On one hand, proven experience in an industry or similar business can minimise the risk of engaging a new partner. They’ve got runs on the board marketing to your audiences and already know a bit about your business, fast-tracking the new partnership and your results.
But on the other hand, could key competitive information shared in this partnership and pertinent to your business and marketing strategy one day end up in the hands of your competitors?
From consulting with large listed businesses to aggressive startups or family businesses – I can attest that – there isn’t any surefire answer as to who and when the experience is considered more an asset or liability.
To be sure, the sentiment is influenced by factors such as how pertinent the digital strategy is to the business strategy, how differentiated products are in an industry and how prominent digital is compared to other marketing channels.
As a consultant in digital strategy, I’m addressing these concerns and developing the right engagement for clients either in conversation or formally through legal agreements on a weekly basis.
In my opinion, every business should have tools they can use to protect their intellectual property if they have any concerns. In general though, having worked with many clients across industries like superannuation, education, and banking, I’ve never found myself in a position where information sensitive to how my clients operated was a factor.
My experience is that, in nearly all cases, agency/consultancy experience is a strength a client should leverage on. In fact, here are six reasons which should allay concerns about your digital strategies being “replicated” for your competition.
1. Brand and value proposition
This is the biggest reason why I find strategies can’t simply be replicated. A business with a solid value proposition is not the same as its competitors, and this impacts ideation and copy for any content or creative elements, and even the creative representation of these assets.
If you are a premium brand you aren’t going to compete with a competitor that is offering a discount or monetary incentive to engage.
As an experienced digital engagement consultant, I would rather extrapolate your value proposition into value add elements that better services your target market. Certain elements are the same between competitors, such as the sales process or evergreen content, however, these are not competitive but universal factors.
2. Margins and conversions rates
A critical question to determine what channels and tactics I decide to include in a strategy is “What can/will you afford per lead right now in your business?”
This differs for each business and is driven by margin certainly, but also by businesses objectives. For example:
Will you accept a break-even result for growth in client numbers, or;
Do you need a clear return on investment to fund the next stage of your business’ journey?
These points impact what an acceptable cost per lead (CPL) might be, and significantly impacts strategy and channel mix.
What you deem a good CPL is also impacted by the performance of your sales team and their close rates of a qualified lead. This remains a huge variable between businesses.
If you have a prolific sales team, you may prefer lead quantity over quality and not be fussed about which channel – as long as it sits within a target CPL.
Ultimately margins and conversion rates throughout the funnel determine your ideal cost per sale, and these factors can differentiate the strategy for two direct competitors.
3. Sales cycle and processes
Your sale processes and cycle determine the digital assets or campaigns we build, which ones we prioritise to optimise, and also how we develop and automate nurture sequences to support your sales flow. And then, we must also factor in what call to action is most appropriate at each stage.
As shared, some businesses are more powerful converting on the phone, meaning our strategy errs towards driving lead quantity.
In various instances, I’ve also had the opposite, where I’ve devised digital engagements for new revenue lines or spin-offs ventures of a few parents companies. Given these enterprises were not the parent companies’ core business, resources were limited and the definition of a marketing qualified lead (MQL) was very stringent.
For a home loan and low doc loan client, my digital team could develop highly gated and qualified lead processes, requiring multiple landing pages or stepped processes before the client accepted an MQL — a very different tactical requirement to their competitors who operated in these areas as their core business.
4. Business lifecycle
Whether your business is a startup, at the stage of growth or stabilising is a BIG mitigating factor in the strategy and the goal.
Are you an established challenger brand? Is the digital marketing goal to drive growth or stable leads/revenue? Is digital a new channel for your business or an existing one?
I’ve had the privilege to work with lots of great clients in the superannuation space, and this is a space that in recent years has become very competitive, with legislative and broader economic/financial issues pushing this industry to the fore.
Startups are focused on their lead indicators, primarily membership growth and metrics associated with that. Established funds want to grow funds under management through retention and revenue by appropriately advising the funds’ investment options.
Even though in many cases, they are fighting for the same superannuation dollars the strategies, channels, and tactics used will differ.
5. Goal and approach
Tied to the business life stage are a client’s goals. An aggressive launch or growth goal might mean you’re willing to take a loss leader approach at this stage to grow your client base.
Direct competitors seeking profitability might seek cost reduction in one case or stable revenue in another.
6. Budgets and resources
This is the point that requires perhaps the least explanation.
What a client tells me is their marketing budget or internal capabilities dictates whether we focus on only the most effective channel for their goal, or if we can develop a holistic strategy combining various tactics that address long and short term objectives for my client.
Finally, to add to the complexity, all these points are interdependent! Meaning the opportunity for marketing strategies and campaigns to be replicated are actually quite slim.
And wait — what if a digital partner doesn’t have experience with my competitors and industries? Is this an asset or a liability?
It’s a cognitive short cut to simply disregard partners who haven’t worked in your industry. Their fresh perspective might be what your business needs to find more creative marketing approaches to give you a competitive edge.
Valuable transferrable capabilities to look for can include experience in a similar industry or experience tackling the challenge your business currently faces.
Irrespective of experience – I’d look for the proven ability to innovate strategy and tactics. Digital evolves faster than any channel in history. Can this new agency be a partner through that change? Check out your digital partners own digital footprint – do they walk the talk? Can they provide examples where they’ve worked in an agile manner to deliver the results the client needed?
Agency experience with your competition is an asset you should leverage. Use their experience to propel your own objectives. After all, a friend of my enemy isn’t necessarily my enemy.
And if they don’t have sector experience that can be an asset too – hire for the digital capabilities that will help you achieve the objectives your business has laid out and use their experience from other sectors as a source of innovation for your internal team and in your marketing outputs.
How important do you feel experience within your industry is when appointing a digital partner? Do you work with businesses that work with your competition? Why and why not? If you have a strong argument for or against – would love to hear from you in the comments.
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