Did you know one of the main reasons behind startups failing is because they choose to tackle problems that are interesting to solve rather than those that serve a market need? And the fact that less than 1 % of start-up companies ever develop into a “unicorn”?
In this technologically disruptive world where AI and innovation are at the forefront of driving the carriage of successful businesses, the road to launching and growing a start-up or small to mid-size business is not an easy path. For businesses to scale and successfully expand, they need to better understand their differentiating strengths as well as the product’s unique selling proposition and most of all, its impact on the market. So then how do small and medium-sized enterprises survive in a world that’s characterized by competition, technological change, and perpetually undergoing innovative disruptions outbursts and evade these aforementioned industry statistics and outcomes?
Here are a few tips and insights for small businesses to survive in this disruptive industry:
- Know the market and the impact of your product: Spreading your business too thin in the beginning by trying to include a wide variety of services that caters to the needs of multiple groups of people isn’t exactly the right way to scale up. It is best to stick to your area of expertise. Identifying the right target market and submarket to which your product belongs should be the first step. Now, map out your business journey and the impact your product will have on that market. It is critical to be vigilant in promoting differentiating factors that set your product apart from the competition. It is so much easier to identify the target audience if your product is specific. For MSMEs, it is a given fact that when you’re in the nascent stage, you’ll have limited resources, and thus, so should your market.
- Know your customers: For MSMEs to thrive, they must have a forward-looking approach rather than just focusing on daily challenges. Asking your customers what they want or will need in the next 2-3 years is the game. And the way to win this game is through taking a deep dive into your customer base early, analyzing, and pinpointing who your ideal customer is and what are their needs. This will not only help you engage with your customers proactively but also with additional insights on how to best enhance your products and business model to better serve them.
- Knowing the industry In and Out: Many MSME entrepreneurs limit themselves by focusing solely on being an expert on their products. But there is much more and beyond products. To exceed customers’ expectations, one must be an industry expert to better understand one’s market position- what’s there, what’s not there, and what’s coming down the pipeline. After identifying the market and submarket for your product, strive to become the thought leader and “sponge” within that field, soaking up any and all information that’s even remotely associated with your business. Deploy solutions like Workforce management to further strengthen your organization and make your resources more efficient. Although it is impossible to be an expert in every aspect of a given field, entrepreneurs should work to understand the overall landscape of the industry, incorporate their niche, and become thought leaders at that intersection.
- Develop a niche product and specialize: Creating a niche product (rather than a general product) allows your company to set industry standards for others to follow. When bringing your product to market, ensure that it solves a specific problem that cannot be solved by other means. Once you’ve determined that your product is both unique and serves a purpose, look for ways to constantly update and improve it. The key here is to specialize in your offerings.
- Provide Unparalleled Customer Service: Some experiences that smaller, more niche businesses can provide, large chains fail to provide due to the very factors that drive their success. While big businesses can typically leverage millions in advertising budgets, small businesses can offer a more personalized and customized customer service. According to the global Zendesk Customer Experience (CX) Trends Report 2022, 94 percent of Indian consumers said that a positive customer service experience makes them more likely to make another purchase. Further, 99 percent of these consumers were willing to spend more money on businesses offering personalized and streamlined experiences. While large corporations frequently have a “one size fits all” mentality, small businesses can capitalize on this by taking the time to get to know their potential customers, assessing their needs, and developing a solution that is tailored for them. Innovative solutions like Voice Analytics provide deep business insights hidden inside every customer interaction— eventually creating customer and business delight.
Thus, there’s no rulebook to surviving and succeeding as a small business in big industries. But the sure shot trick to reach there is by being the best small business you can be and conducting the necessary preliminary research to determine where your company fits into the larger ecosystem. Remember, the more specific, specialized, and niche the product, the better your company’s chances of survival and growth in this vast ocean.
By Uthaman Bakthikrishnan, Executive Vice President, ClearTouch