Are you Losing your Small Business Advantage?

We are in the age of the small business start-up

Thanks to Internet innovation and accessible technologies, it is easier than ever to launch a business. The barrier between a product and its customers has been lifted and exposure is practically free if you can learn your way around social media. More encouraging, is that a buying culture has evolved to not just tolerate or consider new small businesses, but to actually prefer, celebrate and choose new technologies and fresh, small players in established industries. This culture offers many unique benefits to small businesses.

Find out more about what might give you the small business advantage.

Even mega corporations are re-branding as small businesses

Large players across many disparate industries are investing in boutique branding. The largest hotel company in the world, Intercontinental Groups has added the boutique chain “Hotel Indigo” to a hotel family that includes notoriously depersonalized chains like Holiday Inn. Large retail stores like Target are partnering with a single designer at a time to create boutique shops within their superstores. Leading publications are swooping up independent bloggers in order to gain their audiences. Even Internet retail magnate Jeff Bezos of Amazon.com goes to great lengths to seem personal and accessible – his direct contact information is public so that any of his 237 million customers can reach out to him personally.

This indicates a key shift in the way companies handle customer service and outgoing communications – appearing and sounding specific, personalized and backed by the persona of relatable founder or representative is preferred and expected by an audience who now takes accessibility for granted.

It used to be that small companies tried to look bigger

This shift from faceless corporation to start-up nation all comes down to trust. It might sound like a wishy-washy piece of business advice; oddly similar to something a marriage counselor might say. This heightened need for trust comes down a critical cultural moment when, as a consumer, we found out that our marketplace had been cheating us. In the 2008 crash, as a consumer nation, we lost a lot more than just real estate value – we lost our trust in the economic system as a whole. Suddenly our advisors, our agents, or forecasters and the leaders of our biggest corporations, the people who we trusted would lead us to continued economic prosperity, were revealed as deceitful. We no longer trust the invisible leader, a sentiment that increases more so each day with our concerns about online privacy.

While corporate America has jumped on the bandwagon that its important to be a small business, this trend actually makes it more challenging for small businesses to compete when their differentiator is taken away.

“Being small is a differentiation point and something a small business can use to stand out and forge a connection with customers. As the appearance between small and large companies becomes murkier, it’s harder for small businesses to use their intimacy and small status to their advantage.” Says strategist Kelly Spor in a recent American Express Forum post.

Of large concern for small businesses, is that massive corporations are seeing increased growth by simulating a small company presence while a genuine start-up only has an 8% chance of success. Unfortunately, it’s not as simple as just being a small business – it’s how you conduct your small business communications that make the difference.

Big corporations are trying to look like a smaller business

Gaining the trust, and reciprocal loyalty, is critical to surviving this shift in consumer mindset. Luckily, a small business has a vital advantage over large companies when it comes to catering to the consumers need for trust: the ability to adapt with ease. While it might take a large corporation years to develop a new sub-brand or customer service solution, a small business can implement these simple principles quickly and affordably and begin to reap the long term results. Trust is built at many levels within the sales cycle and customer relationship — remember these key touch points when it comes to building trust with your clients.

First Impression

Pricing strategy

Hidden fees are a surefire way to send your customers trust spiraling straight down the drain. Telling someone that your product is one price, and then providing a detailed receipt of hidden fees that bring the total way up is a great way to lose the sale, and to make your customer feel like they have been tricked. Avoid the pricing war altogether – instead, of tacking on fees at the end, keep your price point honest but advertise all the benefits and perks that are included in that fee. For example, if you sell flowers, instead of cutting the home page price but tacking on an arrangement fee at the end, make sure to call out that all of your bouquets come with a free professional arrangement service.  Focus on your unique selling proposition and your pricing reliability – if you find yourself in a pricing war, advertising that you don’t have hidden fees will tip your customer off.

Hiring

In the age of the start-up, the “little guy” has a unique advantage, which makes it a good time to be an entrepreneur – but the expanded marketplace and surplus of options also makes it harder than ever to compete. It’s a great age to start and flourish as a start-up small business – so make sure you sound like one, you’ll gain the trust and ongoing business of your newly expanded consumer base.