are the one who provide local
products to their local customers and they contribute an economy to grow well. It is essential for
SMEs to analyse their marketing factors effectively to analyse how their customers are getting
influenced to purchase their products and services. The following report covers explanation of
SME, overview of chosen organisation and best practice method and techniques of entrepreneur
marketing in chosen organisation.
Main Body
Explanation of SME
SME are those organisations which maintain employees, revenues and asset below a
certain limit. Every country is having their own definition of SME and has fixed a certain limit
for them which are different from another country (Gebauer, 2018). In context of UK, SME are
those organisations which are having employees below than 250 and they have less than £25
million turnover. It also includes having gross asset less than £12.5 million (What is a small
business or SME, 2020). According to a research, it is recorded that there are almost 5.94 SMEs
business across the UK at the start of 2020. SMEs are also divided into three different categories
which are defined below-
 Micro enterprise- These are the enterprises which are having 10 employees at maximum
number. They are the small bakeries and family businesses.
 Small business- These are the organisations which are having 10-49 employees. They
are considered as higher than micro enterprises due to their number of employees and
total earning revenue.
 Medium-sized business- These are the enterprises which have more than 49 employees
but less than 250 employees with a turnover of between £25 million and £500 million per
year.
Characteristics of SME-
 Limited investment- The capital which is required by the entrepreneurs to start their
SME is less due to their small scale operations (Liñán, Paul and Fayolle, 2020).

 Labour intensive- SME’s did not require high quality of machinery and tools, they only
require good quality of management and skilled labours to work for the company.
 Less number of employees- Due to their small scale of operations, SME requires less
number of employees. Hence, they high fewer employees as compared to large
companies.
 Local area of expansion- SME mainly operates in local areas and remains in local
market for longer period of time (Small and Medium Enterprise (SME) – Definition,
Characteristics, & Examples, 2021). This will help them to maintain good relationship
with their customers in local market.
 Management- Most of the SMEs is managed by a single or few group of individuals. In
context of family business, the head of the family take all managerial decisions for the
business.
Importance of SME-
 Employment generation- SME help an economy to grow by generating various kinds of
jobs and opportunities for those individuals who seek employment for their survival.
 Promote local products- SME focus to offer local products to their customers which is
essential to maintain the culture of an economy.
 Represent a country- SME can also represent a country at international level by
developing well and target other market to exchange their goods and services.
 Improvement of quality of life- SME help the people to provide them jobs so that they
will fulfil their basic needs and satisfaction and further improve the quality of their life.
Advantages of SME-
 Better control over business- Due to its size the owner can operate their main operations
and have full control over the business (Saura, 2021). All decisions are taken by the
owner.
 Better communication- SME are having better communication due to less number of
employees and there are less chances of miscommunication due to small communication
chain.
 Close relationship with customers- SME generally focus to maintain their good
relationship with customers and even the owner of SME can meet face to face to their
customers.

Disadvantages of SME-
 Less use of technology- Manpower is use more in SME as compared to technology due
to less investment. Machinery and tools require high investment which a SME is unable
to manage. Hence, they choose manpower efforts more than machinery.
 Difficulty in funding- It is tough for entrepreneurs to manage funds for their SME.
Banks also hesitate to provide loan facilities to all kind of SME owners due to the risk of
loss and most of the SME did not stay last long in the economy.
 Less skilled employees- Employees of SME are not considered as skilled and talented
because most of the SME hire those workers who can work in minimum wage rate and
secondly, they also hire their family members whether they are having skills to conduct
operational activity of the enterprise or not.
Overview of chosen organisation
The Hospitality industry is chosen for the report which is one of the fastest growing industries in
UK. Two hotels are chosen whose description are mentioned below-
Haytor Hotel, Torquay- This is one of the oldest hotels in UK which is founded in the
year 1835 and it is headquartered in Devon, England, UK. The annual revenue of this hotel is
$100K- 5.0M and it is having below than 25 employees to manage the hotel and serve their
services to their guests (Haytor Hotel, Torquay, 2022). They are having good rooms and dining
area for their guests. The interior designing of this hotel helps the customers to gain comfort and
feel like they are staying in their own home. A well maintain garden and the 24*7 service makes
it more attractive for visitors to visit the hotel with their families.
The Marstan Hotel, Torquay- It is also SME hotel with employees less than 25 and
earns revenue of nearly 5 million per year (Marstan Hotel, 2022). They are having well
developed rooms for their travellers and have swimming pools inside the building as well as
outside. It require less than 5 minutes to reach at the beach of Torquay by walk. They are having
dining facilities and parking facilities. They mainly focus to make their hotel more attractive by
maintaining the cleanliness of the hotel.
Best practice methods and techniques of entrepreneurial marketing in chosen organisations
It is essential for these hotels to maintain their marketing activities appropriately and
achieve their aim and objectives with the help of few effective practices of marketing. In context
of the above two hotels, they are focused to promote their business through social media

marketing by uploading the pictures and features of their destinations to gain the attention of
travellers. They also share the prices of staying in their hotels for different facilities so that their
customers will make a purchase decision. On the other hand, they also use website and e-mail
marketing way to promote their business and reach to their targeted customers (Li and et. al.,
2018). Their attractive websites which is considered as easy to use by clients is effective and
they can receive customer’s reservation bookings through their website. They share information
like all the facilities they have in their hotels and what are additional pays for additional
facilities. They use e-mails to share their feedback forms to their customers so that they will get
to know that how much they are capable to satisfy their customers. They also aware their
customers through e-mail by sending them mails which contain information of discounted prices,
additional service and many others. There are few marketing methods and techniques of
entrepreneurial marketing which help them to achieve their goal by increasing their total number
of customers and few of this marketing techniques and methods are mentioned below-
Word of mouth to mouth marketing- This is the marketing procedure where a
company is required to satisfy their customers appropriately and further work is done by
customers themselves by communicating the benefits of products and services to their friends,
family members and the close ones whom they know and communicate (Li and et. al., 2018).
This will help to gain the attention of more customers and it is the tendency of a customers that
whatever they heard in market, they will get attracted to that specific services and product and
try them at once to gain same experience which they heard by their known one. In context of
Haytor Hotel Torquay, they focused to follow this marketing style and specifically they focus to
gain high customer satisfaction by fulfilling their needs and wants appropriately. For this, they
supposed to take review of their customers about their hotel and its services so that in case of bad
reviews for a specific service, they will make changes and gain high customer satisfaction.
According to a research, it is recorded that 92% customers believe their friends and relatives
about the effectiveness of a particular product. They get influenced easily by the facts and
positive reviews share by their known person. There are few examples for this marketing method
or strategy like- when a customer feel good for a product or services than they share its review
on their social media accounts and communicate about good services related to that hotel. This
will influence their family members to use the same service and gain same or much higher
experience. When a diner which is served by mentioned hotel is wonderful, then most of the

customers share the pictures on their social media account and share actual experience through
their social media uploads. The family members and friends who sees those uploads ask
questions about how much they paid, how was the services, are they fulfilling expectations
appropriately or not and many others. A positive replier to each question will make them
interesting to use same facilities and services. There are various types of advantages as well as
disadvantages of word of mouth marketing and these are mentioned below-
Advantages of word of mouth marketing-
 It helps to build a good relationship with customers because Haytor hotel gets personal
with their customers and identify their expectation to fulfil them. This not only influence
customer to spread good reviews about the hotel but it also helps to create a trust and
good relationship between customers and hotel.
 Another advantage of word of mouth is that it cost lesser than any other marketing
method (Husniah, Lanz and Supriatna, 2019). In actual it does not cost anything for the
business, they re only required to serve best services to their customers who paid for the
services and further work is done by their customers themselves.
Disadvantages of word of mouth marketing-
 Haytor hotel cannot control what people say about them. This is the choice of customers
that whether they want to express their good experience or not with their relatives.
 Results are always unpredictable because it depends on the nature and behaviour of
customers whether they share their reviews or not. In case they share only bad reviews
about the hotel than it may decline number of customers for them.
Some effective word of mouth strategies for Haytor hotel-
 They are required to engage more with customers who review their services on their
social media sites.
 They must manage their social media accounts appropriately and share their good
reviews of customers to gain more customers.
Telemarketing- It is the marketing method and technique where companies promote
their goods and service over telephone by communicating the features appropriately (Rahayu,
Rasid and Tannady, 2018). This technique is used by Marstan hotel, their front office department
convey about the services and booking discounts through telephone to their regular customers.
They record the contact number of their guests when they first arrive the hotel and they continue

to communicate with them through telecommunication medium. Here, they send computer
generated mails and messages to their customers to aware them. They mention their telephone
number in their advertisements and in their social media posts so that customers will solve their
quarries through call effectively. When customers call the mentioned hotel, they politely respond
the call and ask about their needs and wants. There are various advantages and disadvantages of
telemarketing for chosen hotel which are mentioned below-
Advantages of telemarketing-
 It helps to provide a more interactive and personal sale services for the hotel.
 It helps to create an immediate rapport with customers (Ghatasheh and et. al., 2020).
 It explains the services to customers more clearly through a call.
 It will help to analyse whether customers are getting influence to purchase the services or
not by analysing their tone of voice.
Disadvantages of telemarketing-
 Customers may get irritated with continuous calls from the hotel at unwanted time.
 Analysing exact customer expectation is difficult through telephone and by limited time
of talk.
 Telemarketing did not allow hotel to analyse the expression of their customers to further
analyse whether customers are getting interested in purchasing their products and
services or not.
 Technical error and network issue can convey wrong message to customers which can
results in declining number of customers.
Effective strategies for telemarketing-
 It is essential for the hotel to hire skilled and talented employees to respond calls and
manage their telephone activities.
 Avoid calling customers at night time (Tilka and Johnson, 2018).
 It is essential that the individual who is appointed for telemarketing for hotel have all
knowledge about the hotel and its services so that he/she will clear the doubts of their
customers immediately.
 Recording the issues and questions which is asked by their customers is a good habit for
the hotel. This will help them to analyse most commonly asked questions about which

service so that they will improve and further focus to satisfy their customers with same
services.
Conclusion
From the above information it is concluded that marketing is one of the most essential
activity for the companies to promote the products and services of company and aware their
customers. SME are those businesses which are having less number of employees and who earn
limited revenue as compared to other big businesses. They main advantage of SME is that it
offers local products to local customers to maintain the local culture. SME faces issue of funding
because banks also hesitate to provide them loans easily due to their durability. Most of the SME
did not last long for many years. It is also concluded that there are various marketing techniques
and methods which a company can use like word of mouth of marketing where a customer share
their experience to their friends and relatives and then they get decide that whether they are
required to use same service of not. On the other hand, telemarketing is also one of the
commonly used marketing methods used by many companies. Here, companies promote their
products and services through telephone.

References
Books and Journals
Cusmano, L., 2018. SME and Entrepreneurship Financing: The Role of Credit Guarantee
Schemes and Mutual Guarantee Societies in supporting finance for small and medium-
sized enterprises.
Gebauer, J., 2018. Towards growth-independent and post-growth-oriented entrepreneurship in
the SME sector. Management Revue, 29(3), pp.230-256.
Ghatasheh, N. and et. al., 2020. Business analytics in telemarketing: cost-sensitive analysis of
bank campaigns using artificial neural networks. Applied Sciences, 10(7), p.2581.
Husniah, H., Lanz, A.R. and Supriatna, A.K., 2019, November. The equilibrium solution of
word-of-mouth marketing strategy. In Proceedings of the International Conference on
Industrial Engineering and Operations ManagementRiyadh, Saudi Arabia.
Li, P. and et. al., 2018. Discount pricing in word-of-mouth marketing: An optimal control
approach. Physica A: Statistical Mechanics and its Applications, 505, pp.512-522.
Li, P. and et. al., 2018. The modeling and analysis of the word-of-mouth marketing. Physica A:
Statistical Mechanics and its Applications, 493, pp.1-16.
Liñán, F., Paul, J. and Fayolle, A., 2020. SMEs and entrepreneurship in the era of globalization:
advances and theoretical approaches. Small Business Economics, 55(3), pp.695-703.
Rahayu, M., Rasid, F. and Tannady, H., 2018. Effects of self efficacy, job satisfaction, and work
culture toward performance of telemarketing staff in banking sector. South East Asia J.
Contemp. Business, Econ. Law, 16(5), pp.47-52.
Saura, J.R., 2021. Using data sciences in digital marketing: Framework, methods, and
performance metrics. Journal of Innovation & Knowledge, 6(2), pp.92-102.
Tilka, R. and Johnson, D.A., 2018. Coaching as a packaged intervention for telemarketing
personnel. Journal of Organizational Behavior Management, 38(1), pp.49-72.
Online-
What is a small business or SME, 2020 [Online] Available Through:
< https://www.endsleigh.co.uk/blog/post/what-is-an-sme/>
Small and Medium Enterprise (SME) – Definition, Characteristics, & Examples, 2021 [Online]
Available Through:

< https://www.feedough.com/small-and-medium-enterprises-sme/>
Haytor Hotel, Torquay, 2022 [Online] Available Through:
https://www.owler.com/company/haytorhotel/
Marstan Hotel, 2022 [Online] Available Through:
https://www.zoominfo.com/c/the-marstan/108447294/