“A small business can do things a large one can’t with marketing – relationships, customized, local. Large businesses are selling predictability, not community.” —Adam Davidson
This continues a discussion from my last post on the Underestimated Small Business Advantage of building relationships with community.
While building relationships really, truly is within reach of small business and not so much for large companies, another advantage of small business also exists. Small business has the distinct advantage of offering a product or service customized for a narrow segment of the market. In fact, this advantage creates the potential for being more profitable, popular, and more appealing than the large company you might compete with.
What does this look like? Here are some examples:
- The Northern Italian Seafood Restaurant
- The attorney specializing in IP for startups
- The auto repair shop focused on serving women, perhaps single moms.
- The architect for green, sustainable houses
- The movie theatre that brings food and drinks to your seat
All of these have larger company counterparts that can never offer the specialized expertise or experience – those large companies need to continue to optimize for the general approach: Olive Garden offers a range of watered-down Italian-style food so that they can appeal to the widest audience and streamline their operations.
You likely already have an ongoing, decent business. Maybe you’re already highly focused on a particular segment – awesome! Congratulations! For most of us, narrowing our focus feels counterintuitive: don’t we want as much business as might be even vaguely interested in us? Isn’t the idea to attract as many people as possible?
Here’s why you want to focus, in addition to the fact that it gives you a huge leg up on your large company competition: people then KNOW your business for something memorable. That all by itself means you have a chance of sticking in their brain. Maybe they’ll remember you when they need your business, and maybe they’ll remember when someone else needs what you do. But if you don’t have that single centerpiece (of course you can offer other things), then you’re likely to not be remembered at all.
If you’re not highly focused and you’re offering a bunch of options – a menu of services that’s a mile long – you can switch that up. How do you do that? You take a look at a few things:
- Who would you like to focus on? Maybe some of your best customers already fall into a category that you just haven’t defined yet. Or maybe you there’s a certain type of customer you’re uniquely suited to serve?
- What are your strengths as a business? What do you do so well that a certain type of customer would really appreciate?
- Where are your competitors dropping the ball? Who’s being left behind?
The process of uncovering a focus and then acting on it isn’t for the faint of heart – this takes work and new thinking. But it’s completely worth it financially as well as streamlining your business and getting rid of what’s not delighting you or your customer or your employees.
I just finished a book that discusses this. Don’t let the title put you off, you don’t need for your business to be your passion in order to get a TON of value as a small business owner: The Passion Economy by Adam Davidson. This book is filled with stories of businesses that focused and flourished and left behind the black hole of competing on price and with larger companies.
“Large companies can’t offer the same level of attention to detail and relationship – so they market the things they can offer and make the small business offering look less enticing.” —Adam Davidson