This article was originally posted on ScoreNYC
Small businesses and corporations have little to do with one another at first glance. The parable of David and Goliath quickly comes to mind: one side features a small, hungry upstart, while the other features an established legacy company with all the advantages — and consequently, everything to lose.
In truth though, this zero-sum mindset is not only inaccurate, but also counterproductive. After all, small businesses have a lot to learn from their corporate rivals, especially where it concerns the areas of systems, branding, and the use of analytics and data. The big difference is scale: obviously there’s a large disparity (in finances, time, and staff) between a corporation and a small business. All the same, with enough creativity and imagination (as well as the power of the internet), small businesses can apply big company knowhow to their own business model.
Invest in branding and design
As a small business owner, it’s easy to dispense with branding and logos. After all, as one experienced designer writes, branding is something of a vague catch-all term, which comprises your company’s personality, reputation, and identity all rolled in one.
Yet branding has a more practical purpose. In an increasingly crowded playing field (worsened by the proliferation of internet-based companies), branding is the best way to stand out. In fact, modern brands arose from the desire of consumer packaged goods (CPG) companies such as Procter and Gamble, General Foods, and Unilever, to give product lines distinct characters. Not only would this make them more memorable to consumers, branding was also a shorthand for a range of snap mental associations for customers, the most important being quality. For instance, Frooty and Tasty Cereals are far sweeter and crunchier than their generic competitors.
And while branding isn’t cheap, it’s likely to be far less expensive than you may expect. While it may not make sense to hire an in-house marketing, branding, and design team, it’s easier than ever to find skilled freelancers to assist. Though I can’t recommend platforms like Fiverr or Upwork (there are far too many low-cost, low-margin designers who plagiarize work), it is possible to find marketplaces with a base of vetted, reliable designers (99designs is a good place to start).
Yet if you balk at the slightly higher cost of these freelancers, just remember: effective design and branding pays for itself many times over. In a surveyconducted by Motiv Strategies and the Design Management Index, researchers focused on the monetary returns to a series of “design-centric” S&P 500 companies, such as Intuit, Disney, or Apple. They found that such design- and brand-conscious organizations saw a 211 percent return on investment.
The verdict is in: brand your business — or languish.
Digitize, if you haven’t already done so
It should be clear by now, but small businesses must build — and optimize — an online presence if they want to survive. Much of it comes down to sheer numbers: one McKinsey report states that over 60 percent of Americans have a smartphone; of this demographic, the majority (80 percent) shop on their smartphone, researching product specifications and reviews, and comparing prices.
As the McKinsey report makes clear, brick and mortar establishments can succeed by uniting traditional advantages of physical retail (the tactile, in-person experience) with digital advantages like scanning QR codes or RFID tags on smartphones, the ability to post and read reviews, or even the use of augmented reality (AR) apps, which allow customers to virtually try on garments or products.
Needless to say, these high-tech solutions aren’t for every business. For instance, a family-owned diner doesn’t necessarily need an augmented reality app. But at the very least, this diner does need a strong web presence. This includes a good website with a great layout, a menu, and bright, appealing pictures. Additionally, the establishment should maintain an active presence on several social media channels, such Yelp and Instagram. If they wish to pull in web-savvy, connected customers, some level of digitization is a must.
From there, however, the possibilities are almost endless, limited only by creativity, time, and budget.
Use Data and Analytics
Big data is scary, and for good reason: concerns about surveillance, privacy, and monetization are at the forefront of the news, and rightfully so. These are all sticky questions with no easy answers, and cut to the core of our expectations of a free internet.
But in the modern consumer economy, data is essential to your business. Just look at Amazon, which built itself from an online bookseller into an e-retail powerhouse largely by cleverly using data. Its recommendations engine, for instance, sifts through your past behavior to make highly personalized, relevant recommendations. It’s so successful that the recommendation engine alone generates 35% of Amazon’s revenue.
Obviously, Amazon has deep pockets and an army of workers (not to mention investors). But using data and analytics to drive any part of your business, be it sales, marketing, or operations, is not as hard as it once was. For one, Amazon released the software behind its recommendation engine, called DSSTNE; this saves a small or mid-sized business the trouble of having to build a framework from scratch.
Moreover, it’s remarkably easy to find outside specialists to help with the nitty-gritty details, such as sifting through data, aggregating raw information, and drawing conclusions. Not only are there freelance data scientists, there are also firms with various data-related specialties, such as online marketing and search engine optimization (SEO) or website testing and optimization.
Ultimately, big brands and small businesses aren’t necessarily doomed to exist forever in an adversarial relationship. In fact, there are plenty of lessons each side can draw from one another. For small businesses, much of this centers around improving back-end systems: digitizing their business, investing in good design and branding to stand out from the crowd, and finally, using data to drive business and marketing strategy.