1.) Realization of need – First the consumer my realize that they “need” an item or service. The realization may happen slowly over time, e.g. the realization that the customer needs a new home, or very quickly, e.g. the realization of a need for Chapstick at the cash register at CVS. The marketer must understand how their targeted consumer segments come to this realization and plan accordingly.
2.) Research – Customers then research which products or services may satisfy their need. They get their information from everything from advertisements, company websites, family and friends, sales people and product packaging. Increasingly powerful source of information is social media and peer review sites. Research may be a large part of the purchasing decision, e.g. a customer purchasing a home will do a lot of their own research and often bring in a real estate agent to find the right match. Or the research process may be as quick as seeing the Chapstick at the cash wrap and realizing they have dry lips.
3.) Evaluation – After the customer has identified a number of options that may satisfy their need, the customer will select the best option for them based on a number of criteria, i.e. price, quality, convenience, brand, reliability, etc.
4.) Purchase – The customer then purchases the product but must still decide which channel (online, retail, catalog, etc) and which specific provider.
5.) Satisfaction – Once the customer has purchased the product or service the customer may realize the purchase was satisfactory or not. This realization will help determine if the customer becomes a positive or negative influence for potential future customers as well as determine if this customer will be a repeat consumer.
While typical New Year’s resolutions (losing weight, spending more time on the family, working out) may be great personal achievements there is one resolution that matters even more: reformulating your organization’s strategy. Continuing to work a wrong or even a bit outdated strategy in 2014 will take more out of you and out of your organization than carrying around that extra 10 pounds.
Working an incorrect strategy saps resources out of you, your personnel and your company’s financial resources. A strategy, correctly formulated and applied, guides every decision maker from customer service to the president in making decisions that are consistent, effective and future oriented. On the other hand a strategy, incorrectly formulated and/or applied, guides every decision maker to make inconsistent decisions that do not guide the organization efficiently or effectively toward a desirable future.
Generally speaking, an organization’s strategy should be validated every year and have a significant review every three years. Organizations that are faltering, experiencing significant growth or in a cutting-edge industry, e.g. 3D printers, should validate and review their strategy on a significantly quicker pace. For truly disruptive organizations, Clayton M. Christensen and Michael E. Raynor suggest processes for fostering an “emergent strategy” in The Innovator’s Solution to have a living continually updated strategy.
For your New Year’s resolution, consider asking yourself these questions:
How recently has your organization’s strategy been validated or reviewed?
Does your organization have a clear and believable strategy that has been working*?
Could every decision maker correctly describe your organization’s strategy?
Is your organization’s strategy specific to your organization (vs. a cookie cutter approach that could fit any organization in your industry)?
Do you have regular tracking of metrics that are tied to your strategy?
If your answer to question 1 is longer than a year or if you answered “no” to any question 2 through 5, it is time to review if your organization’s strategy is up to date and appropriate for the circumstances 2014 is likely to bring your industry.
* Definition of “working”: provide a lasting and positive change to sales trend