It is hard to be a small fish in a huge pond full of sharks. This analogy is synonymous with the experiences of small business owners trying to compete with the big brands of the market.
While big brands shape the market and consumer perceptions of the industry, this doesn’t mean that small businesses are not important within the landscape.
In fact, according to a study by Fundera, small businesses account for 64 percent of annual new job creations in the US. Additionally, SalesForce reports that a whopping 90 percent of the entire business population is accounted for by small and medium-sized enterprises.
Considering how important small businesses are for economic prosperity, it is imperative that they don’t get swallowed by the big brands. To remain competitive, here are ways small businesses can fight against the ‘sharks.’
1. Implement smart branding practices
Do you think branding is a thing for the big guys? Not at all! Branding efforts are imperative for the success of any business, whether big or small.
Why do you think that Apple is able to charge a premium for its products and still be a market leader? It is because of the perception of experience it has created in the minds of consumers. This is the power of branding. In fact, according to Forbes, consistent branding efforts boost revenue by 33 percent.
To compete with big brands, you need to ensure that your consumers are able to recognize your products off of shelves, build associations with your business, feel loyalty towards it and resonate with it.
The key branding practices you must implement include:
- Creating a distinct brand story that governs how people perceive your business.
- Developing a distinct and memorable logo and tagline.
- Use a consistent tone of voice.
Build your brand identity from the get-go and work towards showing your target audience why they should invest in your brand. Remember, you cannot compete solely on the basis of product quality. The world is much more complex than that!
2. Keep your finances in check
A report by Fundera highlights that 50 percent of small businesses only last for five years. Why? Well, that is because 82 percent of small firms fail to owe to cash flow issues.
Don’t mess up your finances by taking the matter lightly. Instead, make sure that you always stay within your budget while investing the money and take care of your taxes and all other money matters properly. Use good accounting software for your small business to keep tabs on your inflows and outflows.
Remember, there is no point in gaining an ephemeral victory against the big players, only for it to affect your finances in the long run! Plan your moves well.
Meanwhile, keep your finances in check via:
- Use automation tools for bookkeeping
- Separating your personal and business finances
- Seeking out loans and maintaining a good credit score
- Ensuring that your payables don’t outweigh your receivables
- Partnering with the right investors
If you think, you are unable to do these things on your own, you may hire services for financial planning via stamosandstamoscpa.com.
3. Establish a strong online presence
Data collected by Statista suggests that there are over 3.5 billion users of the various social media platforms out in the world! And the internet penetration rate is approximately 50 percent of the global population.
Before the rise of the internet and online mediums, never before were branded able to reach out to such a wide chunk of their target audience, all at once!
As a small business, your online presence can be your strength. Compared to traditional marketing, digital marketing is cost-effective and hence suitable for small businesses.
Start with building an organic online presence. Create a stunning website and optimize it for search engines. Complement this with an excellent social media strategy.
Burger Revolution is a great example of a small business thriving in the world of social media. Its “Comment of the Day” campaign converts its customers into advocates. This helps in boosting engagement online as well as illustrating the popularity of the brand.
4. Compete via excellent customer service
As per Microsoft, 90 percent of Americans base their decision of whether or not to do business with a company depending on their quality of customer service provided. And 58 percent of consumers are likely to switch brands after a poor customer service experience.
While previously, many believed that the consumer journey ended with purchase. Now, many marketers vouch for the fact that the post-purchase stage is the most important in deciding whether businesses are able to retain their customers.
Considering that, as stated by Invesp, it is 25 times more expensive to attract a new client than retain an old one, it is better for small businesses to compete via providing excellent customer service.
Apart from investing in the best small business accounting software, also invest in tools like help ticketing systems, live chats, online reputation management, multichannel support, etc. By streamlining this department, you are likely to gain popularity for your impeccable customer service.
5. Find your niche
You need to be realistic in picking your battles. The more generic your product or industry is, the more brands you will have to compete with. As a small business, this can get very taxing.
Better utilization of your resources will be to find a niche you can excel at. This will help you in two ways. Firstly, it will narrow down your competitors. Secondly, it will allow you to offer a specialized product that is likely to be demanded by consumers within the desired niche.
For instance, let’s say you wish to start a fashion eCommerce business. Now, ASOS or H&M might be the ultimate brand to compete with.
But, let’s say that you have a killer idea regarding sustainable fashion. By creating a niche, you are developing the unique proposition that sets you apart from other eCommerce brands. Use your size to your advantage and carve a niche in which you feel you can be a leader. Once you have gained your footing, you can slowly diversify your business.
Every big brand of today started small. While they might seem untouchable to you today, as a small business, know that they are not! Stay put and work your way through the top. Good luck!
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