All enterprise must compete, even if for no more than the alternative use of resources. Sound complicated; it’s not. Buyers have limited resources by definition. The use of those resources is constrained by a simple idea: they must see fair value in the exchange of product for money. Still, most organizations stutter over the question: “How can we compete?”

I like the question; I like hearing it from market organizations—whether for profit or not for profit. Competition, in its elemental form, is simply a matter of “the alternative use of limited resources.” Despite the clear and unmistakable good sense in the basic model of competition, most small companies have the belief that they cannot compete with larger, especially much larger, competitors. The economic reality is that if an organization is selling what the buyer wants, needs, or is in the habit of buying, the seller and buyer will meet in the marketplace. The exchange each seeks is based on value “received.” When the buyer’s limited resources cannot afford the product, he finds an alternative use for those resources.

For example, a young woman just out of college secures a job near her hometown of Zuidoost, just five miles from Amsterdam. She has saved some money for a car, but cannot find the “used” hybrid car she wants for the money she’s saved. She decides to save more money for the car she wants, and buys a bicycle instead. The ride to work each morning takes roughly one-half hour, and she can take the bus when the weather requires it. In this case, the alternative use of her limited resources is a bicycle.

Perhaps, more important, the woman in the story has measured her goals against her means, and found a way to achieve them. She can begin her career and ultimately buy the car she wants.

Most organizations could learn something from this example. Similarly, organizations compete with limited resources; again, a natural constraint in the definition of competition. They may not be able to compete on the same terms as those with more resources, but they most assuredly can compete.

Fortune 500 companies have achieved this elevated status by sheer economy of scale. For as large as they are, they can influence their respective markets more effectively than their competitors. Consequently, most believe they cannot compete with them effectively. But consider for a moment that Fortune 500 companies, at some point, were competing with much larger companies than themselves. Toyota was tiny compared with Ford Motor Co. 80 years ago; and though IBM, Oracle, Microsoft, and Sun Microsystems all saw the logical extension of networking into cyberspace, only Google, a school dorm startup, was able to deliver on the promise with its seminal “Backrub” search engine.
Today, Google commands more than 60 percent of search engine use by all web surfers. But as Google co-founder Sergey Brin has said, “…not all web pages (and search engines) are created equal.”

The Fortune 500 may have the fanciest Web sites, but that does not mean Main Street businesses can’t compete with them. In fact, The Conductor Research, a leading provider of analytics and optimization solutions in the natural search market, concluded that the Fortune 500 fail at search engine optimization, citing that many “still don’t link paid search keywords to SEO campaigns.” This despite the fact that they spend roughly $3.4 million daily on nearly 100,000 keywords.

Specifically, only 25 percent of those keywords rank in the top 50 natural search results on search engines such as Google, Microsoft Bing or Yahoo, according to the Q4/2009 Fortune 500 Report just released by The Conductor Research.

Overall, Fortune 500 companies remain largely invisible in natural search. Only 2 percent of the domains surveyed show a significant number of terms in the top results, revealing that many are still missing a culture that identifies what it takes to build and support a natural search campaign.

Does this sound like an opportunity for small business? It ought to!

Both SEO (search engine optimization) and SEM (search engine marketing) are available to all organizations, both those with and without websites.

A Little Background
SEO improves the volume or quality of traffic to a website via “organic” or “natural” search, which defines the free space on the search page.

SEM optimizes search to Web sites and designated pages through the “paid” placement of keywords purchased by advertisers. The paid results appear in the upper right corner of the search page, creating what is known in Internet jargon as an “inverted L.” The closer to the top of the page that either “free” or “paid” search page results appear, the more visitors the target site receives.

SEM increases the visibility of websites through a combination of SEO, paid placement, contextual advertising (where the ad message relates to the subject matter surrounding it), and paid business listings.

The most successful searches, according to The Conductor Research report, are those containing the fewest words.

Many marketers have difficulty understanding the intricacies of search engine marketing and choose to rely on third party agencies to manage their search marketing. 

As Larry Page and Sergey Brin, Google founders, like to say: “Search” is the great democratizer — it makes all organizations equal, though not all pages are created equal.” This gives every business, no matter its size, the opportunity to compete.

Frank J. Rich is founder and CEO of Encore Prist International, an organizational development company that helps individuals and organizations reach their full potential through the practice of effective business fundamentals. You may reach him at mobile.encoreprist.com.