Taking on the business giants: Five tips on winning

Thursday, 29 April 2010 01:00

If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.

Sun Tzu, The Art of War

I love talking to small business owners. If there is a better barometer for the state of the economy I would love to find it. It gives me a real buzz to see people really getting stuck into delivering a product or service. However the biggest satisfaction is watching a small business taking on a bigger rival, sometimes winning, but always learning.

So as a small business owner is it possible to compete with the big boys at their own game? Here are my five tips for getting one over the competition:

1. Become a private detective

As the Sun Tzu quote above states, to beat your enemy you must know your enemy. Spend time researching the competition. Understand what it means to be their customer and see how it compares to your own operation. Do you know your competitors’ pricing models? How does your competitors’ product or service compare against your own? Research, talk to existing customers and think of ways to tailor your offering to exploit their gaps or weaknesses.

2. Know their news

In business we don’t have the luxury of a level-crossing to tell us when the train is coming down the track, but there are ways of learning what your competitors are doing and how you can take advantage. Always be the first to know their news so you can react quickly. There are a number of tools available that can help:

• Google Alerts allows you to specify search terms, set the update frequency and sit back for news to arrive straight to your inbox. Why not try to set up searches for brands, people and products in your space?
• Copernic automatically scans for changes to websites and alerts you when they are made.

3. Love your existing customers

In the quest for global domination it can be very easy to focus too much attention on gaining new customers while your existing ones are forgotten. Reverse this mentality and use your agility to make sure that your customers are happy customers. The key is to turn your current customer base into brand advocates. Nothing sells a product or service better than the existing users.

Larger brands often have advocates too -- I am sure we can all name our favourite coffee brand. I’m a big Starbucks fan and not receptive to other suppliers’ marketing. To make matters worse for the competition I am also a Starbucks’ advocate. However, it is not perfect. In fact I can immediately think of a number of ways Starbucks could be better. Find out who your competitors’ biggest fans are and see if you can learn from and ultimately turn them.

4. Make their strength your strength

One of the best ways of getting an advantage is to use the big boys’ marketing budgets against them. Get the competition to pay for increasing the footfall into your store, or unique visitors to your ecommerce site. While this may sound difficult and even nefarious, there’s at least one easy technique that is completely above board.

Huge brands spend millions of pounds each year on product positioning, celebrity endorsement, slogans, PR and advertising. To use this, first you need to carry out some research. Spend time monitoring your competitors, e.g. sign up to their mailing lists, look out for ads they are placing and keep an eye on their website for changes.

The idea is to use your size to act quickly, be reactive and work to position a proportion of your offering to be complementary.

One clothing business I talk to does this very effectively. It monitors the competitor’s website and blogs for specific fashion trends or products and advertises against these, using low cost but highly effective online ads.

5. Follow fast

Not every big business gets it right; in fact it’s staggering the number of large businesses that frequently get the basics wrong. So don’t be tempted into believing that the big guys are always right. Sometimes it pays to sit back and let the competition make the initial mistakes.

Google is a great example of a company that looked at the existing market, learnt from its competitors’ mistakes and devised something that met the needs of their customer more effectively.

Give it a shot!

Being a small business can be challenging. But while we often don’t have the resource to follow our big named competitors we have the ability to be agile, and that often makes all the difference. I hope the above tips have given you an idea how to get one over the larger brands. Good luck!

Benjamin Dyer is director of product development for ecommerce specialist, Actinic. Originally published on BusinessZone.