Merchant Advance Blog

Blog Article: What Users Want: Small Business a la Carte

All across the world of services, industries are being transformed by catering specifically to what their users want. The “Uber for X” model, driven by the ubiquity of geolocation, aims to provide only the services that users need, at the minimum cost, with the maximum flexibility. The latest major Canadian industry to be shaken up by “a la carte” service models is the cable television provider. Long dominated by monolithic interests with the freedom to effectively dictate pricing, plan availability, and contract terms, this market has faced the same kinds of pressures that taxi firms have faced from the rise of ride-sharing.

a la carte small business

Users simply don’t want to pay for entrenchment into contracts full of content they don’t care about, and they have access to easy, flexible, inexpensive alternatives (like Netflix and other streaming services) that undercut the big players. As the CRTC moves to mandate the availability and affordability of “a la carte” cable packages, it’s worth asking: can small businesses also benefit from offering their customers more flexibility and choice, without sacrificing business volume?

Conventional wisdom for many businesses has held that the “package deal” is a great marketing move. It’s likely that almost any business model can come up with a way to tie products together in a way that consolidates and moves inventory. However, a la carte systems are highly inventory-efficient.¬†When you use an a la carte system, your stocking patterns reflect the options that customers are actually buying. You are not spending money on products that do not sell, and you can use your bulk purchasing of popular products to negotiate a lower price with the supplier. You can also afford to experiment a little bit more than your usual model might afford, trialling new products or ideas with less risk and potentially finding new ways to gain a leg up on your competitors.

A la carte systems also improve customer satisfaction by letting the customer purchase what they want, and therefore seeing the value of their dollar go up. Studies in the cable/telecom and airline industries – notorious for low satisfaction rates – have supported the improvement associated with adding customer choice. As businesses become more agile in terms of responding to what customers want out of each experience, the rate of refinement becomes better and better – increasing the odds that a given customer will become a valuable advocate within their social circles.

Though not every small business can pivot into offering a customer-choice focused model, the potential for market disruption is limited by your creativity and ability to assess risk. Many businesses claim to put the customer first: is it time for you to consider redefining what this means?

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