Tips for Keeping Your Business Competitive With IT
by Benjamin Dyer of ecommerce and EPOS systems supplier, SellerDeck
While there are many ways companies can differentiate themselves from the crowd, most business owners tend to focus on their offering and not the business as a whole. In this article I look how technology can give you a helping hand.
Slay the dragon
From experience I know that a lot of small business owners are always looking at ways to beat their larger brethren. I recently had a conversation with a merchant that went along the lines of “how can I beat Amazon?” This is fairly typical. However larger enterprises have one advantage that sometimes seems impossible to beat – scale.
Scale, particularly in low margin businesses gives a bargaining power that’s impossible to compete with. The biggest advantage is the ability to price the market and a good example of this is Tesco. Tesco buys in such bulk it can afford to both set the price with the supplier and the consumer, often to the detriment of both.
Tip 1: Catch a ride
One way to slay the dragon is to become extremely niche. However while niche works for some it’s not always appropriate. An alternative idea I’ve seen work incredibly well is to piggyback on someone else’s marketing budget, or as I like to call it, use “hacker marketing”.
Hacker marketing is simple, and technology is here to help. If you have a large competitor then watch out for their messaging. Maybe it has a great ad on TV or a slogan used to some good effect. Assuming you’re not infringing trademarks, why not use some low-cost modern marketing techniques such as pay per click advertising, blogging, or social networking to drive people to your offering instead of theirs?
A regularly updated blog comparing your products against the competition (and obviously why yours is better) is an SEO dream. It may sound slightly nefarious and you need to be honest and factual, but the large brands do it against each other all the time.
Technology, but not for the sake of it
Effective use of technology is an area that can really level the playing field as well as providing an excellent competitive advantage.
There is a slightly misperceived view that technology moves incredibly quickly therefore to stay on top takes a lot of effort and continuous reinvention. However, if you have a system that works efficiently then stick with it – it’s easy to become a victim of IT fashion trends. This is not the strategy of the laggard but a pragmatic approach for small business. Many people try to reinvent the wheel with technology and while this makes complete sense if the wheel is hexagonal, very often it’s money and effort wasted.
Tip 2: Use IT to get ahead
Instead look to invest in technology that can provide a competitive advantage. This can range from IT for improving an existing process, or maybe provide a better user experience. Making my point with ecommerce sites, a classic case of this approach is how many merchants simply don’t bother with peripheral elements that could set them apart. Examples include introducing customer feedback, smart postcode look up, logistics integration or decent hosting.
While these technologies may not set the world alight they are often easy to implement and low cost. Plus if the net effect is a saving of a few percent off your running costs, or increasing your conversion rates, then I would struggle to find a business owner that wouldn’t be happy – the little things really add up.
One area where technology really can make a difference is on your desk. I spent some time recently, talking to a business that was struggling with an archaic IT setup. The owner was frustrated as instead of dealing with his business or satisfying his customers he was fixing old computers and experiencing hours of lost time. While capital spend often comes direct from the bottom line, investment in current hardware is sensible.
The network effect
A network effect is what happens when a product or service becomes more valuable the more people use it. An example of this is Facebook. Using Facebook without connecting to your friends, family or work colleagues would be a pretty miserable experience. The more connections you have the richer experience it becomes.
Tip 3: Help customers help themselves
One way to achieve the network effect with your business is to pull your customers together. At Actinic we have a very vibrant customer community. This is a place where people can come to ask questions and share information about our product with both us and other users. Such a community is incredibly empowering and managed correctly your brand and product are enriched.
Going back to customer feedback, we have recently been working with some innovators in this arena, Feefo. The goal of Feefo is to collect accurate reviews on the behalf of both the customer and the business owner. Not only does this provide a rich source of information it also allows the customer to talk directly to the business owner as well as publicise their opinion of your product or service on your website and their Facebook page! Now this may sound pretty scary but if you are doing a good job then more people know about this the better. Also who’s better to sell the benefits of your business than a satisfied customer?
Technology is an enabler. Used effectively it can be the most deadly weapon in the small business owner’s arsenal. The good news is that while the requirements of running an enterprise business may seem hugely different to your average SME, in reality it’s just a case of scale.
There are many ways to compete and win and clever use of technology is a good place to find that competitive advantage.
About the author:
Ben Dyer is the CEO of SellerDeck, the desktop portfolio of ecommerce and retail applications. He is an enthusiastic blogger and Tweeter, and has written many advisory articles for the small business media.