Digital marketing strategy to compete with the big brands

For many small businesses, competing with big brands can feel like an uphill battle. Large companies often have extensive resources, vast recognition, and established marketing power that can make them hard to beat, but recent research suggests a strong shift in favor of local shops. According to a study by Faire, Americans are willing to spend nearly $2,000 more in 2024 to support their favorite local businesses. Consumers are motivated by a desire to see their main streets thrive, with more than 65% of Americans visiting their local shopping districts several times a month. This growing preference emphasizes the importance of community connection and presents a valuable opportunity for small businesses to compete with larger brands by focusing on personalized service and local engagement.

Extra difficulties for small business marketing compared to big brands

For small businesses, figuring out how to compete with big brands comes with its unique challenges. Big brands enjoy the advantage of vast resources, extensive reach, and established reputation. However, small businesses have unique strengths of their own. By using underdog marketing tactics that emphasize local roots and community connections, small businesses can create strong loyalty and stand out in ways that big brands struggle to match.

Direct competition vs indirect competition in marketing

To build a successful competition marketing strategy, it’s essential to understand the different types of competition.

• Direct competition refers to businesses offering similar products or services in the same market, like two coffee shops on the same street.
• Indirect competition includes companies meeting similar needs differently — such as a coffee shop competing with grocery stores that sell ready-made coffee drinks.

Here are the major challenges facing small businesses in today’s competitive environment:

• Budget constraints. Limited budgets mean small businesses need to rely on creative approaches, such as digital marketing for small business.
• Local reach only. Small businesses often rely on the community, making local business marketing solutions critical.
• Low brand awareness. Building recognition from the ground up can be tough, so developing memorable and authentic small business marketing ideas is essential.

If you want a deeper dive into these challenges, see our case studies for examples of how small businesses have thrived even against tough competition.

Tips for local business marketing

Small businesses don’t need the budget of a big brand to succeed. With the right strategies, small business owners can create a loyal customer base and build strong community connections. Here are three marketing tips for small business owners to make a meaningful impact.

Optimize local SEO to capture nearby customers

Getting found online is vital, especially in local business marketing. Focusing on local SEO helps ensure that your business pops up when people in your area search for services like yours. Here’s how to get started:

• Claim and update your Google Business profile. Make sure your address, hours, and contact details are current. For local searches, this profile is one of the first things customers see, so accuracy builds trust.
• Ask customers for reviews. Reviews improve your standing in local search results and create a sense of reliability. A simple thank-you and a request for feedback from happy customers go a long way.
• Add location-specific keywords. Phrases like “local business marketing in [town]” or “best bakery in [area]” make your business more visible to customers looking for nearby options.

Why does it work? Local SEO gives small businesses a competitive edge in search rankings by making it easy for local customers to find and trust you. For more insights, check out our article on customer experience and its role in local SEO.

Build community through social media

Social media isn’t just a promotional tool – it’s a way to authentically connect with your community. With a strategic approach to small business online marketing, you can keep your followers engaged and loyal.

• Highlight your regular customers. Sharing stories or testimonials from loyal patrons shows appreciation and makes other followers feel more connected.
• Offer a glimpse behind the scenes. Show customers what goes into your business, from preparing a new product to celebrating a team member’s milestone. These insights make your business feel accessible.
• Announce exclusive deals and events. Promote local events or social-media-only discounts. These perks make followers feel valued and “in the know,” making them more likely to stay loyal.

Why does it work? Social media allows you to engage your audience in an authentic way, building loyalty that’s hard for big brands to match. By actively responding to followers and demonstrating your community involvement, you create a welcoming image that reflects your values.

Collaborate with local businesses for mutual growth

Partnering with other local businesses strengthens community ties and expands your reach. Use underdog marketing strategies like these to create mutual benefits: 

• Joint events. Host a collaborative event with a nearby business, such as a fitness studio and a smoothie bar teaming up for a wellness event with exclusive discounts. Both businesses benefit from exposure to new customers.
• Cross-promotions. A bookstore could offer discounts at a neighboring café. This creates additional value for customers and encourages them to explore more local options.
• Shout-outs on social media. Tagging and promoting a partner business introduces your followers to complementary products or services, helping both businesses expand their reach.

Why does it work? Collaborations allow small businesses to expand their customer base without extra marketing costs. Customers appreciate businesses that support other local establishments, making them feel like part of a larger, connected community. For more ideas, see our article on 9 ways to promote your local business.

Small business marketing ideas

Here are some creative small business marketing ideas that can help build a solid customer base and keep your brand top of mind in your community.

Host events that bring in customers

Hosting events allows you to create memorable experiences that draw people to your business. Here are some ways to incorporate successful underdog marketing strategies into your events:

• Workshops and classes. A bakery could host a baking class where customers get hands-on experience. Customers who enjoy the experience are likely to return — and bring friends!
• Charity fundraisers. Partner with a local charity, such as an animal shelter, to host a fundraising event. This adds social value to your business and helps bring in new customers.
• Holiday gatherings. Seasonal events, like a Christmas market or Halloween party, give people a reason to visit your business and engage with your brand.

Why does it work? Events make customers feel like part of your business’s story, creating positive memories and boosting loyalty. Events also allow you to showcase your brand to a new audience.

Encourage user-generated content (UGC) to build credibility

User-generated content (UGC) provides powerful social proof and builds trust in your brand. Here’s how to work UGC into your local business online marketing strategy: 

• Run a photo contest. Host a contest where customers share their favorite product photos using a branded hashtag. This creates excitement and allows customers to promote your brand for you.
• Feature customer reviews. Display positive reviews on your website and social media. This builds trust and reassures new customers.
• Create a branded hashtag. Encourage customers to share their experiences by using your hashtag, like #LocalReadersChoice for a bookstore.

Why does it work? UGC feels authentic and gives potential customers an honest look at your products. It’s a practical approach for analyzing competition in marketing by gathering valuable insights into what customers love most.

Send personalized email marketing campaigns

Email marketing lets you reach customers directly with tailored messages that feel personal. Here’s how to make it work for your local marketing ideas for small business: 

• Customized product recommendations. If you run a clothing boutique, suggest items based on a customer’s past purchases. Customers are more likely to buy items they feel were “chosen” for them.
• Offer birthday rewards. Sending a special discount or gift offer on a customer’s birthday adds a personal touch that can encourage them to visit.
• Announce early access to sales. Give loyal customers a “first look” at new arrivals or sales before the general public.

Why does it work? Personalized emails show customers they’re valued, which boosts loyalty and encourages repeat visits. If you’re looking to make the most of email marketing, check out our marketing plan examples for different industries.

Underdog marketing strategy – stories of success

Here are two inspiring examples of successful underdog marketing where businesses used creative strategies to achieve notable success.

Ben & Jerry’s (Burlington, VT)

A company founded by two former hippies, Ben & Jerry’s began as a small ice cream store in Burlington, Vermont. Instead of competing with big brands on price, they created unique flavors and focused on supporting local and social causes, pioneering underdog digital marketing.

Strategies:

• Inventive flavors. Ben & Jerry’s built its brand around quirky flavors like “Cherry Garcia,” creating a unique identity and strong fan base.
• Social responsibility. Their commitment to social issues helped them attract customers who wanted to support brands with values.
• Community engagement. Sponsoring events and supporting local causes helped Ben & Jerry’s establish loyalty in their home community and beyond.

Today, Ben & Jerry’s is recognized worldwide, but their roots in community-focused marketing show that even the smallest brands can create lasting impact.

Under Armour (Baltimore, MD)

Founded in 1996, Under Armour started with moisture-wicking sportswear for athletes, challenging industry giants like Nike and Adidas. Through focused competition analysis marketing, Under Armour grew into a top sportswear brand.

Strategies:

• Product innovation. They introduced high-performance fabrics, meeting a need for serious athletes.
• Focused branding. Under Armour targeted dedicated athletes, building a brand identity around strength and perseverance.
• Athlete partnerships. Strategic sponsorships with athletes helped Under Armour position itself as a premium brand.

Under Armour’s story shows that a small business with a clear product niche and strong brand identity can compete with industry leaders.

Call IM4U for a strong competition marketing strategy

At IM4U, we understand the unique challenges of competition analysis marketing for small businesses. Our expertise in digital marketing for local business helps clients build connections with their communities by focusing on personalized service. From analyzing competition in marketing to discovering the best local marketing ideas for small business, we’re here to support your success. Contact us at IM4U to learn how we can help you grow.

Conclusion

Big brands aren’t unbeatable. By building on community engagement, providing personalized service, and using underdog marketing strategies, small businesses can make a big impact. These marketing tips for small business will help you attract loyal customers, boost visibility, and succeed in a competitive landscape. With the right approach, your business can turn local support into a powerful advantage, competing successfully even in a market dominated by bigger players.