In today’s fast-paced business environment, small and medium-sized enterprises (SMEs) face unprecedented levels of competition. At Newable, we recognise the challenges that SMEs encounter and are committed to providing expert guidance. In this interview, David Zerny, our Innovation and Growth Specialist, shares valuable insights and strategies to help SMEs thrive amidst competition.
What are some strategies businesses can use to differentiate products or services from our competitors?
The 7 Ps of Marketing serve as a strategic framework. By focusing on product design, features, quality, and branding, businesses can differentiate their offerings from competitors.
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- Product: put simply, does your product (or service) provide outstanding value for your target customers?
- Price: does your pricing represent a fair exchange of value for money? Are you under- or over- priced, against competitors and are you maximising what you could charge?
- Place: is your product available at the right place, right time, right quantity?
- Promotion: does the way you promote your product give customers a reason to choose what you offer, over someone else?
- People: does your team appear friendly and helpful? Are they knowledgeable about your product, and have the right attitude?
- Process: is your product or service easily accessible? Is it easy to order- receive a delivery- return an item?
- Physical evidence: do you evidence the excellence of the customer service you deliver, e.g. offering testimonials, case studies?
Additionally, a lot of purchasing decisions come down to trust; and that is engendered by visibility.
- Be seen as an expert in your field, especially if leading a business. Share knowledge and encourage others to ask you questions.
- Join the business community, e.g. consider joining a local Chamber of Commerce, the FSB, local business groups say as a guest speaker.
- Build connections; for example, use LinkedIn to build awareness of your areas of specialist knowledge
What are your top tips on how to better understand competitors’ strategies and use this information advantageously?
- Study their website and wider online presence: what do they say about themselves, how do they position the business and its products or services?
- Get to know them- talk to them, buy from them, or ‘mystery shop’.
- Join a trade association- they may have data about the sector, or be able to guide on
- Use the data to consider the size of the potential:
– whether you want to compete directly
– if so, how, when and where for example in a part of the country where a rival doesn’t have shops or a strong presence
– whether there is a niche you can exploit
– or not to compete.
What are the key factors that make businesses successful and how to incorporate these into a business model?
Two key factors are effective leadership and having adequate access to finance, such as having enough cash in the bank, or friends and family who will lend money.
Of course, your business model needs to generate cash as early as possible. To do this you need a clearly differentiated, and financially quantified, value proposition product which delivers value to its target market and which customers buy- repeat purchase- and recommend to others.
Professor Malcom MacDonald says “Essentially, a value proposition quantifies in financial terms the value the customer receives from dealing with the supplier. It is about four things:
- a) added value (e.g. revenue gains, productivity improvements etc.);
- b) cost reduction;
- c) cost avoidance; and
- d) risk reduction.
What are your top tips on how to use market research to better understand a competitive landscape?
- Do your research: Understand what makes the current market leaders successful- where are there gaps or weaknesses- and can you exploit them viably?
- Set out differences between primary and secondary research;
– If conducting primary research, have a clear objective in mind
– Ask ‘Why’? i.e. you want to find out not just what someone buys, or uses; but why they made that choice
– Don’t just speak with people you know- you want to get an unbiased response. So if you want to understand whether there might be demand from dry cleaners for cleaning product x in your local town, for example, try to survey a wide cross section.
What are some effective marketing strategies to increase visibility and appeal to potential customers?
- ‘Be seen where your customers look’: where do people who use your product seek information- is it on Google, trade shows, membership bodies, etc?
- How and when do they prefer to be communicated with?
- Think about how you would like to be approached and what might incentivise you to respond?
Are there pricing strategies to attract customers without compromising profitability?
Yes- establish, maintain and reinforce an RRP that is a fair exchange of value for money.
Check that your value proposition, i.e. the aspects of your product or service that make your target market want to have it, is closely aligned to their needs, and that your marketing evidences that value. For instance, through case studies or user testimonials.
Pricing strategies can include gradually increasing prices and/ or lowering costs; but you may be constrained by what margins competitors in your sector settle for, e.g. whether they sell ‘loss leaders’. For instance, supermarkets will sometimes position special offers near the entrance to encourage consumers in, knowing they will then buy other, higher margin items.
What are your top tips for staying on top of industry trends and competition?
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- Understand both the micro (immediate, or local) and the wider macro- environment
- Take note of the wider factors that will affect and influence your customers, for example a change in interest rates or increase in inflation.
- Keep in touch with current news
- Speak with customers; what are the main factors affecting the growth of their company?
- Attend networking events, and ask people how they are finding doing business- is it easy, or are times hard, and why?
About Newable
For over 4 decades, Newable has been supporting thousands of businesses every year through the provision of Money, Advice and Workspace. An employee-owned business with a commitment to creating positive impact in all that we do, our team are on hand to help your business today.
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