Before we get into the weeds, we need to start with the distinction between strategy and tactics.
In 2001, Starbucks launched their first loyalty card. This wasn’t ground breaking; many businesses had launched loyalty cards before. But, it represented a clear marketing driver of revenue. Now, users uploaded cash onto their loyalty card, and in doing so earn discounts and benefits such as ‘order ahead’ apps and reward points that can be exchanged for free drinks and products. Starbucks also partner with other partners like Lyft (Ryde sharing app) which provides added benefit to Starbucks and Starbucks customers.
What does Starbucks get out of the exchange? A lot! First, they get your data and buying pattern, which feeds into their future marketing initiatives and overall understanding of how their customers buy. Secondly, they get your cash upfront before you collect your coffees. Many subcontractors would kill for cash up front like that! Finally, they earn lock-in: once you start accumulating reward points, psychologically, it’s very difficult to switch coffee provider and render all those reward points that you’ve been collecting worthless.
So, the loyalty card drives revenue and many other benefits to Starbucks, but it’s critical that as a business, everyone involved understands that this is a marketing tactic, not a strategy.
What’s the difference between a marketing tactic and strategy?
With the Starbucks example, the marketing strategy was to bring Cappuccino culture from Italy to the US. After a trip to Milan in the 80’s, and experiencing the romance and vibes of the Italian espresso bars, Howard Schultz returned to Starbucks in Seattle for whom he was employed at the time and bought the company. He turned Starbucks from a coffee roaster into a coffee shop, recreating the Cappuccino culture that he loved in Milan.
That was the marketing strategy; bring Italian coffee culture to the US.
Once the strategy is created, deciding who you are; what you offer; how you offer it and the customer that you’ll serve; you can then build tactics to reach those people and sell your product.
You can have an infinite number of marketing tactics, but one strategy. You nail the strategy first, and you don’t move away from it. But, marketing tactics, you can try, test, and keep or throw away. Continue trying new tactics, keep the good ones, get rid of the bad ones.
When it comes to marketing, the problem for most subcontractors is that there is no strategy. Many pick up adhoc tactics and use them with little direction. The tactic doesn’t work, and they drop it. Or even worse, the tactic doesn’t work and they persist with it. If you don’t know what your business is, who your customer is, what they want and how you’re going to identify and solve problems that your competitors don’t, you can’t possibly come up with successful tactics to deliver the goals of your strategy.
Simply put, a marketing strategy is the essence of your business and product. Understanding the problems that your customer has and how your business will address those problems in a way that is not currently available to the customer in question. The marketing tactic is the way that you put your business in front of prospects and eventually turn them into customers. Starbucks create a new type of experience that customers want (Italian Espresso Bar culture to the US), and use tactics to attract customers and get them spending (the reward card).
There is no online marketing?
There is no online marketing, there is just marketing. You create a marketing strategy, and then you come up with all sorts of fun and interesting tactics to bring prospects into the business.
Many people talk about online marketing as if it’s a unique category of marketing. It’s not. Consider online marketing as a series of tactics which can be used but are not isolated from other marketing tactics. They integrate with work we do offline and they stem from our marketing strategy, which covers the whole business.
This series is about online marketing tactics, but there can be no successful online marketing unless you have a solid marketing strategy to work from. If you are getting some minor success with online tactics, and you have no marketing strategy, then you are merely scraping the surface and are way short of reaching all of the business opportunities available to you.
So as we start this series, I want to address the strategy before we move into tactics, and specifically online marketing tactics. How do you develop a marketing strategy that differentiates you from your competitors? The next post will cover the questions that you need to start asking yourself to build the strategy.
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