Yes, you can compete with the big guys but you have to do it on quality and service.
Most small businesses operate in what economists call a perfectly competitive market. By that, they mean no single company is big enough to set prices because of the intense competition of the many producers selling into the same market. Prices are set by supply and demand; producers are price “takers” and not price setters. What this means for a marketing strategy is that competitive advantage can only be gained through superior quality and service. Given the intense competition in this type of market, it would be wise to pay attention to the following when preparing a marketing strategy:
- Make sure you have a quality product or service with which to compete in the first place. This means that quality control and a well-trained staff are the keys to your long- term success. It never takes long for customers to decide whether they are getting value for their money.
- Once your quality is established, do not compromise it.If it is your goal to sell$700 tablets, ensure the product is worth the $700 price tag and your sales staff is knowledgeable. Deep discounting to increase market share can kill the integrity of the brand. The joy of increased revenues from a sale will be short lived when you see a decline of sales at regular prices. If you discount too often, customers start to see the pattern and just wait for the next sale. Then the sale price becomes the real price of your product.
- Educating your staff about the business, its values and the products and services offered must be part of your marketing strategy. Before a product or service is offered, staff should be trained in what can be expected from, as well as the limitations of, the product or service. Encourage staff to ask clients about their expectations and to explain the features and benefits of the product or service, including any limitations. Teach staff to be honest with the customer.
- Ensure that you and everyone else in your business promote confidence and trust in your product or service. If your staff believes in what you sell, so will the customer.
- Whether you or members of your staff are answering the telephone, responding to an email request, or greeting customers on the floor, every single interaction transmits a message about the style of your business. Make no mistake, these messages are indelibly etched into the subconscious of the client. Everything about your business should be geared to making a lasting positive impression on the customer.
- Know your market.Profile your clients.This will allow clearer identification of their needs and wants. Knowing who needs your product or services gives you a greater opportunity to create loyalty to your brand. If your target market is young gamers, for example, hiring staff or purchasing products that suit the over-30 gamer crowd is a recipe for disaster.
- Be a niche marketer. Focus your business in one area and dominate that part of the market. In other words, be a niche marketer. Marketing computer software? Don’t try to sell both gaming systems and business systems. Since each market is so large, it is impossible to become a recognized brand in both.
- The development of the Internet and socialmedia has brought marketing costs per potential customer to an historic low. In fact, you can reach a larger demographic than ever before with less effort and less expense.
- A short-term commitment will not work. Clients and customers want to know that you are going to be there for the long haul. Establishing a marketing program and working it for only a few months will not be effective. Continuity stabilizes your brand in the minds of customers and promotes return business.
- Marketing success does not happen overnight. If the marketing strategy does not pay off immediately, it does not mean that the entire approach should be scrapped. Be patient. It takes a long time to become well enough known for customers to rely on you. Evaluate what you were trying to achieve with your original marketing approach, then determine if modifications are necessary.
- Clients, both potential and existing, need to be able to associate what you do with your name. Thus, it is important to establish a connection between your name and the products or services you sell. Whenever possible, build what you do into your name. For instance, the name First Rate Electrical Inc. indicates that your business deals in “electrical” issues somehow. The name First Rate Residential Electrical Inc., however, highlights the fact that your business deals with residential electrical issues as opposed to industrial or commercial installations. This ensures that those who need residential work know you are the “go-to business” that can solve their problems.
- Consistency is essential. Whether your company name is displayed in print advertising, on vehicles, uniforms or elsewhere, the colours, logos, and taglines should be constant. This necessitates a careful consideration of all forms of advertising before designing the campaign. Ready identification of your name no matter what the media should be your goal.
- Visibility is essential. We are bombarded with hundreds of ads every day: when we walk through a grocery store, watch TV, go online or read the newspaper. Use as many advertising platforms as economically possible. Encourage local patronage by having regular sales events and supporting local initiatives, such as school or sports activities.
- Ensure that your sales messages are not confusing. Often the marketing message is “too cute.” Clever ads may be memorable for their wit but often do not actually sell much product. The client must be able to identify the product and the location and dates of the promotion. A sales message saying you will pay the HST only on limited quantities of products over $x on a Tuesday will deter rather than encourage sales.
Build Customer Loyalty
The success of any business depends on the loyalty of customers who not only do return business but also refer their friends. The first sale is easy; it’s the second one that’s hard. Businesses are built on second sales. Yes, box stores and franchises certainly have bigger advertising budgets and can often beat you on price. But not everyone wants to buy from a box store or franchise. People still want a quality product and service supported by knowledgeable caring staff and owners. When you provide that, you will carry the day and create a thriving business.