The MSME Growth Strategy is designed to equip professionals with the skills, tools, and knowledge needed to develop Sustainable Competitive Advantage by using Strategic Marketing.
Growth is seldom found in micro, small and medium companies through increased sales of products and/or increased use of digital tools. The business must know the customers, improve their skill sets and capacity building, create niche in the market and build-up systems for sustainability in their growth and all these things must be done in a successful MSME growth plan.
The core business of the vast majority of the MSMEs begin with a dream, effort, and good product/service. The more a competition expands, however, a more systematic approach is required for sustainable growth: connecting strategic marketing, digital customer experience, and branding and business decision making in one unified system.
There is a need for a clear growth strategy for MSMEs.
Businesses that are small and medium size may run with constrained resources. This is why it is particularly crucial to make strategic decisions.
Marketing/pricing/business development/customer experience will not be coordinated and resources are probably going to be squandered. The business can invest money into social media without taking into account the audience it is targeting, it can introduce new technology with no customer service or it can cut prices without considering how it will be reflected in future brand positioning.
An effective MSME Growth Strategy results in alignment.
It can aid the business leaders to address key questions:
· Who will be the most successful?
· What is the business doing that is unique and can't be reproduced by it's rivals?
· What is really helping customers on their customer journey with the online channels?
· But what is the right place for pricing when it's not a competition with others?
· What assets do they need to build within to grow?
These choices are easier to make, when linked to growth.
There are Distinctions between Strategic Marketing and Strategic Promotion.
Your marketing strategy is NOT promotion.
Being one of the major misconceptions, many people think that marketing is simply about advertising, social media or promotional campaigns.
Strategic marketing starts a long time before.
It requires companies to learn about customer behavior, the value they want their brand to communicate, their positioning in the marketplace and what the marketplace needs.
For smaller businesses and especially MSMEs, this is particularly important as they can't outspend any big businesses with just advertising.
Instead, they can compete based on the relevance.
Developing a marketing strategy is both creating a market segment and understanding their needs and developing a product offering that provides the value customers want.
Instead of asking the question “how can we promote more?” an MSME should ask “why should our target customer choose us?”
Sustainable competitive advantage is a question.
By ‘Digital Transformation' is meant that it will have to improve the Customer Experience.
The business world has placed digital transformation at the top of its list of priorities. Efficiency and market reach can be enhanced via websites, CRM, e-commerce, automation, social media.
However, technology is not the only factor that can foster business development.
But, even if a company has a modern website, it can be difficult for consumers to find information. May have several social media and respond to queries gradually. It can get expensive software, and have inconsistent customers experiences.
Digital Customer Experience (DCX) is where it comes in. Each digital interaction should further the process of discovering, evaluating, trust and purchasing from the business.
So, MSMEs should consider the entire customer journey:
Understand, Assess, Inquire, Buy, Fulfill, Service and repeat business
These touch points that are interconnected can add more value than simply adding an additional platform digitally without purpose.
Do not scale up a brand, build a brand first.
Creating a brand is also an important component of an effective MSME growth strategy.
A brand is more than a logo, color scheme or social media design. It's the guarantees that customers anticipate from a company.
Strong Brands have a consistent communication:
· who they serve,
· what they are symbols of,
· what is added by them and
· Why Customers should trust them.
It's even more important when a MSME is expanding into new markets.
Businesses with a lack of clarity around their positioning can end up with more confusion than growth when expanding.
Before scaling up, business leaders need to establish their brand promise and ensure that their business and pricing, communication, digital presence and customer service convey this message.
Don't compete on price only!
Competition is one of the major challenges faced by MSMEs.
When the competition is fierce, it's easy to get the idea that to attract customers, you must offer a lower price for the same product or service. But by continuously discounting, margins will be cut and investment in employees, technology, innovation and customer experience will be more difficult.
A more effective way to do this is to increase the perceived value.
When there is a perception of quality difference, expertise, reliability, convenience or service, customers will be willing to pay a premium.
Thus, a strategic pricing must be paired up with the positioning of the brand and integrated marketing communication.
Premium Quality is a guarantee that needs to be relayed via other messages.
This means the position on the market according to price, message and customer experience must be consistent.
Skills Needed for a Successful MSME Growth Strategy
An organization can't be scaled by ambition itself.
Growth requires capabilities.
These skills can include:
· market intelligence,
· digital marketing skills,
· customer relationship management,
· financial planning,
· leadership,
· data-based decision-making,
· innovation,
· employee development, and
· operational processes.
Business leaders should find out what they are not doing well.
For instance, there could be plenty of enquiries but no proper follow-up process. There may be another company with products that are good, but they don't have the digital visibility. A third option may be available but may not have the capacity to offer a steady service.
It's not that it grows fast. It is intended to be able to control growth.
If you can't measure it – you can't manage it, and if you can't manage it – you can't grow it.
The measures that businesses make impact decisions.
MSMEs need to focus not just on the number of followers on social media, website traffic or other standalone metrics.
Useful activity indicators should be related to the outcomes of the business.
These can include:
· qualified leads,
· conversion rates,
· customer acquisition cost,
· repeat purchase rates,
· customer retention,
· sales cycle length,
· average order value,
customer satisfaction, and profitability.
Regular measurement, if carried out, will enable the leaders to know what is working effectively, what needs to be developed further and where the resources should be focused next.
An enabling roadmap for MSMEs to grow in a sensible manner.
The five priorities interlinked can be worked out into a feasible growth plan.
1. Understand the Market
Investigate customer needs, competition and market trends prior to major investments.
2. Define Your Value
Explain the motivations of your customers to be using your business and how your product/service is different.
3. Improve Customer Journey
Focus on friction points both in the online and in-store customer journey.
4. Strengthen Business Capabilities
Build individuals, processes and technologies to consistently deliver.
5. Measure and Adapt
Use meaningful performance indicators to continually adjust strategy
This is a cycle of learning about the market, developing markets skills, doing something, checking it and improving it.
Transforming from Digital Activity to Strategic Growth.
For any MSMEs sustainable growth is not about being with the latest trend in marketing, and hopping on the latest social media platform.
It is achieved by taking strategic connected decisions.
Technology should enhance the customers' experience. When you want to convey value in marketing, you have to do it in a clear way. The placement of the position needs to be reinforced by pricing. Branding should instill trust. Consistent delivery should be possible using internal capabilities.
Mixing of the elements and an MSME can switch from being a part of the market to making a competitive position more secure and strengthening it.
Not every growth plan is the most complicated one to achieve. It is how the business knowledge, the value to the customer and the org are connected.
Frequently Asked Questions
What are the MSME Growth Strategies?
MSME Growth Strategy is a particular approach to growth that helps a micro, small or medium enterprise (MSME) to build its reach, customer base, capabilities and financial prospects. This can include strategy marketing, digital transformation, branding, experience customer, innovation and operational development.
What are the reasons why strategic marketing is important for MSMEs?
The strategic marketing helps MSMEs to understand their customers, opportunities in the market and how much value they can provide to customers. It can help them stand out and gain relevance – not just cheaper or more expensive at advertising.
How can digital transformation support MSMEs in their growth?
Digital transformation positively impacts communication, efficiency, data management, sales and customer access. But the benefits of technology are greater when it's aligned to business goals and focused on a solid digital customer experience.
Digital Customer Experience for MSMEs: What is it?
Digital Customer Experience (DCX) is how great or poor customers' interactions are with a business via websites, social media, email, online shopping, digital support and other digital channels. With Effective DCX, it's easy to improve the customer journey and make it more responsive and consistent.
What are the ways for an MSME to achieve competitive edge?
An MSME can achieve competitive advantage by gaining insight into the market, defining a value proposition, establishing the brand and enhancing the customer experience as well as developing their competences which are difficult for the competition to replicate.
If MSMEs have to compete should they cut down on pricing?
In the absence of other means of differentiating products, profits in the long run will be lower and less profitable. Instead it is important for MSMEs to think about how they can use quality, expertise, convenience, service, customer experience and positioning their brand to add value to the perceived value.
Which one is the best measure of growth for an MSME?
Qualified leads, conversion rates, sales performance, customer retention, repeat purchase, customer satisfaction, profitability and customer acquisition cost are all important measures. Useful metrics are the ones that are directly related to the strategic business goals.
What are the ways by which MSMEs can sustain their business growth?
To achieve sustained business growth, it is not possible to achieve short-term sales growth only. MSMEs need to continuously innovate and invest strategically to understand customer needs and develop organizational capabilities and adapt their business model whenever market changes to be continually evolving.