Welcome to “Business Strategy Examples”! ⚡ This article will explore various strategies businesses can use to achieve their goals and stay ahead of the competition. Whether you’re a startup or a well-established company, having a solid business strategy is crucial for success. We’ll cover everything from setting clear objectives to analyzing market trends and developing action plans. And while online businesses may rely on Plerdy data analysis to improve user experience and conversions, offline businesses have unique goals and challenges to tackle. So let’s dive in and discover some useful business strategy examples!
What is a Business Strategy?
A company’s success is heavily dependent on its business plan. The term “business strategy” refers to a coordinated plan of action with the end objective in mind. The key to a successful business has a well-thought-out plan. Long-term, it’s used by businesspeople (or digital marketers) to boost productivity, make better use of opportunities and resources, raise ratings, and exert more command over a given circumstance. The right business plan can expand the company’s customer base, enhance its public image, and boost output. However, business strategy and business model are similar.
One is a blueprint and working model of the recommended standards for corporate growth. Simultaneously, the model is the method for carrying out these strategies. A company’s business strategy is an overarching plan for how its various divisions (UX designers, analytics, marketing, sales, etc.) will collaborate to achieve its objectives.
The importance of having a business strategy
Every business leader knows that having a vision is crucial for the success of their organization. However, having a clear business strategy is just as important. In the beginning, when a business is just starting, the vision can be flexible and fluid. But as the business grows and gets busier, the strategy may become less defined. With a well-defined strategy, a business can thrive and maintain its core values, especially when personnel changes occur. But unfortunately, this can lead to short-term success at the expense of long-term viability.
A business strategy is the foundation of all business decisions and guides a company to achieve its objectives. A strategy considers the resources available and how to deploy them to achieve goals. It aligns the efforts of all departments and gives employees a clear Northstar to guide their decision-making. Without a strategy, each department will have disordered actions, losing competitive power that will be exploited in the market.
Here are five reasons why devising a business strategy should be a leader’s priority:
- Planning: Business strategy is part of a business plan that sets goals and objectives and provides a way to fulfill those goals.
- Strengths and Weaknesses: A strategy helps leaders understand their strengths and weaknesses and capitalize on what they are good at.
- Efficiency and Effectiveness: A strategy ensures that every aspect of the business is planned, which means more efficiency and better plans.
- Competitive Advantage: A strategy focuses on capitalizing on a business’s strengths and using them as a competitive advantage to position the brand uniquely.
- Control: A strategy decides the path to be followed and interim goals to be achieved, which makes it easy to control activities and see if they are going as planned.
Creating a business strategy is relatively easy but takes time and focus. As a leader, prioritize your business strategy and dedicate time away from day-to-day activities to define your business roadmap. Of course, a strategy only automatically means your business will be successful. Still, it enables you to share your vision and goals with your employees, creating a common thread to strive for success across the business.
8 Key components of business strategies
A business strategy starts with a vision and ends with action. Without a vision, your strategy will be directionless; without action, it will remain just an idea. There are eight key components to creating a robust business strategy.
- Vision, mission, and values: A clear and shared vision, mission, and values are essential for any successful business strategy. They provide direction and purpose, helping the organization understand its important aspects better. The mission statement, which focuses on customers, employees, and investors, and the vision statement, which is future-oriented and aspirational, play a critical role in creating and maintaining a good business strategy.
- Long-term goals: While short-term thinking is necessary, long-term goals can make a real difference to a company’s performance. Companies should set specific, measurable, achievable, relevant, and time-constrained (S.M.A.R.T.) goals or use management by objective (M.B.O.) techniques, depending on their industry and team structure. Achieving long-term goals can require overcoming short-term pain.
- Financial objectives: Achieving long-term business goals requires setting clear earnings, revenue, and market capitalization goals. Financial goals are visible and tangible, but financial priorities change as competitive and economic settings do. Therefore, financial goals should prioritize multiple goals, such as capital, human resources, or product.
- Operational objectives: Specific and measurable operational objectives provide the guidance and direction crucial for long-term success. Operational objectives are short-term and task-specific, motivating employees to meet shared objectives and providing them with a sense of accomplishment.
- Market objectives: Strategic market objectives create customer value and help the company support and improve its market position. They focus on creating better quality, lower costs, or broader distribution to provide long-term competitive positions.
- SWOT analysis: SWOT analysis is a proven framework for understanding internal and external factors that might affect a business. It helps management make decisions for both specific issues and long-term strategic plans.
- Business strategy action plans: Operational, management, and contingency plans help companies determine how to operate best and manage a business. They are a powerful tool to turn your vision into a reality when grouped.
- Strategic alignment is the most critical element of an effective business strategy: This ensures that all the above elements are aligned and committed to activating strategic initiatives. It reduces friction and headwinds, ensuring that the entire organization is rowing in the same direction toward overall goals and objectives.
Remember, while each of these eight components is essential, a perfectly aligned and committed strategy is more effective than a brilliant one that needs to be aligned. Therefore, ensuring that all components work together towards the same end goal is crucial.
How to Develop a Business Strategy: 10 Steps
Developing a business strategy is critical to the success of any business. It can help a company focus its efforts, allocate resources effectively, and create a roadmap for growth. However, creating a business strategy can be overwhelming and time-consuming, and knowing where to start can take time and effort. So we’ve outlined ten steps to help guide you through the process.
- Develop a true vision: Your vision statement should clearly articulate what success looks like, including aspirations of what type of company you want to be in.
- Define competitive advantage: Identify how your company can deliver unique value to its customers and create space from the competition.
- Define your targets: Define niches and specialties to focus resources and enable an integrated sales and marketing approach.
- Focus on systematic growth: Identify the segments in which your company will grow and in what proportion so that the product mix yields a specific net margin result.
- Make fact-based decisions: Access useful information to form your business strategy.
- Long-term strategic business plan: Create processes designed to treat strategy as an annual cycle rather than a one-time, static event.
- Flexible strategy development: Evaluate long-term external forces and adapt based on new information.
- Be strategically inclusive: Include people you can trust, and that can think strategically in the strategy formation process.
- Invest time in pre-work: Make your managers conduct research and prepare relevant information before your strategy meetings.
- Measure your results and execute excellently: Have a strategic action plan that is tracked often, promote common ownership of the plan, utilize key performance indicators, and establish a performance management cycle that supports cascading goals and objectives for every employee.
Following these ten steps, you can create a comprehensive business strategy to help your company succeed. Developing a business strategy is ongoing, so measure your results and adjust your plan to stay on track.
How to measure the success of a business strategy
When it comes to measuring the success of a business strategy, it’s essential to choose your metrics carefully. These metrics will be the focus of your team’s efforts, so it’s important to tie them to your strategic objectives. You can track milestones and quantifiable performance measures, which should be unique to your business. Milestones include launching a website, purchasing equipment, or hiring key staff. For performance measures, you can choose from options related to financial, marketing and sales, operational efficiency, safety, and environmental impact.
However, it’s crucial to keep it simple and choose no more than four KPIs per department. Training your team to track these metrics is equally important to ensure that the data is updated and monitored correctly, which can otherwise jeopardize the implementation of your strategic plan.
Maintaining up-to-date data and using performance dashboards to track your KPIs are excellent ways to ensure that your metrics provide useful information and stimulate the best results. You can periodically report progress to your team and stakeholders using easy-to-understand visuals. Lastly, review your metrics thoroughly at follow-up meetings to ensure they provide the necessary feedback. Following these tips, you can accurately measure your business strategy’s success and make data-driven decisions.
7-Top Examples for Building a Business
There are many types of business strategies. However, before implementing any plan or development, it is worth considering the most famous and successful ones.
Alibaba Business Strategy
Alibaba, one of the world’s largest eCommerce companies, has been successful due to its innovative and forward-thinking business strategies. Here are some of the strategies that have made Alibaba a retail giant:
- Create a seamless link between online and offline retail: Alibaba’s “New Retail” strategy integrates online, offline, logistics, and data across a single value chain. This initiative aims to connect online and offline retail to provide a better customer experience (CX) and tap into the wealth of sales that take place offline in China.
- Create a true omnichannel retail chain: Alibaba opened a chain of futuristic supermarkets called Hema or Freshippo that seamlessly integrates online and offline retail. Customers can scan and go using the retailer’s app, receive personalized shopping recommendations, use digital payments, including facial recognition, and have their groceries delivered to their homes in 30 minutes for free.
- Invest in other brick-and-mortar retailers: Alibaba invested in Suning, China’s largest electronics chain, and acquired a controlling interest in Sun Art, China’s largest hypermart chain, to make their merchandise available on Alibaba’s eCommerce platforms and facilitate shorter delivery times. Alibaba also took Intime Retail, a leading department store chain in China, private to integrate the power of mobile reach, real-time consumer insights, and technology capability to improve operating efficiency.
- Business invest in the warehouse store model: Alibaba opened its warehouse club store called Hema X, which follows an omnichannel model that allows customers to deliver their purchases in 30 minutes.
- Capitalize on the growth of community buying: Alibaba launched a community buying platform called Taocaicai to capture market share in lower-tier cities in China and elevate the quality of routine everyday services in local communities.
- Continue to expand overseas: Alibaba separated its eCommerce business into a China and an international division to serve its overseas customers, including Lazada, which serves South East Asia and AliExpress, which typically serves consumers from Europe and South Asia.
Alibaba’s business strategy is innovative and forward-thinking, making it a leader in the eCommerce industry. By integrating online and offline retail, investing in other brick-and-mortar retailers, and capitalizing on new trends, Alibaba has expanded its reach and continued to grow.
Booking Business Strategy
Booking.com is a leading travel and tourism player known for its innovative marketing strategies. Their marketing strategy is based on three key pillars: segmentation, targeting, and positioning. By understanding their customers’ diverse needs, expectations, and purchasing habits, they have positioned themselves as the go-to travel platform for anyone with travel intent.
Booking.com’s business and marketing campaigns have also been incredibly successful, such as their #AmericaIsForEveryone campaign, which generated a lot of positive results by promoting vibrant cultures worldwide. Another successful campaign was their #BackToTravel campaign, which celebrated the joy of traveling and encouraged people to start planning their trips again.
Regarding social media marketing, Booking.com has a strong presence on all major social media platforms, providing travel material that inspires and motivates users. Their SEO strategies have also been remarkable, with over 18 million organic keywords and a monthly traffic of around 120.6 million.
Booking.com also focuses its business strategy on influencer marketing, aiming to increase accessibility to international travel for everyone. Their e-commerce strategies emphasize boosting traffic through paid and organic search, while their mobile apps provide a user-friendly interface.
Finally, Booking.com’s content marketing strategies focus on brand recognition and loyalty, offering regular articles to pique the curiosity of individuals planning their next vacation. By staying true to their beliefs and connecting with their communities regularly, Booking.com has become a strong player in the digital space, rewarded with high engagement metrics.
HubSpot Business Strategy
Do you need help developing an effective content marketing strategy for your business? The good news is that you’re not alone. Many businesses find themselves in the same boat, figuring out where to start or how to proceed. That’s where HubSpot comes in.
Using a service like HubSpot can simplify and streamline the content marketing process, allowing you to focus on developing high-quality, valuable content that appeals to your target audience. However, before diving into the platform, it’s crucial to understand how to form a content marketing strategy and how to use HubSpot effectively.
Here’s a step-by-step guide to help you use HubSpot to make a good content marketing plan:
- Identify your target audience – Understanding your target demographic is crucial in developing a successful content marketing strategy. Use HubSpot’s Democratic Segmentation to mark trends in your visitors’ ages, languages, and locations.
- Determine your business goals – Why did you create a content marketing strategy? Answering this question and recording your precise business goals allows you to measure the progress of your content marketing efforts.
- Map out your buyer’s journey – Putting yourself in your buyer’s footsteps can help determine if your strategy and user experience work.
- Identify your search engine optimization (SEO) keywords – HubSpot has several tools to help you identify keywords that potential customers may use to find your site or similar e-commerce stores.
- Create a content calendar and social media post schedule – Use your traffic analytics and conversion analytics to determine which day of the week and time works best for posting new content.
Remember that developing a successful SEO and content strategy takes time and effort. However, with HubSpot’s tools and dedication, you can grow your business and increase traffic to your website.
Airbnb Business Strategy
Airbnb has been a great success business story despite the challenges it faced. In 2019, Airbnb hosted 272 million bookings globally. In 2020, despite the global pandemic restricting travel, Airbnb suffered relatively minimal losses of only 22%. This was also the year they decided to go IPO, despite the global pandemic, a significant drop in business revenue, and global travel restrictions.
How did they manage strategy? Through a growth strategy like no other. The Airbnb story is one of perseverance and steadfastness. The co-founders, Joe Gebbia and Brian Chesky, couldn’t afford rent, so they opened their San Francisco apartment for guests. They soon realized they might be onto something bigger than a way to avoid eviction.
Airbnb has evolved substantially since then, though it has been a challenging path to success. One of the wackier ideas is their “Obama O’s” and “Cap’n McCain’s” cereal.
To overcome the “crisis of trust,” Airbnb designed a system that encourages its users to trust the product. This system is called the “hierarchy of needs”: safety, connection, and support.
This new market created an immensely beneficial cash-flow dynamic for Airbnb, allowing them to grow while using much less cash than would otherwise be required. The company created a unique experience, not just for the guests and hosts but also for the travel industry as a whole. In this sense, Airbnb can be seen as Disruptive technology that shook up the travel and tourism industry.
Airbnb’s growth strategy focused on products, overcoming the fear of staying with strangers, and the sharing economy. The future of Airbnb looks bright, and it will continue to innovate and shake up the travel industry.
Apple Business Strategy
Apple’s business strategy focuses on delivering a distinctive consumer experience (CX). The company’s competitive advantage has been driven by its emphasis on design and functionality. Apple has always been able to differentiate its products and services based on its simple yet appealing design, contributing to its broad appeal.
Apple goods reflect the company’s emphasis on enhancing the customer experience, which is visible in their design. Any Apple product is simple to operate, and buyers may begin using it immediately after opening the package. Apple’s numerous stores in strategic locations worldwide have also contributed greatly to the company’s success. These stores enable customers to try Apple items before purchasing, contributing to the company’s client loyalty.
Apple’s creation of an ecosystem is a vital component of its commercial strategy. The company has flawlessly merged its hardware and software, allowing its devices and software to function effectively. Additionally, Apple’s environment fosters customer loyalty, making it difficult for them to convert to competing brands.
Apple has shifted its attention away from iPhone sales, services, and other operations. This transformation has produced favorable outcomes, with Apple’s services sector generating record sales in 2020.
Apple’s overall business strategy integrates product differentiation, customer experience, ecosystem development, and diversification. As a result, Apple has maintained its position as a global leader in the technology and consumer electronics industries by focusing on these aspects.
Tesla Business Strategy
Instead of gradually developing a brand of comfortable and modern cars, Tesla immediately declared itself a brand of expensive and luxurious vehicles. As a result, they had to make considerable investments in the budget.
An essential point of Tesla’s business strategy is that they have sensibly assessed their problems and matters that could derail their plans to implement a cost-effective electric car for the mass market. Therefore, they controlled the production and supply of critical spare parts (batteries).
Just like any startup, Tesla needed investments. Musk relied on his personality and the desire of people to touch the technologies of the future. So, he made the company’s brand and attracted investors.
PayPal Business Strategy
The banking system is one of the most challenging areas to enter. You will need a considerable amount of capital, lots of government approvals, and customer trust (which has been built up over decades). But the guys from PayPal decided to take a chance and succeeded.
Moreover, banks began to take the company seriously and perceive it as a worthy competitor. And there were reasons for that:
- The technical ones are probably well above the average bank, even though PayPal spends little on their development.
- The company has gained the trust of customers in a short time.
- PayPal keeps purchases private but uses them for its analytics.
- The company often launches payment innovations on the market.
- PayPal works directly with merchants, bypassing banks.
The secret of the payment system’s success is hidden in its international business strategy:
- The system has become a payment system on the Internet. It is used on eBay and other platforms.
- The company boldly finds partners among sellers, unlike banks. As a result, today, PayPal accounts for more than 50% of transactions in the market.
Thus, the company could break through even in the most challenging conditions, finding loopholes in the gaps of its main competitors.
Business strategy is crucial to the success of any enterprise. It involves making decisions about the company’s direction and how to achieve its goals. According to McKinsey, business strategy should focus on gaining a sustainable competitive advantage, which can be achieved through differentiation, cost leadership, or focusing on a specific market segment.
Let’s take the example of Starbucks. They built their brand by offering high-quality coffee at a premium price. Their strategy was creating a “third place” for customers to relax and enjoy a good coffee between home and work. This strategy proved successful, as Starbucks became a household name and increased its revenue to billions.
Another example is Nike, which leverages its brand to engage with customers at a deeper level. They offer unique features in their products, such as Nike+ technology, which tracks your runs and offers personalized coaching. This strategy has helped Nike build a loyal following, with customers willing to pay a higher price for their products.
Toyota is an example of a company that focuses on cost leadership. As a result, they offer reliable cars at a lower price point than some of their competitors. This strategy has helped them gain market share and maintain profitability over the long term.
Spotify is a company that came into existence in the tech era. Its strategy was to build a music streaming platform with a level of personalization that engines didn’t offer then. Their platform uses algorithms to create personalized playlists for users based on their listening habits. This approach has gained them a large user base and increased their revenue through subscription-based programs.
More is needed to have a good business strategy; execution is also crucial. Unfortunately, a few cases have happened where companies had an excellent idea but needed to execute it better to gain traction in the market.
In conclusion, balancing leadership, negotiation, ethics, finance, and entrepreneurship is essential to gaining influence in business. When raising the bar of business, focusing on sustainable ways of earning and building enterprise is essential. Business strategy should inspire and offer aid in a way that engages customers and gains their loyalty. Cycles of uncertainty will continue to exist, but with the right business strategy, any enterprise can close the gap and gain a competitive advantage.