Small businesses have a lot to gain from online marketing. However, they rarely have the luxury of a dedicated marketing department with time and resources to commit to it.

When time is short there is a temptation to take advantage of last-minute offers and one-off deals for marketing, and too often on an ad hoc basis. This may seem like a low-cost way of doing things, but the results are often unimpressive, usually because the cheap deal means poor reach, or a lack of relevance.

Firstly question what you want to achieve: Do you want to increase the amount of visitors to your website? Do you want to sell products online? Do you want to gain subscriptions to your service? Do you want to generate enquiries that you can follow up in person?

Your customers are very likely to be online, so the trick is to go where they already are. The first challenge is to commit plenty of time and effort simply browsing the web. Put yourself in the your customers' shoes, think about how they might use the web, what sites they visit, what they want to achieve online and consider how you can get involved, right alongside them.

The more time that is put into research, the easier it will be to identify to whom, when and where you want to market your business. Also be prepared to bookmark plenty of sites in your browser.

When it comes to promoting your business online, there are a number of options available. Here are the main contenders:

• Display advertising
  Banners, skyscrapers, buttons, MPUs: sounds like jargon, but these simply describe different sizes and positions of adverts on a website, which can also be used differently depending on your creative approach. Prices are generally quoted as ‘cost per mille' (CPM) - the cost for showing your ad 1,000 times on a site. Expect to see prices range between £5-£50 CPM depending on how general or targeted a website's audience is

• Email bulletins
  Emails sent directly to potential customers often carry advertising in the form of URL links and images. Costs are quoted per bulletin and vary depending on the size and relevance of the audience, and often the position of the ad in the bulletin

• Viral
  With the rise of more rich and interactive online media, and the increasing number of people on email, amusing or innovative games and videos are readily circulated between friends, family and colleagues: hence the term ‘viral'

• SEO & PPC
  If you have your own website you'll want to make sure that you're found among thousands of other competing sites. The craft of structuring your website and its content to be easily found by search engines is known as search engine optimisation (SEO). If you're happy to spend a little money to encourage visitors, then pay per click might be the way to go - especially if you have a niche, high-value product or service

• Agency v DIY?
  The decision to develop your own advertising and SEO campaign depends entirely on your own skills. There are experts out there, and it may well be quicker and easier for you to achieve better results if you outsource to a dedicated web agency. As always, before choosing a supplier, make sure you've done your homework and always try to get recommendations

Any business needs to watch the pennies when investing in marketing, especially in the current economic climate. So it pays to take advantage of any cost-free opportunities to raise the profile of your business online. Three simple steps that you can take right now are:

• Get listed
  A useful marketing technique, especially when the target market is in your local area, is to get listed on business directories such as FreeIndex.co.uk [1] and UKSmallBusinessDirectory.co.uk [2]

• Find a forum
  Online forums are welcoming and friendly places. Some will help you research firsthand what your potential customers might be looking for, and others offer a wealth of advice and guidance from the real experts who have been there and done it. Visit www.ukbusinessforums.co.uk [3], for example, and have a browse. Participate in discussions, offer your expertise and you'll quickly become recognised for what you do and how you do it. Recommendations can come very quickly if you get this right

• Get a blog
  A blog is a very easy way to let the world know what you're up to. Think of it as a business diary, so set some time aside to jot down the experiences you've had running your business, dealing with customers and even include some personal information about your activities outside of work. It all helps to build up a picture of you and your business, giving it a personality, which has strong potential to attract new customers. Take a look at blog.co.uk [4] or Wordpress [5]

One key benefit of any online marketing is a level of transparency that is missing from offline methods. The five Rs is a process that I use to explain the steps in designing, managing and measuring an online advertising campaign, and how it can help you to relate marketing spend with new business revenue, giving a clear indication of return on investment.

• Reach
  This is the dominant measure of traditional advertising media - much like ABC circulation figures, for example, in print media. In the online world, reach is now most usefully measured by the number of unique visitors (per month) to a given website

• Relevance
  It is almost impossible to confirm what kind of person has seen an ad in print or even if it has been seen it at all. Online, however, the tools are there for advertisers to record this vital information and, with the right supplier, you can even target your advertising message to key audience demographics

• Recognition
  Big brands spend huge amounts advertising above-the-line in the mass media. The constant presence of powerful consumer brands across multiple media platforms ensures a high level of recall when a prospect sees the products for real. Online is no different: it's important to have your brand recognised above-the-line before attempting deep and targeted below-the-line activity. Repetition breeds reputation

• Response
  An audience of good reach and relevance, and a concerted campaign to build recognition of your brand, products or services, provides the necessary build-up to encourage direct responses to your campaign offers. Generally the more niche and relevant the audience, the more targeted your messaging can be

• Return
  The level of transparency and measurability offered by online media means that responses can be mapped to actual sales, and right back through the campaign to your initial marketing spend. This gives you a real measure of return on investment, with no guesswork.

Compared to traditional media, new skills and techniques need to be acquired for successful online advertising. However, the basics of clear communication and calls to action remain the same.

Online, it's sometimes difficult to envisage what the audience is, especially if you're used to dealing face-to-face or over the phone. However, you should feel free to open up a discussion with online media owners to establish exactly how they can help you to satisfy your five Rs. If the media owner is reluctant to share advice and detail on their audience with you, it's time to walk away.

If you decide to get into social networking, blogging and forums, be prepared to make a significant time commitment to being present and above all, make sure that you are regularly available to respond to discussions and opportunities. Things move fast online, and it's not something that you can step away from for too long without losing pace.

Darren Falkingham is head of marketing at Sift Media. For more information visit www.siftmedia.co.uk [6]