Despite Netflix’s pointed fingers blaming its customers, the password-sharing ‘problem’ probably isn’t the reason for this mega-brand’s loss of 200,000 subscribers in the last three months. That’s just the symptom of an increasingly competitive market. Smaller and newer companies are taking chunks of Netflix’s customers by offering either diverse or better content, or by being more lucrative to its clients.
This issue is relevant not only to streaming companies. We live in a world flooded with countless companies offering similar services or products. Customers, being overwhelmed by the number of options available, tend to miss the differences between them. How can a company, especially a small one, stand out in this kind of highly competitive market? Is it even possible for a small business to survive in this economic environment? I am Ofir Bar, an experienced investor with a special interest in young startups and innovators, and I have some insights about this common challenge that might interest you.
Basics of the basics
I truly believe that even a small company can, and should, think strategically. It might not be enough to compete with mega-brands, but surpassing other small businesses in your sector might do just fine.
- Before anything else, it’s essential that you take a close look at your competitors. Who are they, and what are they offering? What are their strengths and weaknesses? What are they doing better than you, and how can you learn from them? Understanding these might help you to ‘choose your battles’ – and assist you in differentiating your business.
- Another fundamental step is to know your existing and potential customers. Clients’ needs and expectations tend to change throughout time, so find out what matters most to them now. Is it lower fees? Better service? The latest technology? Consider starting this research by asking current customers what convinced them to choose you over others.
Level up your strategy
- Find and manage a distinct Unique Selling Point (USP). This means finding THE reason for customers to buy from you, and not from your competitors. Your potential clients should know your distinct benefit before even starting to communicate with your brand. Remember, offering the lowest price is usually a two-edged sword: Once another brand offers a cheaper service, you’ll most probably be forced to lower your prices even further. For this reason, I recommend having a USP that is not price-oriented: a different business model, a better product, a better user experience, and so on. Having a viable USP is likely to help you keep existing customers and bring new ones, even if you aren’t the cheapest in your sector.
- Help people to get to know you and what you offer by investing in marketing efforts. This is done mainly using social media. Note that you might want to consider redesigning your digital presence every few years. Make sure all your promotional marketing efforts transmit a unified message. Do they emphasize your USP? Do they make your product seem appealing? By doing so, and asking yourself these questions, you improve the chances that once a potential client looks for a service that you offer, they will think of your brand first. Always strive to be at your potential customers’ TOM (Top Of Mind).
- Using a Customer Relationship Management (CRM) system can help you manage all sales and marketing efforts, meaning it can hold data about your clients, including their history with your brand. If you have the resources to possess it, I recommend using it. A CRM system can improve efficiency and communication, and allow a more personalized service. There are various types of CRM systems, so pick the one that is most tailored to your needs. If you are low on budget, you can alternatively use Google Analytics. This is another great tool for understanding clients’ needs and triggers, and many of its features are free of charge.
- Increase your customer base by targeting new audiences. Don’t forget to adjust your offer to different market segments. Understand the new potential customers’ needs and local competition. Having said that, don’t neglect your existing customers. Maintaining current clients is easier and cheaper than finding new ones. Remember that they might one day decide to end business with you and move to your competitor, so offer them benefits and improve customer service.
- Most businesses tend to forget a simple truth: An employee who feels taken care of is likely to give better service to clients. consider paying your employees a bit more than what is necessary, or offer benefits. An even better motivator is a good relationship between the employees and their supervisors and other employees. Offering options for career development is also a great idea.
- Lastly, always have a plan for the future. Every day stands on its own, though defining a major goal can help you prioritize and have a better business orientation. What do you want your company to look like in one year? Three years? Five years? Answering these questions is the first step toward achieving these goals, and staying ahead of your competition.
Planting the seeds
Nowadays, entrepreneurs are maintaining companies in highly competitive surroundings, and that is far from easy. The more brands offer similar services the more difficult it becomes for businesses, especially small ones, to not only survive but also succeed. There are no easy solutions for making your brand stand out. However, as I hope you’ve learned from this post, it all starts with strategic thinking. It might be a pricy, long, and exhausting process, but it has the potential to plant the seeds of future growth. That’s why I believe these efforts are a good investment for businesses in the long run.
