Monthly Archives: June 2015

Content Strategy Formation and Competitive Advantage

How does an organization form a content strategy?  How does it know what it should be doing differently with its content?  Content strategy can be more than just a program to improve the performance of content.  It can be a part of business strategy and help to inform how a firm should compete.

As content becomes an increasingly important element in business, it moves beyond being a support activity like human resources or accounting. It becomes a core activity, and joins the ranks of cost, technology, service, logistics and design as a potential source of differentiation and competitive advantage.  By competitive advantage, I am not referring to simply outperforming a competitor at a given time, perhaps following a content refresh in response to an assessment of competitor content.  I am referring to a more systematic approach to finding profitable opportunities relating to content that competitors aren’t pursuing.

Many content strategists associate strategy with planning and process.  A number of popular definitions of content strategy mention planning as the engine driving content strategy.  You need a plan: you can’t just wing it.  Yet in business theory, the notion that strategy is synonymous with planning has become dated. The business strategy guru Henry Mintzberg wrote an influential book in the 1990s on the decline of strategic planning.  He considered the centrality of objectives and programs in strategic planning as a frozen perspective, placing an unrealistic emphasis on control. Elaborate planning has fallen out of favor as businesses confront an increasingly unpredictable environment.

Michael Porter, another business strategy guru, criticized the view of strategy as “benchmarking and adopting best practices.” He argued that strategy should be based on delivering something others can’t.

Planning and process are used to execute a strategy, but they don’t define a strategy.

Popular Perspectives on Strategy Today

Many content strategists present content strategy in terms of a circular diagram.  It starts with discovery and planning, proceeds to creating content, and then moves to assessment before starting a new cycle of discovery and planning.  Many more steps may be involved in this cycle, with more specific descriptions, but the basic pattern draws on classic Plan-Do-Check-Act process for process improvement developed in the 1950s by W. Edwards Deming.  The image is so generic that it’s become a standard PowerPoint template that countless people fill in for business review meetings, a sort of mental comfort food.  No one will disagree with a circular diagram: it doesn’t say where you are going, so there’s nothing controversial about it.

Content strategists also emphasize an organization’s mission and values.  Strategy is more than mission and values.  One needs these things, and it’s important that all content conforms to them.  But values by themselves won’t suggest how to proceed into an unknown future.

Most discussions of content strategy don’t talk about how strategy is formed.  They reference the need to establish goals and to have content strategy reflect those goals, but don’t discuss how decisions are made, and what criteria are used to establish goals.

Three popular ideas color discussions about strategy. Because they are so familiar, people rarely question their limitations.

The first idea is optimization.  Optimization assumes analytics will tell you where you should be heading.  If you apply best practices, you can incrementally improve performance.  It assumes what you are currently doing is basically sound; it just needs tweaking. Sometimes this concept is referred to as performance-based strategy.  But as mentioned earlier, following best practices isn’t a genuine strategy.  By definition, best practices are the same tactics that countless others are using.  With its focus on incremental improvement, optimization can result in a blinkered perspective, where brands myopically follow the same basic course of action even as the operating environment shifts dramatically.  Optimization doesn’t tell us what we should be doing differently with our content, except in the most limited manner.

The second idea is growth hacking.  Here, the approach is trial and error. Firms try something that’s been done by someone else, and sees if it works for them.  If not, they try something different.  Many start ups embrace this approach.  They have a core idea, but have no idea how to make money from it, so they keep trying different things, pivoting along the way.  At its worst, growth hacking provides customers with an exhausting stream of alpha release products based on the hunches of alpha males.  User needs are stress-tested rather than solicited as design inputs.  When big organizations try this approach at scale, it can result in wild gyrations, and can hurt the brand’s standing and customer retention, as high profile initiatives are suddenly and publicly abandoned when they don’t produce their expected magic.

The third idea is goal-setting.  The necessity of having a vision and goals seems self-evident.  Airport kiosks are full of books promising a better tomorrow by setting goals.  TED talks exhort us to ask big questions, and be driven by big ideas.  Why are we here?  What do we want to become?  A goal fetish, however, can generate vague, wishful thinking, along the lines of “we want to be awesome so we can help our customers be awesome.”  Unless the goal is viable, building a strategy off it is pointless.

Goal Viability: the Critical Success Factor

Finding the right goals is key: goals that are both achievable and have competitive impact.  If your goals are tired, or ill- defined, pursuing them won’t result in a big difference.  Tired goals are those that reflexively follow past practices, target obviously achievable outcomes, or simply imitate what others are doing.  Ill-defined goals are those that vague and aspirational without sufficient consideration of constraints and tangible outcomes.  Promising goals, in contrast, blend both realism and imagination.

Conventional thinking about strategy is anchored in the notion that goals shape the strategy, which is the foundation for the plan (Goals > Strategy > Plan).  Strategy based on goals communicates the idea that “failure is not an option,” since the goal is not questioned once selected. Consequently, the goals are often either safe or fuzzy, since no one wants to fail.  There is plenty of need in our personal lives for both safe and fuzzy goals: to exercise three times a week, or to try to be a better parent.  But large organizations face different needs: to find goals that can transform their practices when there’s no obvious script to follow.  They need to change, but don’t know exactly what are the right changes to make.

Rather than have goals determine strategy, it may be more insightful to reverse the process.  We need to create a strategy that can identify viable goals we can plan around.   In this revised formulation, the strategy drives the discovery of goals (Strategy > Goals > Plan).  We then stop thinking about strategy as a declaration, and start thinking of it as a discovery process.  Strategy becomes a way of finding viable goals to pursue.

Viewing strategy as a way to choose goals means the emphasis is on making appropriate decisions.   Strategy is ultimately about making the right choices.  We need a framework for making decisions.

Two themes dominate recent strategic business thinking: the rapid and unexpected changes that can occur outside of organizations from technology, competitors, and consumers, and the vast volumes of data being generated that are difficult to interpret.  These themes impact all areas of business, the field of content included.  In 2011, the World Economic Forum (the Davos conference for global CEOs) sponsored a review of the Future of Content to try to make sense of some of these changes.  The review examined the need for organizations to adopt “transformative business models” to address changes in the content landscape.

Content strategy can draw on recent thinking in business strategy, particularly ideas relating to options thinking and hypothesis testing.  These tools can help organizations answer what they should be doing differently with their content.   Strategy should generate interesting and worthwhile options to pursue.  Options need to be tested for their viability.  Viable options can be put into the plan, after which they are executed and optimized.  In this formulation, the front-end of strategy formation involves the discovery of viable goals, and the back-end involves the testing, selection and implementation of these goals into plans.

“One of the toughest strategy challenges is still the creation of options—creating them is the black box of strategy. It’s easy to write ‘diverge’ on the strategy-process map, but it’s darned difficult to create truly innovative strategy options.”  Dan Simpson (Clorox) in the McKinsey Quarterly

Goal-finding: Generating Options

Three approaches can generate innovative content strategy goals that can be evaluated for their viability.  These are:

  1. Dilemma exploration
  2. Hidden value opportunities
  3. Refinement of beliefs concerning differentiation

Each of these approaches can identify and develop specific goals that seem viable — levers that provide leverage.  Dilemma exploration looks at where to put emphasis. Hidden value exploration looks at opportunities to offer things differently.  Belief refinement is about tightening up beliefs about the capabilities of the brand, and behavior of audiences, so that goals are more specific and potentially achievable.  All three approaches help brands to develop fresh ideas that might become candidate goals.  Candidate goals can then be expressed as hypotheses that can be tested to see if they hold.

Strategy can be a discovery process focused on developing and selecting viable goals
Strategy can be a discovery process focused on developing and selecting viable goals

Dilemma Exploration

Dilemmas are about choices, where two or more options seem desirable.  Strategy is similarly about choices: what to emphasize, to the exclusion of something else.

Organizations face resource trade-offs.  The choices they make when allocating resources can impact their overall effectiveness with content.  While it is easy to allocate content spending in direct proportion to revenues from lines of business or customer segments, doing so might overlook the possibility that a different mix might yield a higher overall impact from content.

Some trade-offs are global ones relating to approach, such as whether to emphasize:

  • Breadth of content, or more limited but highly produced content
  • Targeted content addressing specific niches, or content with wide appeal
  • Succinct, compact content, or expansive content using rich media

Brands need to know where to spend their money.  Let’s imagine that 25% of a budget were devoted to discretionary spending on content: some forms of content receive special emphasis, with the intention that such content would be unique and distinguished from the general content offered by competitors.  What should that emphasis be?  Is it better to do a few splashy things that will get the attention of a particular group, or to try to broaden the reach by creating content more targeted to various specific interests?  For example video is more expensive to produce than written content.  It might yield higher engagement from people not ready to buy, compared with those doing serious comparison shopping, who are reading detailed specs.  Does the attraction of video outweigh the thoroughness of detailed product information?

The interesting thing about such dilemmas is that there are answers, but they are not obvious.  The answers are situationally dependent.  No one can know in advance what the best choice will be, because of the many variables.  There is no best practice that everyone in the industry is following, so there is an opportunity to make a choice that is different from one’s competitors, and potentially benefit from this choice.   As soon as conventional wisdom takes hold about what’s the best approach, the competitive advantage disappears — unless conventional wisdom is wrong and one tacks differently.  Dilemmas therefore are a rich area to explore: decisions with two or more tempting choices that sound promising, but only one of which will yield the biggest overall payoff in terms of value for spending.

Trade-offs also exist concerning whom to target, and which lines of business to emphasize.  This is especially urgent for areas of emerging interest that look promising, but where no reliable information is available.  For example, firms may need to decide whether it is better to emphasize:

  • Segment A (single millennials who travel) or segment B (home-oriented millennial families)
  • Product C (cashless payments) or product D (social lending)
  • Platform E (Apple watch) or platform F (large wall public displays)
  • Marketing theme G (the future) or marketing theme H (nostalgia)

Many marketing campaigns are pitched around a tidy story about how various choices will synergistically work together to yield a perfect outcome — without addressing missed opportunities.  Campaigns may fail or succeed without any clear understanding as to why, and with no learning that can be leveraged later.

All well-considered alternatives offer some value, so it is important to understand the potential value of each. The benefit of dilemma exploration is to determine which alternative provides the most leverage.  Brands may be tempted to try to do everything to some degree, but that would provide no emphasis, and would simply dissipate efforts.  Unfortunately, trying all options at once won’t work.  Dilemma exploration is unlike the superficial comparisons of options done in much A/B testing.  A/B tests generally compare only minor differences, rather than more fundamental differences in emphasis.  Exploring options associated with a dilemma can entail a small special project.  Test an option by making a guess as how big an impact it might offer, and comparing the actual result.  This provides a baseline to know if the option performs better or worse then expected.  Rotate options to try different possibilities and develop a comparison between them.

Discovery of Hidden Value

Hidden value exists when the brand and audience both derive value from a change.  Such value can be discovered when one questions the assumptions embedded in the existing brand-audience value exchange.

Start by asking a probing question: What does the customer want from us that we aren’t providing?  The answer to this question, if grounded in user research and customer feedback, can uncover unmet needs.

Next, respond to each customer “ask” with a question from the brand: What does the brand want from the customer?  To be insightful, the question should be answered candidly, revealing both ideal outcomes and feared ones.

An example will illustrate how hidden value discovery can be applied to content.  Suppose your customer insights indicate that customers are frustrated by your complex terms and conditions.  You benchmarked your terms and conditions, and found them no more onerous than your competitors.  Nonetheless, customers want more clarity in the terms and conditions.  While not at a disadvantage, the brand isn’t using terms and conditions as a competitive advantage either.

When the question is turned on the brand — what it wants from the customer — two themes emerge.  The brand is concerned about possible legal actions from customers, or bad PR if they seem to over promise.  The wordy and weasely terms and conditions are a way to discourage too much attention to what is promised.  The brand’s ask of consumers is: Don’t sue the brand, and don’t create negative PR.

Once the needs of both sides are explicit, one can see common ground that adds value to both parties.  Simpler, clearer terms and conditions would benefit customers, who will then trust the brand more.  Such trust could also benefit the brand, by encouraging more sales.  The brand could feel confident simplifying terms and conditions if it improved its risk management, perhaps by assigning warranty fulfillment to a third party or improving communication regarding scheduled maintenance.  The simplified terms would then be a competitive advantage.

“Framing questions is the other tough challenge, and it’s one of the most important yet under appreciated parts of strategy development. Questions are the lens by which problems are defined and addressed. Generating great answers to bad questions is all too common and not all that helpful in strategy.” Dan Simpson (Clorox) in the McKinsey Quarterly

Beliefs about Differentiation

Everyone wants to be different and special: brands and consumers alike.  Differentiation is a major motivation in strategy. Companies want a competitive advantage compared with their peers, and content needs to stand out in some special way for it to get noticed by audiences.  Differentiation attempts to address two issues simultaneously: things that a company can do that will benefit them but that their competitors are not doing, and things that audiences want but are not getting from the industry segment.

How can the brand be more relevant to customers than other brands?  Unlike the optimization approach, differentiation  does not simply ask how to become better than one has done in the past: it asks how to be better than anyone else.

Three core questions are at the heart of differentiation:

  • Why this?  What’s really unique about the product or service, and in what ways is existing product discourse commodified?
  • Why us?  How do people compare vendors and brands, and where are these factors being addressed inadequately?
  • Why now?  How might content influence the readiness of the customer to take action?

The product and vendor questions are familiar to those involved with market positioning.  Because of their familiarity, it takes a special effort to break free of routine points of comparison: features, benefits, and likability.  Last weekend I walked by a shop in Rome I assumed was a jewelry store.  Something was intriguing about it, so I stepped inside, and realized it was a pastry shop.  The shop had redefined pasty as jewelry: precious and regal, simultaneously reframing my conception of the product, and what a pastry vendor can be.

Brands less often think about how to position their communication with customers to bridge the gap between the customer’s readiness to act, with the brand’s readiness to meet pre-purchase and post-purchase customer needs.  Most brands behave by assuming customers will decide when they decide; the brand keeps badgering them in the meantime to stay top of mind, without probing into how customers decide.  But content has tremendous potential to close the gap between customer readiness and action. It can simplify choices, help customers evolve their preferences over time through dynamic customization, and address buyer concerns about risks and future needs for change.

Refining Beliefs and Testing Hypotheses

Being different can involve having a different set of beliefs from the rest of the field.  We embrace various beliefs about what differences make a difference.  Perhaps beliefs about what makes a company successful: Companies that do certain actions achieve outcomes as a result.  Or beliefs about how customers and audiences behave: Audiences that receive content with certain characteristics will behave in a certain way.

Beliefs about both industry behavior and audience behavior can be expressed as hypotheses that are testable.  With a hypothesis, it becomes possible to refine ideas and determine what precisely might be successful.  Consider the area of content marketing.  Content marketing is common: many brands are doing it.  At the same time, there is widespread debate about how effective content marketing actually is.  Anecdotal evidence suggests that some firms in some sectors can benefit using content marketing with some customer segments.  But there is no consensus that simply doing content marketing is valuable — it may be a waste of money, or even counterproductive if it prompts segments to opt out.

Beliefs many times reflect a hidden goal or wish the believer desires.  Consider some beliefs brands may hold:

  • Customers who share content from a brand are likely to become repeat buyers
  • Our brand can create content for customers that will encourage them to identify with us
  • Our brand can gain new customers by producing non-sales oriented content
  • People who do not typically use our brand may be willing to read helpful content from us if it was available
  • People want to be entertained, and will think highly of us if we provide them with content they enjoy
  • Storytelling is the most effective way to reach customers
  • People expect brands to provide advice about daily life issues, and want such information from our brand

These beliefs vary in their generality and plausibility.  Some may be true in some circumstances, but deserve to be teased apart to appreciate different dimensions involved.  Sweeping generalizations are rarely true in all cases. Some beliefs involve a leap in logic, and should be unpacked to identify intermediate causal dimensions.  Some beliefs may raise a “so what?” response: they sound good, but it is not explicitly clear what the broader benefit is.  Umbrella beliefs about firms and customers can be compared with available cross-industry evidence to see what general patterns and special circumstances may apply, if solid data exists at all.  People can falsely assume their beliefs about one industry or segment are valid for different sector or segment.  People may miss the possibilities of borrowing ideas from a seemingly unrelated area.  Once beliefs are expressed as a statement specific to a brand, or to an audience segment, they can actually be tested.

This kind of rigorous examination of beliefs helps find the kernels of truth in various beliefs that can be usefully developed into hypotheses that can be tested.  Once several plausible beliefs about industry behavior and audience behavior are identified and woven together, the brand has a unique proposition that it can explore.  Examples might be:

  • If our brand creates stories about fun romantic holidays that prospects like (hypothesis 1: brand can successfully create fun romantic holiday stories), they will book more travel services with us (hypothesis 2: bookings influenced by stories).
  • Millennials need, but can’t find, information about their long term disability risks (hypothesis 1: unserved need for content on millennial long term disability risks exists).  If we provide them with relevant information (hypothesis 2: target millennials, and see if they find information relevant), we will make gains with the millennial demographic selling insurance related to this.  (hypothesis 3: some sales activity results).

In the second example, we still see signs that wishful thinking might be at work, but we don’t know for sure.  If people can’t find content that doesn’t exist, that doesn’t mean it is needed or wanted.  What’s seen as relevant information may depend on the segment.  Insurers might consider information relevant to a segment, but the target fails to be interested by it.  Perhaps the insight gained from the hypothesis testing is that targeting millennials is not productive, but targeting their parents about the financial risks of a long term disability to their twenty-something year old children is effective.  In this fictitious example, the pursuit of a hypothesis leads to a genuinely novel goal to execute.

Goals Worth Pursuing

I’ve presented a range of approaches on how to identify fresh ideas that could have strategic value.  There is no need to pursue all these approaches at once, but each might be useful at different times when reviewing high level content goals.  By having tools that invite questions, the development of goals can happen continually, rather than being tied to an event trigger such as a content audit or redesign.

The process for testing and evaluating hypotheses is similar to processes used when monitoring analytics and optimizing content.  Unlike with optimization, a specific answer is sought.  One is looking for confirmation of an effect, rather than just trying to improve what’s happening.  In this sense it resembles the experimentation of growth hacking, although it is focused on innovative ideas screened based on their suitability to the challenge, rather than on copying and trying out marketing tactics widely used by others to see if they fit the problem.  Since the option was chosen because it looked promising, it should show some confirmation that it’s a viable goal, even if it has room to improve.  Testing a hypothesis triggers a decision: whether to keep the candidate goal and try to develop it further, or drop it and try a different candidate.

One benefit of having strategy centered on the discovery of viable goals is that it produces many candidate goals.  The brand can avoid the temptation to make a big bet on one audacious goal.  There are many possible goals worth pursuing, and that encourages creativity and experimentation.

Getting Strategic with Content: the Ultimate Goal for Content Maturity

Many organizations are still trying to close the gap between their current operations, and known best practices.  They are playing catch up, and haven’t yet reached the level of maturity with their content to focus on doing things differently, with the intention of out competing their peers.  They are understandably focused on improving their operations so they can execute plans and goals effectively.

But as content strategy takes root in organizations, and as processes and planning improve, the work of content strategy will be less reactive to fixing quality and operational problems, and more proactive, searching for ways to offer greater value to the brand and its customers.  Firms will stop thinking of content as a commodity to cost-manage, and think of it as a product with defined value.  The evolution of content strategy from process improvement to innovation would thus resemble the evolution of product manufactures from their past focus on total quality process improvement as the central competitive concern, toward considering design and innovation as contributing sources of competitive advantage.

All firms, no matter how mature their content operations, face the challenge of uncertainty.  They face resource dilemmas, and make decisions based on faulty assumptions.  In this respect, all firms need a way to work with imperfect information.  They can’t just follow the example of others.  They need their strategy to empower them to choose goals that meet their specific needs.

— Michael Andrews