I’m super open-minded about strategies. Sure, I have a penchant for specialty strategies (because who doesn't like high margins?), but you can make a case for any strategy if you are willing to build the required competency. There is one strategy I see far too often, though, and it scares me every time I see it. That strategy is: the same thing everyone else does. I see it all the time, in big companies and small, and it’s one of the dumbest strategies you can use.
Similar strategies are almost always doomed to fail for one simple reason: you are attempting to succeed with the same customers using the same competency that your competitor is using. Now, if you have far more resources than your competitor, you might come out on top, eventually. If not, you’re doomed. But let’s look at the “more resources” approach: if you have more resources, why wouldn't you use them to force your competitor into the LESS desirable space in your market, guaranteeing the top spot – and profits – for yourself? There are two answers for this. One is that sameness feels safe. The second reason is that sameness creates the illusion that you can obliterate your competition and dominate the entire market.
Both of these reasons are nonsense. There is nothing safe about sameness – in fact, it’s probably the most unsafe strategy you can pursue. Faced with similar competitors, customers invariably choose the competitor with the thinnest margins – the highest cost offering sold at the lowest prices. That’s just a recipe for poor financial performance. And long-term, your brand loses meaning in the eyes of the market. You become a clone rather than a distinctive, emotion-laden brand. There’s no money in that. The second reason is equally specious: markets rarely tolerate complete obliteration of competition. Don’t believe me? Think of some of the most ballyhooed brands in recent times – they ALL still have competition. Not one of them – not even behemoths like Apple and Wal-Mart – have escaped the world of competition. What this means is that the sameness strategy simply transforms your existence into a struggle at a much higher level than you faced before. You become Coke and Pepsi, duking it out over market share in a game where 0.1% is over $50 million in stakes. It’s a playable game, but it’s not the endgame we all fantasize about.
How can you avoid the trap of sameness? Here are three questions EVERYONE should ask when looking at their strategies:
- 1. Why Us? Why would customers find this so awesome they would flock to our brand?
- 2. What is the difference? Can you point to a SERIOUS difference between our strategy and our competitors’?
- 3. How does our competency stand out? What know-how base do we have that our competitors are unwilling or unable to match?
If you have solid, robust answers to these questions, you’re on your way to better profits. If not, maybe it’s time to re-think HOW you come up with your strategies.
If you’d like ideas about how to come up with better and more unique strategies, drop me an email…it’s what I do, and I love it!