Category: Strategy

Last week we posted about strategy. Today I’m going to unpack the differentiation aspect a little. As a small business, you’re probably in this category (because to be successful as the low cost provider, you need massive scale). In practical terms, that means everything you do should be about creating or capturing value. Are your employees chatting or playing on their phone behind the register? Probably not helping. Are you giving away free stuff? Some say giveaways are an effective marketing tool. There is certainly some truth to that, but you have to be careful that those freebies don’t cheapen your brand.

The question you should always be asking yourself: is what I’m doing right now creating value in the mind of my customer?

Business strategy is about one thing: competitive advantage.

What is competitive advantage?
It’s about creating a product or service that you can deliver better or cheaper than anyone else. “Better” means you should be pursuing a differentiation strategy and commanding a higher price; “cheaper” means you’re the low cost provider.

Why is it important?
Without competitive advantage, you’re going to find it really tough to stay in business.

What does that mean for strategy?
First and foremost, like Highlander — the sword-wielding immortal, not the Toyota — “there can be only one.” You can’t have a product development strategy and a separate marketing strategy. One company = one strategy. Secondly, “better” and “cheaper” are almost always mutually exclusive.

Need help developing your strategy? Contact us today and let’s figure it out together.