Marketing Strategy De-

mystified:
A Simple Playbook

John Zagula and Richard Tong

April 2005
Strategy without tactics is the
slowest route to victory.
Tactics without strategy is the noise
before defeat.

- Sun Tzu
(Chinese General, circa 500
BC)

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What is a Strategy?
The Play
– Five basic strategies
The Playing Field
– Find the gap
The Tactics
– From A to Z

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Play 1. Drag Race

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Drag Race Example
Microsoft Word vs. WordPerfect, 1990
– Word 15%, WP 30%, Other 55%
– GUI/WYSIWYG on IBM PCs
Go to Market
– Word/WordPerfect Challenge, People prefer…
– $129 upgrade = switcher product
Outcomes
– No one wrote about Wordstar anymore
– Word at 85% share

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Drag Race
Conditions
– Fragmented market, vulnerable competitor
– Product/Resources to win
Implications
– Better on price, product, everything
– Shootouts, features wars galore
Risks/Rewards
– Easy to explain, to focus, to get PR
– Netscape pokes bear, bears eats Netscape

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Play 2. Platform

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Platform Example
NTT DoCoMo, 1997
– 10 million subscribers, $18 billion original IPO
– Fat and happy with voice/paging
Go to Market
– Open I-mode with simple development, billing
– DoCoMo providing tools, billing; taking only 9%
Outcomes
– 40 million subscribers
– 1000s of profitable, dependant partners

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Platform
Conditions
– Most popular, perceived leader (post dragrace?)
– You can make others lots of money
Marketing Implications
– Positioned as an industry, not a competitor
– Lots of tools, developer/partner conferences
Risks/Rewards
– Lowest cost, blunts/co-opts erstwhile
competitors
– Incubates competition, not for startups usually

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Play 3. Stealth

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Stealth Example
Enterprise Car Rental, 1970s
– Embroiled in grizzly battle for airport rentals
– No way to outspend Hertz or Avis
Go to Market
– Hometown, insurance replacement
– “We’ll pick you up”
Outcomes
– Low marketing costs, near monopoly in
insurance
– One of the most profitable in the rental
business

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Stealth
Conditions
– Incumbent with chink in the armor
– Lack resources for knock-down fight
Implications
– Positioned as complement, utility, nothing
– Segmentation/targeting, bearhug
Risks/Rewards
– Best for startups, jujitsu the platform
– Drag race too soon, get run over

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Play 4. Best of Both

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Best of Both Example
Lexus, 1989
– Japan low-end/Europe high-end
– Dramatic manufacturing improvements in Japan
Go to Market
– Japanese luxury not an oxymoron; fresh, not
staid
– Whole product approach, car + whole
experience
Outcomes
– JD Powers best car line, Number one luxury
import
– Best of both again with “Luxury SUV” oxymoron

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Best of Both
Conditions
– Mature market, two established competitors
– Customers trade-offs (low-high, power-ease,
etc.)
Implications
– “Why have to chose?” value/have-it-all
messaging
– One winner SKU, attack high end first
Risks/Rewards
– Requires real differentiation
– Worst of both worlds – e.g. Peugeot?

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Play 5. High-Low

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High-Low Example
Sheraton, 2000
– Strong luxury brand
– Marriott lower price, good enough
Go to Market
– Four Points™ ($89)
– Sheraton Keauhou Bay ($500-$5,000)
Outcomes
– Growing share of the mid market
– When can I book Four Points Hawaii?

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High-Low
Conditions
– A key contender, often drag-racing/BoB’ing you
– Can be done with alliances (partner for low-
end)
Implications
– “Why compromise?” right-one-for-you
messaging
– Entry plus premium SKU, attack low end first
Risks/Rewards
– Defensive, until you BoB, hard to execute
– (e.g. Old Navy stealing from Gap?)

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Sun Tzu
If you know the enemy and
yourself, you need not fear a
hundred battles.
If you know yourself but not
the enemy, for every victory
you will also suffer a defeat.
If you know neither the enemy
nor yourself, you will succumb
in every battle.

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Playing Field and
Gaps

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Playing Field
Elements

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The Campaign

Keep it simple. When you get too

complex, you forget the obvious."

- Al Maguire
(Coach, Marquette basketball)

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Positioning

X Y Z
Category Customer Competitive
Definition Target Difference

The only X that solves Y in Z

solution problem unique Way

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Proof>Benefits>Feature
s

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Messaging Tips
R1: Rule of One
– One promise, one offer, one action
R3: The Rule of Three
– No more than three of anything
– Features, benefits, proof points
Awesome, Awesome, Not Screwed Up
– Motivate and Incent Action
– Remove barriers to inaction

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Messaging Litmus
Test

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Summary
Know your playing field
• ABCs/Gaps
• Customer, Competitors, Competencies
Pick your play
• Dragrace, Platform, Stealth, Best of Both, High-
Low
• Right conditions; clear, focused bet; readiness to
shift
Run it down the field
• Positioning: get XYZs right
• Messaging: solid proof stronger than cool
features
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 Your
Playbook?
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