There is only a handful of useful texts on strategy. Any MBA student will be familiar with these:
There is great utility in the strategy-making frameworks contained in these books.
Ohmae defines strategy as “the way a company uses its relative strengths to satisfy customer needs better than its competitors do.” To do this, you must examine your customer, your company and your competitors to determine who you are hoping to serve, what your relative strengths are and how you will serve them better than the competition. It turns out that this is exactly what you need to do to lay the groundwork for a brand strategy too.
For Ohmae, customer-based strategies are the most important: “a corporation’s foremost concern ought to be the interest of its customers rather than that of its shareholders.” As a startup that is starved for funding, you may think your investors come first. And until you launch, that may be the case. But even your investors want to know how you are going to compete and who you want to serve. Once you launch, customers will need to take centre stage. The wisdom here is, if you have happy customers, you will have happy investors.
With that as a starting point, you need to define who your customer is and what their unmet needs are. The mistake most companies make is to start with the product in a “build-it-and-they-will-come” frame of mind. This is the equivalent of a solution looking for a problem. It’s better to start with an understanding of the problem and then work on the product. And the only way you are going to gain that understanding is through conversations with customers.
Once you have those conversations, you are better equipped to shape an offer and a value proposition in response to customers’ real unmet needs, not just what you think they need. This knowledge can be used to inform product development, marketing, messaging, customer experience design and brand positioning.
This is really about defining your strengths as an enterprise and a culture. Are you conducting your business with a focus on delivering operational efficiency and price leadership (like Dell)? Are you a service-oriented culture with a passion for putting customers first (Zappos)? Or are you an innovative culture obsessed with product leadership (Apple)? Most companies are some combination of all three, but to be strategic, you need to lead with just one. This is the essence of Treacy and Wiersema’s Value Disciplines model. Once you have made that decision, you have a key ingredient of your brand positioning.
While a robust analysis of the competitive landscape would look at the strengths, capabilities, product portfolios and value propositions of your competitive set, for branding purposes, you also need to look at how they present themselves. In other words, you must consider brand image in the form of marketing communications, along with everything else. What you are looking for here are patterns of similarity and opportunities for differentiation. And you are looking for the gaps the competition is not addressing, even if they claim they are. Do they do what they say? If not, is there an opportunity there for you?
As an example, let’s say you are Brita, an innovator in the water filtration market. You’re competing with bottled waters from all of the world’s major beverage producers, most of which are pitched on the basis of natural purity. But their weakness is your strength: not only are they depleting publicly owned aquifers to make their products, but they are also filling the oceans with discarded plastic. They are an environmental disaster. Any claims to “natural purity” are, at best, bitterly ironic. The gap between how they present themselves and what they are actually doing is vast. But Brita neither depletes aquifers nor hurts the environment. Amid growing concern for climate change, that is a massive differentiator and a significant value proposition.
The three Cs model encompasses the divergent end of the brand-making process. You are gathering various kinds of data—from the soft, qualitative stuff of customer profiling and company culture to the analytical nature of comparative product attributes and brand claims. You are going broad with your discovery, and only later will you subject all of this data to synthesis. A clear brand strategy is ultimately a carefully wrought synthesis.
As a final point, we should emphasize the importance of soft data. Most companies overlook this because it is so difficult to quantify, but understanding the emotional needs of the customer or patient or end-user is critical to producing a compelling brand proposition. While economists like to think of people as if they were rational actors who base their purchase decisions on logic alone, history has demonstrated again and again that people are not rational actors. How people feel about a brand ultimately determines whether they buy it or not—even in the B2B space.
What follows next is a set of exercises designed to assist you with the three Cs. They will help you identify and understand your customer, assess your company’s relative strengths and size up the competitive landscape. They will help you lay the foundation for the articulation of your brand strategy.