7 myths and 1 curse on digital strategy
The digital strategy is populated with myths and beliefs and it is sometimes difficult to define exactly what it is. When we talk about digital strategy, we are confronted with many preconceived ideas which are often the result of an erroneous perception of what is really happening in the markets. Perceptions, received ideas, multiply when we are faced with a complex and recent phenomenon, and confusions sometimes emerge myths, some of which are particularly persistent. I see mainly 7… but also a curse!
So, when we talk about digital strategy, confusion is not uncommon with digital marketing, growth hacking, social selling, etc. All these terms multiply, intersect, collide, without us knowing exactly what we are talking about. The multiplication of portmanteau words is typical of the emergence of new phenomena. And this is strongly the case for digital strategy, which is the subject of many myths. Here are the 7 most common.
Myth # 1: Having an original idea is crucial
The idea is not the key to everything that needs to be protected from copiers. The success does not lie in the absolute originality of the idea but in the quality of the execution. We are 6.5 billion on Earth, the probability of having an idea that no one has had before is low. For example, Youtube was not at all an original creation, and there were many networks like Facebook at the time of its creation. Who remembers Altavista, long before Google. And Copernicus?
No, more than the idea, it’s the vision that counts. The ability of a person to turn an idea into a vision, which will become a force of conviction, encouraging others to follow it, to build something. So that’s not the idea, it’s what you do with it.
Myth # 2: The first mover, or “First-Mover advantage”
One of the most frequent myths is that of “First-Mover advantage“. According to this principle, the first to enter a market is the one who wins the stake. This is leading some start-ups to accelerate the movement and sometimes to launch a product or service that is not yet fully satisfactory or operational, just to be on the market first. When you think about it, after 5 minutes we are all able to make a list of products or services that are dominant in a market, without having been the first to enter. No ? What about Google, the leading search engine? Archos launched a tablet long before Apple.
Establishing yourself in a market is very complex. The myth of “First-Mover advantageIs a simplification of a complex mechanism. Indeed, gaining the advantage in a market depends on the structure of the market, the type of competitor, the behavior of the consumer, the technological level, etc. The “First-Mover advantageIs therefore a simplification of a complex mechanism, leading moreover to the emergence of the concept of “First-Mover sayadvantage” ; and each study showing that the “First-Mover advantage “ was decisive, another study shows that it does not exist. Isn’t that a myth? Here is a link to an article which details the reasoning.
Myth # 3: “Strategy is just a question of tools”
The purpose of the tools is to identify the threats that weigh on the company, and identify the opportunities that will make it possible to transform it. To do this, there are a very large number of tools.
The tools and methods of strategic analysis and market analysis are in fact information reduction techniques. Their purpose is to organize and enable the analysis of extremely complex information in such a way as to make it understandable and to enable decision-making. However, it is at the same time extremely critical to avoid over-simplification. Be careful not to fit a complex and dynamic situation into a simple framework, and to extract from it over-simplified information which at the same time loses all its richness, and no longer makes it possible to make relevant strategic decisions. The key is therefore to find a balance and avoid the two main traps that we can fall into.
- The use of strategic analysis tools should allow you to look into the past, in order to build a projection of what your business will be like in the future.
- An analysis tool is not a checklist, the goal is not to fill in boxes or draw a diagram. The purpose of a tool is to enable action.
All this means that the strategic analysis must provide all the information necessary to build a competitive advantage, and therefore a position in a market. The goal is therefore not to use as many tools or techniques as possible. The key is not in the tool, but in the analysis.
Myth n ° 4: “The digital strategy is cheap!”
When leading a digital strategy, it is true that the cost structure is different in comparison with the industry. The data available for analysis is considerable, and the expenditure items are different: referrals, training of new professions, data processing, storage, data security, production of content, dissemination of content, animation of social networks, animation of ‘a website, recruitment of often rare profiles, …
For example, the bidding game in implementing a keyword campaign can be very expensive, and a poorly calibrated campaign can both strain your budget and be counterproductive. As part of a digital strategy, “inbound” logic replaces “outbound” logic. This means that the spend is designed to drive the consumer to touch points with your offering. It is for this reason that the cost structure is different.
[La version alternative de celui-ci est: «La stratégie digitale, c’est juste une question de bon sens!». Je consacrerai prochainement un post à cette question.]
Myth # 5: The Talent
“Strategy is above all a question of talent ”. Be careful, talent in itself is not a myth, it is the impact of talent that can sometimes be overestimated. Digital strategy is an essentially analytical discipline.
Armed with a vision, considerable work is carried out on the analysis of information: collection, reconfiguration, cross-checking, etc. Talented, but without quality information, what to do? And following the analysis of the data, the implementation of the strategy, the execution of the tactical tasks, the delivery of the services to be produced, … The digital strategy, it is therefore above all a question of work because the nature of the reasoning , which is dynamic, makes the number of options considerable, and the task all the more complex. The capacity for work is the key.
Myth n ° 6: “A beautiful website, and roll my hen!”
We do not drive the consumer towards a landing page. We build a net on the net, with a large number of entry points leading to business. Providing a website is not necessarily the first thing to do. And the same could be said of creating a Facebook page, a Twitter feed, a Pinterest profile or a blog.
It all depends on the vision (and strategic intent). It is she who will drive the entire analysis process that will lead to the construction of the digital strategy. It is after having built a strategy that we develop the points of contact with the customer, not before. So it’s not all about a website. And this is the main difference between “inbound” and “outbound” logics: expenses are designed to bring customers into contact with your offer (depending on it: Facebook, Twitter, Snapchat, LinkedIn, app. ,… Or a website if necessary) which is very different from the traditional approach which leads to seeking customers.
Myth n ° 7: “It’s just a matter of computers, the Internet and that stuff”
Digital strategy is above all a question of people. It has effects off-line and online, and it is essential to put the consumer at the heart of the reasoning. So, although IT is omnipresent, we are only talking about consumers, people. So to build a digital strategy, we start at a table, with a sheet and a pen, and we think about what we want to do while being guided by the vision. The digital strategy is not a constraint, it offers opportunities.
And so no, it’s not enough to just make an app. No, it’s also silly to say “you have to be on all social networks to make the Buzz“Than to say”Do not go on social media, because a bad comment is enough to kill the business“. And finally, no, for a good digital strategy, we do not just need “a competent guy who will slip bits of code here and there, from a growth hacker!“.
A Curse: “The curse of the incumbent”
“IncumbentLiterally translates to “holder”. When we talk about strategy and markets, what we call “incumbents”, these are the companies which are already present in a market and which occupy (which hold) a position.
Usually, successful companies in a market strengthen and solidify their position by using incremental innovations. They seek to improve the characteristics of their products or services, they specialize their offer. Radical innovations frequently tend to come from smaller companies, the challengers. These companies are looking for an offer that will satisfy consumers differently, through radically different products or services. And this is very important because radical product innovations are the engines of economic growth. They are the source of new markets, and are always at the origin of very large companies. Thus, each large company positioned in a market will one day see this position challenged by a new entrant, a small company able to offer an offer that will better satisfy consumers.
It should therefore be understood that this curse is also a great opportunity because strong positions are temporary, and the more dynamic the markets, the more difficult they are to defend. And digital makes it possible to seize this opportunity. Digital technology, which allows us to better understand customers, increase the number of commercial contact points (leads), better qualify prospects, etc. Digital therefore makes it possible to challenge positions, strengthen the curse for incumbents, and increase the opportunities for challengers.
From this curse, we must therefore learn a lesson, and above all a hope: each small company which enters a new market thanks to an innovation can potentially threaten the companies in place, even those which seem firmly established. So it is always possible to do better, and it is always likely that others will do even better afterwards. So, do better than the others, and rely on digital technologies to get there!
If this curse interests you, this article will fascinate you!
Jean-Philippe Timsit is professor of Competitive & Digital Strategy at ESC Rennes School of Business.
He specializes in competitive advantage and value creation, mainly in digital strategies, as well as in the areas of entrepreneurship and leadership. He regularly intervenes on these themes with companies through seminars, training and consultancy missions or with entrepreneurs in the creation phase.