We are all aware of the stereotypes of marketing and PR professionals in the media. They are either air brained non-entities like Siobhan Sharp in W1a or Steve Coogan’s ultra-aggressive salesman, Gareth Cheeseman.
And such stereotypes seem to feed into the minds of some business managers who treat the marketing function as either a form of warfare or as a complex game. So, if you are charged with your businesses marketing function, are you to act like a field marshal planning troop movements or like John Nash, the Nobel Prize winning mathematician and inventor of Game Theory.
In truth, running a business is not warfare; and I suspect many business owners would be extremely worried if their staff were treating strategy as a game. You are not organising the D-Day landings; you are not playing Monopoly.
However, that does not mean your business strategy cannot learn from both military strategy and game strategy. Even I succumb to occasional quoting Sun Tzu’s The Art of War (and even Machiavelli’s The Prince).
The effective marketer will be able to learn from both military strategy and game strategy.
Some of the analogies in marketing that can be lifted from military strategy are:
- Select and maintain your aim
- Use surprise with audacity and speed
- Maintain morale
- Take offensive action
- Secure your defences and never be taken by surprise
- Maintain flexibility
- Use concentration of force
- Use economy of effort.
These principles can be summarised in four broad strategic options:
- Offensive Marketing:
- Careful consideration of the market leader’s position
- Search for and attack weak points in the market leader’s position
- Attack on as narrow a front as possible like the point of a spear splitting chain mail.
- Defensive Marketing:
- Only those in a market leadership position should consider defence as their primary strategy. Everyone else in the market needs to prioritise offense.
- Attack is the best form of defence
- Strong competitive moves should always be blocked.
- Never underestimate or ignore the competition.
- Flank Marketing:
- Flank into uncontested areas
- Use tactical surprise
- The pursuit is as critical as the attack itself
- Guerrilla Marketing:
- Find a niche segment that is small enough to defend but also viable.
- Regardless of your level of success, never act like a market leader.
- Be prepared to retreat at short notice especially when faced with threats you cannot deal with.
Competitive strategy can also learn from gaming. Like in many games, outcomes of marketing strategy are not reliant on the actions of your business alone: Outcomes are also reliant on the actions and reactions of your competitors.
Markets are becoming increasingly competitive as they mature and new technologies are leveraged. The game of marketing is becoming more difficult to win.
There is a real danger that this complexity will lead to the threat of damaging price wars as businesses desperately try to avoid losing customers, share and sales volume. Increasingly it will appear that the only way to defend against competitors is to cut prices. This in turn leads to a downward spiral where prices only go down, margins are eroded and profitability disappears. This is marketing’s version of MAD; Mutually Assured Destruction.
To avoid MAD, you need to ‘manage’; the competitive process and your competitors. This can be achieved by following these broad guidelines:
- Never ignore new market entrants; particularly those focused on the bottom end of your market. Look at the success of Lidl and Aldi as discount supermarkets and their effect on the pre-existing groceries market in the UK. Look at Norton (a company now in administration). Norton, BSA, Triumph and other UK motorbike manufacturers were once the dominant market leaders but they ignored the ‘cheap’, low powered motorbikes coming from Japan and lost their market dominance to Yamaha and Honda. The UK motorbike industry went from a position of market dominance to that of also-rans.
- Always exploit competitive advantages (unless they are replaced by another advantage which is more attractive, powerful and meaningful to your target customers)
- Never launch a new product or take a new initiative without anticipating the probable response of your competitors.
Day (1996) wrote that successful businesses:
“Formulate strategies by devising creative alternatives that minimise or preclude or encourage cooperative competitive responses. They adroitly use weaponry other than price including advertising, litigation and product innovation. They play the competitive game as though it were chess; by envisioning the long-term consequences of their moves. Their goal is long-term success rather than settling for short-run gains or avoiding immediate losses.”
Too many businesses focus on past experience for future success. They focus on past campaigns; they expect competitors to do as they have previously done. These businesses often fail to ask what their competitors are likely to do in the future. Often these assumptions are invalidated by small market changes.
Many businesses also look to simplify reality (and not just businesses, much of today’s politics, particularly Brexit, is based on simplification of often highly complex realities). Such simplification may just be about sustainable in a static market. But ask yourself how many markets are static?
You need to put in effort to learn about your competitors; their strengths and weaknesses; their ways of doing business; their alliances; and their strategic position. You need market intelligence.
In developing business and marketing strategies you are not Napoleon at Waterloo and you are not John Nash building complex mathematical models. That said, the successful marketer will know the principles of military strategy; they will know the rules of the game; and the shape of the game board. Knowledge of games and military strategy can have a strong influence on business success.