Where to Play and How to Win
One of the conversations we have with new clients is about the importance of strategy - which begins with knowing what it is.
From a Strategy and Business white paper: "Strategy is different from vision, mission, goals, priorities, and plans. It is the result of choices executives make, on where to play and how to win, to maximize long-term value."
Strategy is what separates a business that simply executes well from those that endure and even thrive. Strategy is what Netflix, iTunes, and the like practiced when they nibbled at, then gobbled up and redefined the video rental business. Strategy is what Uber practices as they dominate the ride hailing business.
As those examples illustrate, it would have made no difference if Blockbuster's mission, goals, and advertising campaigns were redesigned and executed at the highest possible levels. Likewise, United Taxi cannot respond to Uber by investing in a better photo shoot or changing their pricing model.
“Where to play” specifies the target market in terms of the customers and the needs to be served. The best way to define a target market is highly situational. It can be defined in any number of ways, such as by where the target customers are (for example, in certain parts of the world or in particular parts of town), how they buy (perhaps through specific channels), who they are (their particular demographics and other innate characteristics), when they buy (for example, on particular occasions), what they buy (for instance, are they price buyers or service hounds?), or for whom they buy (themselves, friends, family, their company, or their customers).
Understanding what strategy is and developing your own approach is sound practice on a macro level, of course. What it also does for a business – whether a bootstrapped entrepreneur or an established national brand – is provide a clear metric against which to measure the relative time and value of marketing activities. Does your business actually need a social media presence? Is a big print ad buy targeting the right audience? When the spend is considered in light of the intended results, tremendous change, measurable change, can result. And that feels good for all parties.
So marketing and strategy asks:
1. Who is the target customer?
2. What is the value proposition to that customer?
3. What are the essential capabilities needed to deliver that value proposition?
For more examples, including an in-depth discussion of "maximize long-term value" please see the original source material at Strategy and Business.