Does WalMart force thousands of small stores out of business? Or do their customers do it for them? The lesson is that you can’t compete with the big guys on price and variety when you don’t have a big box or big bucks.

The internet makes things even tougher for the small ones because comparison is so easy.

Here’s a story about a little guy. His name is John Lamb and he runs “Bagel Boys,” right next to a Starbucks in the Atlanta suburbs. Here’s why he is successful, and this is a template for anyone who wants to survive and prevail:

He has a great distinctive product. He worked for a big bagel chain for years, so he knows all their secrets. He knows how to make a better product even though it costs more.

He knows his market. Location is key. He chose a high traffic spot right next to a Starbucks! He stole some of their customers, and he’s proud of the comparison and the choice. The moral—don’t hide it, flaunt it!

He knows his customers and how to serve them. He calls most of them by their name, and they say, “Hi, John.” His presence is there.

He lives his business. It’s personal. The “Bagel Boys” are literally his boys. Life sized pictures of his adorable sons are the art works of his décor. It depicts them joyfully turning dough into bagels.

He sticks to his guns. He sells tasty sandwiches and salads, but he closes shop at 3:00.
“Nobody eats bagels for dinner,” he says. If Burger King wants to stay open ‘till 2 AM, that’s their problem. “I have a life after work. I want to go home with my boys.”

He knows where he’s going. I’d bet his formula works. He’s looking for a second location, and possibly franchising is in the future. But I can’t see him trading his life for a position as a corporate executive.

He has the secret. He works hard, and he smiles. “I love this business,” says John Lamb.

Traditional textbooks cite the four essential “P’s” of marketing:

• Product
• Price
• Place
• Promotion

I would add “Perception” to the list, but maybe that’s just a sub-set of promotion. Also, “Place” used to have retail connotations, but that’s been augmented by catalogues and direct mail, and now of course by the internet.

Since “P” is a useful letter, I make it the key to successful advertising as well.  Here’s my formula:

P(1) plus P(2) times P(3) equals P(4)

• P(1) is Promise:  That is the benefit a brand stands for. That’s its positioning, its reason for being.
• P(2) is Proof:  Why should customers believe the promise? That adds to its believability and acceptance.
  
  In the old days, that would be enough.  At P&G I learned to just “show and tell,” and users will flock to the brand.  But now everybody understands there is a vital ingredient, and if it’s missing, it won’t work.
  
  People buy from people they like. Today’s great ads have charm and likeability.
  
• P(3) is Personal Contact:  This is a great multiplier. It tells people that you are just like them, that you have something special for them.
  So if you have the right mix of those three “P’s,” you’ll have the potential of a great campaign—
•  P(4) is Powerful Advertising.

Successful brands and memorable advertising are not only products; they have a personality and a built-in trustworthiness. They have a fulfilled promise, not only for now, but for the future.  They are a friend.