6.0 Strategy evaluation of social media strategies – basics 2

Reading time: approx. 18 minutes

Learning Objectives: To learn the basics of strategy evaluation in the potential-based strategy model pbsm and how to apply them.

Exercises: Exercises are in the PDF of all exercises of this course. Download it from here.

Basics

Assessment of the competitive effect

The competitiveness of a strategy is a key performance that we must deliver in order to realize other performances. Without competitiveness, any strategy is lost. Therefore, we should pay appropriate attention to the competitive quality of a strategy. When it comes to competitiveness, make sure that we need to be competitive in social media against both performance competitors and attention competitors.

Criteria for the assessment of the competitive effect are

  • Creation of competitive advantages: we use the content of our draft strategy for the individual topics / subject areas to check whether the respective content can create a competitive advantage over the competition as a whole or over a specific competitor.
  • Durability of competitive advantages: we check whether the respective competitive advantage is of a permanent, structural nature or of a temporary nature. One criterion for this is whether the competitive advantage can be easily understood by the competition / in the short term or whether structural services are required for this.
  • structural competitive advantages: a competitive advantage has structural causes. To compensate for such a competitive advantage, a competitor must establish a corresponding structure/structures in the market. This is a competitive advantage of particularly high quality. One example would be competitive advantage via usage formats.
  • Longer-term but not structural competitive advantages: longer -term competitive advantages are advantages that require a longer period of time to build up or balance, but not a structural change. Example would be a competitive advantage over quality and quantity. For example, a strategy has content of higher quality and quantity that cannot be procured in such a short-term manner.
  • short-term competitive advantages: Measures or contents of the strategy that can be reproduced in a short time.
  • Lack of competitive advantages: the strategy cannot build competitive advantages because there are no open competitive positions, neither in structural terms nor in the quality or quantity of measures and content.

Sources / information basis for the evaluation are options for action and competitive situation in the respective topics / subject areas.

In addition, we evaluate the quality of social media strategies based on

  • of the risks inherent in them: every strategy involves risks. We assess here the identifiable risks from the strategy and not from the implementation since mistakes made in the implementation of the strategy are not identifiable in advance.
  • of the resources we need for them: we assess the resource requirements like the company’s coverage of the required resources. The latter because problems can also arise from this.
  • of the impact on business options that they bring about. Options here stands for future action alternatives that are expanded or reduced by strategies. If we commit ourselves to a strategy for a certain behavior to such an extent that it is difficult to correct, we reduce our options for this behavior. This is the case, for example, when deciding on usage formats or a particular social media architecture.
  • of or the dependencies associated with a social media strategy. We understand dependencies as special risks that should be highlighted and taken into account.
  • the compatibility and mutual support of the content of the individual strategy components. Strategies whose individual components act independently of each other are significantly less effective than strategies whose components act in concert toward a common goal. We define the quality of the social media strategy based on the
    • Compatibility of the strategy components: here we check whether the contents of the strategy components contradict each other, i.e. exert a negative interaction.
    • Support of the strategy components: here we check whether the contents of the strategy components support each other, i.e. exert a positive interaction.

We use this evaluation to compare the quality of different strategy versions at this level.

Assessment of identifiable risks

This assessment should give us a clear view of risks we face in implementing this strategy. Deciding whether these risks are acceptable is part of the decision for or against a strategy design.

We review the defined social media strategy for identifiable risks

  • in the implementation: Risks in the implementation are particularly present where we cannot be sure that we will reliably achieve the respective goals with the intended content. We assess how large / likely this risk is in individual cases and summarize these risks for the entire strategy as an overview. In doing so, we are helped by an overview of the assumptions and prerequisites that must be in place for the strategy design to be successful.
  • in competition: we check which risks the strategy involves in competition. For this purpose, we check which open positions / competitive opportunities this strategy does not use / hedge, i.e. leaves open for competition. Particularly in structurally relevant positions – such as usage formats, participation structures, channels – we should not underestimate these risks.

Based on the identifiable risks, we can clearly show the risks of a single strategy version and compare different strategy drafts with each other.

Risks from assumptions and prerequisites of the draft strategy

We use the assumptions and prerequisites required for the core content of the strategy component to be successful to assess the risks of a strategy version.

Implementation: we analyze the assumptions and preconditions from the perspective of probability and the risks associated with these assumptions and preconditions.

For this purpose, we divide the assumptions and preconditions into different categories. For this purpose, it is advisable to take the most pragmatic approach possible, such as

  • Assumptions and conditions whose occurrence is almost certain or at least very probable.
  • Assumptions and conditions whose occurrence is probable.
  • Assumptions and conditions whose occurrence may be at risk or less likely.

In the last group, we should actually find few assumptions and presuppositions because we are trying to develop strategies with as secure a basis as possible.

The higher the proportion of assumptions and preconditions in the last two cases, the less certain and thus less recommendable the respective strategy design is.

Impact of potential risks: In order to trace the impact of identifiable risks back to the areas of the business model / corporate objectives, we can take into account in the presentation of the assumptions / premises that we assess both the topics that are identifiably affected by these assumptions and premises and the core strategy components. We thus recognize risks arising from the assumptions and prerequisites on

  • the individual areas of markets (via the themes)
  • on the success of the strategy version (via the core strategy components)

can have an impact. We therefore know in advance what the consequences of inappropriate assumptions and preconditions can mean for the success of the strategy as well as the support of the business model / the success in markets. This can be very helpful in discussions with company management, especially when it comes to resources and structures for social media.

We use these assumptions both to evaluate each strategy version and to compare strategy versions.

Risks from open competitive positions

In the core strategy components, our decisions in favor of a particular strategy have an impact on the company’s competitive position. Below are some examples to explain.

  • User benefits: if we do not occupy relevant and important user benefits for decisive topics, we leave this competitive position to the competitor. Can competitors deploy more attractive and powerful user benefits can lead to sustainable competitive disadvantages.
  • Usage formats: if we decide not to use more powerful, possible usage formats, this can result in structural competitive disadvantages if competitors successfully use these usage formats.
  • Participation: if we decide not to offer meaningful participation options that are attractive to users, this decision will result in structural competitive disadvantages as soon as competitors take advantage of these open competitive positions.
  • Motivation: if we do not use suitable motivation methods and structures, we enable the competition to build up competitive advantages.
  • Social media channels: not using certain social media channels allows the competition to operate there in a less competitive situation. If our topics and potential users have a pronounced presence there is the source of a possible structural competitive disadvantage.

Complexity of the strategy / strategy designs

Risks from the complexity of strategy designs can be traced back to the following sources in particular:

  • Too many different user benefits: the realization of different user benefits is not only a technical and conceptual challenge with correspondingly fundamental demands on the design of the social media channels, it also poses permanent challenges for social media management in day-to-day business – in the daily safeguarding of user benefits. Not to be underestimated is the irritation for the social media user if he cannot immediately recognize the user benefits relevant to him. If a social media user encounters irrelevant user benefits during his first contact, there is a good chance that he will turn away and become active elsewhere.
  • Excessively complex usage formats: Complex usage formats are a burden on both social media management and active social media users, which can be harmful in the long run because they make it more difficult to handle the social media offering. If the use of a social media offer is complex, this makes it more difficult for users to achieve the user benefits of the offer. Users who have difficulty using a social media offer leave this offer relatively quickly. If a user comes across a social media offer whose use is not clear to him, he is more likely to leave this offer and turn to another offer.
  • too diverse motivation methods and structures: motivation should be simple and appropriate in its method and structures. The more diverse and multi-layered methods and structures are, the greater the benefits they must deliver to keep users engaged. This means that complexity has a selective effect, i.e. it reduces the broad impact. If it is not clearly recognizable how I as a user benefit from the motivation / the motivational offers, it is likely that I do not use them.
  • Participation offerings that are too complex: If participation offerings are complex and require “familiarization” in order to make sense of them and benefit from them, this also has a selective effect in terms of reducing the broad impact. Participation offerings are also complex when they are designed in different levels or areas.

The complexity of the strategy designs has consequences both for the functions required and the demands placed on their platforms, but also has a clear impact on the demands placed on the management of the social media offering in day-to-day business. While complexity can’t always be completely avoided, we should do everything we can to keep our social media offerings as simple as possible.

Compatibility of the draft strategy

The evaluation of the compatibility of strategy designs has the goal to make clear strategy designs in internal conflicts from the contents of the strategy as well as strategy designs with an internal positive dynamic from the interaction of the contents of the strategy. We use this insight to remove critical strategy designs with unresolved internal conflicts from the race as well as to keep strategy designs with an internal dynamic in the race due to their competitive quality.

  • Negative compatibility: Contents of the strategy components are not compatible with each other.
  • Positive compatibility: the contents of the individual (core) strategy components are coordinated in such a way that they support each other in their effect.

Options and dependencies

As a reminder, options are the courses of action that are still available as a result of the strategy, i.e. the courses of action that are still available after the strategy has been introduced. The content of the strategy also determines which options the company will have for action in social media in the future.

Dependencies arise when we are dependent on the services of third parties for the implementation of a strategy / the use of social media.

Evaluating the options of a strategy shows how this strategy affects the options of a company. Of course, a company can resort to more options if it changes its strategy completely. We assess here the options arising from this strategy and its further continuation.

Example options

If, for example, we decide on the audience usage format for a strategy, we are structurally committing ourselves. The use of a community with it within this strategy is not possible. This would require abandoning the existing strategy with all its consequences, which – in this case – may correspond to a new start.

Example dependencies

If we decide to use one or more external social media channels exclusively in a strategy, this creates a dependency on these channels. This dependency can become problematic if the performance of the channels changes. For example, through the discontinuation of functions or a decline in the use of the channels by the market / user groups important to the company.

The aim of a strategy should be to limit future options for action no more than necessary, and better still to increase them as far as possible and reduce dependencies on third parties.

Assessment of the impact of the strategy on business options

Reminder: by corporate options we mean possible future courses of action.

Deciding on a strategy and its content has a direct impact on future courses of action in social media. For management to decide on the final strategy, it is imperative to show the impact on future business options in social media.

Subsequent examples make the magnitude or scope of these impacts clearer:

  • Topics: Deciding which topics to address with our social media strategy version and which topics not to address at all or to address with low priority has implications for business options. We withdraw from these issues entirely in the former case. This sets the support for these topics (and thus the corresponding markets and areas of the business model). Resuming support for abandoned topics requires an adjustment of the strategy or a completely new strategy. In addition, we must first become competitive in the newly included topics in social media (competing for attention). The inclusion of additional, new topics in a strategy – for example, due to changes in corporate goals – has comparable effects to the resumption of abandoned topics.
  • Usage formats: when deciding on a draft strategy, the company also decides on a specific social media infrastructure (a specific, individually used set of social media channels). The change of usage formats can affect the effect of the complete strategy and lead to a necessary restart of an adjusted strategy. This means that when deciding on the usage formats to be used, we have to make sure that the selected usage formats can cover all of the company’s social media requirements, including future ones. The company’s (future) options in social media are largely determined by the chosen usage formats.
  • UserBenefit: the UserBenefit is the driver of the social media strategy, which should ensure acceptance and support of the social media offering by the social media users. With the UserBenefit, we address individual needs. If we change the user benefits, we may also change the needs we address and thus the markets or target groups on which we have focused our strategy. For example, we run the risk of losing the support of users who are no longer addressed by a new UserBenefit before we have reached the users for whom the new UserBenefit is attractive. UserBenefit therefore has a far-reaching impact on the company’s future options in social media.
  • Participation: the involvement of social media users in our social media offering secures their support and social media resources that can scale social media success. At the same time, participation offerings are connected with technical infrastructure and with lived behavior on the part of the users. Both have implications for the company’s future options in social media. If we change the participation offerings, this affects the acceptance of the users actively supporting us and their engagement.
  • Motivation: motivation determines how much support we generate in social media. Committing to methods and structures also impacts our future options in social media.
  • Social media channels: deciding which social media channels we use, to what extent and with what objectives, not only defines our social media presence and thus its performance. We are also committing to the longer term – with the corresponding implications for future options in social media for the company.

We assess the impact of a social media strategy on future options in social media by asking whether the content of the strategy will influence our future options in social media.

  • reduce: i.e., we will not have any further options beyond this strategy in the core strategy components in the future.
  • expand: i.e., that we can open up or secure further options for the future in the core strategy components through the strategy.

Assessment of the impact of the strategy on dependencies

The use of external resources and offers cannot always be avoided, but also leads to dependencies on these resources. Depending on how easily replaceable these resources are or their importance to social media success, these dependencies can be marginal or existential.

Dependencies on a provider – for the company blog or its own forum – are of a different quality than dependencies on the provider of a social media platform such as Facebook or Instagram, especially if the social media relationships take place entirely on these platforms and are not (or cannot be) secured by the company.

We assess dependency on third parties based on their significance and impact via the criteria of

  • Securing data: we have access to all data that arises in connection with our social media strategy and can both store (physically secure) and process this data without restriction within the framework of the legal basis. This also includes the integration of data into corporate processes.
  • Safeguarding the relationship: we can ensure that the relationship between users can be maintained without restriction by means of communication with the users and, if necessary, between the users (community) and that this does not depend on the decision of third parties. This also includes the disposal of the virtual place of communication.
  • Securing the scope of the service: we can ensure that all functions required for the strategy are permanently available and can be further developed according to the requirements of the company and the wishes of the users and that this is not dependent on the decision of third parties.

Evaluation of the resource requirements

We summarize the resource requirements of the strategy as far as possible and compare the strategy under the aspect of resource requirements to other strategy alternatives with comparable impact in the market, competition and business model. Of course, we can only do this if we have developed alternative strategies.

Without alternative strategies as a comparison, we compare the expected benefits of the strategy – in the form of the effect in the market, in the competition and for the business model – with the resources required for this.

The qualitative resource requirements of a strategy option certainly cannot be determined precisely in advance at the time of strategy definition and testing. However, the requirements for the social media competence required for the respective strategy option (in the central social media area as well as in the use of social media in the functional areas) as well as for the organization of social media use for the respective strategy can be determined at this point, at least in the basic outlines. During the strategy definition / development of an option, as during the strategy assessment, make sure that the resource issue does not become the determining criterion of strategy development and assessment. The resource issue becomes really important when the company finds itself unable to secure sufficient social media expertise. This problem should not be underestimated, but it should not lead to a situation where this concern limits the company’s competitiveness. We develop the quantitative resource requirements via the strategy component Resources.

Format: the amount of content – especially the number of topics and the information about the respective social media courses of action define the size of this image. It is a like in geography. If we want to depict a continent in detail, the image will turn out somewhat larger than if we depict a small village. It is recommended to increase the format of the presentation rather than reduce the quality of the information. If the handy DIN A 4 format is not sufficient – which is to be assumed – a larger whiteboard or a corresponding wall can be the better solution. Especially when you want to explain the connections and their consequences to others.

The evaluation mediocre strategies and their justifications

Mediocre strategy are strategies that do not enable leading competitive positions in the core strategy components. The best that mediocre strategies allow is a tie in one or more core strategy components.

Normally, mediocre strategy drafts should be abandoned in the process of strategy development or improved to such an extent that they are no longer mediocre.

We may still encounter mediocre strategies when we evaluate strategies for whether they can be recommended for implementation because

  • the mediocrity of the strategy was not recognized in the development process. In this case, either – for whatever reason – one did not work carefully when defining the strategy and, for example, neglected or ignored the examination of the competitiveness of crucial contents of the strategy or one simply lacked the necessary knowledge. In the second case, it’s a training issue; in the first, it’s more of a personnel issue.
  • the mediocrity of the strategy was accepted or tolerated in the development process. One recognizes weaknesses, has no answers to them and instead accepts to fail with the strategy and to waste time and resources instead of finding a solution.
  • “it simply didn’t work out better,” or “more was not possible,” or “circumstances did not allow more.” Here we are dealing with a question of perspective and strategic competence. Both are human and therefore understandable problems. Difficult situations can make it individually impossible to find promising solutions. Depending on experience, strategic competence and situation such as individual disposition, such a situation occurs faster and more frequently or is decidedly rare.

Solution approaches for difficult initial situations were addressed in the Strategy Definition module.