Everyone knows that strategic planning is part of the business world, but do you really understand how to build a consistent strategy? Companies that manage to maintain a competitive advantage over their competitors usually invest time and resources in formulating a well-founded and effective strategic plan. Designing a strategy requires both analysis and synthesis, making it an activity that is both rational and creative. We will explain some important factors you should consider before any decision-making process for your business.
Know the market
The market consists of all those consumers who are or could become your customers. However, it is a complex environment, full of people with diverse personalities, wants, and desires who will interact with and identify with your brand in different ways. First and foremost, you should determine segments, i.e., groups of people with similar consumption profiles.
Understand your target audience
Okay, I've segmented a multitude of consumers into small groups with common interests. Now what should I do? Well, even though any consumer might buy your product or service, it's unlikely that you will be able to communicate efficiently with all of them. Your strategic communication efforts will be more effective if you can select those groups most relevant to your business and understand them extremely well.
Analyze your competitors
Once you understand the aspirations, personality, needs, wants, and lifestyles of your target audience, you can identify the companies that will be competing in the market with you. Now is the time to analyze its products and services, the values perceived by consumers, how the company positions itself in the market, and what its differentiators and weaknesses are. This will help you identify gaps between consumer expectations and what your competitors actually deliver, allowing you to see new opportunities for your business.
Understand your essence
Maintaining a strategy that goes against the factors that constitute the essence of the company will not be sustainable in the long run. The business essence works the same way as a person's values—can you sustain decisions that go against your principles for a long time? It is essential to keep in mind the values, principles, beliefs, purpose, personality, and culture that make the company what it is. These elements should not only be remembered in any decision-making process but also well disseminated among all employees of the company.
Build your strategic plan
Okay, now you know who your target audience is and how your competitors behave. Well, the most logical decision to make will be to meet consumer needs through products and services with a higher perceived quality than your competitors. In summary, you should create, communicate, and deliver value, presenting a cost/benefit proposition that is perceived as fair. Understand this: you must CREATE VALUE (develop products or services that meet the needs of the target audience), COMMUNICATE VALUE (after all, what good is having exactly what consumers want if they are not aware of it?), and DELIVER VALUE (successfully deliver the product or service that was promised).
To better understand the world of business strategies, we recommend reading the book"Strategy – A View From The Top – An Executive Perspective" by Kluyver and Pearce.