Introduction
Small businesses surround us. They are on every other street and on every corner. Every second thing someone buys comes from a small business. In India, where unemployment is a serious issue, small businesses gain a special position in the industrial structure because of their ability to utilize labor and create employment.
What is a small business?
Small businesses are either service or retail operations like grocery stores, medical stores, tradespeople, bakeries, and small manufacturing units, etc. Small businesses are independently owned organizations that require less capital, a smaller workforce, and no machinery. These businesses are ideally suited to operate on a small scale to serve a local community and to provide profits to the company owners.
What is a startup business?
A “startup” refers to a company in the first stages of operations, so it is founded by one or more entrepreneurs who want to develop a product or service for which they believe there is demand, and their funding sources are family and friends, venture capitalists, crowdfunding, and loans.
When we talk about business models, the names of successful businessmen come to mind. But there are many businesswomen in the society who have built a company worth crores based on their hard work and ideas.
You must have seen Vineeta Singh, CEO and founder of Sugar Cosmetics, currently playing the lead investor and also investing money in many startups in the reality show Shark Tank India.
So today we will scrutinize some business models of Sugar Cosmetics:
- Sugar Cosmetics follows the D2C model for its business.
- The company has an excellent distribution network, operating in more than 130 cities with a retail presence of 35,000+ stores in India.
- Their model was mainly focused on Indian consumers. Hence, they made products that suited their Indian clients best.
- Regarding revenue, the company’s income has increased eight times. For FY22, they earned a net income of 222 crores.
- Their major sources of revenue are direct sales in India and export sales across the world. Side by side, they earn from advertisements.
The marketing strategy of sugar cosmetics.
1. Mid-price products:
If you go for Lakme or Maybelline products, the price range would be within 300. But, if you wish to buy priced at 1000 or more, you have MAC and Estee for the same. But the gap between 300 and 1000 remained intact; there was no range between these two. Sugar Cosmetic decided to bridge this and launched their products between 300 and 1000 so they will be affordable and quickly catch the attention of customers.
2. Attractive Packaging:
The products are affordable and not so expensive, and the packaging they chose was surely so enticing that people couldn’t resist buying them.
3. Inclusivity:
Inclusivity played a major role, as Sugar has never restricted its brand to women only. Even men on various fronts need it, so their doors are open for all genders.
4. Influencers marketing:
They have always enjoyed free promotions. i.e., word-of-mouth marketing in simple terms.
5. Hybrid Model (Online+ offline presence):
They used to sell products through websites and other leading eCommerce partners like Amazon, Nykaa, Shein, etc. and in retail outlets in shopping malls.
6. Digital Marketing:
Nowadays people don’t want to invest time in reading blogs, so they shifted towards short, crispy, and informative videos Sugar Cosmetics tried to market its product on digital platforms like Instagram and YouTube because they have that ‘short video’ option that sums up the whole of specifications in a few seconds.
Successful business strategies
As we enter 2023, it’s clear that we are entering an altered business paradigm, driven as much by new technology. The global recession, ongoing war in Ukraine, and increased credit rates have all presented new challenges for businesses looking to grow. However, it’s important to remember that adversity can also present opportunities for growth and innovation.
Keeping in mind the following are the strategies that businesses can use to come out on top.
Expand your followers:
To establish an engaged audience around your brand in an affordable way, your business can send personalized communications, including anniversaries, birthdays, and promotional emails. So, for growing your followers, you should focus on interacting with individuals for next-level client loyalty instead of traditional marketing channels and expenses on advertising.
Concentrate on consumer retention:
Retaining existing customers is simpler than finding new ones, so to retain them, you need to make some offers or make some updates to your current products or services. This will expedite the growth of your client, who already have trust in your brand.
Build a strong referral network:
You can build a network by working with the biggest supporters of your company by providing discounts for bringing you, clients.
Automate time-consuming processes:
Automation is an effective way for businesses to streamline repeatable processes and give employees time to focus on their main tasks.
Compete on a local level to acquire customers for less:
Using free tools like a Google Business profile can help small businesses compete with larger companies with bigger marketing and advertising budgets, and you will start getting new customers.
Highlight the value of your product or service:
It is more important to clearly communicate the value of your product or service to customers. By drawing attention to the benefits that your offering brings, businesses can differentiate themselves from competitors and convince customers to make a purchase.
Take advantage of low-cost marketing and advertising channels:
While traditional marketing and advertising channels may be less effective in times of economic uncertainty, there are still plenty of low-cost options available to businesses. From social media marketing to content marketing, businesses can reach new customers without breaking the bank.
Video content:
Video content helps build brand awareness and generates a positive return on investment for its marketing efforts. Creating comprehensive and actionable videos that answer your audience’s most pressing problems, it can assist you in establishing your authority.
Final words
Now that the concepts and strategies are put forth, making the choice and offer to your target audience is something you would need to look out for.
The distinction between a startup and a small business extends beyond how we typically use these terms. It’s considerably more important for aspiring business owners. Are you creating a startup or a small business when you’re launching your own firm?
With that response, you’ll be better equipped to plan your business’s future, establish goals, and secure capital.
