Building a business is a challenging process; however, maintaining and growing an existing brand is equally challenging. Whereas a startup with a single offering for a target market can tailor a specific message, established organizations with the resources to pursue multiple opportunities face the risk of spreading themselves too thin. This is likely due to a brand's inability to define its "why."
Let's uncover four reasons most companies take on undue risk and stray from their strategic goals.
Four Reasons Most Companies Fail
Companies tell their audience what they do instead of who they are.
Businesses and consumers want to buy from organizations that share common values. Increasingly, environmental, social, and political values are driving purchasing decisions. And aligning with the advertised brand is not enough. Social media creates a new channel for direct communication with the ethos behind the brand. Therefore, it's essential to authentically connect with your audience by providing insight into what you represent, value, and appreciate instead of simply focusing on the financial transaction.
Brands aren't specific about how they deliver their product or service.
When your brand lacks focus or clarity, we make our customers work to understand precisely what our company does. For example, Chevy had a short-lived tagline in the early 2010s, “Chevy Runs Deep.” Even though the audience is familiar with the brand, making the audience uncertain about what they will receive from your company and how you will deliver it creates unnecessary friction. . Be specific in your language and the marketing and advertising surrounding your brand. When your audience has clarity, they know what to come to your brand for and what you specialize in.
Brands aren't offering focused products or services.
Many businesses need help because they're offering too many services, making it harder to succeed in the long run. For example, BASF’s famous tagline, “we don’t make a lot of the products you buy, we make a lot of the products you buy, better.” Besides being a mouthful, this doesn’t tell me “how” or “why” the company engages in their business.
Companies are more successful when they focus on a defined, targeted basket of services to a target market. While it's natural to want your hand in many different lines business, you should not pursue this strategy because it is not sustainable in the long term. A company is more successful when they're specific and distinct, making them the go-to brand within its particular industry or niche.
Lack of Strategic Plan
A lack of strategic planning can significantly contribute to the failure of a brand. They miss opportunities for growth, miss target audiences, and lose their focus, leading to a decline in customer loyalty, business profitability, and, ultimately, brand failure. On the other hand, a company like Southwest, with their slogan, “you are now free to move about the country,” is a clear strategy that allows the brand to make informed decisions, allocate resources effectively, and compete in their markets.
By creating your strategic plan, you have defined how you will make your brand identity and where you will differentiate your product. But how can you successfully launch a new product or scale an existing product by implementing your strategic plan?