The number one reason I believe small businesses fail comes down to two words: competitive differentiation. This is essentially what makes your business different from your competition. To have competitive differentiation you have to have a niche, a specialty.
If you were to ask someone why they buy coffee from Starbucks, they are likely to tell you that no matter where they go, they can count on their drink to taste consistent. That from Seattle to New York, and everywhere in between, your "two pump, stirred, no-whip, mocha" should taste the same. Starbucks designs their branding and stores to reflect this consistent, "coffee house" specialty. No matter where I'm at, the stores always look pretty much the same, all the way down to the barista's uniform.
By heavily marketing themselves as a consistent chain, Starbucks knows that they are shutting out the customers who prefer a more local, personal cafe. But Starbucks knows that you can't be everything. You have to choose your niche, and make it your identity.
Businesses that lack a specialty are afraid to committing their identity to one thing in fear of losing money. These businesses remain vague, and people walking by aren't able to identify what the business is "about", so they move on.
I worked at a Starbucks store in a mall for years. Another coffee shop opened up on the other side of the mall, they sold coffee and smoothies and tea and juice and red bull and muffins and cake and sandwiches and panini's and salads. Even though they served so much food the interior didn't feel like a restaurant, it felt like a combination of a bookstore and a cafe, it had carpet and a fire place... it was weird. The identity of the business was vague. The ladies who worked their weren't experts in making coffee or panini's or salads, they had to do a little bit of everything. If I was in the mall and wanted a great sandwich and cup of coffee, I would go to Subway and Starbucks. If I wanted an okay sandwich and cup of coffee, I would go to this place.
I was not surprised last year when the cafe closed down. Their lack of identity, presence, and differentiation made them vague and undesirable.
When you're starting your business, you have to ask yourself, "What makes me different? What makes my business special? Why would people choose me instead of the competition?" Highlight the answers to these questions in your advertising and don't be afraid to cut out the area's of your business that don't.
To give a personal example, there is a fantastic photography studio in our area who is great at what they do. In the few years they've been open, they have had amazing success. If people are looking for studio photography, I don't have a problem highly recommending them, because that's not what Charlie and I do. To differentiate our business from theirs, I focused on what we do great, such as finding unique locations for every portrait session and including all the digital files in our packages, which is not something that every photography business offers.
Make a list of some things that you think your business is awesome at. It may be different from what your competition is doing, and that's okay. Don't shy away from something just because it's not the norm. Make another list of things you feel like you have been doing without even giving a lot of thought to, just because it's what everyone else is doing. Narrow down your speciality, and capitalize on it!
I want to hear your questions or fears about this, so please comment!
Love,
Sara
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