Small start-ups are in a big disadvantage as they are entering the market. They need to confront much larger competitors who have solid position in the market. In many cases, these big players are able to offer lower prices and run more advertising campaign. Despite these challenges, it is possible for small business to perform successfully in the market. There are methods that you can implement to carve out excellent position in the market and drive sales. These principles should apply for both traditional small businesses and online commerce websites. Here are two approaches that small start-ups can take:
- Become an “alternative”: If there are already big competitors in the market, you need to properly shift your market position, so you don’t need to compete directly. It is possible to obtain good sales by becoming an alternative to the market leader. You may advertise and promote specific aspects of your services and products. This is a classic strategy for newcomers in the market. It will be possible for you to compete in small areas in the market that are not yet fully exploited by major players in the market. As an example, Pepsi positioned itself as the Choice of a New Generation, while Coca Cola continues to stay in its traditional positioning. Today, Pepsi continues to become the number one contender in the cola industry and it is making billions in the process. This method also applies for small business and new dot com companies. New business owners should survey the landscape to gauge its degree of competitiveness. Although you may not become the second place in the primary market, being able to conquer small niches can offer huge profitability.
- Sell what’s not available in the market: There could be small details and trinkets that are not yet supplied by big competitors. Those little things could complement or enhance the experience of using existing products. As an example, many small companies provide innovative accessories for Apple iPhone and iPad. There’s no way for these companies to compete directly against Apple and other smartphone makers. However, they are often skilled and innovative enough to provide new items that improve the experience of using existing smartphone and tablet models. If a start-up provides innovative technology, they may look for ways so their implementations can improve what’s available in the market. If you are lucky enough, big corporate may make a move to absorb your start-up through acquisition of technology and the business itself. With a meagre starting capital, you may end up with dozens or hundreds millions of dollars, once the acquisition is completed.
Regardless of what method you choose, it is important to drive awareness for your presence. It takes time to slowly build your reputation and you can often achieve it through proper credibility. Follow all the basic principles of starting and running a new business to improve your chance of success. Pitch ideas to the market and media, so people may start to think that your product and technology could become a game-changing solution.