Many of America’s great companies began as small businesses.
Their success in the marketplace involved smart decisions, hard work and an element often overlooked by small businesses: branding, a way to distinguish a company from its competitors and build an identity that creates loyal customers.
Branding experts said small businesses face similar challenges to their larger corporate counterparts with far fewer resources.
“But there are many cost-effective ways for small companies to brand themselves," said Subir Bandyopadhyay, a professor of marketing at Indiana University Northwest in Gary, Ind. He added that small businesses may even have a few advantages. One such advantage is that large companies like Sony may have multiple brands and products, while a small company may only have one or two.
“That’s why small businesses must identify and target their customers: are they end-users of their products or services, or do they serve other businesses? They must identify what their customers are seeking. Are they image conscious? Price conscious? There are so many potential customers, but you can only target that subset whose needs you can confidently cater to. You must know your strengths and limitations and identify a subset of those customers.”
He said the term branding involves two goals: to identify a company and then to differentiate it from its competition.
“Where do you currently stand on these two in your consumer’s mind? What is your comfort level with that perception? If you’re not comfortable, you need to rebrand and reposition your product,” he said.
To realize that new brand, small businesses must write a value proposition that clearly communicates to everyone what they aspire to achieve with their brand, he said.
Create your consumer identity
He cited small businesses like Green Mountain Coffee, sold only online to end users and wholesalers, as employing a different business model.
“If you’re a local brand, you’re not looking for national advertising. You can use local billboards, movie theater trailer and newspapers. Your clientele is local,” Bandyopadhyay said, adding: “Properly located billboards, flyers in the local library, even on Google, can be cost effective ways to reach your consumers. And the prices will be lower if it’s local.”
Kevin Lane Keller, the E.B. Osborne Professor of Marketing at Dartmouth University’s Tuck School of Business in Hanover, N.H., and a nationally recognized researcher and expert in branding strategy, said it’s vital for small businesses to create meaningful differences between themselves and their competitors.
“I can’t impress how important it is to figure out what they do that has value that their customers can’t find elsewhere,” he said. “That’s the essence and heart of branding and they need to focus in on that from the start.”
Once companies have undergone this process of self-identity soul-searching, they can move on to more tactical issues.
“One of the most important things is literally how they brand themselves: their name, slogans, logos, type fonts, all these are cost-effective ways of reinforcing the brand strategy they came up with to identify themselves to customers,” Keller said.
He also suggested that small businesses should consider how they can borrow equity in shaping their brand.
Maybe you’re a small business with big, well-recognized clients, or you operate in a beautiful or unique place,” he said, citing the rural charm customers ascribe to Ben & Jerry’s Ice Cream and its Burlington, Vt., home.
“Anything that reinforces your brand in a unique and positive way can work well,” he suggested. “Borrowing from the positive identity of a person, place or thing comes with some risk, but can be effective.”
Keller advised small businesses that communicating who they are, what they do and what makes them special and unique is the goal. He said social media offers many opportunities.
“A good website is hugely important. Having activities or events you can create to get people to try your products and services, creates interest and complements social media. You need to make people know who you are and why they should do business with you.”
He said at the heart of a great brand is a great product offering good value in a unique way. “Word of mouth and press can be very powerful, and their communications strategy can build off of that.”
Lorri Feldt, regional director of the Northwest Indiana Small Business Development Center in Crown Point, Ind., a small business incubator and support collaborative, said by failing to name themselves well or accurately in the beginning, some small businesses inadvertently cause problems.
“By choosing a name that may mean something to them, but doesn’t translate well to the outside world and may not suggest who they are or what they offer, owners can short-circuit their branding strategies. Their names might be quirky or clever, but without a big adverting budget to spread the word, the names don’t tell people what they produce. Then they have to live with those names and work around them.”
Feldt said small businesses also hurt themselves with inconsistency in their graphics, logos and other brand identification tools.
“To successfully brand they need to drive home consistent messages that identify themselves in their customers’ minds.”
Feldt cited Chicago entrepreneur Carmella Saraceno, whose Miller Beach Market Place exploited a local need for fresh food and groceries in a beach community of Gary, Ind.
“Carmella is her own brand,” Feldt said. “She is over the top enthusiastic and people can feel and embrace it.”
Small business owners share branding tips
Saraceno said a women’s business course encouraged her to develop a business plan. She incorporated a branding strategy within that plan and said that made all the difference.
“It helped me to visualize what my brand would look like,” she said. “I asked myself: what is my mission? What is my budget? How much can I afford to spend on marketing?”
She contracted with graphic designer to create a public identity for her business, a decision she said has paid big dividends. She said her logo helped establish a fun, outdoorsy, beach identity for the convenience specialty store she operates a few hundred yards from the shores of Lake Michigan.
“People recognize and identify it,” she said.
“We offer ingredients for living by the lake. We stock what people have requested me to have. We’re not your ordinary convenience store.”
Meet your customers where they are
Jorge Benavente , an optometrist for 37 years, went to Professor Bandyopadhyay and his students for advice in rebranding his optometry business. “Marketing is always changing and you have to change with the trends, with the way people communicate,” said Benavente. “More people are going to mobile apps and advertising. So I have a mobile site. I went to social media because that’s where people are going. People are looking for services on their phones now and we wanted to have a presence there.”
Benavente, who operates eye care practices in Munster, Ind., and Country Club Hills, Ill., called the Internet “a black hole for advertising. You could get lost in there without a marketing strategy. So we had to educate ourselves.”
He learned that posting information on the firm’s Facebook page is more successful when the material contains information that triggers an emotion and connects with users. “We put photos of kids trying on lens frames and overnight it got more than 235 likes. People can relate to cute kids.”
He said creating an online store that allows people to shop for products has helped drive business and distinguishes his firm from competitors.
“We also have an online appointment app that allows customers to make online appointments and now that traffic is increasing,” he said. “Small guys like us have to compete with larger chains. This gives us a cost-effective way to compete.”
Benavente said his main takeaway for successful branding is to know where to reach customers.
“If you have customers from their teens to early 30s, most are online and are brand conscious. You have to come up with a branding strategy and apply that to the Internet,” Benavente said. “You also have to maintain it and be selective about the social media you choose.”