Many small business owners begin with humble origins, but big dreams. We all want to start off with the biggest, the best and the most profitable product or service. The ultimate goal is to compete with someone like YouTube, Johnson & Johnson or Apple: corporate giants. Yet, starting off with these kinds of huge companies as the ideal competitor will drown out any new innovative product or service. Instead of focusing all efforts on this big idea, new and existing businesses should start small by finding their niche in the lesser known, less expensive and broader market at the bottom of the tier. This is known as a disruptive opportunity.

What is a disruptive opportunity?

I’ll begin with an example. Let’s say I designed a new kind of jacket, one that would certainly serve customers of someone like Levi and Vans better than the clothing they have already. They sell their jackets for anywhere between $60 and $150 and have a targeted audience of those consumers who can afford to spend that much on a jacket and regularly shop for Vans or Levi clothing.

My jacket could be sold for that same price, but I can’t necessarily snag those loyal customers right away. Instead, I focus my efforts on a wider target audience. I sell my jacket for cheaper initially. Mine costs $30 to $50 for the consumer and spreads like wildfire through the bottom of the market tier.

Eventually my brand becomes more and more popular, to the point where these consumers of Levi and Vans are now paying attention to me (through genius inbound marketing tactics and the power of social media). Yet, they don’t want a cheap product. They want to continue to spend the same amount they were spending on their Vans or Levi clothing because that is the price of a quality jacket in their minds.

Now I release a new jacket, at the same price point as Vans and Levi. I move vertically up through this tier by first entering the market at the bottom, gaining a substantial amount of consumers and then disrupting the top of the market. I saw an opening in an industry, entered the market at the bottom, and disrupted the standing social order. This is the very basis of a disruptive opportunity.

Disruptive Opportunity Faux Pas

Just because something works for one company, does not mean it will work for your company. A good idea is not necessarily good for your brand. In order to make a disruptive opportunity work for you, it is important to create a unique brand identity and stay true to it.

In the case of my jacket company, imagine I prided myself on being an expert on jackets and jackets alone. Cold weather is my area of expertise, because my company was founded in Alaska. Not only do my jackets keep you warm, but they are designed and marketed by a company whose very identity is cold weather.

Let’s say it’s called Frigid Digs, or something of the cold nature. Just because I want to compete with Vans and Levi for some of their market share in the jacket industry, does not mean I should also start designing shorts and tank tops for the beach goers. Instead I want to keep myself true to cold weather. Frigid Digs beachwear would make zero sense for me to launch.

Whatever the case may be, it’s always important to remember that just because a great idea is working for one company does not mean it will work for another.

Find your Disruptive Opportunity

Now that we’ve established what a disruptive opportunity is and not to overdo it, how do we start?

  1. Gather your marketing and/or management team for a brainstorming session.
  2. Ask what piece of the market is underserved? Where is there room for you to grow?
  3. What can your company uniquely offer these consumers that others cannot? What should your emphasis be focused on?
  4. Build from your strengths to make yourself unbeatable at what you do.
  5. Begin the marketing process tailored to your industry and target audience.

Building this process may require an abundance of research. This market research can be done in-house or by a hired agency. If you have the tools and the know-how to conduct such research, then dive in and prepare this information prior to your brainstorming session with your marketing team.

If you don’t have the tools, knowledge or time to conduct this research, hire someone to do it for you. You’ll have a prepared presentation highlighting your market, target consumers and disruptive opportunities available without any work. An agency might also be able to help you establish your disruptive opportunity, how to brand yourself appropriately and even build your online presence though a website and Search Engine Optimization.

The main idea here is: don’t be afraid to take a leap into a new territory just because it might be less profitable at first. You need to create an opening to dig your way up to the top of the market tier. Define your brand and identity, make yourself widely known, establish your expertise and then move up.

What have you learned about disruptive opportunity through your own businesses? Please share your story on our Facebook page!