If you’re in the process of setting up a business, changing direction or planning for growth, then you will probably be faced with a few options to consider when it comes to your Marketing Strategy. Whatever your options are, choosing any marketing strategy will require a trade-off.
To help you to decide which option to focus on, we recommend that you prioritise your goals before you consider those possible marketing strategies and consequential trade-offs.
This is where the mission and values of the company can help you in selecting the right strategic direction and should make your priorities a lot clearer.
So, what do we mean by a trade-off? As an example, let’s say you introduce a series of sales promotions – whilst this would help you with some short-term profits, the trade-off is that it could risk reducing the value of your brand image, by making your product seem cheap. This could be detrimental to your long-term growth.
Corporate social responsibility is another example. Companies are expected to be involved in ethical endeavours like eco-schemes or community support efforts – which are all great for the company brand, long-term. However, the trade-off is the impact on the company bottom line. Say staff spend time on community projects, or, maybe you give preferential rates to charitable organisations such as Fairtrade. All of this activity will affect your profit, and if your shareholders are screaming Profit! Profit! Profit! Then that strategic direction could become a problem further down the line.
Similarly, think about your positioning as a company. Are you a high-quality, premium-priced product/service? Or a budget product for everyone? Are you an innovator (a risky position but one that puts you at the forefront of new products and allows you to set the price & positioning of products)? Or an imitator (a safer position that allows you to improve on your competitor’s product using their own feedback, and to enter an already established market, but automatically puts you on the back foot when you enter a market)?
It’s no secret that risks are an essential part of business growth, but think about what level of risk you would be comfortable with before setting your strategy. Weigh up the level of risk against the potential reward and consider your plan B; what would that look like if it all didn’t work out? Then judge whether it’s worth the possible consequences.
Finally, you need to consider your market position. If you’re the market leader, you will need to defend your position from the market followers, as their strategy will be to challenge you.
If you’re a market “runner up”, i.e. second or third in the market, you will have to adopt both an offensive strategy against the market leader AND a defensive strategy against companies behind you in the pecking order.
Ultimately, once you’ve got settled on one or two potential strategies, ask yourself these three questions about each one:
- Does it solve the problem? (This is the Suitability Element)
- Is it acceptable to the stakeholders? (This is the Acceptability Element)
- Can you deliver on it? (This is the Feasibility Element)