Mark Price

BrainTrust Query: Be Small, Think Big and Get Ready

December 28, 2009

FROM RETAILWIRE:
We truly are entering the golden age of small business. And while the editor-in-chief of Wired magazine says "It might not feel that way to a lot of small businesses," there are enough clear signs to suggest that the landscape is dramatically changing. Are the advantages in being small now outweighing the disadvantages?      [more...]

On the plus side, being small and nimble permits retailers to quickly adapt to changing customer preferences and to build closer relationships with Best Customers. The close customer contact provides rapid feedback on assortment, pricing and marketing activities. In addition, much technology can now be accessed at little cost, "through the cloud."

On the negative side, small retailers lack the economy of scale to purchase in bulk and to utilize the technology that is still expensive, such as data warehousing and supply chain software. In addition, smaller retailers lack the ability to partner with larger, branded companies to form added-value relationships.

I net out that smaller companies can succeed where larger companies can fail, if they can listen to their customers, create relationships and communicate with those customers consistently though email and direct mail, as well as handwritten notes and phone calls.

Critical technology includes e-commerce sites and personalized email design and marketing tools. In addition a company will also need to maintain a single customer database that can be accessed via the web by customers and store personnel. In this game, a small company will truly live or die by the quality of data on customers and their transactions, as well as by the "feet on the street" insights directly from their customers, particularly Best Customers.