5 Startup Strategies Every Business Should Incorporate
It seems like every other week, some startup company is featured in the news for disrupting an industry, innovating a new product or retaining employees with a trendy workplace perk. If you’re a more established company, those headlines can be intimidating. But that does not bar you from putting valuable tactics into place to improve your company culture, customer loyalty and bottom line.
As the old adage goes, “If you can’t beat them, join them.” Check out these five startup strategies every business can implement to compete in today’s marketplace.
Dominate a Vertical
Startups don’t go into business trying to take over an entire industry; they hyper-focus on a vertical. They start with a single product or service, dominate it and then add another. A good example is the fitness startup Peloton, which focused on indoor cycling classes before it added other types of exercise courses to its mix. The brand was valued at more than $4 billion just six years after its launch, reports Fast Company.
If your business is too diversified and not winning in any one vertical, consider scaling back or focusing your attention on one area this year — with the goal of becoming a dominant force in your industry. Choose a product or service that is the highest source of revenue or an area where you offer something distinct from your competitors. Invest your resources there and aim to grow your business by a large percentage. Remember, Amazon was once a startup that honed its retail prowess in books before it became an e-commerce giant.
If you think that using a customer’s first name in your email marketing is making the experience unique, think again. Today’s consumers want businesses to wholly customize all communication, marketing and offers — more than just sending a coupon on their birthdays. A study from Salesforce found that 62% of respondents are accepting of companies sending personalized offers or discounts based on items they’ve already purchased, and 57% are willing to share their data in exchange for these opportunities.
Personalization can come in a couple of forms. First, use a customer’s past purchases to suggest other products and services. Provide a curated list of items either in an email campaign or as suggested products on your website, saving customers time and energy searching for what they need. Or, customize how you offer your products and services. For example, the clothing startup StitchFix became successful by including complimentary personal shopping services as part of its business model.
Offer a Subscription Service
From food to beauty products to dog treats, consumers love subscription boxes. Although growth has slowed down a bit, the industry is still growing by one percent per month, reports Forbes. According to McKinsey & Company, 15% of online shoppers have subscribed to at least one subscription service. Subscription-based businesses grow revenues 5.5 times quicker than their S&P 500 counterparts, according to the Subscription Economy Index report by Zuora.
Startups such as Blue Apron and Birchbox once dominated this trend, but larger companies are getting in on it by offering similar options. For example, Amazon offers customers lower prices when they subscribe to monthly deliveries of products, such as food or toiletries. If you sell consumable products or services that are often repeat purchases, consider offering a subscription that will save your customers time reordering. Offer something exclusive or special discounts. Seeing as churn rates are high, according to McKinsey, companies must give their programs great end-to-end experiences to keep consumers engaged.
Be Socially Responsible
Today, it’s not enough for businesses to be good; they also have to do good. A study by Cone Communications found that 63% of American consumers were looking to businesses to take the lead on social and environmental change; 78% of people wanted companies to address social justice issues; and 87% of consumers said they would be willing to buy a product or service based on a company’s advocacy concerning a social matter.
Several startups are taking social responsibility seriously. Sock manufacturer Bombas donates a pair to a homeless shelter for every one it sells. And the footwear company Allbirds only uses sustainable materials to make its products. If you’re not sure how to contribute, it may be as easy as taking a stand or supporting an issue. Consider encouraging employee volunteerism, providing grants for environmental initiatives and selecting suppliers based on their socially responsibility. Then, be sure to share your efforts through your marketing platforms and website.
Ditch the Office
Ping-pong tables and “take your dog to work” day may have made headlines by startups from the past, but today’s companies are giving their employees what they really want — the ability to work remotely. Many of today’s successful startups, including ice cream company Halo Top Creamery and digital product design platform InVision, have their entire team working remotely, reports Adweek.
If you haven’t embraced this trend, it’s time to start. Today, 70% of organizations offer some form of telecommuting, according to a benefits report by the Society for Human Resources. Over the next few years, it’s estimated that approximately 50% of the U.S. workforce will work remotely, reports Forbes. By offering work-from-home positions, you can tap into a wider range of talent by expanding your geographic footprint. Doing so could also help you save on costs associated with having people in an office.
Startup strategies can be a great source of inspiration for larger, established businesses. Their success can prove the idea so you don’t have to take the risk. Competition makes us all better, so be sure to keep an eye on yours and think about how you can adopt their newsworthy practices.