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Growth Comes from Strategy

Monte Wyatt & Brad Sugars, May 28, 2019

If you only compete on price, your business will not be sustainable. Others can always undercut you, and customers won't learn to choose you for the quality of your products or services.

It's true that you can distinguish yourself from the competition by price. Profit should definitely play a role in marking a company's progress. But profit can't be the sole determinant of a company's success. You don't just lower your prices to increase sales. You differentiate yourself and adapt to the market. That's what we're going to look at in this post.

You must be aware of the market, and adapt to it through what you offer, not what you charge.

Some terrific companies are wildly innovative. They change the way the world thinks or operates. But there are others that stick with what they like and fail to anticipate or adapt to changing market conditions or their customers evolving needs, they crash.

Let's take BlackBerry as an example. BlackBerry was once the epitome of a great technology company. Its products defined business communications. But once the smartphone came to market, BlackBerry's focus on a single product line that could only do one thing led to its decline. The introduction of iPhones and Android-based smartphones led to increased technological expectations for electronic devices. But BlackBerry didn't adapt to these new expectations. As a result, BlackBerry's stock price dropped by 87%.

The thing is, most businesses have built their business models around a product. As a result, they don't have sustainable strategies for their companies: if their product starts to falter in the marketplace, they become like BlackBerry and they can't recover. These companies believe that the sales strength of their products proves they have successful strategies. But the truth is their strategies are for their products, not for their companies.

Companies without a strategy, and that don't adapt, hit their ceiling and crash down. Remember: innovation is useful, but constant change is crucial. Always look to the future and over your shoulder, too.

You cant be incredible for a long time if you’re only thinking about a single product. In addition to BlackBerry, consider the Ford Mustang. If Ford had continued to manufacture the 1965 Mustang forever, it wouldn’t be sustainable as a business because it would have only been about that product. Instead, Ford went with a concept that added longevity: it made Mustang about how we feel about ourselves. That gave Ford big picture and long-term opportunity, leverage, scalability and marketability, the four components of a good strategy.

Here are some steps to beginning to think outside of your own point of view.

  • Take the time to figure out the precise difference between you and your competition.
  • Determine who your competition is.
  • Determine who your customer is.
  • What is your market?
  • Where are their opportunities?

If you haven’t taken the time or effort to figure out the precise difference between you and your competition, it’s seems easy to act like a commodity and compete on price because, in the short term, you’ll make a profit.

To repeat, your business won't be sustainable if you only compete on price. You've got to know your strengths and market to them and adapt to the changing market. You do this by defining what sets you apart, by determining who your competition is, by knowing your market, your customer and identifying opportunities.

We'd love to hear from you. How much do you know about your marketplace, your customer and what sets you apart? Thank you for sharing.