In many business settings, strategy is a word that has cachet. It seems to have a little less today, with the word execution gaining quickly, but it still carries some weight.
At its essence, strategy (the “how”) is a way to accomplish an objective (the “what”). In terms of a marketing strategy, if the objective of marketing is to select, serve and satisfy customers in a profitable manner, then a marketing strategy is the way a company accomplishes those objectives, which may include segmentation studies, competitive analysis, and the tactical 4 Ps (Promotion, Place, Product, Price).
A famous figure in the world of strategy was a general named Sun Tzu. He lived in northeastern China about 2500 years ago and was considered an expert in military strategy due to his many victories on the battlefield. Many successful military leaders (like General Patton) and business executives (like Jack Welch, the former GE CEO) have attributed their victories to their application of Sun Tzu's principles (see The Art of War for Executives by D.G. Krause and The Six Principles from Sun Tzu and the Art of Business: Six Principles for Managers by Mark McNeilly).
Sun Tzu wrote about four areas, among others, that we could apply to the testing of marketing strategy: speed, strengths and weaknesses, alliances, and successful market capture.
Speed
Market timing and speed are critical to many industries, such as technology, pharmaceuticals, and some consumer goods. Although many writers have challenged the first-mover advantage approach, it is still valuable to have the capability to execute quickly and deliberately.
Depending on the current maturity of the market, being able to time a market window and execute a fast launch may be the difference between gaining substantial mind-and-market share or none at all. This scenario has played itself out, writ large, in the chip business—as Intel, AMD and others try to be the first-to-market and the first to capture the “heavy using” innovators and early adopters (see Diffusion of Innovations).
In technology markets, for example, the top three competitors often have market shares of 50%, 15%, and 5%, respectively, depending on being first-to-market, having proprietary technology, and having overwhelming superiority or functionality.
Like I said, time-to-market and speed are not crucial to all industries; it often depends on the lifecycle stage and how dynamic the industry is. But they are generally relevant to any new venture, product/service or strategic direction. Speed does not mean to do things hastily, but to prepare and develop the necessary structure to be opportunistic, adaptable and agile.
A couple of questions to test the speed area:
- How important is speed to your industry, and how do the best players exploit it?
- What actions can you execute to take advantage of speed components and market windows (e.g., incentives based on speed, business process redesign)?
Strengths and Weaknesses
Many people are familiar with the SWOT technique as a way to analyze a company's current situation, to brainstorm, and to develop new strategies (you evaluate your internal Strengths and Weaknesses, and external Opportunities and Threats). Sun Tzu's key message in this area is to avoid your competitor's strengths and attack their weaknesses.
Many marketing strategies already implicitly include this understanding, but it's often not explicit or fully fleshed out. Many companies would be better off flanking (versus going head-on against) their competitors by differentiating their solution or altering, extending or re-shaping their customers' requirements.
A couple of questions to test the strengths and weaknesses area:
- Within the context of your strategy, how do your actions or tactics attack a competitor's weakness?
- What are your company's vulnerabilities, and how might you prevent or mitigate a competitive attack?