Small businesses and the need to be market savvy

Small businesses and the need to be market savvy


Expect the small grocer, the small tech company, the small corporation, the small consultancy and a whole host of offerings that glamourise the small

By Harish Bijoor
A big piece of India-centric data that hits you hard and quickly is the fact that 79% of the national GDP is accounted for by family businesses in India. And we largely thought the family business was a small business. Not at all. Family businesses come in all sizes. They come as micro-enterprises with a family-run size of one or two, and they equally come as large conglomerates that are businesses with holding patterns that point to big family names.

At one end, you have my neighbourhood Ashok Kirana Stores, run by Ashok and his ever-active wife, Reena. And at another, you have the Aditya Birla Group, the TVS group, the Kirloskar group and the Godrej group.

In reality, every business is first a family business before it morphs into other avatars, making it global and transnational. Let’s remember that Walmart (US), Volkswagen (Germany), Samsung (South Korea) and the Tata Group in India all started out as family businesses. In many ways, the ethos these businesses preserve is very close and, in an umbilical manner, connected to the promoter family that started it all. Even financially.

No surprise, then, that eight out of 10 businesses in India are family-owned. A recent piece of data states that there are 111 publicly-traded family-run companies in India, valued at a whopping $839 billion. What’s more, India is home to the third largest number of family businesses globally.

What, then, is a business? And how did it all start?

If one is to state the obvious fact that buying and selling started it all, the finger points to latent demand and excess supply as the two drivers of any business. The farmer with a small plot of land that grew wheat had extra wheat at the end of the harvest. But then, all he had was wheat. His neighbour, who grew rice, had an excess of rice. The two met and traded. The first business thus began with a simple barter—a format where what was excess was put on sale and what was short was on the buy list of the other.

And then came the shop that stocked every item a home needed. The first shop in that manner was the first business. The shop was open for business. The shop was first run by the man or woman who started it, and then it became bigger and bigger before the corporate shop as we know it came. Today, Reliance Retail is precisely that.

The family business therefore developed in all directions. The family doctor, the family barber, the family butcher and every business we see around is a family-run business.

So, firstly, the family business is very big. Secondly, it is ubiquitous in its presence. Literally every business you see around is a family business. And thirdly, it subsists within the attitudes of business people that make it look small and unprofessional. And that’s the big paradigm within which family businesses thrive in India. And I keep wondering why.

The Family Business has an image issue that needs to be tackled first. Small is still considered “not beautiful”. Not savvy. Not efficient. Not professional. Not economically viable. Not respectable. And many more “nots” that I have no space to list. If you run a small family business, I think you know what I am talking about.

I do think E F Schumacher was right. Small is beautiful. If it is not yet so today, wait for it to happen. I look around at trends and point the way to a future where small is going to look more pretty. And then it shall become beautiful. And eventually, it will be the only way to be.

Look around, and there is a huge movement where people want to showcase the niche ayurvedic branded toothpaste in their bathrooms, as opposed to the one toothpaste brand that occupies 52% of the market share in the country. In the single-malt whisky category (another category I research), I find connoisseur High Networth Individual (HNI) homes in India showing a preference for brands that
sound different from the ‘Glenmorangie’ and the ‘Glenfiddich’. Anything that looks more like a well-known name is shunned, and anything that looks boutique, small and niche is embraced. ‘Monkey Shoulder’ it is.

Expect the “small” movement to cascade. We already have the small finance bank. Expect the small grocer, the small tech company, the small corporation, the small consultancy and a whole host of offerings that glamourise the small. As each of these position themselves by size, they reposition the big. If small is beautiful, big is what?

The same shall cascade into the retail lives of the big business. Big businesses will be seen to be more “massified” than small ones. Big businesses will also be seen as producing mass factory outputs instead of selling small handmade products and hand-curated services. Consumers will progressively move to bless the small with their business instead of the big. The thinking pattern is clear. Must a lot of people benefit from the business than less? The small business does just this.

Is the small family business ready to welcome this movement then? And why the small family business alone? I do believe every business needs to be ready with a minor variant of their business to welcome this change. Big toothpaste brands possibly need to launch 40 other brands that embrace the small-business ethos, look small and marry into the efficiencies of small-scale manufacture. Most importantly, they must even adopt the “innocent-marketing ethos”, as I call it.

I believe the one thing small family businesses do not understand is marketing. These businesses have great products; they pour passion into what they produce, and this is coupled with reasonably good packaging and distribution. But they have suboptimal branding and marketing inputs.

A final tweak-thought on this, then. Must these businesses learn the art, science and philosophy of marketing, as every Tom, Dick and Harish suggests? Or must they just get a label put on their good offerings? A label that simply says, “Innocently marketed”. Must we then look for products and services with this label that says, “Innocently marketed”? And will the consumer of the future search out the “Innocently marketed” as opposed to the aggressively marketed product and service of the day? Let’s think this out.

Harish Bijoor

Brand Guru and Founder, Harish Bijoor Consults Inc




News Source Link

Leave A Reply

Your email address will not be published.