Success attracts competition, and in selected product/service categories, can often lead to a perceived saturated market of too many companies chasing too few customer dollars. In most cases, however, there is still room for innovation and creativity. How does a “newbie” start his/her operation in that sort of environment? It seems to me that the key is to stand out from the very beginning so that you immediately attract members of your target market, get their attention, and then begin developing relationships to hopefully make them “lifetime” customers.
This doesn’t have to be rocket science. Think about it….what attracts you to do business with a new firm? Of the companies that you currently buy products and services from, are there ones that exceeded your expectations from the very start, and for which you have developed a long-term loyalty?
Perhaps you are made to feel special when you trade with them. I once had an auto repair facility owner where I used to live that called me after most every visit to his shop, to make sure that I was satisfied, and to thank me for my business. That personal follow-up made me feel valued, and they would still be servicing my vehicles if they now weren’t so far away.
Perhaps you are offered some special incentive to initially stop by, and then to come back to see them. A new swimming pool supply dealer now has my business this season through attractive “loyalty program” deals and coupons that they keep showering me with. This is supported by a trained, friendly staff that now knows me when I walk in, and provides free valuable technical knowledge when needed.
Perhaps they simply provide great overall value in creative ways. There is a family owned ice cream store in a small town near where I live that has placed a complimentary cherry on top of every soft serve ice cream cone that they have served since they opened, just to make their product a little different than their major competitor down the road.
If you are thinking about starting your own business in a very competitive market, I would encourage you to consider some of the reasons for your own buying behavior, and then apply some of these best practices to your new business. Even in a saturated market, a business plan that includes a unique selling proposition and proactive relationship building can help you stand out in the crowd and improve your odds of developing a solid foundation of customers/clients for your ultimate success.
Larry White is a Business Advisor for the Central Indiana Small Business Development Center, an organization with the mission of having a positive and measurable impact on the formation, growth, and sustainability of small businesses in Indiaan, and to develop a strong entrepreneurial community. Larry can be reached at lwhite@isbdc.org.