Four Strategies for Growth
Effective marketing starts with a well and accurately defined problem and a correct diagnosis of the action that needs to follow.
In this post, we highlight a checklist from London Strategy Unit that works a treat at the start of a new project and ensures that you are directing your efforts in the most profitable direction for growth.
1. What’s going on in your category?
Do you need to do a better job of conveying your products unique strengths? Where consumers are making considered choices, like cars and high-end appliances, claiming to be best in category is a reliable way to drive growth. Of course this is most likely to be successful if you have a genuinely differentiating USP, it also helps if the category is defined as high interest. The reason is that a best in category strategy is rooted in the perceived superiority of your product over other choices, so its important to make sure that people are carefully choosing between ‘better’ products.
Examples include our work for McLaren, where the brand has been positioned as the gold standard in sportscars. As well as work for Miele, where we created a new dimension of better in the appliance category with a campaign for ’20 Years Tested’. A strategy that boosted brand consideration by more than 37%.
2. Which customers will drive growth?
Are there competitors in your category that have weaknesses you could take advantage of? Perhaps there is a large amount of switching in your category. In these cases it’s possible to steal share from rivals with well targeted appeals.
Examples include Apple’s Mac vs PC, a campaign that successfully repositioned PCs as old hardware compared to the newer, creative and more interesting Apple Mac. Virgin Atlantic famously took on British Airways, with a third of their size, by conveying a sense of scale and competing on service differentiation with campaigns that directly took a swipe at BA’s old- fashioned offering for business travellers.
3. What perceptions do you need to promote?
Are there negative perceptions surrounding your brand – that if addressed – could remove barriers to consideration? In these cases, these unhelpful perceptions may be the sole reason people don’t buy from you.
Research from marketing science firm Ebiquity have shown brand consideration has the closest link to base sales, where growth in consideration causes growth in base sales. On average, 1% increase in consideration can be expected to drive 0.5% – 1.5% increase in base sales.
In these cases overcoming negative perceptions are likely to be successful if your company or brand reputation is less than favourable. There may be a commonly held misconception around your product or the category itself.
Another route to consider is whether you can promote meaningful differentiation. Following a five-year analysis of BrandZ data, Millward Brown revealed that brands that are salient (thought of in buying situations) and seen as meaningfully different are more likely to grow share faster.
Might your brand boost its appeal by excluding certain audiences? Can you find a product weakness that can be turned into a product strength? In these cases it pays to celebrate your differences.
As Richard Shotton explains in The Choice Factory: 25 behavioural biases that influence what we buy, ‘admitting weakness is a tangible demonstration of honesty and therefore, makes other claims more believable.’ This strategy works particularly well when competitors are regularly boasting.
4. Who has the biggest influence on new customers?
Can you get people who know your brand to talk about it to new people? Can you leverage their network? In cases where you have a robust database of loyal customers, it pays to use current customers to attract new ones.
One example comes from the Behavioural Insights Team in the UK, where bank staff were encouraged to donate to charity. But instead of asking people to give directly, they found managers in the company who had given in the past, and asked them to ask their colleagues to donate.
The results were impressive – using current customers to attract new ones in this way increased the proportion of people donating from 6.1% to 38.8%.
At the heart of any growth strategy should be a well defined and articulated business problem. Adopting successful strategies from unrelated categories that address your desired behaviour is a fast, simple way of cutting through the complexity and testing new ideas for profitable brand growth.
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