Understand These 3 Things Before Crafting a Growth Strategy It is essential to know the who, where and why before putting the strategic pen to paper.
By Andrea Olson
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Every organization wants to grow, but the challenge is always how. We often struggle with identifying new opportunities. We examine competitors, yet don't see a clear path to differentiation. Or we get consumed by company gravity, where unique ideas get killed by resistance to change from the status quo. The problem is before we can start down the path of developing an organizational strategy, we need to have a firm grasp on the not-so-sexy fundamentals. Those organizational truths that form the basis of insight-driven decision making.
However, this can be lengthy, slow and hard. We want to jump to action, instead of reviewing, weighing and assessing information. Because we want to keep momentum, we skip the step of deeply understanding our current state, identifying specifically where the organization is losing customers and money, or more importantly, why. We often only capture high-level KPIs, discuss them in a so-called strategy meeting, skipping the process of questioning the cause and effect of those outcomes.
Even though challenging, any good strategy has these fundamental insights established upfront. Yet, great strategies are a different breed, born from not just knowledge of current state, but future needs. This doesn't come from extensive industry research, competitive analysis or big data mining, but from a better understanding of your customers. Customers are the lifeblood of every organization — there's no revenue without them. However, deep customer insights are often left out of the strategic planning process.
This happens because gathering and deciphering useful customer input can be even more complex. Understanding customers requires more than sending out a few satisfaction surveys, and most organizations don't build the time necessary in the strategic planning process to capture what is needed for crafting a great strategy. However, there is a short cut. If you begin by understanding three key fundamentals — who, where and why — you can take your strategy from good to great and gain a unique advantage in the marketplace.
Related: Know Your Customers by Living a Day in Their Lives
Understand who
Regrettably, most companies don't actually know who their customers are. Even though we capture endless amounts of customer data, organizations often have little insight as to who their customers really are. Customers are frequently distilled down into groups of generic demographics, whether it be by age, purchase preferences, race, income or marital status.
Great strategies require an intimate knowledge of customers. Understanding their unmet needs, their goals and the obstacles they have to overcome to achieve them. This requires digging deeper — actually leaving the building and talking to customers directly. This engagement helps you uncover hidden subgroups — pockets of your audience who have an unaddressed need in the market — creating opportunities for differentiation and growth. By focusing on who precisely to win over, you will gain an advantage over those competitors who are trying to be all things to all people.
Related: Meet The Consumer Chameleon: Don't Categorize Your Customers ...
Understand where
It's not enough to know your customers use popular digital apps, or that they subscribe to your newsletter. Knowing where your customers congregate and where their tribes are provides insight into their networks, communities and other potential customers who have the same passions and interests. These often unexplored areas are excellent sources of insight for designing a great strategy.
By examining not only your subgroups — those target segments of your larger audience who have unserved needs — but also where they engage with others who have similar interests, you can find a wealth of information on how those customers behave, how they think and what they care about. Understanding the where simply expands your pool of potential customers with like-minded interests.
Understand why
By engaging with real people directly, you also gain insight into their motivations, behaviors and mindsets, helping create a better understanding of their why. Why customers make the decisions they do, what drives them and how they perceive your organization and offerings. This is critical to understand when building your strategy, as it helps shape approaches to communication, marketing and brand positioning.
Having a solid understanding of a customer's why also provides insight into those emotionally-driven aspects of decision-making. This enables you to build into your strategy approaches for positioning your offerings to address hesitation, concerns or doubts, which can be impediments to purchases and engagement.
Strategy is hard, but we make it harder by not having a comprehensive understanding of the customers we are trying to target. Without fully understanding who, where and why, your strategy will likely not be a strategy at all — simply a document that outlines 100,000 foot-level goals, lacking ties to how those goals can be achieved.
A well-crafted strategy helps an organization make better decisions on where to invest money, time and resources to produce successful results. This means understanding who you're targeting, where they gather and why they behave the way they do. This requires getting out of your building to discover where strategic opportunities with customer growth truly lie. If you want to take your strategy from good to great, start with a new way of thinking that comes with having a better understanding of your customers.
Related: The How-To: Building A Customer-Centric Strategy For Your Business
