Critiquing your current strategy, step 3 in developing a marketing strategy

Developing a marketing strategy in my view takes time, patience and effort.  It starts with thinking (I call this the Customer Review), and then moves into delivery.

We have covered the first two stages of the customer review; Customer insight and a review of the marketplace.

The next step in building these 7 concrete foundations is a critical review of your current strategy;

  1. Customer insight ✓
  2. The marketplace ✓
  3. Critique the current strategy
  4. Identify and critique your enemies
  5. Critique your current/planned offer in detail: Product / Service / Channel
  6. Pricing Review
  7. Futurology

 (3) Critiquing your current strategy

Purpose:

  • To identify if your current strategy is fit for purpose and is still relevant in the context of the other 6 elements of the Customer Review
  • To show you if the strategies you have been employing are now more or less effective than they have been
  • To give you a  focus on what your strategy for the upcoming period SHOULD be

Process:

In short, what you are trying to establish in this process step is whether the strategy is right and the execution needs attention or if the strategy you are currently employing is actually inappropriate.  Bear that in mind as you walk through these simple steps…

  • Start with your brand iceberg;

brand iceberg PH

  • Make sure you are critical of the actual impressions customers have of your brand.  Use research and listen to customers and your colleagues
  • Conduct a complete review of performance.  The metrics and KPIs you use will all be different, but make sure you are delivering to your expectations in as many areas as you (can) measure.
    • You must, though, look at the following: sales, loyalty/attrition, cost control, market shrinkage/expansion, P&L, capital position, demographic shifts, channel usage shifts, customer feedback and your colleagues feedback/staff surveys.  These are a good basic starting set.
  • Next you need to start looking at the dynamics of your strategy in more detail;
    • Given your current and past experience and strategy what is it reasonable for you to plan to deliver in the coming year(s)?
      Start with the assumption of maintaining market share – you have to start somewhere after all !
    • Then look at what growth you can reasonably expect … use your past growth as a guide.
    • Examine what drove that growth – was it new products or services, competitor activity and so on.  This will lead you to the third part of this analysis:
    • What will your planned product development or service change/enhancement need to look like?
    • Then go back and look at what your 3 or 5 year forecast said last year, the year before and so on … to build up a sense of momentum and a sense of whether this is likely to be acceptable to your Board/Exec – and even more fundamentally is there a gap to what you forecast last year?  If so, is it positive or negative? either way, you must now complete a documented exercise to explain and understand what has changed
    • In an ideal world at this stage I would produce the following pictures:
      • Revenue and Profit for a steady state hold market share scenario (with a view of market size change)
      • Revenue and Profit for a reasonable market share growth scenario again within assumptions about market size
      • Revenue and Profit for a shortfall that negates the forecast increase in profit that you predicted in the past strategic plan i.e. if the market grows and you fail to grow as predicted what damage is done.  This will help inform your product, service and campaign plans in due course
  • Set up a small team at this stage of your review with a single-minded task of ‘opportunity identification’.  By doing this at this stage the team will understand the strategic context and can start to look for opportunities such as unmet customer needs (from complaints data, Ombudsman reports etc) look for growing market segments where you do not compete currently and look for trends in the marketplace you could exploit.
  • In “Offensive Marketing” Davidson argues you should ask the following questions about the wear out of your strategy:
  1. Does your current strategy require you to be superior in at least one area to win?
  2. Are you doing so?
  3. Is your strategy underpinned by at least one significant advantage over your enemies or is it by a collection of small increments?
  4. Do customers see you as appealing and/or differentiated or to stand for something?
  5. Are you constant in following your strategy?
  6. Are the basics of the strategy understood by the business from Exec down?
  7. Are they implemented (well and consistently) by colleagues?
  8. Is the brand seen as a weakening force or growing force by customers?
  9. Do you regularly check your strategy with customers to reflect their changing needs, within your overall vision?

I like these questions – I have paraphrased them a little, but they are solid and sensible and very practical.

Pay-offs:

  • This is a hard exercise, by its nature it is critical and the team will need to be open and honest and willing to accept a challenge.  If they do then you have a great foundation for your strategic development team to build on
  • You will also be able to explain to your Exec or Board in-depth why you think you can achieve what you are forecasting
  • You might even start to get a view on brand extension opportunities
  • You will certainly have the bones of the product development and service enhancement plans
  • But more fundamentally what you do not have is a subjective view of your strategy.  You have a reasoned view, with numbers and customers at its heart.  The value of this cannot be overstated.  It is crucial in building your own credibility and that of your marketing team… yours will not be a strategy based on whim or wish, it will be grounded in hard numbers and the actual views of customers and that gives you a far better chance of delivering it successfully!

I hope you continue to find my thoughts useful … let me know what you think as always, leave me a comment or two.

Part 4 on your “enemies” will  follow next week

Paul

06 April 2013

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