One of the most cost-efficient ways of entering into the New Year is developing a solid business and marketing strategy. While it may be time consuming, the time spent developing a strong plan of attack, will not only save you money all year long, but it will give you a clear vision of how you will reach your revenue goals.
Developing an approach is a lot like performing detective work; you have to become the Sherlock Holmes of strategy. Asking the right questions, uncovering clues of the market, understanding the players involved all in order to obtain the correct answers to solve your business case.
Strategy begins with research. Good ole’ fashion research it acts as your magnifying glass for analyzing the market, recognizing and learning from competitors and having a thorough understanding of your target audience and how to reach them. By defining your customer, identifying who they are, how they make their purchasing decisions, what demographic they are in, will allow you to strategize an effective plan around how you will reach them and secure their business.
After discovering the aspects of the market you can then determine a realist budget
Thinking like Holmes
for your marketing campaigns and prioritize where you should focus your assets and attention on.
Sherlock gets it when he says, “It is a capital mistake to theorize before one has data. (A Scandal in Bohemia)” So go out there and get your data and form your theories of how you will succeed in this New Year.
We’ve all made our New Year’s Resolutions: eat healthier, save money, join a book club, spend more time with family. Having this firmness of purpose is what is so exhilarating about resolutions. Why stop at personal resolutions, why not apply them to your business? This year make determined resolves for your business.
It’s a New Year. A clean slate, a fresh start. New goals, objectives, ambitions, and metrics. While we slowly climb out of this recession, now is the time to focus on cost-effective solutions that will jump-start the New Year and allow you to make the most of your resources and get you to where you need and want to be. The New Year allows you to refocus, update expectations, set new benchmarks and ultimately strategize how you will reach your aspirations for the year. Where to begin?
Start at your vision statement. Where do you see your business headed? How do you want it to operate? What will it be in the future? What are your core values and how can those attributes make your vision a reality? After defining your vision and clearly articulating it, move on to your mission statement.
Compose your mission statement with your vision in mind. Ask yourself what the main strategic intent of your business is. What are your essential competencies? By understanding your purpose and aim as a company, and using your attributes to your advantage you can set focused, targeted goals.
New Year’s Resolutions have a bum rap for always getting thrown out the window around week three. This year, resolve to stay on track.
Posted by Sumontro Roy, email@example.com
A Value Proposition is your position in a particular market segment vis-à-vis your competitor’s position and does not exist in a vacuum. Thus, it is best used along with other tools used for conducting a situation analysis (examples include: PEST, SWOT, Conjoint, 5C).
Identifying the Value-Drivers
The crux of developing a unique Value Proposition depends on identifying and understanding what attributes your consumer “values”. This can be a (complex) mix of tangible, intangible, stated and implied attributes.
Often, there are gaps between what customers say they value and what they actually do. Digging for such inconsistencies helps to uncover their real preferences and value-drivers.
Also (as in Conjoint Analysis) “value” is almost always evaluated in comparison between various criteria and features e.g. within a given set of parameters, do you value Criteria X more than Criteria Y?
You need both context and perspective to understand what your target market values. The core of this value identification process is through a comprehensive needs analysis with the target customer.
The needs analysis must uncover the value-drivers (e.g. quality, price, convenience) in the current as well as in the future and also which of these are ranked higher than the others i.e. the critical and non-critical. The Value Proposition must then be centered on them.
Importantly, as you go through this entire process keep checking to see how these ‘value-drivers’ match up against the core competencies of your firm. The Value Proposition must (ideally) be centered on the firm’s core competencies i.e. what you do better than your competitors – that is the key to sustainable profit.
Given the dynamic nature of value, there is no “silver bullet” when it comes to crafting a winning Value Proposition.
However, the Value Proposition concept is a valuable tool that can be used with great benefit for each target market, to identify what is of value to them and to build a compelling offering to your target audience.
Please feel free to contact the Perks Team for developing a winning Value Proposition for your business!
Whenever you brainstorm business strategy, it’s crucial to set business metrics for your team to measure progress and budget time, resources and funding effectively. But, how do you know which metrics are the right ones for your business? According to business experts, metrics should:
Create a single objective that unites your team
Streamline progress toward the end goal
Create clear depiction of your business’ strengths and needs
Your metrics should be clear, measurable and actionable. Create a metrics report that keeps your team’s performance up-to-speed. (You could create your own or use available software to run your monthly metrics.) Tracking your performance this way will enable you to set accurate targets and track your progress, which will be helpful when conducting department or employee reviews as well as communicating performance results to your clients. Additionally, this will allow you to see which facets of your business add the most value. Keep an eye on what departments are draining too many resources–keeping your ROI in mind here is key. You could create metrics for any of the following areas:
Business performance as a whole
Once a month, hold a meeting with your project managers and team. Run the metrics report for each project, department or resource. Communicate your goals clearly to all members of your team and discuss where you may have fallen short for the past month. If it helps, select a few crucial metrics and track their progress in a public space like on a bulletin board or poster displayed in a place of prominence. This will motivate employees to perform and add the element of accountability. Be sure you reward successes and hold team members accountable where apporpriate.
Tracking and running metrics is crucial to the success of any emerging business. Keep your team, and your clients, in the know by tracking your results.
A Value Proposition is the sum of the net benefits that your customer receives upon purchasing your product or service at a given price. Your customer is constantly measuring it against your competitors’ offerings.
A Value Proposition can relate to an entire business unit, product lines or brands and clearly answers the question as to “why your target market should choose you over available competitors?” It is a clear statement of the tangible and emotional benefits a customer receives from using your business, your products or services. Therefore, the more defined your Value Proposition, the better.
A Value Proposition is often confused with a Mission Statement or with a company ‘Tag Line’. It is also sometimes inter-changeably used or also referred to as a Positioning Statement.
A Value Proposition is a clearly defined concise statement (in three-four sentences) that describes to customers a brand’s (or company’s) unique value-creating attributes.
A Mission Statement outlines the main strategic intent of a business (e.g. to be a Top 3 player in a market-segment, to generate profits for shareholders, to gain market share etc.). It is more an internal focus while a Value Proposition describes your position to your markets in relation to your competition.
For example, the Value Proposition of company ABC Limited’s brands is to “provide good quality products at mass-market price points for everyday people to consume as part of their daily needs.”
The Mission Statement of the same company is to “improve the quality of living of the middle-income group in the Northeast part of the United States by providing them with quality products at affordable prices”.
That Value Proposition can then be communicated in different visual and textual ways with relevant and meaningful supporting messages that then becomes the Positioning statement. Positioning is the cornerstone of an effective marketing and communications plan and a well-crafted positioning statement defines your brand’s/company’s position in the market-space as well as in the consumer’s mind-space.
Therefore, the Positioning Statement could also be defined as the pointed and concise communication of your Value Proposition to your consumer.
Accurately positioning your product in the mind of your target customer is one of the most important aspects of your marketing strategy – your Value Proposition might be the best in the market but unless you can convince your customer that it is, you won’t win the consideration battle. (Tip: “Positioning: The Battle For Your Mind” by Ries and Trout is a defining piece on this topic)
Do I need a Value Proposition?
Yes, but of course you do!
Regardless of size, nature of business or current positions on their company/product life cycles, all businesses, brands and products benefit from a well-defined and compelling Value Proposition.
However, a Value Proposition isn’t something that you develop and forget about. Since the definition of value is dynamic and constantly evolving, it is something that you must constantly evaluate.
Expressed differently, it is the “Cost-Benefit Ratio” that your customer sees. Therefore, this ratio must always be one where the customer “receives” (i.e. the benefit from consumption) more than what he “gives up” (i.e. the monetary or any other value in receiving the benefit). Your Cost-Benefit Ratio must also be better than competitive offerings.
Next week: how to craft a Value Proposition and a worked example…see you then!
Making a list of amazing goals and ideas is easy. Putting those thoughts into action–not so easy. But a famous Chinese philosopher once said, “A journey of a thousand miles begins with a single step.”
So, here are a few “small steps” you can take toward reaching your goals.
Putting off your goals won’t make them disappear. The sooner you start reaching toward your goals, the sooner you’ll achieve them. Give your goal a deadline, this will make it seem more urgent and you’ll be more likely to start right away.
Don’t Lose Steam
One of the key traps in setting out to achieve your goals is that we often put our goals “on the back burner” when more important projects emerge. Don’t fall for this one! The best way to avoid losing traction is to keep pushing forward. In fact, Guerilla Marketing pioneer Jay Levinson recommends that small businesses undertake at least three to five marketing items each day. If you force yourself to stick to this rule, you should reach your marketing goals in no time! (If three to five sounds like too many, check out our blog on motivational speaker and author Lynette Lewis’ “one-one-one” strategy.)
Make it a Habit
Studies show it takes about three weeks to develop a habit, so the good news is once the first weeks are over you’re past the hard part! Building positive habits that are constructive and relevant to your goals, ensures that you’re taking steps in the right direction.
Share your Strategy
Communication is key. Whether these are personal goals or business goals, sharing your strategy with your team ensures that the job gets done. Make sure that key players and decision-makers are on board, and get your team involved as well. Harvard Business School suggests managers ask these three questions:
How should the strategy affect our unit?
What must we thus accomplish?
How will we accomplish it?
Once you find the answers to these questions and create your strategy for goal execution, the rest is a breeze. Check out the diagram to the right for ideas about how your overall goal execution plan should function. Note that the diagram is a circle, which means that this process should never end. Constantly revisit and review your goals with your team to take your business strategy to new heights!
So you’ve completed an analysis of your business and its strategy. Great! Now, it’s time to take all that knowledge and put it to use for your business. Get out a pad a of paper and get ready to set some new goals for your business! First, a few pointers.
Create a color-coded goals poster or collage with powerful images that really get you motivated. Tap into your inner artist by drawing pictures that relate to your goals. Write your goals list with the hand you don’t normally write with–this may open different parts of your brain. (Take this short quiz to find out if you’re right or left brained.) Have a team brainstorm and make it fun! Throw in a few crazy goals–reach for the stars!
3. Share your goals.
If you decide to make a goals poster, display it in a place where everyone can see it. Tracking goals by measuring them (think of the fundraising thermometer.) Share your goals with other members of your team. Have your friends and family members bug you until the job gets done. Discussing your goals with others helps you realize what needs to be done. Plus, the shared sense of accomplishment when you achieve your goal is so much better than celebrating your success alone!
4. Revisit your goals.
Check in with your goals often. Track progress. Modify your goals based on changes in your business needs or situation. This will keep your goals practical and current.
“the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations.”
So how do you figure out if your business strategy meets all of the requirements above? You can start by taking this short survey to find your Strategy Quotient or you can ask yourself the following questions:
What direction is our business headed?
What’s the scope of our market?
How can we outshine competition and maintain our competitive advantage?
What resources do we need?
What are the needs of our consumers?
What are the needs of our stakeholders?
Is my business a pioneer or a follower?
Is our market broad or niche?
Are our products high-end or low-end?
By evaluating the environment in which your business operates, you can better determine what strategy will work for you. But it’s important to look at your business itself.
Take another look at your mission statement and business plan. What is your value proposition? Conduct a SWOT Analysis on yourself and take stock of what your company needs to work on, as well as what your company’s strengths are. Re-evaluate your business goals and set a new plan into motion. Hop into the driver’s seat today and see where your strategy takes you.
Price is one of the four major elements in the Marketing Mix and getting your price-point right is critically important for a variety of reasons:it is a leading cue to your customers about your positioning, the starting point of your ROI and determines the degree of profitability that you enjoy.
Inaccurate pricing could potentially have hugely damaging effects on your business: under-pricing prevents you from realizing your true profit potential whereas over-pricing might cause you to lose customers. From the Porters Five Forces perspective, over-pricing and super-normal profits would likely attract competitors that want a share of the pie and could drive down your (and industry) profits faster.
Obviously, you need to consider many elements in making this decision, including customer perceptions of your offering, the competitive landscape, the stage of the industry life cycle and your own strategic and profit objectives. Based on your unique requirements, there are different pricing tactics that you could adopt.
One of these is Perceived-Value Pricing, where you fix your price-point based on what your customer is willing to pay for your product/service. Your customers will determine this based on their perception of the value that you provide and how you measure up against competitive offerings.
In a recent CNN.com article, restaurant owner Sam Lippert of Kettering, Ohio took this concept the whole distance – to fight off the recession, he asked his customers to pay whatever they thought the meal was worth! A risky strategy no doubt, given the challenging times that we are in, but the gamble paid off – business is up in a big way, with “daily sales and customer counts having risen by 50 to 100 percent!”
Learning: Never stop innovating, or be afraid to explore new ideas…good ideas can drive business growth, even in recessions!
SWOT Analysis is a powerful technique for understanding your Strengths and Weaknesses, and for looking at the Opportunities and Threats you face. It helps you carve a sustainable niche in your market by taking the best advantage of your resources, talents, capabilities and opportunities. In general, Strengths and Weaknesses are often internal to your organization while Opportunities and Threats often relate to external factors.
What makes SWOT particularly powerful is that it helps you uncover opportunities that you are well-placed to exploit. And by understanding the weaknesses of your business, you can manage and eliminate threats that could affect you negatively.
Using the SWOT framework to assess your strengths and that of your competitors’, you can analyze the competitive landscape and develop a strategy that helps you differentiate yourself from your competitors, so that you can compete successfully in your market.
To carry out a SWOT Analysis, start with:
• What advantages does your company have?
• What do you do better than anyone else? Is this a critical part of your offering? Are you delivering it effectively?
• What unique (differentiated) attributes or cost-advantages do you have?
• What do your target-audience view as your strengths?
• What factors clinch your sale?
Quick tip: If you are having difficulty with this, make a list of your characteristics. Some will be “positive” and, in turn, your strengths. Others will likely be your “negative/limitations” and your weaknesses.
While assessing your strengths, think about them in relation to your competitors – for example, if all your competitors have strong and efficient distribution networks, then that is not a strength in the market-space, it is a necessity.
• What do your competitors do better than you do?
• What could you improve upon?
• What should you avoid? (E.g. market segments)
• Are you focused enough?
• What do people in your market (customers, competitors) likely to perceive as weaknesses?
• What factors drive customers to choose your competitors over you?
Quick tip: analyze them from an internal and external basis: Do other people identify weaknesses that you do not see? Are your competitors doing any better than you? Make sure you are brutally honest in your answers: it is easy to be blind to what you don’t want to see!
• Where opportunities/openings are available for you?
• What are the coming trends that you are aware of?
• Useful opportunities can come from such things as:
Changes in markets needs (micro and macro levels)
Changes in laws, rules and regulations
Changes in technology, social patterns, population profiles, lifestyle changes, local environments etc.
Quick Tip: A good practice is to identify your strengths and see whether these open up any opportunities. Similarly, look at your weaknesses and see how they are limiting you and whether eliminating them –or managing them better – could create opportunities by eliminating them.
• What obstacles do you face?
• What is your competition doing that you should be worried about?
• Are the required specifications for your job, products or services changing?
• Is changing technology threatening your position?
• Do you have bad debt or cash-flow problems?
• Could any of your weaknesses seriously threaten your business?
Do a similar SWOT Analysis on your competitors. This will help you in understanding how they stack up against you and how and where you should plot your strategies against them.Only accept precise, verifiable statements (“can charge up to $5 more per unit”, rather than “can command a premium”)
Make an exhaustive list of attributes, prioritize them and give appropriate importance to each
Conduct it at the right level i.e. the level at which the opportunity/problem exists (e.g. brand, product, corporate)
Supplement it with other Situation Analysis tools (PEST, 5C) since none is likely to be completely comprehensive.