As many consumers are being ignored by big brands, the vacuum is being filled by smaller brands that are observing and hearing what these consumers are looking and demanding. This, as smaller brands with the use of the internet are building powerful connections with their customer base. After all, is this not how Amazon started up? By catering for the “longtail” of needs that got overlooked?
This is against the idea that when the customer stands out, the small brands will cash in. In addition, it was the retail analyst for The NPD Group, Marshal Cohen, which declared that Customers today are not looking to be one of a million people — they’re looking to be one in a million. They want to stand out.”
As such, there are some tricks that big brands can do, instead of just focusing on scale, to deal with the power of competition from small brand. Here are a few lessons big brands can learn from smaller brands.
The power of social media
Big communication budgets can also be a thing of the past, if you look at the potential power of social media. An example is that of Tracksmith, This luxury apparel brand based in Wellesly, doubled its social media budget to $5000 in advertising spending. Still this brand which was launched in 2011 can completes against big brands like Nike, Puma and Adidas, where about to tell a seductive and inspiring stories through a brand story that contains photos that showed everyday runners sweating, training and looking knackered after their training session. This was a contrast against the normally triumphant depiction the bigger brands were doing. This in fact led to Pentaln Group, which has a stake in Speedo, and holds the licenses for Ted Baker and Lacoste footwear, offered Tracksmith an investment deal of $4.1 million.
Get to know your costumers better
It might seem strange, but many big brands seems to forget who their customers are, instead would rather want a one fits all approach. But a smaller brand know will that they are closer to their customers.
A good example of a company that build is business around the customer is that of Victoria Secret. This a their CEO once declared, “At Victoria’s Secret, everything feels very focused around how males are really viewing women,” and that, “lively is about creating something that’s made by women for women, really thinking about how a woman is going to feel in it and what that product does for her mindset in terms of confidence and power and comfort.”
Added to that, there is a trend towards segmentation. This is something that small brands seems to grasp better than their bigger peers. But what segmentation allows is that the targeting of individual groups can be done allowing for the business owner to speak to that group based on different sub groups to have a more bespoke message as compared to a one size fits all approach.
Using research and building up profiles of the customer could also help to enhance the knowledge the company has of the customer they are servicing.
Big multinational companies such Unilever still does not a digital presence. This as smaller brands are producing similar products at lower prices thereby eating away at these super big companies’ profits.
Therefore, something that big brands can learn from smaller companies are to make sure that they are selling directly online. Examples of smaller brands that sell direct online are Tracksmtih and Lively just to name a few. The use of technology provides a platform for smaller brands to compete on par against the biggest and mostly established brands.
Big brands, which mostly rely on their size, can learn from the innovative and clever ideas that the small brands are using. In most cases, the small brands are using technology to level them with the biggest brands. But the smaller brands are building up a better relationship with their customer, which is something big brands should take note of. More so, small brands are sharing messages that resonate with their audience, instead of pushing out genetic messages to a wide audience with the hope that the message will be accepted. In short. Big brands needs to find a new way of thinking, as the traditional ideas might not be applicable for much longer in this increasing digital world.
Thanks to my apprentice Clive who helped draft this piece of thought leadership.