Creating Winning Growth Strategies,
Strategic Planning Part II
By Jim Doucette, Managing Director

The critical starting point for a robust strategic planning process is a consumer behavior-based analysis that leads to role definitions for each Brand. Once the foundation is set, the second key is to balance strategies and activities between the core business, new innovation and acquisitions/divestitures across the portfolio.

Before we get to balancing activities across the portfolio, it's time to create growth action plans at the Brand level in six areas:

Marketing Strategy

There are two critical questions that need to be answered: What is the right strategic positioning for my Brand and how should the positioning be communicated to my Brand's target consumers?

If the consumer behavior analysis determined that your Brand's actual competitive frame is broader than previously imagined, your new strategic Brand positioning should reflect this broader competitive set. The strategic Brand positioning should be very specific with regards to competitive frame, target, benefit, reasons to believe and Brand personality. A well-defined positioning easily lends itself to a copy strategy that is the linchpin to making sure your Brand's messaging is synchronized across all marketing, PR and selling touchpoints. Even marketing and sales programs that sometimes have more of a short-term, tactical objective (such as many consumer promotions and in-store promotions) should be linked to the strategic positioning to reinforce the Brand's new message.

Spending Strategy

A precise positioning also yields efficient growth for established Brands because you can calculate the profit-maximizing point of marketing spending – across Advertising, Consumer Promotion and Trade (or Customer) Promotion - against your Brand's new competitive frame. In cases where the competitive frame for your Brand is much larger than previously imagined, the Brand likely should be spending more on marketing to reach the broader audience with your new, more relevant message.

Innovation Strategy

In addition to growing the base business, growth through new innovation is part of the lifeblood of any successful Brand. The key question to answer is: How and why will the new product replace consumers' existing behavior with a new behavior? While creativity is important in any innovation process, it should be directed after a thorough understanding of the existing consumer behavior that must be changed, the benefits consumers seek through this behavior, the attributes that support the behavior, and the parts of their current behavior consumers are willing to change and not change. All of these facets should be understood by the consumer behavior foundation you built at the beginning of the strat plan process.

Comparing the innovation opportunities you have defined with your company's in-house development capabilities can form the basis of an acquisition strategy. On the other side, if segments of the business no longer fit well with the Brand's competitive frame, you may want to consider divesting those segments.

Financial Strategy

The essential questions to answer at this stage are: What activities truly drive profitable volume growth and what is the optimal pricing for my Brand? A thorough Brand Due-To analysis will identify the activities that truly drive growth for the Brand. This is an especially important step. In our experience, activities that are within your control often play a large role in determining the success of your Brand.

A clear and precise understanding of your Brand's competitive frame identifies the competitors consumers are likely to switch to and forms the basis for a Brand pricing strategy. For a more accurate measure of price elasticity, consider Brand (not item) elasticity within the context identified by the competitive frame. Once the pricing architecture has been determined, the final step is to identify the "right" spend back that maximizes revenue and earnings while protecting volume and equity.

Selling Strategy

Even when well executed, great marketing strategies cannot be fully realized unless the consumer concept is taken all the way to the point of sale. At this point, you need to translate the Brand's consumer strategies to category leadership platforms with Shelving, Assortment and Promotion strategies that reflect consumer behavior and are tightly linked to marketing strategies.

Portfolio Strategy

After Brand-level Strategic Plans are developed, it is time to integrate the Brand plans into a portfolio plan. This is where the Brand roles, which you determined earlier in the strategic planning process, come into play. Meshing Brand Roles with the Brand-level Core Business (Marketing/Selling/Financial), Innovation and Acquisition/Divestiture plans should lead to the right blend of activities that are sequenced to deliver accelerated top-line growth while delivering bottom-line commitments.

Strategic Planning season is the time to step back from the day-to-day activities of managing the business and assess your business in a holistic, yet in-depth manner. This is the time to be bold and create a plan that puts your business on a new, higher growth trajectory.

Embrace Strategic Planning as the great opportunity it is. Think big!