The Game Plan to Crush Your Competition: The 7 Strata of Business Strategy
Through grit and determination, you have reached a level of success in your small business. To rise to the next level, a new game plan is often required. Rethinking your strategy can be the catalyst for incredible growth. Do you have a winning strategy to guide your next growth phase? While you may have worked solo to this point, gather your team for the work going forward. Identify the leaders who will bring depth and experience to this strategy. The team should also commit to obtaining and integrating customer data and employee insights to make informed decisions. When you and your team consider the following 7-point strategy and then fully implement each item, you will be scaling up your business and crushing your competition. The following blog provides an overview of the 7 points to your winning strategic plan.
Strata 1 Consider the Words You Own
Name and claim phrases to signify your brand. Used in all your marketing communication, this will set you apart from the competition. The words you own are more than keywords for SEO purposes. Owning words and phrases is a commitment to excellence. BMW is a classic example. It can’t honestly stake a claim on the words car or automobile or even performance car. BMW has made a name for itself by claiming the ultimate driving machine. Everyone knows that phrase means BMW. What words express the qualities of your brand? How do you want the public to see your brand?
Strata 2 Determine Your Sandbox and Brand Promise
Get clear on who your customers are, where you can find them, and what you sell them. Hint: what you sell is often an aspiration, not a physical product. The who, where, and what create your sandbox of target customers. By dialing in your target customers, marketing campaigns can become more specific and effective. You can also look at the bottom 20% of your current customers and ask whether you should be working with them any longer. Once your sandbox is defined, develop your strong brand promise. A brand promise meets the needs of the marketplace and your target customer. It describes what the customer can expect every time they engage with your brand. Written as a quantitative statement, you can then measure progress. Delivering brand promises creates a consistent and strong brand in the eyes of your customers. Geicos’ brand promise is not hidden in fine print but is part of its ad campaign. “15 minutes or less can save you 15% or more on car insurance” is something the public can rely on. Not only that, this numbers-rich statement provides an increased performance standard.
How do you define your core customer? What percentage of your customers are truly your core customer? What kind of promise is fitting for your brand?
Strata 3 Develop a Brand Promise Guarantee
A promise is a promise. A brand promise guarantee states the good intentions upfront and lessens the likelihood of a breakdown occurring in the first place. A brand promise guarantee also reduces the customer’s perception of risk. And that increases their potential to buy. CarMax has built its business on transparent car history details, an easy buying experience, and no-haggle pricing. It backs it up with a policy of “30 days to change your mind.” If a customer doesn’t feel right about their car purchase, no worries, CarMax has the customer’s back. Does your organization have a strong guarantee that encourages the customer to buy? How can your brand promise guarantee be a catalyst for your organization to deliver improved performance?
Strata 4 Create Your One-Phrase Strategy
Identify one phrase that is your key to making money. When repeated often in organizational communications, a clear and concise phrase serves as a shining light for daily decisions and tasks. Tie your one-phrase strategy to the decisions made in steps one through three above as well as your company’s mission, vision, and values. It should be authentic and believable. Leaders and teams within the company will come to see it as a clarifying filter for in-the-moment activity. It dampens confusion, empowers employees, and unifies teams. Southwest Airlines’ “wheels-up” one-phrase statement is a reminder to staff that aircraft are meant to be in the air. Safe turn around time is crucial because, in the end, the airline makes money when planes are in the air. What is your key to making money? The answer to that question is the core of your one-phrase statement.
Strata 5 Identify Your Differentiating Activities
With steps 1-4 decided upon, now you can make granular decisions about daily activities. Execution is your secret weapon and key differentiator from competitors. Identify unique ways you can deliver products and services to underpin your one-phrase strategy. When you offer something completely different in the marketplace, you have made it nearly impossible for the competition to duplicate you. These differentiating activities are also known as 3-5 Hows. There are numerous differentiation strategies, including product, service, price, channel, or brand differentiation. The key is to select a few sustainable ways you can differentiate from your competitors. Maintaining the difference leads to dominating your industry. Whole Foods is a good example of differentiating activities. This chain is clearly different from every other grocery store and dominates in the natural food category. It actively promotes a “green lifestyle” from the content it shares, the cooking classes it offers, and the attention drawn to the local stores and neighborhoods. How can you operationalize your purpose, values, and passion? Make the customer’s experience with your brand noticeably different from your competition.
Strata 6 Find Your X-Factor
When you discover your industry’s key constraint and find a way to creatively solve it, you will have found a 10x-100x competitive advantage. A competitive advantage is a unique attribute to your company. It is also the key to unlocking your 3–5 Hows (point #5 above). Leverage your competitive advantage and your 3-5 Hows to your benefit to offer a differentiating, winning option to your targeted customers. Softsoap created a new market for liquid hand soap when it was released in 1980. Competitors Colgate and Proctor & Gamble were planning to launch liquid hand soaps at the same time. To beat the competition, Softsoap’s parent company Minnetonka approached a few US manufacturers of dispenser pumps and bought the entire supply. This stymied the other brands’ launches and widened the potential success for Softsoap.
What is the key constraint in your industry? If you can solve that problem, it will give you a massive advantage against all your competitors.
Strata 7 Define Your Profit Per X and Create Your BHAG®
The 2004 book Built to Last by Jim Collins and Jerry Porras coined the term BHAG, aka Big Hairy Audacious Goal. To achieve industry-dominating status, 10 and 25-year goals are a must.
These goals should not be slapped together. Rather, big and audacious goals must align with the company’s purpose, brand promise, and profit per X. To determine your “X,” you must identify the core of your economic engine. What is the basis that creates your profitability? Once you know what your “X” is, then you can work on reducing costs and maximizing profits. When a BHAG® is created from a shared understanding of purpose, brand promise, and profit per X, it results in a goal that rings true, has staying power, and high success probability. Starbucks’ big and audacious goal is to be the top consumer brand in the world. Its brand promise is found inside the mission statement: “To inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time.” It promises to get each cup of coffee to the customer’s liking. By knowing the profit per cup of coffee, it knows what is in line with its brand promise. Starbucks is well on the way to achieving its goal – it is currently the third-largest fast-food restaurant and the seventh-largest beverage company in the world.
In conclusion, the journey to elevate your business to new heights demands a strategic game plan. As you embark on the next phase of growth, the key is to transition from a solo effort to a collaborative team approach. Identify and empower leaders within your team and leverage the invaluable insights from both customers and employees to inform your decisions.
The 7 Strata of Business Strategy outlined here serve as your blueprint for success, offering a comprehensive guide to scale up and outperform competitors.
For personalized guidance in implementing these strategies, consider VIP Business Coaching. Its expertise can amplify your efforts, ensuring a seamless integration of these strata into your business framework. Success is a collaborative journey – embrace it with a strategic mindset and the support of a coaching partner like VIP Business Coaching. Here’s to your triumph and the growth that lies ahead!