1. Standing out is better than selling out
If you’re running a small or mid-market business, competing against the giants can feel like an unfair challenge. But here’s the thing—big companies have inertia. They move slowly. That’s your advantage.
The key isn’t to spend more on marketing, it’s to spend smarter. Many SMBs fall into the trap of running endless promotions and discounts to attract customers. That works in the short term but wrecks long-term profitability. When customers expect discounts, they stop paying full price. Worse, constant promotions dilute your brand. Instead, focus on building an identity that commands attention.
Les Binet, a leading marketing effectiveness expert, argues that a strong customer experience drives loyalty better than discount-heavy CRM programs. This makes sense. People stick with brands they trust, and not necessarily ones offering the biggest price cut. Think about Apple—when was the last time you saw them offering huge discounts? Instead, they create an experience that customers want to buy into.
If growth slows, don’t panic. Many businesses cut marketing spend when revenue dips, which is like stopping an engine mid-flight. That’s the perfect moment for smaller brands to push harder. When bigger players pull back, they leave market share open for those willing to stay visible. Outlasting the competition is half the battle.
“The goal here is simple: be memorable, be consistent, and make customers feel something. If you’re just another discount machine, you’ll always be replaceable.”
2. Being small isn’t necessarily a weakness
Size isn’t a weakness—it’s an opportunity. The best way for a small brand to take on industry leaders isn’t by playing their game, but by changing it.
There are two proven ways to do this. The first is “versus positioning”—going head-to-head with the dominant player and positioning yourself as the better alternative. Tesla did this with legacy automakers. Instead of making just another car, they made electric the future. You don’t have to be the biggest. You just have to be different in a way that matters.
The second approach is owning a niche before scaling up. Instead of trying to capture an entire market, find an underserved segment and dominate it. Dr. Mark Ritson suggests looking at mature industries and identifying smaller, high-growth subcategories that big players overlook. For example, instead of competing in the entire organic food industry, focus on something like protein-rich organic snacks for athletes. Win that niche, and then expand outward.
This approach lets you punch above your weight. Large brands can’t pivot quickly. They move like oil tankers—you move like a speedboat. By the time they notice a rising trend, you’re already the established leader.
Control a niche, scale strategically, and make sure your brand stands for something unique. That’s how small brands turn into market leaders.
3. Follow to the 95-5 rule
Most businesses make a critical mistake in their marketing: they focus only on customers who are ready to buy right now. That’s like only planting crops when you’re already out of food.
The 95-5 Rule, outlined by Ty Heath, explains this well. At any given time, only 5% of potential customers are actively shopping. The other 95% will buy—just not today. If your marketing only targets the 5%, you’re constantly fighting over the same small group of buyers, and your acquisition costs will keep rising.
Instead, smart brands build brand awareness year-round. This means staying visible, even when customers aren’t immediately looking. When that 95% eventually enters the market, they should already know who you are. Companies that do this well don’t have to chase customers—they attract them naturally.
A strong brand lowers acquisition costs, creates customer loyalty, and makes future sales easier. Think about why people line up for new iPhones before they even see the specs. That’s the power of brand recall. If you wait until customers are ready to buy before showing up, you’re already too late.
4. Tap into the power of zero party data
Data is the new oil, but not all data is created equal. For years, businesses have relied on third-party data—tracking cookies, behavior monitoring, and aggregated insights from external sources. But with increasing privacy regulations like GDPR and Apple’s crackdown on tracking, that data well is drying up. The solution? Zero-party data.
Unlike third-party data, zero-party data is voluntarily shared by customers. It’s not scraped from their browsing history or inferred from behavior—it’s given directly in exchange for a better experience. This data includes preferences, interests, and personal details that allow you to tailor marketing in a way that actually matters.
Jamal Miller highlights a critical point: SMBs can turn zero-party data into a competitive advantage. Large brands rely on mass marketing and broad demographics, but SMBs can create hyper-personalized experiences without needing billion-dollar budgets.
The key is engagement-based data collection. Instead of spying on customers, ask them.
- Surveys and quizzes: A skincare brand asking about skin type to recommend products.
- Polls and preference selectors: A coffee company letting customers choose their favorite flavors for personalized offers.
- Loyalty programs: Reward customers for sharing preferences and engaging with your brand.
Customers are more willing to engage when they know their data is used transparently. If you can offer value in return—better recommendations, exclusive deals, a more relevant experience—they’ll gladly share insights.
“Brands that master zero-party data will win the future of personalized marketing. Those that don’t will be left scrambling as privacy laws tighten and third-party tracking disappears.”
5. Level the playing field with AI
AI is a tool that levels the playing field in a way we haven’t seen since the internet revolution. Big companies used to have an advantage because they could hire massive teams to analyze data, optimize campaigns, and personalize messaging. AI automates that—at scale—for everyone.
Peter Weinberg and Jon Lombardo compare AI’s impact to social media and email marketing, but I’d argue it’s even bigger. AI changes how we communicate and it changes how businesses operate.
For SMBs, AI is a force multiplier. It eliminates grunt work and gives smaller teams the ability to execute at a higher level.
- Automating repetitive tasks: AI-powered chatbots handle customer service. Machine learning algorithms optimize ad spend in real time.
- Hyper-personalization: AI analyzes customer behavior to recommend products, adjust messaging, and create dynamic, personalized content.
- Predictive analytics: Instead of reacting to trends, AI helps you anticipate them—identifying what customers will want before they know it themselves.
The best part is that AI doesn’t require a massive budget. Tools like ChatGPT, Jasper, and Midjourney allow small businesses to generate high-quality content, automate engagement, and analyze data for a fraction of what it used to cost.
While AI won’t replace human creativity for the time-being, it does supercharge execution. The companies that integrate AI now will outmaneuver, outpace, and outperform those that don’t.
Key executive takeaways
- Strategic brand positioning wins over price cuts: Competing on discounts erodes long-term profitability. Leaders should prioritize strong brand identity, customer experience, and strategic pricing to drive sustainable growth.
- Niche dominance fuels scalable growth: Small and mid-sized brands gain an edge by targeting underserved market segments. Establishing authority in a niche before expanding allows for more efficient resource allocation and stronger customer loyalty.
- Brand awareness must precede demand: Only 5% of potential customers are ready to buy at any moment. Leaders should invest in continuous brand-building efforts to stay top of mind and reduce long-term acquisition costs.
- AI and zero-party data create competitive advantages: AI streamlines marketing operations, while zero-party data enables personalized customer experiences without privacy concerns. Companies that leverage these tools will improve efficiency and engagement without large-scale resources.
