In economic parlance, Small and Medium Scale Enterprises (SME) is a general term for firms with less than 250 employees. According to most economists, SMEs account for majority of economic activities in most developed economies. For instance, there are approximately 23 million small businesses in the United States of America. SMEs account for 99.8 per cent of all companies and 65 per cent of business turnover in the European Union.
Lagos city scene, Nigeria
There is also a plethora of SME’s here in Nigeria, according to a study conducted by the Federal Office of Statistics. Ninety-seven per cent of all businesses in Nigeria employ less than 100 employees. What this means is that 97 per cent of all businesses in Nigeria are “small businesses”. The SME sector provides on average, 50 per cent of Nigeria’s employment, and 50 per cent of its industrial output.
There is, therefore, little doubt that these SME’s play an important role in the economy of a country especially in Nigeria. Nevertheless, as more small businesses will continue to spring up in different parts of Nigeria, many more are certainly not going to survive if things remain the way they are. A major reason for this can be traced to the neglect, poor application or total misconception of the concept of branding by most small business owners.
Branding, which seeks to convey an image or impression about a particular product or service, is often overlooked or undervalued by small business owners. Small enterprises pay little attention to branding, ignoring the fact that this can represent the source of a sustainable competitive advantage, which if taken into account can make their clients loyal, enable them to charge a higher price, and help to differentiate products and companies.
In Nigeria, only a handful of businesses, both large and small, actually engage in strategic branding. Branding is most times neglected in small businesses, because owners of small businesses believe it does not produce immediate results in terms of sales. The role of branding is not necessarily to stimulate the immediate purchasing of products but to determine the creation of favourable images and perception of the brand and everything related to that brand.
Other times, small business owners usually have misconceptions of what branding really is. In some instances, business owners feel once they get a “good” name and logo for their business they have effectively branded. Other entrepreneurs consider branding to be just the manufacturing of a high-quality product.
For some other small business managers, when they hear branding, they immediately get the impression that it is an accessory only meant for big corporations that have the financial wherewithal to embark on branding activities. As a result of this perception of branding, small business owners usually forego it, with the feeling that it is rather expensive and not a priority for their business. This often plays out against the business both in the short or long term.
Mr. Adeolopin Gooding, Chief Operating Officer, CookHouse Brands, a Strategic Marketing and Brand firm reveals that for small businesses to thrive through branding, they first need to understand what makes their target market tick.
His words: “In order to reach specific consumers and satisfy their unique needs, it’s essential that business owners clearly research and understand consumer desires and motivations. It is not enough to simply target the mass market. You have to understand how to reach out and build relationships with consumers by tailoring the brand experience according to the research gathered.”
“Finding a relevant, unique and memorable name is essential when branding a small business,” said Olatunji Bamigboye, a brand marketing consultant. He added: “The business name and accompanying positioning statement should express the identity and communicate the personality of the business. It is vital that the business name is memorable and if possible demonstrate the uniqueness of the company’s product or service, as this will leave the door open to future business development opportunities and assist brand recall in new markets.”
He stressed that in order to successfully implement the points stated, it is important for small business owners to employ the services of a professional brand consultant. He dispelled the myth that branding is meant for only large corporations with huge marketing budgets.
Setting a business apart from the competition through branding is one of the hardest aspects of starting or expanding a small business, but if it is done correctly the rewards are infinite.
One of the first advantages of branding is that the loyalty of the clients is enhanced. It is understood that, on the long-run, branding (done in a professional way) can be substitute to expensive marketing techniques such as advertising and sales promotion campaigns, which most SMEs may not have the economic muscle to undertake.
There is also a plethora of SME’s here in Nigeria, according to a study conducted by the Federal Office of Statistics. Ninety-seven per cent of all businesses in Nigeria employ less than 100 employees. What this means is that 97 per cent of all businesses in Nigeria are “small businesses”. The SME sector provides on average, 50 per cent of Nigeria’s employment, and 50 per cent of its industrial output.
There is, therefore, little doubt that these SME’s play an important role in the economy of a country especially in Nigeria. Nevertheless, as more small businesses will continue to spring up in different parts of Nigeria, many more are certainly not going to survive if things remain the way they are. A major reason for this can be traced to the neglect, poor application or total misconception of the concept of branding by most small business owners.
Branding, which seeks to convey an image or impression about a particular product or service, is often overlooked or undervalued by small business owners. Small enterprises pay little attention to branding, ignoring the fact that this can represent the source of a sustainable competitive advantage, which if taken into account can make their clients loyal, enable them to charge a higher price, and help to differentiate products and companies.
In Nigeria, only a handful of businesses, both large and small, actually engage in strategic branding. Branding is most times neglected in small businesses, because owners of small businesses believe it does not produce immediate results in terms of sales. The role of branding is not necessarily to stimulate the immediate purchasing of products but to determine the creation of favourable images and perception of the brand and everything related to that brand.
Other times, small business owners usually have misconceptions of what branding really is. In some instances, business owners feel once they get a “good” name and logo for their business they have effectively branded. Other entrepreneurs consider branding to be just the manufacturing of a high-quality product.
For some other small business managers, when they hear branding, they immediately get the impression that it is an accessory only meant for big corporations that have the financial wherewithal to embark on branding activities. As a result of this perception of branding, small business owners usually forego it, with the feeling that it is rather expensive and not a priority for their business. This often plays out against the business both in the short or long term.
Mr. Adeolopin Gooding, Chief Operating Officer, CookHouse Brands, a Strategic Marketing and Brand firm reveals that for small businesses to thrive through branding, they first need to understand what makes their target market tick.
His words: “In order to reach specific consumers and satisfy their unique needs, it’s essential that business owners clearly research and understand consumer desires and motivations. It is not enough to simply target the mass market. You have to understand how to reach out and build relationships with consumers by tailoring the brand experience according to the research gathered.”
“Finding a relevant, unique and memorable name is essential when branding a small business,” said Olatunji Bamigboye, a brand marketing consultant. He added: “The business name and accompanying positioning statement should express the identity and communicate the personality of the business. It is vital that the business name is memorable and if possible demonstrate the uniqueness of the company’s product or service, as this will leave the door open to future business development opportunities and assist brand recall in new markets.”
He stressed that in order to successfully implement the points stated, it is important for small business owners to employ the services of a professional brand consultant. He dispelled the myth that branding is meant for only large corporations with huge marketing budgets.
Setting a business apart from the competition through branding is one of the hardest aspects of starting or expanding a small business, but if it is done correctly the rewards are infinite.
One of the first advantages of branding is that the loyalty of the clients is enhanced. It is understood that, on the long-run, branding (done in a professional way) can be substitute to expensive marketing techniques such as advertising and sales promotion campaigns, which most SMEs may not have the economic muscle to undertake.
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