Playing The 'We're Local' Card Isn't Enough To Make Your Business A Hit Although business owners within the ecosystem may have incentive to support local businesses, the reality is that customers do not.
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Within the entrepreneurial ecosystem, I have continuously listened to people advocating support for local businesses, and how it is our duty as members of the community to endorse our fellow entrepreneurs with their endeavors. "We need to support local startups" is often common rhetoric at these networking events, and the general consensus response seems to be: "We aren't doing a good job at it." I have also come across entrepreneurs struggling to grow their businesses who rage at how difficult it is to acquire new customers, and point blame at the community for consciously choosing not to aid in their startup's success.
This claim does resemble conversations that have been pervasive in many other markets, and are now part of the larger debate that has emerged within our community as a result of globalization, foreign investment, the ever-growing community of entrepreneurs, and the emergence of local startups. Although business owners within the ecosystem may have incentive to support local businesses, the reality is that customers do not. "Why should we support local businesses as opposed to their foreign counterparts?" has been the cornerstone of endless discussions, and we have seen an increasing amount of David vs. Goliath references. There have been a swarm of articles written on how small businesses build local character, strengthen communities, and keep the economy fueled by recycling a much larger share of revenues back into the local economy. Throughout history, and more recently Hollywood, we have seen and heard of communities that underwent emotional transformations when replacing small mom-and-pop shops with international brands.
Not too long ago, I got caught in the Uber vs. Careem conversation, one that is quite common in the UAE. I had shared my experience on social media, and I was openly supporting one business over the other. What I anticipated to be just another quickly overlooked rant online, however, turned into a public forum for others to express their own experiences and offer insights on supporting one business over the other. Within a few hours, I had also received messages from both companies regarding my stance.
Ultimately, the rationale for supporting one over the other was not a debate about the local small business vs. the large foreign counterpart. It had nothing to do with startup vs. multinational, East vs. West, or Us vs. Them. The conversation was built around a group of customers sharing their experiences with both brands on an even playing field. The discussion covered customer service experiences, habits of using one brand "just because," the lack of awareness of an alternative, and the convenience of the services offered by each business. The conversation was not about supporting a local business, just because of its locality.
The reality today is that small local businesses now have access to the same technology and knowhow as their foreign counterparts, and in many cases similar investment capabilities, and that has evened out the playing field. As such, the dynamics of the debate has changed, too. The real question we should be asking is: how can local businesses compete with their foreign counterparts to win over customers?
1. Build on trust through a personalized customer service schema
When you deal with larger businesses, they tend to have many of their processes streamlined because of scalability, and customer service tends to fall within that trap. Managing customers can be time and energy consuming, and as the number of customers increases, many larger businesses begin to manage that growth by deploying automated systems. Generic responses through SMS or email templates and rehearsed scripts by detached customer service agents often replace the once-appreciated human touch.
As a small business, you have a chance to give personal attention the way the bigger players can't. You can invest time in servicing your customers better by letting them learn more about your business and your team. Let your customers know who you are- sometimes familiarity and a personal touch develops and escalates the conversation, thereby upping your tailored service offering. When customers personally know the people behind the business, they enjoy a connection that they would not otherwise have- one that is built on trust.
Empower your customer service team to build these connections with customers, and give them the flexibility to be more engaged and hands-on. Be more flexible in dealing with issues, and bend the rules if and when you need to. Don't be afraid to change a return policy or deliver VIP treatment to a customer when least expected. When you personalize your customer support processes, you'll better understand what specific customers need and hence you can tailor your services. If you can make this work, your customers will turn into raving fans and motivated brand advocates.
2. Become an active member of the community to increase your enterprise's relevance
If you stop to think about it, you'll quickly realize that many businesses in our everyday lives are actually small businesses. According to the Dubai Chamber of Commerce, SMEs represent more than 90% of businesses within the market. Yet, many customers are attracted to the big businesses and the big brand names without considering their local counterpart or the many SME options available. Small businesses are often overlooked because they are not top of mind. Customers don't know they exist, or if they do, don't know the value of their service and what it is they actually have to offer. They just assume that smaller businesses will have higher pricing or lower quality products or servicesthis mindset can be beat by focusing on grassroots efforts.
Instead of using conventional channels to market your business, target your efforts to the local community by leveraging on your understanding of the social and business culture. Dedicate your focus to winning the market by rolling up your sleeves and getting involved with the community. Build ties with local influencers, connect with your peers through social media, and impact your community by giving back and by being present. Customize services that celebrate local occasions and community-specific events, and be quick at responding to ad hoc circumstances. Use creative means to build relationships with your customers so that you become a part of their everyday thinking, and they will spread your message to the much larger audience within the market.
3. Being local doesn't automatically make you better; you still need to have a differentiator
Many small businesses believe that they have leverage over their foreign counterparts just by positioning themselves as being a "local" business. They believe that the "local" element will engage community support solely on that basis, and that will translate into an easier time onboarding clients. That may only be the case if the local business can claim to have a similar or better offering than its foreign counterpart.
If a local business wants to compete in the market, it can no longer look for that locality in itself as a competitive advantage. The playing field has allowed larger businesses to enter the market and provide better quality products and services at more affordable prices. So for a local small business to compete, you need to be able to meet those standards and simultaneously try to offer a product or service that a larger business doesn't.
An example of this USP or differentiator could mean offering a cash payment option when your foreign competitor only uses credit cards, or offering a home delivery or advance booking service when your foreign counterpart does not. Whatever it may be, it is about understanding your local user habits and catering to them in a specific product or service, ergo creating a competitive advantage.
We all have a sense of community and we all want to see local businesses succeed, because their successes somehow translate to our overall success as a community. For those of us within the entrepreneurial ecosystem, it ignites hope that the possibilities of this type of success may exist for all of us. The reality is that most customers don't have that vested interest, and that garnering their support revolves around a business' merit and convenience. If you want customers to support local businesses, you need to be ready to give them a reason to- and that's a responsibility that we have to shoulder.