fbpx

How to develop a strategy in small business

Strategy building blocks.
Share on facebook
Share with friends
Share on linkedin
Share with Network
Share on twitter
Share with Twitter
Share on email
Share via Email
Business Station

How to develop a strategy in small business

First let’s be clear about what strategy is. Strategy has 3 features. 

Strategy is the way you: 

  1. Reposition your competitor 
  2. Reposition your customer or, 
  3. Reposition your market ,or all three or any combination of. 

Reposition your competitor. Pepsi Cola’s strategy was to reposition Coke as old, boring, dull and what your parents drink. Pepsi was the choice of a ‘new generation’ rebelling, coming of age, wanting to be independent. Hertz rental car was not going to be beat Avis to number one, so the Hertz strategy was to rejoice in being number two and play the underdog card. Hertz, ‘we try harder’. BMW was always up against Mercedes Benz. BMW repositioned Mercedes as old, dull and what your parents drove. BMW was sporty, young, and edgy. What the up and coming movers and shakers drove. It was simple ‘sheer driving pleasure’. 

Reposition your customer. Evian sells water in a bottle. You can get water free from a tap. Evian’s strategy was to divide and conquer. Evian convinced us, tap water was what people who couldn’t ‘afford’ bottled water drank. Forget that before bottled water we all drank from the tap regardless of class. Craft beer too was never mainstream. Like imported beer it was exotic, for special occasions and expensive. Today we don’t blink at paying $22 for a six pack of craft beer where once we only paid $16. Like Pepsi and Evian, regular brand beer drinkers were repositioned. Craft was fun, edgy, better. Regular beer was what the ‘others’ or dare I say it, our parents now consumed. Who wants to be like their parents right? 

Repositioning your market. Dell computers identified the need to custom make PCs for novice users. Before that, only businesses custom built PCs and everyone else bought box off the shelf. Dell repositioned the market that everyone could assemble their dream machine and in doing so expanded the market. Compaq laptop computers were first in the market with the laptop, they realised people travelled more than ever, were much more mobile. The world was going global. Made sense that their computers had to go with them, and the personal computer market was repositioned with desktop PCs as clunky and limiting.  

eBay believed that people were inherently honest and repositioned the market that goods could be paid for before being received, from strangers too. The consumer retail market was repositioned giving rise to the online ecommerce market, which paved the way for Amazon and thousands more. 

Strategy is critical to long term success and importantly sustainable success. Every success story in business had a strategy that had one or all three of the features above. So, in developing your strategy, using the same 3 features You need only ask yourself one question, do you need to reposition your competitor, your customers, or your market. 

Share this article

Share on facebook
Share on twitter
Share on linkedin
Share on email
Share on pinterest

still got questions?

  • This field is for validation purposes and should be left unchanged.

want to chat?

Call, email or drop in to one of our locations to speak to someone from the Business Station team!