Longevity of SMMEs in Soweto: Does marketing play a role?

Abstract

Small businesses in South Africa are in a fight for survival. Fewer than 50% of all SMMEs survive for more than five years, this while government sees itself as the saviour and growth engine for creating jobs in the country. This research focuses on the longevity of SMMEs in the Soweto township and furthermore investigates whether the use of marketing plays a role in the success of these SMMEs. The research is descriptive in nature, using a quantitative survey and quota sampling technique. In total, 652 responses were received. Results indicate two key reasons for success of the SMMEs in this area: the successful differentiation of SMMEs from their competitors by means of marketing innovation and an intimate knowledge of their target market’s needs. The importance of the marketing function as a contributor to longevity is confirmed. Start-up SMMEs that did not follow a differentiation strategy and did not have good knowledge of their customers were found to be less marketing-oriented. This group was also less positive about their turnover performance, confirming that the utilisation of the marketing function remains of utmost importance for successful SMMEs located in this township.