Identify an industry where small and large businesses compete with each other.
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Most people agree that a little healthy competition is a good thing—but what happens when that competition becomes seemingly impossible to manage? With this issue in mind, we posed the following question to The Experts: What's step No. 1 when you suddenly find yourself in competition with a larger business? Resume SubscriptionWe are delighted that you'd like to resume your subscription. You will be charged $ + tax (if applicable) for The Wall Street Journal. You may change your billing preferences at any time in the Customer Center or call Customer Service. You will be notified in advance of any changes in rate or terms. You may cancel your subscription at anytime by calling Customer Service. Please click confirm to resume now. Entering an industry as a business owner where big companies are already operating in the space is a bold prospect and very intimidating. Though it’s not statistically likely that you’re going to be able to jump in and overtake a company like Target in their home court, you can absolutely prosper and even proliferate alongside the well-established heavy hitters. If there are multiple businesses who are offering the same product or service within the same general area, then that means there is probably a large enough market to support them all. Dig in, commit yourself to the task, and use the following strategies to give your small business every advantage that you can. The Odds Are Already in Your FavorWith some exceptions, nearly everything about what a small business produces is better than the big ones. Service and support are generally faster and more attentive; quality control is better because it’s far easier to manage quality with a lower volume of products; and the speed and accuracy with which orders are fulfilled is superior to that of big companies for the same reason. Another advantage that you have automatically with a small business is that today’s consumers are increasingly looking for a more authentic experience with businesses. Big companies have a much harder time providing that authentic experience, whereas small businesses tend to thrive on it. You can concentrate on the customer experience much more thoughtfully in your business than a larger business can, and that gives you the opportunity to give customers the authenticity that they crave.  Customer Service Can Be Your Most Valuable AssetExploring a little further that point regarding a more genuine & authentic customer experience, you can even turn it into your greatest selling point, as most smaller businesses seem to be doing now, as well. Massive companies, like those in the telecom industry, for example, are notorious for providing terrible customer support, and in the tech arena–just a side note–that can be a killer because it’s one of the industries where support is needed most. In a very informed article published by the Harvard Business School, they explain that, “The companies (disruptors) spearheading the trend [of decoupling] look for opportunities to deliver what is of most value to the consumer while stripping away what’s not, leaving the rest to be delivered by the established player.” This is a progressive trend that the article discusses, which is based on the idea that new, disruptive companies are doing something called, “decoupling”, which the author describes as the extraction of the services or products, or certain aspects of the service or product, that the customer really wants from the bundled products that established corporations sell to the consumer. We’re taking the article’s point a little out of context, but this trend is 100 percent applicable to the realm of customer service. Small businesses have been noticing for a few years now that the foremost aspect where businesses need to beat their competitors is customer service and support. Customers will drop you like a bad habit if your customer service is lacking, and the large corporations are still catching on to the idea while small businesses & startups have already understood it. Give Your Products a Personal TouchYou have the ability, as a smaller company, to make your customers’ experience more personal by adding simple touches, especially through a human connection through your staff. This can actually go one of two ways: On one hand, you have way lower volume than your huge, corporate counterparts, which may allow you to personally connect with customers; however, when you’re still small, this strategy could completely overload your employees because you haven’t hired sufficient support personnel just yet. In either case, you should still make an effort to connect with your customers without going through some CRM software, which is of course very useful, but not for all aspects of the customer experience. There is the option of deploying a major directive to assign employees to a group of customers whom they will stay in contact with as needed, personally. Although, you can do something much simpler like sending a personalized note to people when they become a new customer. Get creative with it & try to add some kind of touch that just shows them you don’t see them as only a number. Market Your Business as an Alternative to the Big, Bad CompaniesTo market yourself as the solution to cold calculation of big business gives you a very effective selling point. The online merchant Etsy is a perfect illustration of this strategy. Though Etsy does target a specific portion of the online sales market, they also managed to paint themselves as a somewhat warmer, more inviting online seller than Amazon. They don’t make much of a dent in Amazon’s revenue–who rakes in almost half of all online sales–but if you can’t find something on Amazon, you might check Etsy next. That’s a really good spot for a business to be in. Most big companies have a really hard time making their customers feel well-taken-care-of, which puts your small business in a great position to pick up where they leave off. Do Some Guerrilla MarketingIf you’re unfamiliar with this concept, guerrilla marketing employs nontraditional methods and tactics which are usually extremely creative, to advertise or promote a business’ product. Large companies & corporations are usually afraid to utilize guerrilla marketing because they’re worried about getting wrapped up in any kind of controversy or bad press, which gives you, as a small business, the perfect opportunity generate some grassroots & potentially mainstream attention by using unconventional methods. They call it guerrilla marketing because it is typically organized at very low cost and executed without going through normal channels. They key is to do it in a nontraditional way because it’s an awesome way to set your business apart from the “normies”, especially the huge, corporate ones. To use these methods, you will need to get very bold and creative–possibly even hire an artist or two. If you’re interested in testing this strategy out, then you can see the link below to check out a bunch of examples of truly inspired guerrilla marketing campaigns that other businesses have used. The takeaway here is that you really can compete with big businesses if you double down in the areas where they fall short, such as outstanding customer support and a product of superior quality. The concept of decoupling is another thing that new businesses should keep in mind because it’s a chink in the armor of the old guard of large businesses. You can also find a link to the article about decoupling at the end of this post. You may not be able to overthrow the big companies, but if you do everything better than them, then you are a formidable competitor. SOURCES: 1. Michael Blanding, “Disruptors Sell What Customers Want And Let Competitors Sell What They Don’t,” February 2, 2015, Working Knowledge: Business Research for Business Leaders, Harvard Business School, https://hbswk.hbs.edu/item/disruptors-sell-what-customers-want-and-let-competitors-sell-what-they-dont 2. Guerrilla Marketing: About the author
StephanieStephanie is the Marketing Director at Talkroute and has been featured in Forbes, Inc, and Entrepreneur as a leading authority on business and telecommunications. Stephanie is also the chief editor and contributing author for the Talkroute blog helping more than 100k entrepreneurs to start, run, and grow their businesses. How can a small business compete with a large business?Don't Let Big Brands Swallow Your Business. Establish a Solid Digital Presence for Your Small Business.. Test Out Marketing Trends.. Build Your Business's Reputation.. Deliver Excellent Customer Service.. Make Improvements Based on Customer Feedback.. Segment & Refine Your Target Audience.. What are the five areas in which businesses compete with each other?According to Porter, there are five forces that represent the key sources of competitive pressure within an industry They are:. Competitive Rivalry.. Supplier Power.. Buyer Power.. Threat of Substitution.. Threat of New Entry.. What are competing industries?Industry competition includes businesses that sell a similar product or service. So if you're starting an online clothing store, your industry is digital retail and your competitors are other online apparel companies.
What is it called when companies compete with each other?Business competition is the contest between organizations that provide similar products or services or that target the same audience of consumers. Businesses compete to convert and retain customers, increase revenue and gain more market share.
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