When you are trying to build a business, there are two critical questions you have to answer:
- How do you identify opportunities to sustain the business?
- How do you create a focused strategy that builds the brand?
Though they might appear similar at first, they entail very different tactics. To sustain the business, you have to think short term and opportunistic. Particularly in the early stages of development, businesses are inclined to take any revenue opportunity that comes their way.
However as a business looks longer term, the focus on the brand becomes more important. As a business matures; the value of a brand starts to be reflective of how unique or substitutable customers perceive it to be.
Take the Saturn Car Company, for instance. Saturn started small with a single model targeted at one segment of the market. As they grew, they branched out and in a bid to expand their revenue and build their business.
Unfortunately, this strategy led to serious brand dilution to the point where consumers no longer knew what the unique value was of owning a Saturn. Today, a brand that should have been a bastion of value for GM was one of the first to go in its restructuring.
In the end cases like Saturn make me believe that success doesn’t come from finding an answer for either question. Instead, success comes in finding a common answer to both questions.
That’s the supreme challenge of business development and the key to really strong brands.