When you are launching a new company or struggling to keep a small company afloat, it’s easy to forget the simple truth that all big, successful companies started out small – just like you.
Good business is good business, so even though you may have only a handful of employees and an almost non-existent marketing budget, you can learn from a much larger company’s experiences. Here are five lessons small businesses can learn from their larger counterparts.
Five lessons small businesses Can Learn from Big Companies
Why do certain companies have all the new bells and whistles and still go belly up while other companies have been around for a half century or more and are still chugging along? One of the reasons is that longevity in the business world has a lot to do with keeping fresh.
ValueWalk's Raul Panganiban interviews Kirk Du Plessis, Founder and CEO of Option Alpha, and discuss Option Alpha and his general approach to investing. Q1 2021 hedge fund letters, conferences and more The following is a computer generated transcript and may contain some errors. Interview with Option Alpha's Kirk Du Plessis
Successful companies stay on top of new trends and are quick to adapt to them without sacrificing quality. Large companies are willing to take a risk; whereas smaller companies often stay stuck in their ways. Businesses that make it long-term will change and evolve to meet their customers’ needs.
Let’s look at Old Spice, for example. The male grooming product line has been around since the Depression. The Procter & Gamble Company (NYSE:PG) acquired the line in 1990 from Shulton, Inc., its original producer. The very first Old Spice product was introduced in 1937 and was created for women. Old Spice for men followed in 1938.
So how did a line of men’s products dominated by aftershave lotion and shaving soap that was marketed with sailing ship motifs get to be something that today’s young men clamor to purchase?
The answer is that the company found a way to both maintain itself and reinvent itself at the same time. Old Spice has embraced its history with its “classic” shower gel that is sold under the slogan “The original. If your grandfather hadn’t worn it, you wouldn’t exist.” And it has repositioned itself with savvy packaging and marketing that includes everything from viral video campaigns, to NASCAR and NFL spokesmen (Remember Isaiah Mustafa telling women to “Look at your man, now back at me”), to new slogans aimed at young men such as “Believe In Your Smelf.”
After seven decades of being stuck on the bathroom shelf, Old Spice today enjoys a place in men’s backpacks and gym lockers because company owners weren’t afraid to rebrand with the times.
Treat your Employees Right
Maybe you only have a few employees now, but as you grow, take a tip from a giant like Google and treat your employees like the asset they are to your business.
With roughly 30,000 employees, Google Inc (NASDAQ:GOOG) does a lot to keep its workforce happy. For example, the internet giant’s Mountain View, Calif. headquarters includes three wellness centers and a seven-acre sports complex, with a roller hockey rink, swimming pools and courts for basketball, bocce, and shuffle ball. Other employee perks include free haircuts, laundry and dry cleaning facilities!
Google employees not only receive bonuses and frequent supervisor feedback, but they can honor each other with what the company calls “peer spot bonuses.” Another benefit is the 20 percent time program. Google Inc (NASDAQ:GOOG) allows its employees to use up to 20 percent of their work week at Google to pursue a project unrelated to their normal workload. Google reports that many of its new products started out in the 20 percent time program. Google also has innovative ways of requesting and getting employee feedback on all aspects of the company and how it functions.
Now maybe, you’re thinking “I can’t afford offer a health club or free haircuts to my employees.” That’s okay. What you can offer is an atmosphere that shows your workers that they — and their opinions — are important and valued.
When you make a mistake acknowledge it, apologize and try to fix it
Unfortunately we live in a world in which few people – or companies – admit their mistakes and actually apologize when they make them. Think BP plc (ADR) (NYSE:BP) (LON:BP) during the 2010 Gulf of Mexico oil spill. A company spokesman actually said, “There are no magic bullets for something like this.”
When your company makes a mistake – and it will — take a cue from FedEx Corporation (NYSE:FDX) and admit you were wrong and try to fix it. When a security camera video that caught a FedEx delivery man tossing a computer monitor over a gate in 2011 went viral, FedEx senior VP Matthew Thornton III quickly went to the internet for a direct apology: “It’s just not who we are,’ he said.
“We do take this matter extremely seriously, and have initiated action in accord with our disciplinary policy, while respecting privacy concerns. Without going into detail, I can assure you that this courier is not delivering customer packages while we are going through this process.”
In discussing how the customer had already received a replacement computer and how FedEx Corporation (NYSE:FDX) was working to make sure this kind of thing did not happen again, Thornton used straightforwardness and honesty to rebuild trust.
Stuff happens. When your company hits a snag, you can also hit the problem head-on like Fed Ex did.
Build a loyal fan base
When you think of customer loyalty, one of the first companies that may come to mind is Apple Inc. (NASDAQ:AAPL). Despite the fact that it is extremely easy to change electronic brands, Apple maintains a fierce customer loyalty base.
Why? Many Apple fans report that they are sold by the company’s innovative and attractive designs. They simply look cool. Other say that they know that when they buy a new Apple product it will be easy and simple to operate. Both of those components breed customer loyalty.
Apple customers expect and receive support. With videos, forums, tutorials, and contact pages – plus a network of stores worldwide — Apple customers feel that they can get their questions answered by real person who knows what they are talking about.
Use social media to build fans
Small companies need to take a page from the book of large companies that capitalize on social media campaigns. With little to no cost, you can build contests and promotions on your page that build customer awareness and participation.
Here’s an example: In honor of Valentine’s Day earlier this year, Dunkin’ Donuts asked fans to post a “couples’ pic” on its Facebook page. By posting their stories on the company’s wall, many couples told stories of how they met at and how the doughnut company is part of their relationship. This promotion was not on the company website and was exclusive to its Facebook page. Fans got to vote on their favorites, and the winner — posted as “CupiDD’s pick” – simply received the honor of the title. The campaign got the job done – getting people to talk about the doughnut company and getting more traffic to its site – at little to no cost.
Businesses of all sizes need to find and exploit their niche on social media. Promote your business and your brand on social media accounts just like the big guys do. It’s cost-effective and smart.
The key to long-term business success doesn’t come from a wait-and-see attitude. Even if you are small in size—for now — take a big picture attitude and put these ideas into play. Remember, every big company started small.