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When creating a business plan, many marketers miss the opportunity to clearly define their strategy.
A well-defined strategy is vital for a team to understand what needs to be done and which areas need investment; it also helps companies identify what to stop doing, where to save money, and what is not worth the team’s time.
“Strategy” refers to the long-term planning and implementation of methods that will help the company achieve its goals. However, “strategy” is often misused to refer to a company’s current tasks and tactics.
It’s easy for teams to get excited about new opportunities, channels, and media. The problem is that with limited resources, managers risk spreading their resources too thin instead of focusing on the projects that can provide the company with a unique advantage.
Looking to avoid falling into such a trap? Here’s an example of what not to do:
We will push product sales by developing a new app that caters to all demographics, providing a variety of features to meet various needs. We will invest heavily in innovation, enabling the app to provide a shopping feature, gaming, reviews, content for grandparents as well as Gen Y young professionals and young children. We will price our product competitively, through running promotions and discounts that will be promoted through the app. We will also promote the product through a new blog written by our full-time, in-house writing staff. To cater to a more affluent portion of the population, we will also provide a concierge service; this will enable clients to call our dedicated call-center team to troubleshoot issues with the app.
That is a kitchen sink strategy—an excessively diverse and scattered approach guaranteed to fail.
Now that you have seen what not to do, you should be curious about how to say “no,” and avoid “scope creep” when defining your strategy.
Zoom in as much as possible to pinpoint the programs and methods that will help the company meet its goals:
What demographic is most likely to purchase the product? If you’re creating a product that’s targeting teenagers at the same time as baby boomers, that’s a red flag. Create competitive advantage by narrowing your audience and enriching your value-add proposition by including targeted features.
What features are valued by consumers and what features can be removed?Drivers looking for an economy car, for example, are probably not looking to pay extra for leather seats.
What support services are needed? Airlines have been streamlining their services for years. The personalized check-in experience is long gone. Travelers can check in online through their phones, and they receive limited support from airport staff because of check-in pods and bag drops.
Are your prospective customers focused more on cost, quality, or great service? The old formula says you have to pick just two of those three and you can’t excel at all three at the same time: There’s always a trade-off.
Establishing a clear strategy has many benefits: Teams know where to invest time and resources, and when to say “no.”
Saying “no” is the way to stay focused. There will always be an exciting new social channel or a cool new product feature that could help your company. Should you try it? Maybe not. Saying “no” to anything that doesn’t support your strategy can help your company create a unique path and stop following the herd.
It’s vital to put your strategy into context, together with other components of your business plan, such as mission, goals, objectives, tactics.
Unfortunately, there is a lot of confusion surrounding how to define and use those terms. For instance, you might see a plan stating that the team’s strategy is to “increase sales 10%,” but that is not a strategy; rather, it’s an objective, stated without defining what the team will do to get there.
Here is a handy template to differentiate among those various concepts: Fill in the blanks to create statements unique to your business—and boost your next business plan!
Not a mission: To increase sales of our dryers by the year 2020.
Not a goal: To email our customers twice a month in order to generate repeat business.
Not a strategy: To grow our share of the market.
Objectives: Measurable, concrete steps towards the goal, including a completion date. To (grow, increase) + our (market share, sales, membership) + by (number, percentage) + among (segment, demographics) + by (date).
Not an objective: To schedule weekly meetings with our top 20 clients.
Launch a (brand extension, offer, app) to generate (interest, sales, likes) among (new, repeat) customers to (test, return to, subscribe to) the product.
Create a new (service, plan, software) with a (unique benefit) that will cost less than (competitor).
Not a tactic: To increase sales of our flat-screen TVs.
These examples illustrate the differences between mission, goals, strategies, objectives and tactics. The more you define them clearly, the more likely that your team will be on the right path.
Defining a strategy is an important step toward creating focus in an organization. It helps teams invest time and resources in programs that support the company’s plan.
Often, teams are afraid of narrowing the scope of a plan, and instead try to do too much and end up scattering resources. It’s important to say “no” to regain focus.
Writing your goals, strategy, objectives, and tactics on your business plan is an exercise that will help you to confirm that your company is taking the right steps toward meetings its goals.
Originaly posted on MarketingProfs.com