Most independent retailers will face competition from many angles, and the arrival of a chain store competitor in your own town might be a daunting prospect. How can a small business not only compete against but thrive alongside large chain store organisations with a similar offering?
An important first step in marketing strategy is to establish your position in the market. You need a clear definition of what your business does, who it does it for and the fundamental reasons behind it all. Developing a brand proposition, writing your mission statement and preparing an elevator pitch as well as completing a SWOT analysis are all key steps in creating your marketing plan. Once you’ve established these basic ground rules you will be much better positioned to make decisions about how to take on your competitors.
When planning your marketing activity it is important to include campaigns that will bring new customers through your doors but it is also crucial to ensure you are working to make your existing shoppers feel valued and encourage them to return in the future to keep spending with you. Consider whether a loyalty or reward programme would work for your business. Types of business will vary and many retailers offer products that do not suit a regular repeat spending pattern and in these cases perhaps you could consider campaigns that try to connect new business through your existing clients, possibly including referral programmes.
It’s easy to create a beautiful looking store if you have the kind of budget that your chain store competitors have access to when planning a new fitting. Things aren’t quite the same when you’re starting out, there isn’t an unlimited pot of money to magic things into existence. But first impressions count and you are likely to be judged on your image so spend some time auditing your customer journey and make thorough notes on what can be improved. Is your logo a good representation of your brand? Do you have a colour scheme that is consistent on everything you do? A small investment in updating the appearance of the store and making everything consistent will give a boost to customer confidence.
Large retail chains usually have complex pricing strategies going on behind the scenes. Typically there are products where the consumer will feel that price is more important, and will be conscious of how much to spend on that item, but other products where they will be less concerned and focus on other factors. You might not be able to compete on price for everything, but consider offering a ‘loss leader’ where you accept a very small profit margin on one particular item, ideally something very popular and typically fast moving. Heavily promote this item locally to attract customers looking for a bargain. Place this product at the rear of the store so that when they come to purchase, they have to browse a good percentage of your store looking for it, or better still engage with a member of staff. Both of these options give you considerable opportunity to connect with the new visitor and try to turn them into a long term customer.
You have a real opportunity to connect with the local population and encourage them to support local businesses like yours, in the knowledge that supporting these small businesses is good for their own local community. Large organisations might very well have significant budgets for (and fully staffed teams working on) social media and blogs but these activities will be so generic and diverse that they aren’t able to focus on the issues that affect your area. Engage with your customers about topics that matter locally and your efforts are much more likely to be rewarded.
Take time to regularly review your competition (perhaps as part of a SWOT analysis). Visit their stores and observe their customer experience first hand, and afterwards make a note of what you liked and what you didn’t like. Use the positives as inspiration to improve your own store’s customer experience. Try to focus your marketing efforts on the benefits of shopping with you, rather than a negative attack on your competitors weaknesses.
Small businesses are usually very streamlined and much more agile than large organisations. You can make fast decisions and react immediately to trends, without waiting for approval at the next bi-annual meeting. Support innovation from your suppliers by stocking the new products, and your store will gain a local reputation for being the place to go for the latest thing.