How do companies with low investment attain High Impact!. Companies are realizing there smarter ways to get noticed and generate revenue than blow tons of dollars on advertisement. Companies across the world are recognizing the value of going frugal, yet innovative.
Being frugal! in business means gaining higher goals with relatively lower investments and efforts. Frugal also refers to optimal use of means to reach goals. Frugal is not just an effective strategy for new entrants to market, but also the incumbent. Frugal strategies for newbies is more to make noise and getting notices, while the focus of frugal for incumbents would be to increase richness and affinity of engagement.
Fremium is not just a customer acquisition strategy, but also a proven strategy for brand building. It is a strategy that not only works with IT products, but also with other physical goods. A good story here is Grand sweets, an Indian Sweets and Savories chain in Chennai India, which was the first to employ widows, but also shares a small portion of “Puliyogare” free for all walk-in in customer. Founder’s logic was children and elderly would walk-in for the freebie and the parents and other accompanying them would end up buying some items. This is also a strategy used by many Indian restaurants in USA and Canada where they offer free meals to deserving students instead of throwing out the left-overs. Lo, they have won a battery of converts who canvass for them whenever a white or native asks them for a reference.
The newbies can follow the experience sharing strategy. This can include sharing free info, case studies, videos, blogs or any content online. This is an effective strategy not just for IT intensive businesses but also physical products such as engineering goods, medical devices, etc. Experience sharing can also be with respect to sharing an article about your brand\offering for free online or offline. The content in the article will be read and eventually might get you a free publication in the newspapers. Entrepreneurs these days become members of StartUp movements and fests which directly gives them exposure to media, even before launching their brands in the market.
Another approach well practiced by restaurants in USA and other parts of world, is what is known as Chinese Cab strategy. Chinese restaurants in these markets offer good food at reasonable price when they open and attract Cabbies, Guides and journalists because they are open later hours. Once they have established a reputation, these restaurants slowly start upscale themselves and price themselves out of reach of their old patrons. This sour grape strategy works well even in times of Zomato as many key informational sources fondly remember and vouch for the restaurant.
Some companies imitate a natural phenomenon, host-parasite approach, to grow their brand. Companies use industrial associations, church groups, Haj Committees or Pooja Pandals to get noticed and build a brand community. Choosing the host is an important element of this strategy. Most effective ones are when the products/services are unrelated or at best complementary.
While freebies by themselves may not work, exploiting sociological aspects like communities of interest or communities of work can quickly build +ve WOM and brand. NIRMA, which created quite a buzz and competed with Unilever worked on a community approach to build attention and brand. They identified a specific user group in India, the washer-men community in the dhobighats of Gujarat and gave packets of NIRMA for free. This worked out well for Nirma as the WOM went viral among the Washer-men communities. With its competitive pricing NIRMA acquired a major chunk of 35% the market share in a shorter span of time.
Some brands pursue a any attention is good to build branding approach. This strategy works best in the creative industries, where controversies lead to promotion. Playing on greed is a good old strategy used by traders and con artists. Some companies, especially in consumer goods have exploited this strategy. Classic case is an Indian Biryani group which advertised 1 GM gold coin in any of its packs and ensured the wins get advertised at their local stores attracted enough eyeballs and foot falls.