Innovation is always the key to success for any small business. In this case study, we’ll show you how something as mundane as a donut shop can find new, innovative and creative ways to inexpensively position themselves as a dominant force in their market.
Through innovation, it’s possible for any small local business to compete and even beat its larger competition. We will use the following six areas to highlight how this can be done quickly and inexpensively: (1) effective branding, (2) gathering customer contact information, (3) working the local area, (4) joint ventures, (5) working the database, and (6) creating something BIG.
Step one involves branding. Many business owners think this means using any methods possible to “get their name out there.” That would be nice, but NO small business can afford to that these days. In today’s media saturated world, branding for a small business MUST revolve around the creating of “top of mind awareness.”
In other words, you MUST brand your business locally, so that when any local prospect has a need for what you do, your business immediately springs to mind. I’m about to explain how to do that if you owned a donut shop. However, take this information and apply it to YOUR business. I guarantee you that with VERY minor shifts, everything I’m about to reveal can be used to position your business as the dominant force in your market.
Let me quickly overview the six steps I just highlighted. First, everything must be branded… from the decorations to the company van, including signage, logos and company colors. Then create a signature item for your business. Be the “Home of the Whatever.”
If you run a donut shop, create a donut double the size of typical donuts. If you give haircuts, offer a five-minute head massage and dub it “the meltdown.” Don’t skimp on this step. Cheap looks cheap. Spending a little money here will be invaluable.
In step two – (the key to the whole program) – you must collect the contact information for every single customer who walks through your doors. To do this, create loyalty programs as incentives. Consider incenting your employees so that they have a vested interest to make sure that no one leaves without filling out a customer contact card.
In step three, try the 5 x 5 x 50 plan. Pick five local companies for five days and send them promotional materials for 50 weeks. Just give them whatever you sell – donuts, haircuts, sandwiches, whatever. Make sure you exchange the free vouchers you will provide to them for contact information.
In step four, create joint ventures with local companies. Write a “Joint Venture Getter” letter and ask if you could provide your product or service for free for the other company’s customers. Even offer to create the marketing that links them to your product.
In step five, work the database consistently. Email, mail and text message your database perpetually. Make it fun. Send them games, offers, etc.
In step six, go BIG. Try something newsworthy to get the public’s attention. You could openly declare war on your competition and print T-shirts and bumper stickers that deliver your message. You could hook up with a local charity and give away ALL proceeds for a certain day or days. Try to set a world record. Pull off an elaborate stunt. Just find a way to get prospect’s attention.
If you follow these steps you will not need a large marketing budget to beat the sizable competition. Like David who beat Goliath with a single but deliberate blow, you too can knock out the competition.
A friend of mine who lives in Texas recently walked into a donut shop and was surprised to see that it was owned and operated by a Korean family. “Just opened?” he inquired as he approached the eager employee standing behind the counter. “Three weeks open now,” came the broken-English reply. My friend was amazed that after being open only three weeks, this shop already had the look and feel of a crusty little donut shop that had been there 25 years.
It wasn’t dirty — but there was absolutely nothing remarkable in the entire place. The walls were all painted pale yellow, and on the left wall was the standard-issue donut shop drink cooler with sliding glass doors and an assortment of juices, milks and energy drinks. Just past the cooler was the huge Jesus picture — the one that’s always there in these kinds of shops, unless they have the more traditional Buddha-type statues. Just below that was the 17-year old CD boom box playing random light rock hits from the 80’s.
The back wall featured a bulletin board where you could leave your business card, which caused my friend to think — do you really want to hire an accountant, plumber, or personal trainer you found on the bulletin board at the donut shop? A half dozen of those flimsy little donut shop tables and chairs were in the middle of the shop for those who preferred to dine on their donuts while reading the Korean newspaper that was conveniently available. The glass cases under the counter featured an assortment of nice looking donuts.
Five dollars a dozen was the asking price on the menu board above the clerk’s head. It was the generic kind of sign with lines on it that you can stick letters on to form whatever words and prices you want. Fancy and cream-filled donuts would cost extra, but for regular old donuts, their price was a full dollar less than the Evil Empire (Krispy Kreme) was charging less than a mile down the road.
My friend bought his standard cache — a dozen glazed and a dozen chocolate sprinkles plus 3 chocolate milks for his kiddos back home — and the lady threw in a dozen donut holes for free — a nice touch. He got out of there for just under fourteen bucks. Not too shabby.
As he drove home he couldn’t help but think that this brave little startup was doomed to be crushed by the venerable Krispy Kreme – in fact, it was only a matter of time. But it didn’t have to be this way! A savvy Korean shop familiar with basic marketing principles could take a chunk out of KK’s hide if they would just employ a few simple strategies. Four strategies to be precise — detailed here for your reading pleasure. Think of these strategies as the holographic Princess Leah that R2-D2 kept showing Luke in the original Star Wars. Here’s the blueprint required to destroy the Death Star, and along with it… the Evil Empire.
Next time, we’ll discuss strategy one in detail…
Ted Leithart of Loveland, Ohio, President of the Leithart Group, LLC, creates more profitable ways for your business to make money without changing your business model. More information may be found at http://www.TedLeithart.com or by calling 513-833-7966.
Source: Ted Leithart