Brand Research: So Who Are You – Really? (Part 2 of 2)Jan Carlson
As we discussed earlier this month, there is great value in taking time-out for a long, hard look at your business. From a marketing research perspective, this also gives you the opportunity to pull together all the data and insight you’ve collected – hopefully being able to create some over-arching insight that will guide strategy development. In this second part, guest blogger Ron Strauss lays out a plan to increase competitiveness.
“Winning in today’s ever-competitive business climate means defining who you are to your customers. Can you?
SO WHO ARE YOU REALLY? -by Ron Strauss (continued)Ron Strauss
Getting to the Next Level: The Competitive Edge
The companies that will flourish despite macro-economic conditions will be those who answer the question “What business are you in?” by saying, “We’re in the business of providing our customers a competitive edge.” This is more than a snappy saying. It’s a way of thinking, being and doing.
It’s similar to the marketing approach, only instead of focusing on your customers, you also examine your customers’ customers and the value creation network they belong to. While this sounds simple, you must understand your customers’ value creation network, the key stakeholders, how value is created and destroyed within that network, and the potential ways in which your company’s business model and offering positively can impact value creation.
Creating a “competitive edge” requires an understanding of:
1. Incremental versus disruptive thinking – You may discover ways to improve your current competitive posture with existing customers. Or, you may discover there are new opportunities that require a new offering based on a new business model.
2. Becoming a “learning” organization – If you keep seeing the same information and feedback, you’ll keep doing the same things. You must step outside of your comfort zone and ask new questions of new audiences, and see the world with new eyes. How else will you learn, share and adapt?
3. Changing things up – Go from cost-based accounting and pricing that’s focused on profit maximization for your firm, to how costs are incurred to create offerings that can be priced profitably given their value to customers. This is opposite of how most firms develop pricing, and is an adaptive, dynamic process.
4. Risk versus reward – In established companies, new lines of business are viewed as inherently risky, because established lines of business have “known” risks and returns. This is a flawed way of thinking that inhibits change, innovation and growth. “Suspend” hurdle rates/IRR s (Internal Rate of Returns) for new initiatives until they can get traction or they’ll be dead before they arrive.
5. Brand value creation – How will your firm position enhance new service offerings? How will you organize and communicate these new offerings internally? How will you measure progress? How will the new service offerings create free cash flows and economic value, and how will that, in turn, impact enterprise value? How will you measure and track value creation?
What’s the best way to start?
This is a leadership issue. The leaders of the company or business must have a sense of urgency and act upon it. They must understand the value of having a “competitive edge” and support the journey to acquire one.
Create two separate initiatives. One focused on current product and service offerings, and how to improve their competitive posture. Another initiative focused on creating new offerings based on new information and insight. Most companies have the former initiative in place. Few have the latter in place.
Each initiative requires different skills
People invested in the current operations are the best to staff the incremental improvement efforts. The new initiative would be best staffed by people inside the company who are most vocal about the need for change and the challenges of trends to the business. You also will find success from stakeholders outside the company – ones who can bring an “outside-in” point of view. All of these participants must have “vision,” or the ability to see things the way they could be, not just the way they are. This is a rare skill.
Ultimately, the leaders of the business must make the case for developing “a competitive edge.” Even if the platform is not burning, but only smoking. Remember, change takes time, energy and resources. It doesn’t happen overnight.
The cost of not engaging in change and innovation is the greatest cost of all.”
Ron Strauss is an innovative thinker in marketing and branding. Strauss founded Brandzone, his brand guidance firm in 2002, to help CEO’s use their brand to create a framework for accelerated and sustainable value creation.
Hundreds of CEO’s have benefited from his insights into how to rediscover the power of their corporate and product/service brands. Marketing campaigns Ron led for clients Siemens, Schlumberger, Land O’ Lakes, Mobil et al are featured in textbooks and magazines – and have won CLIO, One Show and AMY awards.
Ron and Bill Neal co-authored the highly acclaimed book “Value Creation: The Power of Brand Equity.” They also authored “Leading CEOs and Boards to a Greater Understanding of Brand Equity” in the inaugural issue of Chief Marketing Officer Journal. Ron created the American Marketing Association’s training seminar “Brand Measurement – It’s Purpose, Potential and New Approaches.”
A Cornell University alumnus, Strauss is a recipient of the BMA Atlanta Chapter President’s Award and is a Certified Business Communicator (CBC). Ron currently serves as vice-chair of The Edge Connection, a business incubator and is a member of Vistage and a member of the faculty of the American Marketing Association.
Topics: marketing research, marketing research company, marketing effectiveness