They say size doesn’t matter. They’re lying

There may be few certainties in life, but when it comes to the marketing world, there are several hard facts that account for why it is really, really tough to go from being a small business to a large one.

There may be few certainties in life, but when it comes to the marketing world, there are several hard facts that account for why it is really, really tough to go from being a small business to a large one.

Some of these issues are simply a byproduct of how our economy works, while others have much more to do with human behavioural psychology and the mysterious way our brains sometimes operate.

Over my career, I’ve worked for some very big companies. I’ve also started my own somewhat smaller company, so I’ve experienced these marketing laws from both sides of the fence. So, what holds smaller companies back, and how can you “hack” the system if you’re a small company looking to get bigger?

The familiarity problem

The first and most fundamental barrier for small companies is the human brain. We are programmed to pay attention to the familiar, essentially priming us to only notice things that we already know about. People out shopping just don’t “see” unfamiliar brands in the same way they notice the big brands, even when right in front of them. In this way, marketing from those larger brands works much more effectively than those from more obscure brands.

I experienced this firsthand at a conference we sponsored. Our logo was plastered in front of delegates all day, but when I asked an attendee over coffee if he’d ever heard of us, I received a rather blank “no”.

So, while marketing from small brands needs to work much harder to get noticed, those large, well-known brands are constantly capturing small slices of attention every time we see them, making them more familiar still. There’s a reason people still drink Coke.

Fear of getting it wrong

Compounding the attention problem is the issue of trust. We’re emotional creatures, and there’s no emotion stronger than the fear of failure or embarrassment. When it comes to those bigger, pricier purchases – like those we see in the B2B sphere – the fear of making the wrong decision far outweighs the potential benefits being marketed to us.

The result is a tendency to buy from companies whom we consider as “proven”, and these tend to be – you guessed it – larger brands. And the code for “proven” is often “I have heard of them”. Defaulting to these (theoretically) tried-and-true brands helps to absolve us of the feeling of personal responsibility if it does go pear-shaped, after all, we bought from a brand that everyone knows can be trusted, so it’s not our fault it didn’t work out, right?

This is a key point, especially in B2B marketing, as it’s not just brands that the buyer is familiar with, but ones that their boss also knows about, providing even more reason to play it safe and making familiar brands even harder to dislodge.

Economies of scale

Larger companies don’t only have a marketing advantage over smaller ones in terms of customer psychology, they also have budget efficiency on their side. There are a thousand ways that big firms benefit from economies of scale. I recently attended an expo full of large companies. They had far more of their clients attending, enabling them to buy a bigger booth, enabling them to benefit from better placement, visibility and so on. This plays out in multiple scenarios in B2B marketing of course, but also on the consumer side, too. The big brands can buy the most visible advertising spaces and displays, and this feeds into our original issue of attention and familiarity.

Similarly, large firms benefit from manpower. Great marketing is hard work and requires extreme attention to many small details. Get any one of these wrong and it can be a devasting waste of cash. In the SME world, it’s entirely possible that there simply isn’t a dedicated marketing team with endless resources and deep pockets, making it difficult to put that detailed work into every campaign.

Double jeopardy

Finally, we come to the law of double jeopardy. This is a particularly nasty one for small businesses. It says that not only does a small company have fewer customers, but those customers are less loyal than those of larger firms.

The concept of repertoire buying dictates that bigger brands get more customers and more of the available revenue from those customers to boot. Unfair, isn’t it? This is closely linked to our first point but turned into hard numbers.

Marketing as a small company doesn’t just have to work harder to even gain traction with the average consumer, and then actually convert them into a paying customer – it also must work much harder than the bigger brands to keep them coming back.

Why small is beautiful

Given the huge obstacles that seem to be working to keep the little guy down, should smaller brands throw in the towel and give up? The answer is of course, no.

First of all, there is absolutely nothing wrong with being small. You can target a specific market or customer type and become well known to those people. You simply may not be aiming to go “big”. Niche marketing works well. Become famous to a few.

As a smaller company, you also have one big weapon on your side – creativity. You can break the rules and get attention in ways marketers of the big firms may be wary of doing. Being small gives you no excuse to be boring when it comes to your marketing. Say something different. Be surprising. And do it in a new way. Small companies are not usually run by committee, so it’s more feasible to be braver and take a little more risk on a great marketing idea. Creativity buys you attention. Whether from customers or the press, or these days, on social media.

Smaller companies are also in a great position to take their small but lovely brand and tie it up with a bigger business that gets you that reach. Big firms often use smaller ones to add value and set themselves apart – a win-win scenario.

Being smaller could in principle also get you far closer to your customer and allow you to understand them much better than a huge multinational. Find new and appealing ways to get through to them and deliver their needs better. This is a foundation skill of marketing and smaller companies are often inherently closer to their customers to pull this off.

Keep on keeping on

It may seem like the odds are stacked against you as a small company, and while they are in many ways, in many more, smaller firms are in a unique position to do things differently and make a real impact with their marketing.

As a small firm, persistence is key. Most big companies expect marketing to work fairly quickly. If you are an owner of a small business, you may be willing to spend a significant amount of time plugging away, growing step by step. Your patience can be, in the end, your point of difference.

Whatever you do, obey the golden rules: be consistent, be different and know your customer. Someone has to be tomorrow’s big firm, right?

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They say size doesn’t matter. They’re lying