All businesses have goals. But goals are meaningless if you do not have a well-defined plan set in place detailing how you will achieve them. And that’s the job of a business strategy. However, a business strategy is not as simple as you may think. If you want a plan that you can stick with through till the end, the strategy has to go to the nitty-gritty of things.
In this article, I will show you how to create a business strategy that is suited to your own organization while at the same time, making you aware of some of the conceptual issues and future problems that may arise when you are creating or implementing a business strategy.
And, if you need any help in formulating your business strategy, book a free consultation with us. We help startups formulate their business strategy and even provide a free consultation in that regard!
Why You Need to Have a Business Strategy
If the business strategy is not detailed or does not keep individuals accountable, it is bound to fail. Therefore you end up having to make continuous revisions to the plan, reducing its effectiveness by a long shot.
That doesn’t mean the business strategy can’t be flexible. In fact you need your strategy to be flexible to account for the constant changing business environment but at the same time you need your business strategy to be extremely detailed, layered throughout your organization.
The business strategy helps bring your business plan to life and keeps the individuals in your organization accountable. It also shows your strengths and weaknesses and allows you to plan accordingly.
A word of warning though – often times, businesses get confused between the meanings of business plan, business model and business strategy. These three are completely different.
Business strategy is more of a sub-set of the business plan. While the plan deals with the higher level conceptual matters, the business strategy is more rooted to the ground and deals with the tangible periodic actions that a business has to take.
To me, strategic marketing is a strategy that make the best use of as many marketing avenues as possible with the intention to draw the attention of a specific target audience.
I think a few companies don’t quite reach this last goal because they aim at everyone. This can definitely work depending on the product or service being sold, but in most cases, not everyone is your audience. By ignoring those who would have a specific interest in your company, you are not reaching them as effectively as possible. In fact, you are less likely to truly reach anyone, since you are trying to appeal to people who may not need your service. By being particular about your audience, you don’t just sell a service, but you also build trust and loyalty.
I think that AI will be a great way to improve this in the future as it can really scrutinize customer data to provide more accurate marketing campaigns.
Mathias Ahlgren, CEO and Founder of Website Rating
The Three Levels of Business Strategy
A business strategy has three levels-
- Corporate Level strategy,
- Business Level strategy,
- Functional Level strategy
While corporate level strategy is absolutely at the top and slightly conceptual in nature, it becomes more rooted to the ground in the lower stages.
A well-developed business strategy helps your business discover the right marketing mix, the right market, make the right financial decisions and choices as well as improve the competitiveness of the business.
In my experience, businesses often think they are strategic, but many miss the mark. True strategic marketing requires a deep understanding of market dynamics, customer behavior, and measurable goals. It’s about foresight and planning, not just reactive measures.
For instance, I once worked on a campaign for a healthcare client where we utilized targeted content marketing combined with SEO optimization to boost organic reach and patient engagement. Over six months, we saw a 50% increase in organic website traffic and a 30% uptick in appointment bookings directly from the content.
Looking ahead, AI is set to revolutionize strategic marketing. AI can analyze data faster, predict trends more accurately, and personalize customer interactions at scale.
As AI tools become more sophisticated, they will allow marketers to not only reach the right audience at the right time but also create more nuanced and adaptive strategies. This means marketing efforts can be more efficient and aligned with both current and future consumer needs.
Ihor Lavrenenko, Search Engine Optimization Specialist at Bananas Marketing Agency
To begin with, we will start at the highest of the three levels with the –
Corporate Level Strategy
Of a company’s vision and mission policy, the corporate level strategy deals with the vision of the organization, that is what its end goal is.
This deals with what are the objectives of the business, the policy of allocation of resources, as well as how the organization shall be designed, that is, what the legal business structure of the business ought to be.
The business strategy at the corporate level deals with mainly the following three issues-
- Type of business that the organization is going to take part in – This basically means what you intend to do with your startup. This involves testing your business idea so as to ascertain whether it is a sustainable business idea. (You could use a proof of concept test.)
- Stance on competition – Do you want to enter a high-competition market or a low competition one? Should the market be one wherein the barriers to entry are high or should the barriers to entry be low?
- Proper allocation of human resource and capital across the key business areas of the organization.
- Related Read: How to do Market Research: A Complete Explainer
While the first two instances are decisions that have to be decided before entering into the market, the third decision involves both pre-market and post-market decision making.
However the resource allocation has to be a broad based strategy and should not go into the minute details as you need to allow for flexibilities in the bottom two levels.
Since the corporate strategy is the highest level of business strategy, it is not easily changeable. However now, after the foundation of the design thinking principles and lean startup principles, if you have a startup, you need to be comfortable in allowing your corporate strategy to be changed often.
Changing your corporate strategy often involves changing your customer base, and even the market and this is known as pivoting.
Apart from those, some other areas which you may need to consider are the structure of your business – whether you want a centralized structure or a decentralized one.
Portfolio management is another area which can come into play in your corporate strategy. As with all levels, the more detailed your planning, the better.
It is better to have a thoroughly planned strategy and changing it with changing times than to make your strategy vague.
When you are working on creating your corporate strategy, remember that it is your master plan and all the other levels of business strategy will revolve as per the corporate strategy.
Being the Founder and CEO of Nationwide United Auto Transport, I define strategic marketing as an adaptable process of identifying and connecting with our customer base in ways that align with our business goals.
It’s a balanced blend of long-term vision and short-term execution, keeping the pulse of changing customer needs and industry trends. Certainly, our company aims to be strategic in its approach, and an example that comes to mind is our ‘customer convenience-driven’ campaign.
Recognizing our customers’ increasing need for convenience, we designed a door-to-door vehicle transport service, allowing us to significantly broaden our market reach. This approach boosted our quarterly bookings by 35%.
Further, looking towards 2024 and beyond, AI is going to play a significant role in strategic marketing. I foresee AI being utilized in our business to optimize customer communication and service delivery.
For instance, AI chatbots could provide instant assistance to website visitors, while AI algorithms could help fine-tune our logistic routes for more efficient deliveries. These changes would further enhance customer satisfaction and streamline our operations.
Chris Estrada, CEO of Nationwide United Auto Transport
Business Level Strategy
Business level strategies are made by those organizations that are running several businesses under the, and treating them as strategic business unit.
For example, Google has several businesses and therefore may use business level strategies.
But, this level of strategy making is not only used by large organisations, but also by startups. Strategic business units (SBU) can be created for all independent products that a business creates as well as for market segments that an organization serves.
Therefore there can be several business level strategies under a corporate strategy.
As such, each business level strategy is unique and depends largely upon the SBUs concerned. Since the corporate level strategy is overarching, the limits set by the corporate strategy has to be followed by the business level strategy although there is ample room to play in there.
For example, you may need to follow the broad resource allocation guidelines set out by the corporate strategy although you can plan your own resource allocation within your product or market segment or you could even further delegate it to the functional level of strategy making subject to some guidelines.
The three main approaches to business-level strategies are-
- Cost leadership,
- Focus to achieve a sustainable competitive advantage, and
- Differentiation
While cost-leadership was a famous business strategy principle in the 20th century, you should not focus on that approach now. Instead you should try and differentiate yourself and create a branding for yourself.
Innovation is the best route for business strategy at the present.
As the Founder of CleanItSupply.com, strategic marketing to me equates to forging robust, future-forward plans that aim to meet business objectives while satisfying customers’ needs.
In this digital era, being ‘strategic’ isn’t limited to careful planning but also includes leveraging technology and data analytics to make informed decisions that can drive growth and engagement.
For instance, one of our most successful marketing campaigns was the ‘Customer First’ initiative, where we personalized our customer engagement. Using data analytics, we segmented our users based on their purchasing behavior and created targeted content in the form of product review videos.
This resulted in a 40% increase in customer engagement and a 30% rise in repeat purchases over 18 months. It was this commitment to customer satisfaction that led to the birth of my pseudonym ‘Danny D.’
Looking to 2024 and beyond, AI will undoubtedly play a significant role in strategic marketing. We’re levelling up our marketing game to incorporate predictive analytics and AI-driven customer segmentation for enhanced personalization.
AI, in my view, will become crucial in automating real-time decision making. This will empower businesses to deliver relevant content more efficiently, thus elevating the customer experience and overall business performance.
Dan Dillon, CEO of CleanItSupply.com
That said, once you have created your plan for this stage, you should move on the lowest stage, which is-
Functional Level Strategy
Functional strategy operates on a single functional operation and governs the activities that needs to be conducted for that function. For example, you need a functional strategy for financial management, human resources, marketing, manufacturing, research and development, information systems, etc.
In this level of business strategy, you often need to involve a restricted planning on the subject matter and involve deliverables so as to hold the managers executing the processes, accountable.
You also need to go into the nitty-gritty of resource allocation in this stage. At times, even the functional level strategy can again be subdivided into operations level strategy. However these are looked into by low level managers.
An example of the operation level strategy is how you can divide the marketing level strategy into operational levels such as sales strategy, pricing strategy, distribution strategy etc.
In my eyes, strategic marketing is a marketing initiative which is data-driven, purposeful and consistent with the companies existing material and goals. Strategic marketing needs to rely on clear KPI’s to make informed decisions about future campaigns.
An example we saw
The National Association of Children of Alcoholics (Nacoa) came to us with a project to produce a series of marketing collateral to help promote their charity which provides support to children of alcoholics. I can provide an in-depth breakdown of
this project however for a quick recap you can view our case study here.
Data-wise, the series was viewed collectively over a million times via social media and led to Nacoa’s helpline receiving a 33% increase in calls.
AI’s role
AI will play a pivotal role in making strategic marketing more tailored and informed via more accurate commerce predictions and the ability for marketing to be made bespoke to individual user data. Hyper-personalized advertisements pave way to an unprecedented amount of data surrounding buying habits which will no doubt revolutionize how marketers plan campaigns.
Billy Southard-Woolf, Marketing Executive – Synima Video & Animation Production
How to Create a Functional Strategy
While creating a corporate and business level strategy is comparatively easy, a lot of individuals fail to plan their functional strategy in-depth and that creates problems thereby introduce errors all the way up to the corporate strategy.
As of now, I will be dealing with four of the main functional strategies which are-
- Financial strategy,
- Marketing strategy,
- Production strategy,
- Human Resource strategy.
While detailing in-depth on the four essential functional strategies in-depth is out of the scope of this article, I will be showing you the areas which you must have in your business strategy for these functions.
In my view, strategic marketing is all about taking a long-term, big-picture approach to marketing efforts. It’s not just about throwing tactics at the wall and seeing what sticks. Instead, it involves:
Understanding your target audience: Who are you trying to reach? What are their needs and pain points?
Setting clear goals and objectives: What do you want to achieve with your marketing?
Developing a unique value proposition (UVP): What makes your business different from the competition? Why should someone choose you?
Creating a cohesive marketing mix: This includes your product or service, pricing, distribution channels, and promotional activities (the 4 Ps of marketing).
Continuously measuring and iterating: Track your results and adjust your strategy based on what’s working and what’s not.
Is FlexClip strategic?
We definitely strive to be strategic in our marketing approach. We focus on understanding the needs of content creators and small businesses, and we develop products and marketing campaigns that address those needs.
For example, we recently launched a social media campaign highlighting the ease of use of FlexClip. We targeted this campaign towards busy entrepreneurs who don’t have a lot of time for video editing. The campaign used a mix of social media posts, influencer partnerships, and content marketing, and it resulted in a significant increase in website traffic and free trial signups. While I can’t share specific numbers publicly due to confidentiality, the results were well above our initial projections.
The role of AI in strategic marketing
AI is already playing a big role in marketing, and I believe its impact will only grow in the coming years. Here are a few ways I see AI being used strategically:
Personalization: AI can be used to personalize marketing messages to individual customers, which can lead to higher engagement and conversion rates.
Content creation: AI can be used to create content, such as blog posts, social media posts, and even videos. This can free up marketers to focus on more strategic tasks.
Data analysis: AI can be used to analyze large amounts of marketing data to identify trends and insights that can be used to improve marketing campaigns. However, it’s important not to rely 100% on AI. Care must be taken to ensure the accuracy and authenticity of data, as well as compliance with ethical and legal standards.
Overall, I believe AI will be a powerful tool for marketers who can leverage it effectively. However, it’s important to remember that AI won’t replace the need for human creativity and strategic thinking.
Jessica Miller, Partnership Manager at FlexClip
Creating Your Financial Strategy – What You Can’t Miss
When you are creating your financial strategy, these are the must have components–
- Free Cash Flow – After all, cash is king. It does not matter how much your accrual income is, if you don’t have the cash necessary to run your business on a day-to-day basis.
- Asset management – If you don’t strategize around this, you will find your assets being sold off or put into disuse and thereby depreciation. Make sure your employees make the best use of the capital or human resource that you introduce into your organization by way of this strategy.
- Economic Value Added goals – This can be set to motivate your organization to target only those sectors which help its value to grow the largest and thereby leaving out the unprofitable or less profitable areas.
- Financing your business and structuring the capital – Your startup needs a delicate balance of financing. Too much equity and your own stake will be diluted. Too much debt and you will scare off future equity. You need to ensure that the financing is done while at the same time keeping the cost of capital to the firm at the minimum. And that’s why you need to strategize for this option well in advance.
- Profitability ratios
- Risk assessment and management – You need to identify your key risks and create detailed plans to control them.
- Optimization of tax liability – You must ensure that you structure your business in such a way that your tax liability is minimal.
- Growth indices – You need to set your growth expectation and the tradeoff levels of growth with funds that you are comfortable with. Some startups have a “growth at all costs” mentality which often burns through the cash of the business. And therefore you need to strategise for this option in-depth.
As such, you can see that this area of strategy is heavily tied to the revenue model of your business.
- Need help with your business strategy? Book a free consultation with us.
Creating a Marketing Strategy for Your Business – The Process
Your marketing strategy needs to make three important decisions-
- The markets that your product or service is going to compete in.
- The USP of your product – that is, where the basis of your business’ competitiveness lies.
- When you should compete and when you should differentiate your offerings.
The three decisions keep changing with time considering both the internal as well as the external environment of the business.
Your market position also influences the strategy that you are going to pick. There are four main market positions –
- The market leader,
- The challenger,
- The market follower,
- The market nicher.
I have discussed in-depth about the marketing strategies in this post.
The HR Strategy – The Essentials
To create your HR strategy, you need to first assess the HR capacity. This means, you need to assess number of people working for you, the skill level of the people as well as their work culture.
After that you need to forecast the HR requirements in the future. You need to consider the number of positions that you may need to create as your business continues to grow as well as whether you need to incorporate a new talent that you previously thought you did not need.
After the forecast, you may want to conduct a gap analysis to keep track of the gap between the existing and desired HR position of your organization.
You may also need to develop operational strategies for areas like skill development, restructuring strategies, outsourcing and creation of innovating recruitment strategies so as to find high performers in any organisation.
If your business has a high churn rate, you may need to plan for a retention strategy.
Some other essentials of a successful HR strategy are-
- Onboarding and orientation of new employees,
- Compensation plans for employees,
- Rewards system for high performers,
- Work culture development as well as strategy for transition in work culture,
- Creating team spirit and improving employee productivity.
That’s all. Hope you found the article helpful. If you need any help, book a free consultation with us detailing your needs and we will help you out ASAP!
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