How to create a business ecosystem and compete with marketplaces if you are not Yandex or Sberbank

Vik Dovnar is an entrepreneur and founder of Hooglink.com, a marketing service and magazine. He is also the author of the book “Antimarketplace. How to create a profitable business under the dominance of online platforms, which was released by the Bombora publishing house. With their permission, we're releasing Chapter 14, a collection of helpful tips for small and medium-sized businesses.

Welcome to the world of ecosystems! Here the rich get richer and the poor get poorer. Here, major players like Yandex and Sberbank are playing to redistribute the market and are going to leave no stone unturned from competitors.

The strategy is clear: buy up all niches in order to completely surround the buyer with yourself. The main indicator is Customer Retention Rate. The main weapon is the ecosystem.

We are following the path of China and South Korea, where the winner takes all. But if you already have a business and want to develop it further, you should consider creating your own ecosystem.

Small Business Ecosystem

Whoa, whoa, whoa... Where do you order to take billions of rubles for your ecosystem, dude? Good question.

I will answer this: you will never create an ecosystem like Yandex and Sberbank, but you can create your own unique ecosystem using targeted partnerships. Because I think that the new world will consist of numerous integrations.

The main condition for the viability of a small business is easy, it is also called "seamless", integration into everything and everyone in your market.

Integration both physical and digital.

Let me remind you: do not try to be like the giants, because you are not. After all, you do not have so much of money, not so many specialists, not so many technologies.

Instead, specialize in one thing, carve your niche, and grow. Specialization will help your business integrate with other companies and become a single ecosystem with them.

Let's take a look at possible integrations and then discuss how a single ecosystem is formed.

Create your own universe out of shit and sticks

This story happened to me as a child. I was eight years old. I read books about the kings and generals of antiquity: Alexander the Great, Julia Caesar, Atilla, leader of the Huns.

And I really wanted to play in the history of these kings. I decided to create my own "ancient city". He came to the guys in the yard and said that they were playing Ancient Rome in the neighboring yard, and if we don’t start playing something like that right now, they will enslave us. The threat, of course, is so-so ...

But they believed me! And we decided to create our own Ancient Greece: we built a palace and a fortress from sticks broken in a nearby grove. The girls were peasants, and the boys were warriors. I proposed to appoint my own sister as our queen (I myself could not be king, because I was younger than the others). And the Game of Thrones began. I was happy! But after a couple of weeks the guys got bored and the people began to disperse.

Then I threw the same bike into the neighboring yard. The biggest kid, realizing that he is the leader, I showed our fortress and how everything works with us. Of course, he added that there were other ancient countries. And (attention!) the whole next week, under my strict guidance, the guys from the neighboring yard built Ancient Rome.

As a result, nine yards played with us in a year. And I was able to become the king of the island of Crete (remember the story about the Minotaur?).

So. Why am I?

And besides, you need to think like hackers: your business will not build itself. But with the help of leaders and partnerships, you can create an ecosystem in your business areas.

Possibly made of shit and sticks, but effective, which even giants will find it difficult to overcome. Just don't make sisters queens! This is a very, very bad idea.

So, what partnerships can you form to build your ecosystem?

Co-marketing or affiliate marketing

The eternal question of small business is where to get customers, so let's talk about affiliate marketing.

To make this type of integration effective, you need to find a product that is different from yours, but with the same target audience.

Vivid example: Burger King and World of tanks

Fast food restaurant Burger King came up with a burger especially for fans of the game World of tanks. It was intended for the one who made a combo in the game and had extra points. This is how the online world integrated with the offline. Each of them got more supporters of their brand.

Second example: Android and KitKat

Nestlé has released a special KitKat chocolate bar in the form of an Android robot with their logo. And since KitKat is youth brand, then they absolutely hit the audience of Google.

What to do?

Find companies of your level, but with a different product, that serve the same audience!

Hooglink.com has a direction of contextual advertising, we work mainly in the DIY segment and construction topics. And guess what I do?

I partner with SMM agencies that cooperate with furniture brands and with DIY. I interact with guys who create websites for large companies and have portfolio a large number of clients on our subject. And also with web designers working in our field.

Hooglink.com gives them customers and gets a percentage. In turn, they refer clients to us and receive their percentage. Everything is simple, clear and easy to remember.

A tailor who sews high-end suits will find customers faster in the next niche than anywhere else.

Brands of luxury shoes, jewelry, cars and the like are the best channel to work in such segments.

This works great for e-commerce as well. You sell shoes - you may well advertise clothes, accessories, bags, etc.

Yes, you can become a marketplace and add yourself a billion suppliers. But then you will "blur" the client's attention, lose positioning and expertise, and most importantly, joint marketing with partners. It's better to be part of an ecosystem than to hunt an elephant with a fly swatter.

Content

My oldest son is ten years old. Like most of his peers, he became interested in TikTok and started my channel. He had no ideas, no time, no desire to spread something all the time. From time to time I shot some videos, but there were few subscribers. But my son really wanted to be a blogger! And then he realized a simple truth that some entrepreneurs cannot understand.

He agreed with two of his friends to upload videos in turn. The channel began to grow. Some videos got to the top, and the number of subscribers increased. All participants of the channel received the effect from the partnership.

The bitter truth is that 99% of small and medium e-commerce businesses do not have the time or resources to launch their own media or hyped social media account. There are not even enough ideas and material to raise your resource into the air.

Why then do so many companies invest in SMM money, and sometimes in vain? Because it's trendy! OK. But if you look at the statistics of their budgets, it turns out that they are insignificant compared to competitors in the struggle for the attention of users in the media space.

But what if several companies serving the same target audience launched a common resource? Would you allocate a budget, write down the rules, hire one smart (read: expensively paid) specialist and launch your own resource? Could they profit from it?

Contests are extremely popular on social media these days. But in order for people to follow you, you need to give them gifts at least every week.

If you have five partner companies, it's not that expensive. It may seem that in this case the attention of the client is scattered. But since you serve one target audience, the customer experience with your brands through a single resource works on the Customer Retention Rate.

And now it is one of the most important indicators in business, even more important than profit. Well, at least that's what Sberbank, Yandex, Facebook* and Uber think.

The principle of shared ownership of resources and shared benefit can be applied not only in the creation of content and advertising, but almost everywhere.

Logistics

Large companies buy services, logistics centers and data services to increase the value of the main product. Small and medium-sized businesses need to be able to negotiate and use all the opportunities for their development.

Logistics is the most painful issue for e-commerce in Russia.

No logistics partner can compete with the courier services of large companies in terms of speed and cost of delivery.

But several partners together can give the expected effect. The dostavista.ru service operates in many regions. And in each region there are similar services, cooperation with which is often more profitable.

When we developed the company sklad220.ruOnline store of chandeliers and lamps with delivery throughout Russia. (I sold it a few years ago), then in the direction of logistics we worked with several partners. If you have software that interacts with one or another service and alternates between them depending on the situation, the effect can be explosive.

Install a dynamic delivery calculation system on your website. So you can keep customers, and for some, become the cheapest and fastest deliverer of your goods.

Pickup points

Large companies such as CDEK operate here. This Russian express delivery operator for documents and cargo has a large and independent network of pickup points. By the way, the great and terrible Wildberries once worked with them.

Cooperation with CDEK helped sklad220.ru a lot: we posted the addresses of all their points of issue on our website and began to advertise by region. People perceived us as big company, and regional conversions skyrocketed.

CDEK pick-up points are equipped with fitting rooms, they also provide the service of returning goods, etc.

If you work in a region, then you can negotiate with a local grocery chain, for example, and use their stores as points for issuing your goods.

Customer Retention Rate is our new king

The Hooglink.com agency has a contextual advertising and SEO department.

Once, while doing a report, I noticed that the cost of a client in contextual advertising has recently increased and SEO leads for most of our clients have decreased, although these figures seem to have increased. And this is despite the fact that the main service of the team is the launch of brand media and its own affiliate program service hooglink.io. And in SEO and context, we have always been strong.

I think this situation will repeat itself. Therefore, like you, I need to look for ways to increase the return rate and customer retention. Otherwise, you can lose business.

I want to draw your attention to the fact that everything in the work of large companies is aimed at increasing this particular indicator. For this reason, Yandex and Sber are ready not even to make a profit for some time, but to make the potential client become fan of their brand.

Four Easy Steps to Building Your Ecosystem for SMBs

1. Make a decision to work together with other companies to capture a part of the market.

2. Find the right partners. You should have approximately the same level of turnover, resources, brand and traffic, one target audience that is different from your product, and you should enjoy working together.

3. Write down clear rules of interaction. These are the terms of the partnership, the obligations and responsibilities of the parties, the conditions for terminating the contract.

4. Digitize your partnership. Create a single space for internal work: a joint application, website, content for clients (the latter is optional, but possible).

The Antimarketplace book will be useful for those who want to start an e-commerce business without serious investments. Making your company stand out from the competition, creating an inexhaustible flow of customers, avoiding most of the mistakes that prevent business from growing - you will learn about this and much more if you read it.

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*Activities of Meta Platforms Inc. and its social networks Facebook and Instagram are prohibited in the territory of the Russian Federation.