Why Competition Over Price Is Destroying Your Small Business Advertising
Advertising can make or break a business. Large scale businesses have enough advertising resources to pay top dollar on their advertising, while small business advertising needs to be cost effective. Most small business heavily relies on marketing techniques to gain more customers.
Thanks to the current recession, small businesses have been suffering. Competition has increased and the resources are scarce. Without backup plans and the funds to undertake those plans like big businesses have, small businesses are closing their doors for good. In order to maintain profits and increase clientele many novice entrepreneurs lower their prices in the hopes of increasing their business volumes. But they don’t understand that a small 5% of customers decide on what to buy based on price. So in lowering their prices a small business inevitably cuts back costs in the form of lesser wages, cutting down on marketing costs and often compromising on quality as a result. The other 95% of chopers that decide what to buy based on quality, service, and what they get out of advertising are ignored by taking the price route. Because small businesses usually don’t handle the vast amount of customer flow that large corporations do, they can’t benefit from a price drop in the same way.
Also keep in mind that effective advertising is what gets price based shoppers to your store, so by reducing what you put into your small business advertising, you end up losing customers. To make sure that a small business gets steady profit, it must focus on making a specialty of itself, rather than simply dropping prices. To do that a company needs effective small business advertising. First you need to stand out from your competition. Better customer support, unique services, error free orders, etc. are just a few ways to show off your business’ special niche. You can actually demand better prices for your company, and still attract more and more customers because your unique advertising should have told them that you’re company dares to be different. Small business advertising has a great role to play in terms of building clientele and brand loyalty. It should be able to convince the shoppers why you are the ideal choice for them. Small business advertising should focus on advocating your uniqueness and specialty; hence drawing in more customers.
Small business retailers that compete on price are basically taking a draw from the hat. The position of reigning giant of the retail price wars belongs to only one…Wal-Mart. They can’t be beat when it comes to prices, so instead of hoplessly throwing a price out there and praying someone bites, you should instead focus on promoting brand loyalty. To improve your consumer loyalty and keep them coming back, you should never throw out the value that you put into your small business advertising.