If not, I recommend you consider these four points:
1. Identify effective strategies to stay ahead
As part of your long-term strategy, you should identify and put in place effective strategies to keep your business ahead of the market and your competitors. The long-term success of your business does not lie solely within your actions. What your competitors do and what customers want both play a significant role in whether your business succeeds in the long-term.
One of the best strategies to stay ahead is to keep an eye on what your competitors do. To remain relevant to your consumers and your industry in the long run, you have to do competitor research. Researching your competitors helps you understand a lot about yourself and the industry you are in.
For example, learning how they are positioning themselves, what their value propositions are and most importantly, how their business models differ from yours could help you understand how to beat them in the long-term. Some of the easy ways to research your competitors include;
- Reviewing their websites and social media channels
- Reviewing their client lists
- Reviewing marketing and advertising content
Reviewing this publicly available content from your competitors can help you understand your industry’s pecking order and where you lie in that order. This review will also make it easier for you to understand your industry’s current needs and where your competitors are coming short in solving these.
With good competitor and market research, you will be able to develop a long-term strategy that positions your business in the most marketable way. You will also be better placed to anticipate the industry’s direction and plan accordingly.
2. Reallocate talent and capital
When strategising for the long-term, it is vital that you put your money where the action is. Businesses that cannot reallocate capital efficiently are doomed to stay in the same projects long after they stopped making a profit. These businesses are also bound to miss out on emerging opportunities that require flexibility from business owners and a willingness to take on a new challenge.
There are generally two kinds of businesses. Some allocate the same amounts or proportions of investment to the different projects they are undertaking every financial year. These are often the majority of companies.
Then there are those in the minority that re-evaluate their investments every year or two, taking into account the performance of each investment to date and the changes in the market preferences and direction. These latter businesses also take into account the relative performance of all their projects before deciding how much to invest in each going forward. These types of companies vary their investments based on performance and the potential returns for the investors. They are less prone to bankruptcy and more adaptable to the industry’s changes in the long run. In fact, after fifteen years, McKinsey’s research shows that a business that can efficiently reallocate and redeploy capital will have a 40% higher evaluation on average than its static capital counterpart.
Some of the other benefits of capital and talent reallocation include;
- Minimising losses on failing enterprises
- Accelerating growth in returns and valuation
- Increasing industry relevance and consumer confidence
- Higher customer retention
3. Resist the urge to boost short-term profits
Short term profits are attractive and desired by all businesses and CEOs. However, the visionary CEOs know that short term profits should not come at the expense of long-term returns. A lot of short term profiting strategies come at the expense of greater longer-term profit. A profitable business and a good business leader is one that can understand the tradeoff between short term gains and long-term profit.
There is tremendous pressure in today’s business world to maximise short-term profits. Quarterly reports and monthly returns numbers put pressure on company executives to maximise short term profits and growth. This is at the expense of a sustainable long-term strategy that will multiply a company’s returns, not just increase them marginally as short term strategies do.
There are many flaws with trying to boost your short-term profits as a business. Many of these flaws are potentially fatal for companies if you do not mitigate them well. Because businesses do not have a lot of flexibility in what they can do in the short term, many will opt for measures like cutting costs. For example, laying off employees and diverting resources from long-term projects are some of the ways to maximise short-term profits.
While these measures will indeed increase your short-term gains, they will put your long-term survival in jeopardy. Laying off employees would dramatically affect your product’s quality in the long-term and could lead to a reduction in consumer confidence. This is why it is best for your organisation to stay the long-term course and resist the urge to maximise short term profits.
4. Develop a sales and marketing plan that lasts
Sales and marketing plans have two relevant types; short-term and long-term marketing plans. While both plans have their benefits, the best companies can combine both into a holistic marketing plan designed to last.
A short-term marketing plan is designed to be executed within a year to grow sales and revenue in the short and medium-term. Short-term strategies often include sales discounts, team rewards and incentives, and advertising new products. This plan is primarily designed to increase the number of new qualified leads generated by the business in the short term.
On the other hand, long-term marketing plans are concerned with your company’s strategy over ten years. Long-term plans are more concerned with growing the quality of your customer engagement, creating brand loyalty from your consumers and thus increasing your customer retention in the long run. In order to achieve these long-term marketing goals, marketing teams deploy strategies such as;
- Social media engagement
- Thought leadership through content marketing
- Designing an effective customer management system
- Integrating sales and marketing teams
- Search Engine Optimisation (SEO)
- Brand related public relations management
As we have shown you above, both the short-term and long-term marketing strategies have several apparent benefits. For that reason, you are not advised to pick one strategy over another for long-term success. The best long-term strategy is one that combines both of these plans to create a sustainable and effective plan that is built to last.
Keeping your eye on both the short and long-term when making strategic decisions in marketing will help your organisation plan and prepare effectively for its marketing campaigns. You will also come across as homogenous and consistent to your customers over time, which will help you earn their trust.