Why Having a Strategy Is a MUST Today
Our most recent guest was John Jantsch, founder of Duct Tape Marketing. John has been a trusted advisor to small- and medium-sized businesses for more than thirty years. He specializes in marketing strategy, consultancy, and advertising, so we asked him all about the importance of strategy for businesses. Here’s what he had to say:
Before we dove into the ins and outs of strategy, we asked John how he defines it. He thinks about a strategy as the problems it solves.
For example, feeling like your business is a commodity, you’re constantly competing on price, you can’t attract the right customer, or you’re reacting to “the idea of the week” are all problems that a strategy can solve.
“When you implement an effective strategy, which is essentially your intention for how you want to compete…you start attracting the ideal client, you can charge a premium for what it is that you do, you start getting more referrals and more repeat business, and you retain clients longer,” John said.
It’s best to start thinking about strategy before you start a business, but it’s equally as important to revisit and evolve that strategy as your business grows. “You certainly should be going out there with some sort of plan,” he said.
When establishing a marketing strategy for an existing business, identify the top 20% of your clientele. John and his team find that more often than not, this seemingly arbitrary number is a great indicator of how to become more profitable. Most referrals come from this group, and by narrowing the focus of your messaging and even your product offerings, you’ll naturally begin to attract others like that top 20%.
“That group will spend 10X more with you if you focus on what you can do for them, it’s the fastest way to properly scale a business,” John said. “Quite often, just turning our attention to that group in a more focused way can be a tremendous way to scale a business.”
Next, John and his team map the entire customer journey. They use a seven-stage hourglass model to market to their audience. The seven stages (in order) are: know, like, trust, try, buy, repeat, and refer.
“You might note that a couple of those stages come after someone has become a customer—and that’s another big miss for a lot of organizations; they don’t spend enough time making that buying experience as great as possible,” he said. “A lot of businesses will tell you that they get a significant share by word of mouth or referrals, but they do absolutely nothing about it. So we build this end-to-end customer journey as a significant part of strategy. How are we going to attract the right client, charge a premium to that client, and how will we retain that customer.”
Creating an excellent customer experience is the best way to ensure your company can charge a premium.
“When you get a reputation for a better experience… [customers] go in and expect to pay a premium,” said John. And customers are willing to pay that premium because they know they’ll get the result they’re after from an organization they trust.
It’s crucial to revisit your strategy quarterly and identify the top 2-3 priorities for the quarter. Otherwise, our tendency to try and do it all overwhelms us, which usually leads to nothing getting done or burnout.
“Every tactic should lead to advancing those 2-3 priorities,” John said. “If a new opportunity comes up, just put it in the parking lot and get back to it next quarter.”