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Direct Marketing Article |
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Succeeding in Established Markets
Starting last doesn’t mean you can't finish first
By Marc Gordon
During tough economic times, one statistic that rarely gets mentioned is the
number of new businesses being registered. Of course when you think about
it, it should come a no surprise.
As more people are offered incentive packages to take early retirement or
accept a severance package as a result of company downsizing, many of them
are find themselves with no job, but not ready to end their working careers.
With a one time influx of cash, they are ready to make the jump into self
employment.
While starting a business can be as easy as registering a name and opening a
bank account, the real test comes in being able to survive and thrive in a
market place already occupied by established companies.
One of the most often asked questions I hear is how to enter a market
dominated by a couple of big players. New business owners are overwhelmed at
the notion of being able to compete with known names and brands who have had
years to solidify their market position through strong marketing and market
recognition.
The fact is that in many cases, especially with small business, market
leaders do NOT have a legitimate hold on the market. They are just lucky.
One of my clients relocated to a small town after taking an early retirement
package form the company he worked 30 years for. He had always wanted to
open a pizzeria and decided that this was the right time.
In this town there was one other eat-in pizzeria that everyone in town went
to. Word on the street was that they had the best Italian food around. My
client was concerned that success would be tough to get as this other
business seemed to own the market.
But when we looked at the competing pizzeria closer, we realized their
market position was not legitimate. The prices were high, the menu was
limited, and the décor was old. What they had going for themselves was great
food and no competition.
Even if you’ve never owned a restaurant, you can see where the opportunities
are to take a run at this market. Within a year, my client had built his own
pizzeria. The menu was bigger, the prices were better and the décor was
clean and inviting.
As for the food, he used proven recipes he had grown up with. He also lured
away one of the cooks from the original pizzeria buy offering a slice of the
business (no pun intended).
If you are starting a new business, or have an existing business and find
the market place ruled by someone other than you, take a closer look at why
they’re there.
Ask yourself these questions regarding you current or potential
competitor before creating your business strategy.
Are they the only place in your area that provides the same product or
service as you?
If so, maybe the time is ripe for you to start your business. If not, you’ll
have to decide if the market is ready for another entry.
Is their quality of product or service perceived or real?
Just like the story of the pizzeria, even if everyone says they’re the best,
the best compared to what? Don’t let people’s opinions be your deciding
factor. Opinions can quickly change in your favour.
What makes them unique?
Being unique can be as simple as having an unconditional satisfaction
guarantee, or and eclectic variety of products. Find out what your
competitor’s unique selling proposition is and how you can adapt it to your
own business.
What benefits do they do they offer their clients?
As yourself "what’s in it for me to shop there instead of at my own
business?" Do they help their clients save money, make money, have more fun,
have more free time? How does your business measure up to what benefits they
can provide to the market?
Are they resting on their laurels?
Many business owners can grow complacent and lose the innovative thinking
that brought them success early on. This can be especially true for
companies run by second or third generations of family. Beyond a name and
reputation, look closely to see if there’s any real reason your competitor
deserves to still be in business.
Remember that every existing business at some point started with just one
location and one dream. McDonald’s, Wal-Mart, Sony, and Honda are all
examples of companies that have grown from a single location with one owner.
Why shouldn’t you be next?
About the Author:
Marc Gordon is a professional speaker and marketing consultant based in
Toronto, Ontario. His firm, Fourword Marketing, specializes in helping
businesses create a brand identity and developing effective marketing
campaigns. Marc can be reached at (416) 238-7811 or visit
www.marcgordon.ca
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