5.1.2 Strategy Definition Usage: competitive responses, customer journey, options

Application competitive responses

We take into account recognizable competitive responses when developing the content of the strategy components. That is, in strategy development, we decide on specific content based on the courses of action available to us and our priorities and the focus of the strategy. We check what responses to our measures can be expected from the competition and take these possible measures into account in our content. We are therefore examining whether our planned measures can withstand the expected responses of the competition or be neutralized by them. If our measures are sufficient not to be neutralized by anticipated competitive responses, we include them in the strategy component. If our measures / content run the risk of being undermined by expected competitive responses, we revise and improve our measure until this risk is minimized to an acceptable level or eliminated entirely.

It is advisable to record this process in the strategy components for documentation purposes and to make decisions easier to follow.

We also ensure this contribution at the level of the strategy components by checking how the content of our strategy components specifically contributes to the success of the company.

We record the – intended – contribution of the measures to the company’s success in the respective strategy components. We use this information to evaluate the performance of the strategy.

Risk Minimum approach

We develop strategy versions that best reflect the priorities and focus of the company, the options for action and the competitive situation.

This includes that we also consider possible responses of the competition to our strategy – as far as we can estimate them – in the definition of the core contents.

Competitive responses are mostly to activities and actions. Our measures may also lead to a reassessment of the competitive situation by our competitors and thus to new behavior and changes in market development.

In developing our strategy, we take into account possible competitive responses, particularly in the content of our core strategy components.

Therefore, when defining the content of our core strategy, we should make sure that we not only use the content that is currently competitive, but that we use the content and measures that are generally the most competitive. Otherwise, we offer the competition the chance to prevent the success of our strategy with more competitive content.

Application competitive responses

Practical principles for the application

• Consideration of competitive responses in strategy development is always an assumption. I.e. we must consider both that this assumption can occur, but also that it does not occur. Both cases should have been thought through in and for our strategy.
• Whenever we decide on a certain strategy or content of this strategy or prepare this decision, we should consider the reaction of the competition beforehand. Until it is clear to us which possibilities of reaction to our action the competition has and which consequences result for us from the possible responses of the competition, it is not advisable to decide or pronounce on the content of a strategy or on a strategy.
• If we have to accept a risk, we examine how we can best respond to corresponding behavior on the part of competitors and to what extent our strategy supports this response.

The information basis for our assessment are

• the options for action that we developed in the run-up to our strategy definition and
• the assessment of competitors and their behavior.
• the contents of our strategy / strategy version

To more clearly identify the impact of competitive behavior, we define the opportunities for competitors to respond to our strategy for the core of our strategy

• the or the userBenefits of our strategy
• or the usage formats of our strategy
• the participation offers / participation of our strategy.
• the motivation methods and structures of our strategy.

The questions to identify the risks from possible competitive responses are for

User benefit

• Which UserBenefit is likely to equalize or neutralize our UserBenefit?
• Which competitor would be able to equalize or neutralize our user benefits?
• What could prevent our competitors from using this more attractive user benefit?
• What is the reason that our UserBenefits have not used this UserBenefit so far and will not do so in the future?

If a UserBenefit exists that is more attractive to users than our planned UserBenefit, this represents a risk that we must not underestimate. The user benefit is a central element of success.

Recommendation: if we cannot be absolutely sure that our competitors will not be able to deploy a competitively powerful UserBenefit either today or tomorrow, it is recommended that we reconsider our own UserBenefit.

Usage formats

• Is a more powerful usage format feasible in one, several, or even all of our themes?
• Which competitor – attention and performance competitor – is basically capable of doing this?
• What prevents our competitors from deploying viable high-performance usage formats and what is causative for this behavior?

If our social media strategy can be outmaneuvered via usage formats, this is a particularly delicate risk because usage formats have the character of an infrastructure.

Recommendation: As long as we cannot be sure that one or more competitors will not be able to use this opportunity – a more powerful usage format – either today or in the foreseeable future, this is a reason to reconsider the decision for the intended usage formats.

Participation offers / participation

As a reminder, we let the market play for us via the participation offerings. Therein lie the social media resources that offer significant market advantages to a company acting accordingly. Participation offerings require not only conceptual competence, but also an appropriate set of technical functions and a competent social media management team.

Conceptual risk avoidance: At the time of strategy definition, it is not always certain that we will be able to have all of these conditions in place to a sufficient degree. That’s why we intuitively tend to keep the demands as low as possible in this field. This behavior can remain harmless if we are lucky and all competitors behave this way. But with this behavior, we no longer have the initiative in our own hands and can be forced to move. Even a leading competitive position in this case is one on demand.

• Are more attractive participation opportunities generally possible for users?
• Which competitors would basically be able to realize these offers?
• What ensures that this opportunity will not be seized by these competitors today or tomorrow?

Recommendation: should we identify a fundamental risk here that cannot be ruled out with certainty, it makes sense to review this point again. For this purpose, do not take the current perspective but the perspective that your company has when a competitor successfully lets the market play for itself – and thus against your company – in this way. Define possible consequences that may arise for the company.

Motivation methods and structures

• what more powerful motivational methods are possible in the themes of our strategy / strategy version?
• what more powerful motivational structures are possible in the themes of our strategy / strategy version?
• which competitors are able to implement these methods and structures?
• how high do we estimate the risk that the individual most important competitors react to our motivation methods and structures with superior offers?
• what is stopping our main competitors from responding to our strategy with more powerful methods and structures?

We use these questions to review and, if necessary, adjust the contents of our strategy components Motivation and to highlight risks arising from the planned contents of our strategy / strategy version.

Guidance for strategy development with possible competitive responses

It is qualitatively something fundamentally different whether I develop a strategy from the perspective of the current state or from the perspective of the potential. With a strategy from an as-is perspective, any competitive response beyond the as-is state is very likely to run into problems in the form of needing to adapt and losing the initiative.

Strategies that have been developed with a view to possible competitive responses and “consolidated” accordingly are qualitatively very different from strategies in which possible competitive responses have not been taken into account. This also applies to the quality of strategy development.

Taking into account possible competitive responses is not only a question of the quality of the strategy but also helpful when it comes to securing resources for more powerful strategy content. Under no circumstances should you allow yourself to be forced into a strategy that is unnecessarily risky in terms of content by using the resource argument against better solutions. Only the company’s management can decide on a strategy that is additionally risky in terms of content. The job of the strategy developer is to make these risks visible.

Practical consideration of competitive responses in strategy development

We can better consider and evaluate possible competitive responses if we have defined the contents of our own strategy / strategy version.

Risk assessment at the content level

• We list our own content for each of our core strategy components and then contrast that content with recognizably better performing alternatives. If we do not know of more powerful alternatives to our content, we can instead justify why there cannot be more powerful alternatives.
• We describe the impact on the success of our strategy when a competitor in the core strategies responds to our strategy with more powerful offerings.
• We describe which options for action we have in this case and what effects and consequences this entails.

Risk assessment at the competitor level

• We list the relevant (attention and performance) competitors with their content in the respective core strategy component.
• We justify why the respective competitor can respond to our strategy with more powerful content.
• We describe the conditions that must be met in order for a competitor to be able to operate with a more efficient offer.

The benefit of these steps lies in their impact on the content of our strategy. If we manage to secure a more powerful strategy through these analyses and the presentation of the results, it will be a success worth the effort required.

Application Customer Journey

We can – and should – consider the customer journey as an additional element for strategy development. There are several valuable approaches to this.

Themes and Customer Journey

Together with the definition of the topics on which we align our strategy, we can – and should – define the Customer Journey – in addition to the business model and the company’s goals.

• as another source for topics
• As a source for the priority of topics

use

Customer journey as a source for topics and topic priorities

We primarily use the business model and corporate goals as a source for the topics of our social media strategy. With the Customer Journey, we have another source that is valuable as a check on the completeness of our collection of topics.

That is, we derive the topics of our Customer Journey and check whether all these topics are already present in our collection of topics.

• Task: Deriving the themes of the customer journey
• Involved: Social media management, functional areas (marketing, sales, customer care)
• Work steps: We create the customer journey or use an existing customer journey. We identify the topics from the individual stages of the customer journey. We align the topics of the customer journey with the topics from the business model and corporate goals. Business model topics that scored high but are not part of the customer journey deserve additional scrutiny. The customer journey may not be complete, or the issues may be overstated.
• Result: additional topics for strategy development or confirmation of the collection of topics from business model and corporate goals, correction / addition of priorities. Customer Journey via their topics and their priority integrated into the strategy definition.
• Use of the result: social media options for action and strategy definition for the topics / subject areas.

Competitive situations and customer journey

In competitive situations where success in an important topic / subject area is questionable, instead of focusing on this topic, it may make more sense to choose a topic from the Customer Journey that precedes the critical topic and gives us the opportunity to address users about this earlier topic and thus generate a contact / prospect. The procedure could look something like this:

• Task: Definition of topics to bypass a difficult topic.
• Involved: Social media management, functional areas (marketing, sales, customer care)
• Work steps: Search for topics in the customer journey that allow a critical topic to be bypassed or users to be reached beforehand and won over for the company.
• Result: Customer journey topics that can be used for early redirection before critical topics.
• Use of the result: Redirecting users in the customer journey before critical issues by designing the strategy accordingly.

Application options

A strategy should keep the company’s options for the future as open as possible. The strategy should therefore help to create as many new options as possible rather than reduce existing ones. That is why we check decisions and content of a social media strategy to see if, based on this decision/content, your company can

• has more options for action and development or fewer options available in the future.
• enters into a higher dependency or gains more independence.

This applies in particular to the contents of a strategy that have the character of an infrastructure, i.e. are of a longer-term nature or cannot be changed at short notice. These include in particular

• the usage formats that are used,
• The subject areas (as the equivalent of markets) that are addressed,
• relationships with our customers,
• knowledge of the needs, attitudes and wishes of our markets / customers
• the structures for participation and motivation
• the social media channels we use,
• the target groups / user groups we address.

Overview options and strategy

To get an overview of which options are retained, lost or added to a strategy, a simple list of the strategy components with their contents, supplemented by the listing of open options, lost options or new options for each strategy component, helps.

Involved: Social Media Management

Usage

We use the impact of a strategy on the company’s options to evaluate the quality of the strategy and to compare strategy designs.