The Mini-Strategic Plan
by Don Libey

There are times when a series of small strategic plans makes sense. Here is a Plan of Action recently created for a large business-to-business multichannel marketing company to assist in a comprehensive review of performance and opportunities.

On initial evaluation of the performance of a direct marketing company, we find benefit in zeroing in on a number of mini-strategic elements aimed at improving performance and fueling growth. These often include:

1. New or expanded market niches;
2. Merchandising and product expansion;
3. Online channel development, integration and optimization;
4. Talent expansion.

1. New or Expanded Market Niches

Most companies can benefit from a formal exploration of logical and illogical adjacent markets to existing major markets. A mini-strategic exploration generally involves solicitation of the CEO’s and senior management’s thoughts and ideas on new ‘tree-ring’ adjacent market concentrations in order to identify 3-4 potential scalable universes for 1) existing products and 2) new products.

The process is generally done by the senior management and consists of developing expansion profiles of five to ten potential adjacent markets by each manager, including universe size, product affinities, potential for assembling product lines from existing products, potential for new product lines, usage implications of the new niche (AOV, number orders per year, line items per order, consumable versus non-consumable products, projected niche growth, geographic and shipping elements, and other strategic considerations). With potentially ten to twelve total adjacent market potentials, a mini-strategic session is held to review, lobby, debate, justify, and otherwise qualify three to four potential new markets for consideration. With that collegial narrowing, the top two potentials are selected for a fully furnished projected strategic plan. From those findings, one new adjacent or expansion market is selected for expansion. At that point, detailed plans are developed for:

1. Product requirements (existing and new);
2. Merchandising and positioning;
3. Channel integration (catalog, online, other);
4. Circulation planning (prospect and existing customer break-out);
5. Timelines, analytic projections and financial pro forma;
6. Competitive creative design and niche protocols;
7. Market test;
8. Test evaluation and adjustment;
9. Secondary market test and adjustment; final, comprehensive pro forma projections;
10. New adjacent market roll-out.

The first portion of the process—the collegial evaluation of potentials—is generally a ninety-day undertaking. The first thirty days develops the parameters for exploration; the second thirty days is research; the third and final thirty days is development of findings and recommendations for the mini-strategic planning session.

The second portion is the actual two-day strategic planning session, restricted to the market niche development findings and reaching a collegial understanding and ownership for the go-ahead development of one expansion market.

The third portion is the progression of items 1 through 10 above and varies from three to six months. Best case, a new, adjacent market can be researched, identified, pro forma’d, developed, power-tested and entered in five to six months. Worst case, is generally one year.

2. Merchandising and Product Expansion

Companies may benefit from a fully-furnished product review that classifies all products on a product lifecycle basis, capturing the percentage of products in the introductory, growth, mature and obsolete phases. With senior management’s collegial agreement of these findings, thoughts and ideas on adjustment of positioning and merchandising tactics and approaches are solicited, by product line, by media, by channel and by financial analytics.

During a two-day mini-strategic planning session, changes in positioning are presented, lobbied, debated and consensus is reached on one to two positional changes to enhance existing market and product performance through merchandising. These changes may involve product viewpoint, service, pricing tactics, offer tactics, product mix adjustments, channel concentrations for pricing and offer advantage, sweet-spot quantity pricing, volume pricing, membership programs, or any other positioning and merchandising concepts not currently being utilized or maximized.

Generally the first portion of this initiative is internal product and sales performance research and takes up to ninety days to complete.

With the findings, management can develop its collegial thinking and ideation during a thirty day period.

The two-day mini-session narrows the potential position changes and enhancements based on the pro forma protocols.

The selection of one or two positioning enhancements and initiatives then moves to the active planning stage over the next thirty days and includes part or all of the following elements:

1. Offer revisions;
2. Pricing revisions;
3. Service revisions;
4. Application information and editorial revisions;
5. Product line revisions (additions, retirements, resting, “new and improved” programs, “reintroductions,” knock-offs, adaptations, adoptions, close-outs, clearances, liquidations, variable pricing programs, large-order programs, fulfillment programs, channel programs and drivers, and other positioning tactics and initiatives not currently utilized and maximized;
6. Projected inventory adjustments and de-centralization implications;
7. Financial modeling and pro forma projections of enhancements;
8. Testing and adjustments;
9. Retesting and final pro forma and projections;
10. Roll-out of repositioned products and merchandising components.

This mini-shift in strategic performance generally is a one- to two-year initiative. It can be accomplished in less time, but only is there is pristine product performance data and it is related to provable RFM or regression modeling of performance leading to reliable and predictive financial analyses that demonstrate positive outcomes.

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