business strategy examples in business plan

BUSINESS STRATEGIES

9 business strategy examples (and why you need one ASAP)

• Amanda Bellucco Chatham
• Dec 14, 2023

Most successful businesses start with a good idea. In 1976, Steve Jobs and Steve Wozniak had the idea to make computers small enough to fit into people's homes and offices. Enter Apple, now the largest tech company in the world. 

But good ideas alone aren’t the catalyst to success—behind the scenes, a business strategy is at work. And a business strategy is something you need in order to complete the big picture and define how you plan to grow, operate and thrive.

In this post, we’ll define what we mean by business strategy, outline why it’s important and provide some tangible business strategy examples.

Set yourself up for success with a free business website  from Wix.

What is a business strategy?

A business strategy is a plan of action that keeps you focused on several things. Different from a business plan—which dictates how your business will be run from day to day—a business strategy tends to focus more on how, exactly, you will reach certain goals, milestones or achievements in running your business. 

You need a strategy when you want to start a business , as well as when you’re planning to grow or change an existing business. Your strategy defines your business goals and provides a framework for all of the moving pieces your venture needs to operate successfully.  

A business strategy typically includes the following elements:

Core product or service : What you're selling, your business idea or your service.

Target customer : A clear profile of who your business serves, including the problem that your product or service solves for them.

Competitive assessment : A summary of the competitive landscape including strengths, weaknesses, opportunities and threats (SWOT analysis). 

Financial plan : A financial projection that includes planned revenue, expenses and cash flow. 

Pricing approach : Your preliminary pricing for products and services offered, or your pricing approach (e.g., flat fee, hourly, fee-for-service, etc.).

Marketing and sales plan : An outline of how you plan to market your products and business, including a rough budget for paid media, details on how to make a website  and anything related to business promotion. It should also define some sales strategies focused on language meant to promote and differentiate your brand.

Staffing and hiring : An org chart that defines roles and hiring needs. Include any resources and personnel you have on hand (e.g. Is it just you? Is it a partnership?).

Growth objectives : A business growth  plan that incorporates your current goals, plus where you'd like the business to be in the next one, two or five years (e.g., markets, number of customers, revenue projections, etc.).

Pro tip : A business strategy and business plan go hand in hand in shaping the goals, objectives and achievements of your business. Looking for a business plan  instead? Check out our simple, customizable and free-to-download template.

3 types of business strategies

Any successful business starts with a roadmap that outlines how goals will be achieved. However, not all strategies are created equal. Let's take a look at three types of business strategies that can drive your business toward sustainable growth:

Corporate-level business strategy : This high-level strategy includes the company's vision, mission and key decisions. This might involve business choices, acquisitions or divestments, and resource allocation, for example.

Business-level strategy : A business-level strategy determines how a company competes in a market, considering product mix, customer segments, pricing, marketing and distribution. It aims to deliver value to customers and outperform competitors.

Function-level business strategy : A functional strategy focuses on the operational aspects of a business, like production, marketing, finance and human resources (HR). It supports corporate and business-level strategies by maximizing resource productivity.

Why a business strategy is important

Starting any type of business isn't for the faint of heart. There are many predictable and unpredictable factors to prepare for at every stage of growth. That’s why you need a business strategy to keep you on track.

As far as benefits go, a business strategy:

Helps you navigate market complexities : It provides a roadmap for staying ahead of the competition, plus external factors like supply chain issues and global events that may impact the market.

Provides insight into your customers' needs : When you know their pain points, you can align your strategy with real-world preferences and demands. 

Helps you anticipate small business challenges : Knowing about potential opportunities and issues will help you adapt to market changes—and be more resilient overall. 

Makes long-term success much more likely : A thoughtful plan takes the guesswork out of things like hiring, investing, growth and innovation.

9 business strategy examples

So, what does a business strategy look like? We’ve outlined nine examples below to inspire you as you iron out the blueprint for your business’s success.

Customer experience 

Cross-selling and upselling

Customer retention programs

Cost leadership

Differentiation

Acquisition

Social responsibility

01. Customer experience 

Companies like Zappos, Starbucks and Amazon are known for their exceptional customer experiences. They prioritize customer satisfaction, make doing business with them easy and (in the case of Starbucks) turn something as simple as grabbing a cup of coffee on your way to work into an immersive and satisfying sensory experience. 

Customer experience, as a business strategy, is beneficial for any small business owner . It creates loyal repeat customers who tend to become brand advocates, recommending your business, products and brand to their network of friends and family. 

02. Cross-selling and upselling

Focusing on selling more products to existing and new customers is a strategy that, if successful, has a direct and immediate impact on your cash flow, revenue and profitability. There are many ways to do this, including cross-selling and upselling  to shoppers as they browse your website, bundling similar products and using loyalty programs to entice past customers to return. 

Old Navy is a master of motivating return sales. Their Super Cash program awards shoppers $10 for every $25 spent on their website or in stores. The coupons become active at a later date, which encourages shoppers to hang onto them and return to shop again in the future.

Your rewards program doesn’t have to be elaborate, either. Wix merchant Jule Dancewear  offers customers five reward points for every $1 spent in the shop, with bonus points awarded for following the brand on Instagram or celebrating a birthday. Customers can then redeem their points for a certain dollar amount or percentage off a future purchase. 

03. Customer retention programs

Creating more customer loyalty is a viable and lucrative business strategy. It’s often more cost-effective to focus on retaining customers than constantly finding new ones. In fact, most brands have a 60-70% chance  of selling to an existing customer, but only a 5-20% chance of closing a sale with a new one.

Loyalty comes in many forms—e.g., retail loyalty programs that reward shoppers with coupons and discounts, or points systems like airline miles on credit cards. You build loyalty by being trustworthy, communicating clearly and creating high-quality products. Consistency is also key to building ongoing relationships. 

Perhaps no one does this better than Amazon with their Amazon Prime program. Customers buy into the program for a monthly or annual fee and are guaranteed fast, free shipping from Amazon sellers who opt into the program. Returns are also easy and Prime members get lots of other benefits, including a huge catalog of movie and TV shows, exclusive sales events and unlimited photo storage.

04. Cost leadership

Cost leadership is a strategy where a company offers the lowest prices in a niche or market. Companies like Walmart and IKEA are famous examples. They've mastered this strategy by offering products at prices lower than their competitors, while still maintaining profitability. 

This strategy isn't for everyone. Walmart's size gives it more leverage over suppliers (and wholesale pricing) versus a local mom-and-pop store. But even if you manage a smaller business, you can make a cost leadership strategy work by keeping costs low, creating your own products and being (incredibly) vigilant about your business costs. This is a strategy that takes a lot of planning and monitoring, so it’s important to do your research before jumping in.

05. Innovation

Innovation tends to be connected to categories like technology, pharmaceutical and business services industries. It's a business strategy that focuses on creating cutting-edge products or services that are either brand new (e.g., in 2007, Apple’s iPhone was the first smartphone introduced to a huge market of people who didn’t know they needed it) or best-in-class products or services in an existing market. 

Innovation, as a business strategy, isn’t limited to products or services. It can apply to a business approach—in other words, the way you offer your product or service. A perfect example of this is the rise of meal kit delivery services like Hello Fresh and Blue Apron. These companies provide “meal kits'' with fresh ingredients delivered as a subscription service to their customers (e.g., three meals per week). Or, take a look at Wix merchant Napa Wild , which offers weekly subscription shipments of fresh produce to areas surrounding Napa County, California. Their produce boxes are available in three different sizes to suit different households.

Some companies, like Tovala, include technology with their delivery service. Tovala’s smart oven works by scanning a barcode on the pre-made meal so that the cooking time and temperature are automatically set in the oven. When the meal is complete, the customer is notified via the Tovala app.

06. Differentiation

Differentiation is about making your business stand out compared with your competitors. You do this by providing something uniquely special about your product design, features or quality. You can also differentiate yourself by creating a unique and meaningful brand story. When done well, differentiation gives you a lot of flexibility around pricing and approach—including the types of products and services you offer. An effective differentiation strategy helps your customers identify with your brand. They are either Coke drinkers or Pepsi drinkers, for example.

Or, take Starbucks as an example. Lots of places sell coffee, but Starbucks has taken coffee to an entirely new level with uniquely crafted (and premium-priced) drinks that are as much about lifestyle and identity as they are about getting your daily caffeine fix. 

07. Acquisition

Acquisition is a business strategy that involves purchasing another company (or companies) to fuel growth, expand market share or be more competitive. Acquisition can be a game-changer for your business, allowing you to quickly tap into new markets, acquire valuable assets and eliminate competition. 

Companies like Meta (formerly named Facebook) have effectively used acquisition as a strategy to maintain their dominance in the social media space. By acquiring platforms like Instagram and WhatsApp, Meta expanded its user base. It also diversified its offerings, ensuring it remains relevant even when other platforms like MySpace and Friendster have flamed out over time.

Acquisition as a primary strategy isn’t for the faint of heart. You need a deep understanding of each of your target company's operations, culture, financial health and customer base. Integrating two companies can also be complex and stressful. There are often issues with merging technologies, company cultures and aligning operations. Thus, conduct thorough due diligence before making an acquisition or you could end up turning a beloved global brand into a classic example of what not to do when acquiring a legacy company.

08. Social responsibility

Social responsibility is important to all consumers, but particularly Millennial and Gen Z consumers  who often evaluate companies and products based on environmental impact and sustainability. Social responsibility helps businesses differentiate themselves because it fosters community, protects the environment and ensures you’re prioritizing ethical practices throughout your operations.

In fact, according to a Deloitte survey, a quarter of consumers  are willing to pay more  for sustainable products and packaging, or for products or services from suppliers that respect human rights and ethical working conditions.

Two examples stand out here—Patagonia and TOMS Shoes. Both companies built their brands around social responsibility. Patagonia pledges 1% of its sales to environmental causes and is well-known by its loyal customers for being sustainable and supporting the lifestyle it promotes (loving the outdoors). Meanwhile, TOMS Shoes has a "One for One" model, donating a pair of shoes for every pair sold.

Value is subjective, but it can be a guiding light that helps new customers find you and inspires existing customers to return time after time. With a value-based strategy, the goal is to present something that is not just different but also has significant worth or meaning (or both) to your target audience. 

Apple doesn't just sell technology; they sell an entire ecosystem. Apple products resonate with customers because Apple is as much about a lifestyle as it is about a device or feature. Their products, while technologically advanced, are aesthetically pleasing, easy to use and integrate seamlessly with each other. 

Remember, offering unique value isn't about being different just for the sake of it. It's about understanding what your customers truly desire and creating something that fills that need in a way that no one else can. This could manifest as unparalleled quality. It could be a novel feature, or it can focus on exceptional customer service. Think about the companies you love that do this well—Disney, Trader Joe’s, Lululemon, Ben & Jerry’s and Ikea. A company that promises value and then delivers on it attracts new customers. It fosters loyalty and even advocacy. 

Dig deeper : Want more information on how to start or grow your business? Check out our essential guide on how to run a business , which includes 10 steps for business success.

Related Posts

What it takes to be a successful small business owner in 2024

How to start a business in 14 steps: a guide for 2024

The essential guide on how to run a business

Was this article helpful?

• Scroll to top

•   / Sign Up
• HOW WE HELP CLIENTS
• schedule your conversation

Business Strategy Definition, Examples, Types & 10-Step Guide

Published: 13 December, 2023

Social Share:

Digital Strategy

Table of Contents

In the ever-evolving business environment shaped by digital dynamics, business strategy stands as a guiding force. Whether for start-ups or established companies, a well-defined business strategy is indispensable for ensuring long-term success. At Digital Leadership, we deeply grasp its pivotal role in laying the groundwork for effective digital transformation strategy and innovation strategy .

We foster creativity, ensuring seamless alignment of technology adoption with business goals , and driving purposeful and impactful transformations. We go beyond conventional approaches by integrating Jobs to be Done into your business strategy , focusing on customers’ fundamental needs and motivations to establish meaningful and lasting connections.

What is Business Strategy?

Business strategy refers to a comprehensive plan or a series of actions meticulously crafted to achieve specific business goals and objectives. It entails a systematic approach aimed at gaining a competitive edge, responding to market dynamics, and attaining sustainable success within a particular industry or market. This strategic framework encompasses several crucial elements, such as defining the organization’s vision, mission, and values, assessing internal strengths and weaknesses, and Identifying external opportunities and threats.

The Business Model Canvas (BMC) plays a pivotal role in business strategy, offering a visual and comprehensive framework that outlines the key components of a business model. Its importance lies in its ability to succinctly capture and communicate the fundamental aspects of how an organization creates, delivers, and captures value. The BMC consists of nine building blocks, including customer segments , value propositions , distribution channels , customer relationships , revenue streams , key resources , key activities , key partnerships , and cost structure . By utilizing the BMC, businesses gain clarity on their core operations, customer interactions, and revenue generation methods. You can download it now.

Your download is now available!

You can now access the complete Business Model Canvas Package, including a full presentation, related models and instructions for use.

The UNITE Business Model Canvas

An effective business strategy demands an in-depth understanding of the market, competition, and internal capabilities. It involves strategic decision-making regarding resource allocation, target market identification, and the development of a distinctive value proposition to differentiate the organization from its competitors. Importantly, business strategy is not a one-time endeavor but an ongoing process that adapts to changes in the business environment.

What is Strategy in Business? How Does It Differ From Tactics?

Strategy is a deliberate and well-defined plan that outlines how an organization intends to achieve its goals and objectives, considering the allocation of resources, competitive advantages, and potential challenges. It serves as a roadmap for decision-making and actions to ensure the organization’s success and effectiveness in a dynamic environment.

Strategy and tactics are distinct concepts in the realm of business and planning:

In business, a strategy is the overarching blueprint that outlines an organization’s long-term goals and the broad approaches to achieving them. It is the high-level plan conceived by top leadership to provide direction and set the trajectory for success. Strategic decisions involve critical choices about markets, products, and positioning, impacting the entire organization. A robust strategy serves as a guiding force, providing stability and a framework for decision-making, ensuring that every action aligns with the overall mission.

While strategy sets the grand vision, tactics are the nitty-gritty manoeuvres designed for the immediate implementation of the broader strategy. Tactics are the specific actions, steps, and procedures undertaken by mid-level and front-line managers to execute the strategic plan. Unlike the more enduring nature of strategy, tactics are flexible and adaptable, responding to the dynamic and ever-changing business landscape. They deal with the specifics, answering the question of “how” the strategic goals will be achieved in the short term, making them the hands-on tools for day-to-day operations.

Importance of Business Strategy

A business strategy establishes a unified vision and direction for the entire organization. Clarity in goals and alignment with the company’s mission is crucial for every individual within the company. The strategy plays a pivotal role in providing this overarching vision, ensuring that individuals stay focused and committed to their company’s objectives.

Why is Strategy Important in Business?

Strategy is essential in business for its role as a guiding roadmap. It aligns everyone with shared objectives, prevents deviations from the mission, and enhances internal performance. A well-crafted strategy is crucial for identifying market opportunities and trends, staying competitive, fostering innovation, and creating a comprehensive organizational vision. In essence, strategy is vital for ensuring alignment, efficiency, and adaptability in the dynamic business landscape.

Value Creation for Customers

A successful business strategy centres on understanding value creation . It involves the difference between customer willingness to pay (WTP) and the price of goods or services . The strategy aims to widen these gaps for customers, the firm, suppliers, and employees. By increasing customer delight, firm margin, supplier surplus, and employee satisfaction, businesses create value for all stakeholders. Engaging stakeholders and developing employees are crucial components of a sustainable strategy.

Download the Complete Value Creation Model package, including instructions for putting it to work for you today.

The UNITE Value Creation framework

Enhancing customer satisfaction and boosting customer delight.

A well-crafted business strategy , deeply rooted in customer-centric principles, becomes the driving force behind tailored products and services that meet specific customer needs. This strategic approach optimizes every customer touchpoint, ensuring consistent and delightful experiences. By fostering a dynamic and adaptable response to changing customer preferences , business strategy enables organizations to stay ahead in a competitive landscape. Moreover, the continuous improvement cycle embedded in strategic planning allows businesses to identify and address pain points , creating a brand experience that goes beyond meeting expectations—it consistently exceeds them, fostering enduring relationships with satisfied and delighted customers.

Internal Business Performance Guide

Internally, a strategic business framework acts as a guiding force for optimal performance. It aligns teams, resources, and processes, fostering a collaborative environment where every individual works cohesively toward common objectives. This alignment enhances operational efficiency and overall effectiveness.

Identify Opportunities and Trends in the Future

Strategic thinking also includes proactive opportunity identification , allowing businesses to capitalize on emerging trends and innovative possibilities for sustained growth. It involves not only addressing current challenges but also anticipating future trends and opportunities. By incorporating this foresight into the business strategy, organizations position themselves as industry leaders, always staying one step ahead in a dynamic business landscape. This proactive approach extends to not just mitigating risks but also actively identifying and capitalizing on emerging opportunities.

Create a Competitive Advantage

Business strategy acts as the cornerstone for businesses aiming to carve out unique positions in the market. Through strategic differentiation, organizations can identify and leverage their strengths while addressing weaknesses, positioning themselves uniquely against competitors. Integrating innovation and foresight into the strategic business framework, empowers businesses to stay at the forefront, consistently delivering value that sets them apart, thereby establishing a sustainable and resilient competitive advantage.

Create a Whole organisational vision

A successful business strategy extends its impact beyond individual initiatives; it encompasses the entire organization. It nurtures a shared vision that aligns everyone toward a common purpose. This cohesive vision not only enhances internal cohesion but also provides a roadmap for sustained growth and success.

10 Key Components of Business Strategy

Developing an effective business strategy involves considering multiple components. 

1- Vision and Business Objectives

In business strategy , the component that lays the very foundation is a compelling vision and precisely defined business objectives. They not only provide direction but also serve as the bedrock for effective decision-making and resource allocation, ensuring that every aspect of the business aligns seamlessly with the overarching strategy. In essence, a well-crafted vision and business objectives are integral components, shaping the very essence of strategic initiatives.

The SWOT analysis emerges as a pivotal component of business strategy . It goes beyond a mere examination of internal strengths and weaknesses or external opportunities and threats; it forms the bedrock for strategic planning . At Digital Leadership, we understand the significance of conducting a SWOT analysis as an indispensable element of business strategy. This comprehensive evaluation becomes the compass, guiding organizations to capitalize on their strengths while tactfully addressing weaknesses. Thus, SWOT analysis stands as an essential cornerstone, providing the strategic clarity needed to navigate the competitive business terrain effectively.

By incorporating The UNITE SWOT Framework into business strategy, organizations gain a comprehensive understanding of their internal landscape and external environment, paving the way for more informed, innovative, and adaptive strategic planning.

You can now access the complete SWOT Framework Package, including a full presentation, related models and instructions for use.

The SWOT / TOWS Analysis Framework

3- core values and resource allocation.

Aligning business strategy with core values ensures ethical decision-making. Strategic resource allocation ensures that resources are deployed efficiently to achieve business objectives.

4- Tactics and Operational Delivery

Effective tactics translate business strategy into action. A well-defined operational plan ensures that day-to-day activities contribute to overarching strategic goals .

5- Measurement and Analysis

Continuous measurement and analysis of key performance indicators (KPIs) help organizations track progress and make data-driven adjustments to their strategy. In business strategy , the relentless pursuit of success demands a vigilant eye on performance metrics and key performance indicators (KPIs). Measuring progress against predefined KPIs serves as a compass, providing real-time insights into the effectiveness of strategic initiatives. This data-driven approach enables organizations to gauge the impact of their actions, identify areas of success, and pinpoint areas that may require strategic recalibration.

6- Supply Chain Management

Supply Chain Management involves the end-to-end oversight of the processes and activities that transform raw materials into final products or services and deliver them to customers. In the realm of business strategy , an efficiently managed supply chain contributes to the seamless execution of strategic initiatives.

7- Integrating Technologies

Strategic integration of cutting-edge technologies, such as AI, IoT, and blockchain, is vital for keeping organizations at the forefront of innovation. This involves leveraging technology to enhance various aspects of business processes. By incorporating emerging technologies into the fabric of the business strategy , organizations can respond effectively to changing market dynamics, customer expectations, and industry trends.

8- Business Process Management

Efficient business processes are integral to successful strategy execution , BPM guides organizations in optimizing their processes for maximum efficiency, ensuring seamless alignment with strategic objectives. As organizations navigate the complex landscape of business strategy , BPM serves as a foundational element, ensuring that operational activities are not only efficient but also in harmony with the broader vision and objectives set forth in the strategic plan.

9- Business Intelligence and Analytics

Informed decision-making relies on accurate data. Incorporating business intelligence and analytics into the business strategy ensures that decisions are data-driven and aligned with organizational goals, fostering a culture of continuous improvement.

10- Competitive Analysis

Understanding the competitive landscape is vital for informed decision-making, it assists organizations in conducting comprehensive competitive analyses and provides valuable insights to inform strategic choices and maintain a competitive edge.

Business Strategy Development in 10 Strategic Steps

Creating a business strategy is a meticulous process that requires careful consideration. Develop a business strategy   through the following ten strategic steps:

Step (1): Conduct a SWOT Analysis

Embarking on the business strategy journey begins with a thorough SWOT analysis, delving into the intricacies of internal strengths and weaknesses, coupled with external opportunities and threats. This foundational step serves as a compass for businesses, providing a nuanced understanding of their current position in the market landscape. In this comprehensive analysis, internal strengths are scrutinized to leverage and optimize, weaknesses are identified for targeted improvements, opportunities are explored for strategic expansion, and threats are assessed for proactive mitigation.

Step (2): Identify your Business Purpose

Moving forward in the strategic roadmap, it is imperative to distinctly define the purpose that drives the organization’s existence. This step involves a meticulous examination of the company’s mission, vision, and values to articulate a clear and concise business intention and purpose. By aligning the business strategy with the overarching mission and business purpose , businesses can foster coherence, ensuring that every strategic move resonates with the core values that define the organizational identity. This alignment not only serves as a guiding force for decision-making but also establishes a strong foundation for sustainable growth and impact in the marketplace.

TheUNITE Business Intention Model guides organizations to distinctly define the driving force behind their existence. In a meticulous examination encompassing mission, vision, and values, the UNITE model ensures the articulation of a clear and concise business intention and purpose and it establishes a robust foundation for sustainable growth and impact in the marketplace.

You can now access the complete Business Intentions Package, including a full presentation, related models and instructions for use.

The UNITE Business Intentions

Step (3): setting up business goals.

In the intricate landscape of business strategy development , the third step involves the meticulous process of setting up clear and measurable business goals , the significance of well-defined goals provide a structured roadmap. By articulating specific, measurable, achievable, relevant, and time-bound (SMART) objectives, businesses can ensure that their strategic efforts are purposeful and directed. Through this strategic clarity, organizations can align their resources, efforts, and initiatives with a unified vision, fostering a cohesive and results-oriented approach.

Step (4): Defining Your Competitive Advantage

Defining competitive advantage emerges as a linchpin in the framework of business strateg y, this step holds paramount importance in the strategic narrative, serving as a compass for organizations navigating the competitive terrain. By identifying and leveraging a distinctive competitive advantage, businesses create a unique value proposition that sets them apart. This strategic differentiation becomes a guiding force, steering organizations towards long-term success in a dynamic market.

Step (5): Opportunity Identification in the Market

As organizations embark on the business strategy journey, opportunity Identification emerges as a pivotal and forward-looking endeavour. In this nuanced phase of business strategy development , the focus shifts to the external landscape, where astute organizations keenly observe, analyze, and capitalize on emerging opportunities. By conducting a comprehensive scan of the market, businesses position themselves as agile players ready to navigate the currents of change. It empowers organizations to strategically align resources and capabilities to harness them effectively. In a dynamic business environment, seizing the right opportunities becomes a transformative catalyst for sustained growth and resilience.

Step (6): Build your Team

In the intricate tapestry of business strategy development , building your team stands as a critical pillar defining the success trajectory. At this juncture, the focus transcends individual capabilities to the collective strength of a cohesive and synergistic team. The significance of aligning team dynamics with strategic objectives, fostering collaboration, and harnessing diverse talents. As organizations navigate the complex strategic landscape, a well-built team becomes the driving force, propelling the strategic vision into actionable reality.

Step (7): Enhance Value Creation for Customers, Suppliers, and Employees

In business strategy enhancing value creation for customers, suppliers, and employees, takes centre stage as a transformative act beyond customer-centric approaches, business strategy framework extends its embrace to suppliers and employees, recognizing them as integral stakeholders in the strategic equation. This step signifies more than a transactional give-and-take; it embodies a commitment to fostering lasting relationships and mutual growth from customer delight to supplier partnerships and employee satisfaction, our approach ensures a harmonized symphony of value that resonates through every facet of the organization.

Step (8): Develop your Business Strategy Execution Framework

Developing your business strategy execution framework emerges as the meticulously composed score that transforms strategy into tangible action to execute your  Successful Business Strategy.  It becomes crucial to establish a clear roadmap for turning your strategy into actionable steps and determining the daily activities of the entire team.

The UNITE Strategy Execution Model holds immense importance in guiding organizations through the transformation of strategic plans into actionable steps, ensuring a seamless alignment of daily activities with the overarching business strategy .

You can now access the complete Pirate Metric Funnel (AAARRR) Package, including a full presentation, related models and instructions for use.

The UNITE Pirate Metrics Funnel (AAARRR)

The Strategic Planning Process guides you through the stages of creating a successful Business Strategy . Utilizing a Business Model Canvas can help you visualize the various components of your operations more effectively.

Download the Complete eXtended Business Model Canvas package, including instructions for putting it to work for you today.

11 Types of Business Strategy with Real-life Business Strategy Examples

When formulating your Business Strategy, it’s valuable to consider the various shapes it can take. Each strategy is viable in its own right, and the direction you choose will be influenced by your Business Purpose and Objectives, as well as the resources available to you.

1) Cost Leadership Business Strategy

Cost Leadership is a strategic approach where a company aims to be the lowest-cost producer in its industry. This strategy involves achieving a competitive advantage by offering products or services at the lowest possible cost. Key elements include economies of scale, operational efficiency, stringent cost control, and often, a pricing strategy that undercuts competitors.

Example: Walmart business strategy

It exemplifies this strategy by leveraging large-scale operations and efficient supply chain management to provide products at lower prices than competitors. While effective, maintaining cost leadership requires a continuous emphasis on efficiency, cost control, and market share growth. However, companies pursuing this strategy must be cautious of potential imitation and should balance cost-saving measures with innovation to stay competitive.

2) Focused Business Strategy

A Focused Business Strategy, also known as a niche or segmentation strategy, involves targeting a specific segment of the market rather than trying to appeal to the entire market. This strategy is effective when a company identifies a particular market segment with unique needs and preferences.

Examples: Tesla Business Strategy

It employs a focused strategy by concentrating on the electric vehicle market. Instead of catering to the broad automobile market, Tesla targets consumers seeking high-performance electric vehicles. Focused strategies allow companies to tailor their products or services to meet the distinct demands of a niche market, often resulting in higher customer loyalty and less competition. However, it requires a deep understanding of the chosen segment and the ability to provide superior value to customers within that niche.

3) Differentiation Business Strategy

A Differentiation Business Strategy involves offering unique and distinctive products or services that stand out from competitors in the market. Apple, a prominent example, excels in differentiation through its innovative product designs, user-friendly interfaces, and ecosystem integration.

Examples: Apple Business Strategy

Apple’s strategy focuses on creating premium, high-quality products that provide a unique user experience, setting them apart from competitors. Differentiation strategies often lead to higher product prices, but they also cultivate brand loyalty and perceived value among customers. Successful differentiation requires continuous innovation, investment in research and development, and a keen understanding of customer preferences. Companies employing this strategy strive to build a strong brand image that becomes synonymous with quality and innovation in the minds of consumers.

let’s categorize Apple’s strategy into two types of Differentiation Business Strategy: Broad Differentiation and Focused Differentiation .

• Apple’s Approach: Apple adopts a broad differentiation strategy by offering a wide range of unique and distinctive products to a large consumer market.
• Diverse product line, including iPhones, iPads, MacBooks, Apple Watch, and more.
• Emphasis on innovative design, cutting-edge technology, and user-friendly interfaces across all product categories.
• Premium pricing is justified by perceived quality, innovation, and the Apple brand.
• Apple’s Approach: Within its broad product line, Apple also employs a focused differentiation strategy by tailoring certain products to specific market segments.
• Examples include specialized products like the Mac Pro for professional users and the iPad Pro for creative professionals.
• Customization and features geared towards the unique needs of specific user groups.
• Premium pricing for specialized products, targeting customers willing to pay for enhanced capabilities.

4) Sustainable Business Strategy

Sustainable Business Strategies centre around environmentally conscious practices, social responsibility, and long-term viability. Companies adopting sustainable strategies aim to minimize their environmental impact while contributing positively to society.

Examples of business Strategies

• Tesla Business Strategy: Tesla exemplifies a sustainable business strategy with its commitment to electric vehicles, renewable energy solutions, and reducing carbon footprints. By prioritizing sustainability, Tesla not only aligns with growing environmental concerns but also attracts a consumer base increasingly valuing eco-friendly practices. Sustainable strategies extend beyond environmental aspects, encompassing ethical labour practices, community engagement, and transparent governance.
• Coca-Cola Business Strategy: Coca-Cola implements an Environmental Sustainability Strategy to reduce its carbon footprint and water usage, emphasizing responsible sourcing and recycling initiatives.
• IKEA Business Strategy: IKEA adopts an Eco-Friendly Business Approach by promoting sustainable sourcing of materials and designing products with a focus on longevity and recyclability.

These companies demonstrate a commitment to addressing global challenges, such as climate change and resource depletion, by integrating sustainable practices into their core business strategies. Sustainable strategies not only contribute to corporate social responsibility but also resonate with environmentally conscious consumers, fostering a positive brand image.

5) E-commerce Business Strateg y

Ecommerce Business Strategies revolve around effective online retailing, leveraging digital platforms, and optimizing customer experiences. Amazon, a prime example of a successful e-commerce strategy, employs an omnichannel retailing approach. This involves seamlessly integrating online and offline channels, providing customers with a cohesive shopping experience.

Example of a business strategy: Amazon Business Strategy

Amazon’s vast product selection, efficient logistics, and customer-centric focus contribute to its dominance in the ecommerce sector. The company strategically leverages technology, such as AI algorithms for personalized recommendations, to enhance user engagement. By prioritizing convenience, diverse product offerings, and customer satisfaction, Amazon exemplifies how ecommerce strategies can lead to market leadership and sustained growth in the digital era.

6) Competitive Business Strateg y

Competitive Business Strategies are essential for organizations seeking to gain a market advantage and outperform rivals.

Example of business strategy: Nike business strategy

Nike, adopts a differentiation strategy by focusing on innovation, branding, and product design. Nike’s marketing and product development efforts create a distinct brand image and a perceived higher value, justifying premium pricing. These examples showcase how varied competitive strategies align with business goals, enabling companies to thrive in diverse market landscapes.

7) Design Thinking in Business Strategy

Design Thinking in Business Strategy involves placing a strong emphasis on user experience, innovation, and customer-centric solutions.

Design Thinking business strategy examples:

• Zara business strategy : It adopts an Agile and Customer-Centric Approach in its fashion retail strategy, responding quickly to market trends and customer preferences.
• Starbucks business strategy : it differentiates itself through an Experience-focused Store Design, creating inviting and personalized environments that enhance the overall customer experience.

Design Thinking goes beyond aesthetics; it shapes the entire product or service journey, ensuring that businesses resonate with their target audience and remain adaptable to evolving market needs. These real-life examples showcase the transformative power of design thinking in crafting successful business strategies.

8) Data Driven Business Strategy

Data-Driven Business Strategies harness the power of information to optimize decision-making and enhance customer experiences.

Data Driven Business Strategy Examples

• Netflix Business Strategy: Its Personalized Content Recommendation Strategy, utilizes data analytics to suggest tailored content, engaging users and increasing satisfaction.
• McDonald Business Strategy : It adopts a Data-Enhanced Customer Experience strategy, leveraging customer data to personalize offerings and improve service efficiency.

These business strategy examples illustrate the transformative impact of data-driven approaches, emphasizing the importance of leveraging insights for strategic decision-making and creating a more personalized and responsive customer journey. In today’s digital landscape, businesses that harness the potential of data gain a competitive edge by staying attuned to customer preferences and market trends.

9) Technology Business Strategy

Technology Business Strategies exemplified by Google and YouTube showcase innovative approaches to digital market dominance. Google business strategy includes pioneering search algorithms, cloud services, and diverse digital products. And youtube’s business strategy focuses on Digital Platform Expansion, continually evolving as a video-sharing giant and expanding its reach. These strategies highlight the importance of diversification, continuous innovation, and a commitment to technological advancement. In the fast-paced tech industry, adapting and expanding digital capabilities ensure long-term relevance and sustained growth, marking these companies as trailblazers in the ever-evolving digital landscape.

10) Business Turnaround Strategy

Business Turnaround Strategies, as exemplified by IBM and Microsoft, underscore the importance of adaptability and strategic redirection in the face of challenges. IBM business strategy is a Successful Business Transformation strategy that stands as a testament to its ability to reinvent itself, transitioning from traditional hardware and services to a focus on emerging technologies like cloud computing and artificial intelligence. On the other hand, Microsoft’s Corporate Business Strategy showcases the company’s resilience in navigating market shifts and leveraging its strengths in software and cloud services. These examples highlight the significance of strategic agility, innovation, and a proactive approach in revitalizing businesses for sustained success.

11) Retail Business Strategy

Retail Business Strategies encompass a diverse range of approaches tailored to the dynamic consumer landscape. Emphasizing customer experience, streamlined operations, and omnichannel engagement, successful retail strategies strive to meet evolving market demands. These strategies often include personalized customer interactions, inventory optimization, and seamless online and offline integration. Retail giants continually refine their approaches, with a focus on adaptability, innovation, and leveraging technology to enhance the shopping experience. The retail sector’s strategies evolve to align with shifting consumer behaviors, making agility and customer-centricity key elements in sustaining competitiveness.

Digital Business Strategy

Digital business strategy is a comprehensive approach that organizations adopt to leverage digital technologies for transformative outcomes. In the digital era, businesses recognize the need to go beyond traditional models and embrace digitalization to stay competitive. This strategy involves integrating digital technologies into all aspects of a business, from operations and customer interactions to product/service delivery. Key components often include data analytics, cloud computing, artificial intelligence, and innovative digital platforms.

The goal is to enhance efficiency, customer experience, and overall organizational performance. Companies implementing a digital business strategy position themselves to navigate the digital landscape, respond to market changes swiftly and unlock new opportunities for growth. It’s a proactive approach that embraces digital transformation as a fundamental driver of success in the modern business landscape.

Business Growth Strategy

Business Growth Strategy refers to the deliberate and proactive planning and actions taken by organizations to expand and increase their market share, revenue, and overall scale. This strategy is crucial for organizations aiming to progress and thrive in competitive markets. Business growth can take various forms, such as expanding product lines, entering new markets, acquiring other businesses, or diversifying operations. It involves identifying opportunities for expansion, assessing potential risks, and developing a comprehensive plan to achieve sustainable growth. Successful business growth strategies align with the organization’s overall objectives and market conditions, ensuring that expansion efforts contribute positively to the company’s long-term success. Implementation often requires a combination of innovation, strategic partnerships, and operational excellence to capitalize on opportunities and navigate challenges effectively.

Corporate Strategy vs Business Strategy: What’s the Difference?

Corporate strategy and business strategy are distinct yet interconnected concepts that guide an organization’s overall direction and decision-making. Here’s a breakdown of the key differences between the two:

Corporate Strategy:

• Scope: Corporate strategy involves decisions at the highest level of an organization, addressing its overall mission, vision, and goals.
• Focus: It is concerned with how the organization as a whole will achieve success and sustain its position in the market.
• Decision-Making: Corporate strategy decisions often involve choices regarding diversification, mergers and acquisitions, resource allocation, and portfolio management.
• Time Horizon: Corporate strategy tends to have a longer time horizon and looks at the organization’s position in the industry over an extended period.

Business Strategy:

• Scope: Business strategy is more specific, focusing on a particular business unit, product line, or market segment within the organization.
• Focus: It is concerned with how a specific part of the organization will compete effectively in its market and achieve its objectives.
• Decision-Making: Business strategy decisions involve choices related to product development, market positioning, pricing, and competitive advantage.
• Time Horizon: Business strategy often operates within a shorter time frame, addressing challenges and opportunities in the near to medium term.

In essence, corporate strategy sets the overall direction of the entire organization, while business strategy zooms in on how individual business units or segments will achieve success within that broader framework. Together, they ensure alignment between the organization’s overarching goals and the specific actions taken at different levels.

What is Business Level Strategy

Business-level strategy pertains to the intentional and strategic actions undertaken by companies to attain a competitive advantage within their designated market segments. This strategy entails crucial decisions regarding resource allocation, product differentiation, and the creation of distinctive value for customers. Through the successful implementation of a clearly defined business-level strategy, companies can establish a unique market position, allure customers, and foster sustainable growth.

Strategies in organizations operate at three distinct levels: Corporate, Business, and Functional.

• Corporate Level : This is the highest level, where top management establishes the strategic plans, including the mission and vision statements. Corporate-level strategies profoundly influence the long-term performance of the organization, guiding decisions related to growth, acquisitions, diversification, and investments.
• Business Level : Business level strategies align with the corporate vision but focus on a specific business or market segment. At this level, the broader vision and objectives are translated into tangible strategies that outline how a business will compete in its specific market.
• Functional Level : Functional level strategies address how various departments such as Marketing, HR, or R&D can support the defined business and corporate strategies. These strategies ensure alignment and coordination across different functions within the organization.

It’s common for a company to have multiple strategies at each level, reflecting the diverse needs of each layer. While managing multiple strategies introduces the risk of conflicting priorities, effective management can mitigate these risks.

Integrating Digital Transformation Strategy with Innovation Strategy in Your Business Strategy

Integrating Digital Transformation Strategy with Innovation Strategy is a dynamic approach that propels organizations to the forefront of the rapidly evolving business landscape. This synergy harnesses the power of technological advancements and creative ideation to drive comprehensive organizational change .

• Digital transformation acts as the enabler, ensuring that technological innovations are seamlessly integrated into various facets of the business.
• Innovation strategy fosters a culture of creativity, encouraging novel ideas and solutions to meet evolving market demands.

By strategically aligning these two pillars within the broader context of business strategy, organizations not only adapt to the digital era but also position themselves as pioneers, capable of continuous innovation to stay ahead of the competition. This interconnected strategy promotes agility, resilience, and a forward-looking mindset, essential elements for sustainable success in today’s dynamic business environment.

Frequently Asked Questions

1- what is a strategy.

A strategy is a meticulously devised plan that outlines the approach an organization takes to achieve its long-term goals. It involves a comprehensive and forward-thinking approach to decision-making.

2- What does strategic mean in business?

In business, being strategic encompasses making decisions that contribute not only to immediate success but also to the long-term sustainability and competitive advantage of the organization. It involves foresight and a proactive mindset.

3- Who is responsible for business strategy?

Business strategy is a collaborative effort led by senior leadership. However, the responsibility extends to experts specializing in strategic planning , such as the professionals at Digital Leadership. These experts play a pivotal role in crafting effective and innovative strategies tailored to the unique needs of organizations, ensuring a holistic and forward-looking approach.

Related Posts

Business level strategy: examples & types for business strategy success.

In strategic management, businesses use a variety of approaches to craft a1

Porter’s Generic Strategies Tips for Business Competitive Strategy 

In business competition, understanding and effectively implementing strategic frameworks are crucial for1

Digitization vs Digitalization: Real-life Examples And How to Digitize

The terms digitization, digitalization, and digital transformation have become increasingly prevalent. These1

Digital Transformation Guide For Digital Transformation Journey

This article on Digital Leadership aims to offer a preliminary guide to1

Recent Posts

Examples and Types of Effective Functional Level Strategy for Business Support

A key objective of any business strategy is to improve operational efficiencies...

The Three Levels of Strategy: Corporate Strategy, Business Strategy, and Functional Strategy

Understanding the intricate levels of strategy is crucial for any organization aiming...

Register For Your FREE 
Innovation WorkShop Seat Now!

Learn how to overcome the 90% failure rate in innovation from a master innovator and best-selling author.

Expert tactics to boost your innovation odds.

Insights on capturing customer needs for innovation.

Tools that turn your ideas into triumphs.

First name *

Last name *

Professional E-mail *

I want to be kept up-to-date and accept the privacy statement *

By signing up, you agree to receive news and accept the privacy statement (mandatory)

Verify your e-mail address now by entering the 6-digit code we’ve just sent to your inbox

Don't receive Code? Resend code

Last one step

Help us better understand our innovation Show members

Country * Please Select Afghanistan Albania Algeria Andorra Angola Antigua and Barbuda Argentina Armenia Australia Austria Azerbaijan Bahamas Bahrain Bangladesh Barbados Belarus Belgium Belize Benin (Dahomey) Bolivia Bosnia and Herzegovina Botswana Brazil Brunei Brunswick and Lüneburg Bulgaria Burkina Faso (Upper Volta) Burundi Cabo Verde Cambodia Cameroon Canada Cayman Islands Central African Republic Central American Federation Chad Chile China Colombia Comoros Congo Free State Costa Rica Cote d’Ivoire (Ivory Coast) Croatia Cuba Cyprus Czechia Democratic Republic of the Congo Denmark Djibouti Dominica Dominican Republic Ecuador Egypt El Salvador Equatorial Guinea Eritrea Estonia Eswatini Ethiopia Fiji Finland France Gabon Gambia Georgia Germany Ghana Grand Duchy of Tuscany Greece Grenada Guatemala Guinea Guinea-Bissau Guyana Haiti Holy See Honduras Hungary Iceland India Indonesia Iran Iraq Ireland Israel Italy Jamaica Japan Jordan Kazakhstan Kenya Kiribati Korea Kosovo Kuwait Kyrgyzstan Laos Latvia Lebanon Lesotho Liberia Libya Liechtenstein Lithuania Luxembourg Madagascar Malawi Malaysia Maldives Mali Malta Marshall Islands Mauritania Mauritius Mexico Micronesia Moldova Monaco Mongolia Montenegro Morocco Mozambique Namibia Nassau Nauru Nepal Netherlands New Zealand Nicaragua Niger Nigeria North Macedonia Norway Oman Pakistan Palau Panama Papal States Papua New Guinea Paraguay Peru Philippines Piedmont-Sardinia Poland Portugal Qatar Republic of Congo Republic of Korea (South Korea) Republic of the Congo Romania Russia Rwanda Saint Kitts and Nevis Saint Lucia Saint Vincent and the Grenadines Samoa San Marino Sao Tome and Principe Saudi Arabia Schaumburg-Lippe Senegal Serbia Seychelles Sierra Leone Singapore Slovakia Slovenia Solomon Islands Somalia South Africa South Sudan Spain Sri Lanka Sudan Suriname Sweden Switzerland Syria Tajikistan Tanzania Thailand Timor-Leste Togo Tonga Trinidad and Tobago Tunisia Turkey Turkmenistan Tuvalu Uganda Ukraine United Arab Emirates United Kingdom Uruguay Uzbekistan Vanuatu Venezuela Vietnam Württemberg Yemen Zambia Zimbabwe Industry * Please Select Automotive, mobilty & transport Financial Services Chemical & agriculture Construction & Real Estate Consulting Education Energy Banking, insurance & FS FMCG Food Gov / Public Industry Health & lifestyle Logistics, Aero & Shipping Media & Entertainment Natural resources & mining Pharma & Biotech Retail & trade Tech & E-Commerce Telco Tourism design Information technology & services Management consulting Retail Pharmaceuticals International trade & development Professional training & coaching luxury goods & jewelry Automotive Insurance Mechanical or industrial engineering Company Size * XS - 1-10 S - 10-100 M - 100-1000 L - 1000-5000 XL - > 5000

Seniority * Please Select Junior Consultant Senior Consultant Manager Senior Manager Director VP SVP Partner CXO Board Member

Areas of interest * Innovation Digital Transformation Culture & Organization IT Strategy & Bus. Alignment Customer Experience

Discover the largest library of innovation & transformation tools on the entire Internet!

LOG IN VIA E-MAIL

Forgot password?

New to Digital Leadership? Create your account

Thanks, We’ve Received Your Updated Details

Learn how to overcome the 90% failure rate in innovation from a master innovator & bestselling author!

Your e-mail address: * Your first name: *

One Last Step..

Help us better understand the UNITE community

Free guide to improve your innovation success rate*

Our 35-page comprehensive innovation guide covers the key areas why innovation fails. While it cannot cover all the solutions (that would take books to fill), it provides you with a convenient starting point for your analysis and provides further resources and links to the corresponding UNITE models, ultimately allowing you to work towards a doubling and tripling your chances of success.

Get access to the UNITE Models now!

Discover the largest library of innovation & transformation tools on the internet!

Choose Your Password *

Confirm Your Password *

Already have an account? Log in

Country * Please Select Afghanistan Albania Algeria Andorra Angola Antigua and Barbuda Argentina Armenia Australia Austria Azerbaijan Bahamas Bahrain Bangladesh Barbados Belarus Belgium Belize Benin (Dahomey) Bolivia Bosnia and Herzegovina Botswana Brazil Brunei Brunswick and Lüneburg Bhutan Bulgaria Burkina Faso (Upper Volta) Burundi Cabo Verde Cambodia Cameroon Canada Cayman Islands Central African Republic Central American Federation Chad Chile China Colombia Comoros Congo Free State Costa Rica Cote d’Ivoire (Ivory Coast) Croatia Cuba Cyprus Czechia Democratic Republic of the Congo Denmark Djibouti Dominica Dominican Republic Ecuador Egypt El Salvador Equatorial Guinea Eritrea Estonia Eswatini Ethiopia Fiji Finland France Gabon Gambia Georgia Germany Ghana Grand Duchy of Tuscany Greece Grenada Guatemala Guinea Guinea-Bissau Guyana Haiti Holy See Honduras Hungary Iceland India Indonesia Iran Iraq Ireland Israel Italy Jamaica Japan Jordan Kazakhstan Kenya Kiribati Korea Kosovo Kuwait Kyrgyzstan Laos Latvia Lebanon Lesotho Liberia Libya Liechtenstein Lithuania Luxembourg Madagascar Malawi Malaysia Maldives Mali Malta Marshall Islands Mauritania Mauritius Mexico Micronesia Moldova Monaco Mongolia Montenegro Morocco Mozambique Myanmar Namibia Nassau Nauru Nepal Netherlands New Zealand Nicaragua Niger Nigeria North Macedonia Norway Oman Pakistan Palau Panama Papal States Papua New Guinea Paraguay Peru Philippines Piedmont-Sardinia Poland Portugal Qatar Republic of Congo Republic of Korea (South Korea) Republic of the Congo Romania Russia Rwanda Saint Kitts and Nevis Saint Lucia Saint Vincent and the Grenadines Samoa San Marino Sao Tome and Principe Saudi Arabia Schaumburg-Lippe Senegal Serbia Seychelles Sierra Leone Singapore Slovakia Slovenia Solomon Islands Somalia South Africa South Sudan Spain Sri Lanka Sudan Suriname Sweden Switzerland State of Palestine Syria Tajikistan Tanzania Thailand Timor-Leste Togo Tonga Trinidad and Tobago Tunisia Turkey Turkmenistan Tuvalu Uganda Ukraine United States United Arab Emirates United Kingdom Uruguay Uzbekistan Vanuatu Venezuela Vietnam Württemberg Yemen Zambia Zimbabwe Industry * Please Select Automotive, mobilty & transport Financial Services Chemical & agriculture Construction & Real Estate Consulting Education Energy Banking, insurance & FS FMCG Food Gov / Public Industry Health & lifestyle Logistics, Aero & Shipping Media & Entertainment Natural resources & mining Pharma & Biotech Retail & trade Tech & E-Commerce Telco Tourism design Information technology & services Management consulting Retail Pharmaceuticals International trade & development Professional training & coaching luxury goods & jewelry Automotive Insurance Mechanical or industrial engineering Company Size * XS - 1-10 S - 10-100 M - 100-1000 L - 1000-5000 XL - > 5000

Editable UNITE models (PowerPoint) included

Most of our models and canvases are designed to be applied! 


To help you personalize them to your exact business requirements, you can download fully editable versions of the UNITE models available (PowerPoint format)!

They are straightforward to work with, and you can directly incorporate them into your presentations as you need…thus saving countless hours of replication!

PS: did you know that you are also getting hi-res print-ready versions for your workshops?

Monthly live webinars

Each month we host our exclusive, invitation-only webinar series where one of our industry-leading experts updates our members on the latest news, progress and concepts around business strategy, innovation and digital transformation, as well as other related topics. 



You will receive the book in PDF and EPUB formats, ideal for your computer, Kindle, Tablet or other eReading device.

Bi-weekly live group Q&A sessions

These sessions are your opportunity to bring any questions or challenges you’re facing and receive expert guidance on the spot. 


Come and be a part of engaging discussions where your unique concerns are heard and addressed.

1x personal coaching session / month

If you are occasionally looking for a sparring partner or you need limited support, then this option will be ideal for you. Coaching sessions are 1-2 hours where we can discuss any challenge or opportunity you are currently facing.

If you need a few more hours outside of this provision, then these could be billed transparently.

Unlimited video call support! – it’s like always making the right decision!

We believe support shouldn’t be limited. Because we typically find that the occasional hour just doesn’t cut it – particularly if you and your team are in the midst of a large and complex project.

Your time with Stefan is therefore unlimited (fair usage applies) – in his function as coach and sparring partner. That does mean that you will still have to do the work – we cannot take that off you, unless you hire us as consultants. But you will get valuable strategic insight and direction to make sure you are always focusing your efforts where they will lead to the best results.

One personal coaching session / month 
+ unlimited support via e-mail & WhatsApp

We believe support shouldn’t be limited. If you generally know what you are doing but want a sparring partner to frequently raise questions to, this is the perfect choice!

In addition to your monthly 1-1 live coaching sessions with Stefan, you will also get unlimited support from him via email and WhatsApp messaging (fair usage applies). This not only allows you to get valuable strategic direction in your calls, but also gives you instant access to expert help as you work through your plans each month.



The fact that support is text-based means that we can speed up our responses to you while keeping the overall cost of support down.

Welcome gift of our book 
 “How to Create Innovation” 
 (digital + physical editions)*

As a welcome gift, you will receive the both the digital and physical version of our book “How to Create Innovation”, which covers numerous relevant resources and provides additional deep dives into our UNITE models and concepts.


The print version will be shipped out to you on sign-up. The digital version will be emailed to you, and comes in PDF and EPUB formats, ideal for your computer, Kindle, Tablet or other eReading device.

1x major workshop or 2x smaller workshops / month

1x major or 2x smaller workshops based on the UNITE models.

• Topics covered: almost any challenge under the header of #strategy, #innovation or #transformation, leveraging the UNITE models.
• Hands-On Learning: solve your challenges while learning the practical application of the UNITE models and walk away with concrete plans and tools to take your next steps.
• Industry thought leadership: facilitated by Stefan, the founder of Digital Leadership and the main author of the UNITE models, ensuring top-tier guidance and knowledge sharing.
• Collaborative approach: engage in interactive sessions that foster collaboration, idea exchange, and real-time problem-solving among peers and industry leaders.
• Continuous Improvement: Regular workshops ensure ongoing development in your organization staying ahead of industry trends and customer needs.

Access all of our UNITE models, 
 (incl. editable & print versions)

All of our Professional plans offer full access to the following:

• 6x UNITE model package downloads are included per month, if you need something in addition to these however, please let us know!
• Hi-res, print-ready versions you can use in your workshops
• Fully editable PowerPoint versions where applicable – personalize to your needs.
• Exclusive access to our vault of never-before-published strategic materials. We have much more to share – a lot of our concepts have never been published!

Exclusive access to our private UNITE community (upcoming)

We are currently in the process of launching our brand new community., we are designing our community to specifically help you:.

• Get answers to questions (“How do I …”)
• Share leading practices & knowledge
• Jointly develop new models
• Network amongst a highly qualified group of peers

Please, select the reason

Cancelling your plan will deactivate your plan after the current billing period ends. You will not be charged further, but also won’t be able to access [exclusive features/services].

• Cost-related issues
• Unsatisfied with the service
• Features I need are missing
• Switching to a different service
• Other (Please specify)

Book Your Initial Blueprint Session Now

Simply fill out the below form and book in a time for our initial session that works for you. This initial session is free, no strings attached, and is where we can discuss your Blueprint needs more in-depth before moving forward.

Stefan F. Dieffenbacher

Founder of digital leadership.

Adam D. Wisniewski

Partner for it strategy & business alignment.

Get in touch with Digital Leadership

Speak to our team today to find the best solution for your business to grow and scale.

We are here to support you across the entire lifecycle in all topics related to #digital, #innovation, #transformation and #marketing!

Stefan F. Dieffenbacher Founder of Digital Leadership

Contact Us!

Contact form, contact details, book a call.

Title, first name & last name * Email address * Phone number Please let us know how we can best support you! *

By clicking “Send”, I agree to Terms of Service and Privacy Policy.

Let’s have a conversation!

“Please be invited to reach out! We are happy to help and look forward to a first meeting!”

+41 (0) 44 562 42 24

[email protected]

Schedule Your Call With Our Team

Find a time on our calender that best suits you !

Founder and CEO of Digital Leadership

SCHEDULE YOUR INITIAL CALL

A Quick Survey!

What is the main challenge you're currently facing in your business?

You Want To Drive Change?

Let’s find the best solution for your business to grow and scale sustainably!

Let’s kick start it!

We will uncover your current business situation and goals and provide you with a bespoke solution that helps you drastically grow your business working with us.

Stefan F. Dieffenbacher, M.B.A.

Feedback about our consulting that we are proud of

Read the reviews and make sure that this is not a waste of time, but a super effective tool.

You want to drive change?

Schedule your free business assessment call with our founder.

On this call, we will uncover your current business situation and goals and talk about how to drive change and solve your need.

Choose the meeting type that applies to your needs and schedule a time to meet with someone from our team. We look forward to speaking with you soon!

Schedule Your Free Business Assessment

Schedule Your Free Business Assessment Call With Adam D. Wisniewski

Welcome to our scheduling page.

Let’s Design your Customer Experience Blueprint !

In a uniquely designed 60 or 90 minute session* , we will …

• > identify where to start with near-certainty
• > define what approach it takes to create success in your organization

Based on the Blueprinting session, you will receive a tailored blueprint that aligns with your objectives, vision and goals, ensuring that your initiative is a success from start to finish.

In this session, you will be working together with Patrick Zimmermann, Associate Partner for Customer Experience

Let’s Design your Culture & Org-Change Blueprint !

In this session, you will be working together with Dr. Andreas Rein, Partner at Digital Leadership for Culture & Org Change

Let’s Design your Innovation Blueprint !

In this session, you will be working together with Sascha Martini, Partner at Digital Leadership for Innovation and Digital Transformation

Let’s Design your Transformation Blueprint !

In this session, you will be working together with Stefan F. Dieffenbacher, Founder of Digital Leadership Stefan is a global thought leader in the innovation space

Let’s Design your IT Strategy & Business Alignment Blueprint !

In this session, you will be working together with Adam D. Wisniewski, Partner for IT Strategy & Business Alignment

Patrick Zimmermann

Sascha Martini

Dr. Andreas Rein

Write a personalized review! Log in

Create Review

• Certifications
• Associate Business Strategy Professional
• Senior Business Strategy Professional
• Examination
• Partnership
• For Academic Affiliation
• For Training Companies
• For Corporates
• Help Center
• Associate Business Strategy Professional (ABSP™)
• Senior Business Strategy Professional (SBSP™)
• Certification Process
• TSI Certification Examination
• Get your Institution TSI Affiliated
• Become a Corporate Education Partner
• Become a Strategy Educator
• Frequently Asked Questions

What is Business Strategy? Definition, Importance, Levels, and Examples

Business strategy is the battle plan for a better future. - Patrick Dixon

Scaling up a business without a clear strategy is like captaining a ship without a rudder. The success of any business depends on the strategy that one follows. The business strategy establishes the needs of the business. Business strategy plays an important role for businesses of all sizes and entrepreneurs. It sets the direction of the organization and helps to create goals to aim towards.

What is Business Strategy?

Business strategy is defined as the course of action or set of decisions that support entrepreneurs in achieving certain business goals. It is a master plan that outlines the direction the organization intends to make, the actions it will undertake, and the resources it will give to attain certain competitive benefits and drive sustainable growth. It involves a combination of decisions, actions, and resource allocation that positions an organization in its industry or market.

Why is a Business Strategy important?

Business Strategy plays a crucial role in guiding a firm’s growth, competitiveness, and success. It offers a roadmap for decision-making, resource providing, and adaptation to transforming circumstances, ensuring that the firm stays agile, focused, and well-prepared to achieve its goals successfully. It is carefully planned and flexibly designed with the purpose of:

• Achieving effectiveness
• Perceiving and utilizing opportunities
• Mobilizing resources
• Securing an advantageous position
• Meeting the challenges and threats
• Directing efforts, behavior and
• Gaining command over the situation

What is the Difference between Business Strategy & Business Plan & Business Model

Business Strategy, Business Plan, and Business Model are three distinct elements that offer various purposes in the world of business. They are vital for the success and sustainability of a business, and they are interconnected, with slight changes which are often confused by several aspiring business strategists , especially during their interviews. Here's a breakdown of the important differences between these:

Levels of Business Strategy

Effective strategic management consists of coordination and alignment across various levels of strategy to achieve the organization's long-term goals and competitive advantage. Business strategy can be categorized into different levels depending on its scope, focus, and the organizational hierarchy at which it functions.

The three primary levels of business strategy are:

• Corporate level strategy Corporate level strategy is a long-range, action-oriented, integrated, and comprehensive plan, which is formulated by the top management of a company. It is very helpful to ascertain business lines, expansion, growth, takeovers and mergers, diversification , integration, and the latest fields for investment.
• Business level strategy The strategies that relate to a specific business are known as business-level strategies. It is developed by the general managers, who convert mission and vision into concrete, clear, and result-driven strategies. It acts like a blueprint for the total business.
• Functional level strategy Developed by the first-line managers or supervisors, the functional level strategy involves decision-making at the operational level concerning functional areas such as marketing, production, human resources, research and development, finance, and so on.

How to Implement a Successful Business Strategy?

A business strategist feels that it is tough to ideate any plan in a few hours. It requires a step-by-step procedure to be associated with completing a SWOT analysis . Here are the top steps that can be considered to build the best business strategies and execute them with precision:

• Understand the targets One of the clearest challenges for growth is poor targeting. Clear target markets offer an organization the ability to create an integrated sales and marketing approach, where marketing enables sales productivity. Sales and marketing business plan gets executed more efficiently if the targets are fixed in a proper way.
• Outline the tactics A successful business strategy is made up of several various tactics, including both online and offline options. The goals, target audience, and industry factor into this decision. For instance, if the target audience is young, focusing on social media is more beneficial as this is primarily where this group consumes content. If the industry is product-based (for instance, jewelry designing), then using a more visual platform would better showcase the products. To be most effective, one must choose which methods are right for the business. Once the selection of tactics is done, list them in the plan and determine how they’ll help to reach the goals.
• Think long term In the scope of constant change, planning the horizons is usually shorter than it can be. However, only thinking quarter to quarter is a trap that may rob organizations of their ability to see around the bend. Best-in-class organizations create processes designed for a series of financial and non-financial metrics to treat strategy as an annual cycle rather than a one-time, static event.
• Create a timeline Time is precious mainly when it is about the business. Based on the goals and objectives one can set for the business. Creating a timeline that will define what tasks can be completed and when they can be completed. It is highly advisable to allocate extra time for unexpected events that may delay some of the goals.
• Focus on growth A thriving organization is a growing organization. It is only through growth that the firms can afford to invest in aspects such as technology, the best staff, and the latest tools. The business strategy should identify the segments where an organization will grow and in what proportion.
• Have a budget plan Creating a budget for the business strategy can inform the efforts by determining what can be done and cannot be. Choosing the most cost-effective options for the business ensures the success of the overall business strategy. This doesn’t have to limit the options. Paid advertising on social media and search engines gives access to manage budgets well.
• Make fact-based decisions Several executives often complain about a lack of fruitful data, but they consistently find information that is useful in the formation of business strategy. The business has a set of values that guides it. Making fact-based decisions will outline the values and ensure that the people who interact with the business are aware of them. It will also ease the message that reflects on the brand honestly so it can actively demonstrate the values outlined in the mission statement through the interactions with clients.
• Invest in pre-work Always allocate time to do proper pre-work so that one can be up to date. It is better to conduct proper end-to-end research and prepare relevant information in advance of the business strategy meetings. The goals and needs will change over time. Ideally, it is important to revisit the business plan every annum to make adjustments as needed. Follow industry news and trends that can add to the existing strategy.
• Execute well and measure results Measuring the effectiveness of the business strategy will inform the current plan and future efforts. Always be sure to track and measure the business so these measurements are effective. Set up a corporate calendar to enhance the productive meetings, and also to form a performance management cycle. One should write the marketing plan with this growth in mind so they can measure it. The execution of strategic planning needs discipline, and it must be taken care of by the senior executives to promote processes that keep the team focused.

Examples of Business Strategy

Hubspot developed and executed a perfect business strategy where it created a market that didn’t even exist – inbound marketing. It created an online resource guide explaining the limitations of interruption marketing and informing about the advantages of inbound marketing. The organizations even offered free courses to help the target audience understand its offering better.

Apple Inc. differentiated its Smartphone operating system iOS by making it simple as compared to Android. This differentiated it and built its followership. The organization has been following a similar business strategy for its other products as well.

Wrapping up

Establishing the business strategy keeps the business goals organized and focused, saving valuable time and money. With the increase in the competition, the demand for business strategy is becoming apparent and there is a tremendous increase in the types of business strategies used by the businesses.

Recent Posts

How Data Analytics Can Revolutionize Your Business - A Strategist's Guide

Download this Strategist's Guide to empower yourself with resourceful insights:

• Roadblocks to Data Usage
• Advantages that Data Analytics offer for businesses
• Elements of a Data Analytics Strategy
• Top reasons why businesses must adopt a Data Analytics Strategy
• Case studies, Scenarios, and more

CredBadge™ is a proprietary, secure, digital badging platform that provides for seamless authentication and verification of credentials across digital media worldwide.

CredBadge™ powered credentials ensure that professionals can showcase and verify their qualifications and credentials across all digital platforms, and at any time, across the planet.

Verify A Credential

Please enter the License Number/Unique Credential Code of the certificant. Results will be displayed if the person holds an active credential from TSI.

Stay Informed!

Keep yourself informed on the latest updates and information about business strategy by subscribing to our newsletter.

Start Your Journey with The Strategy Institute by Creating Your myTSI Account Today.

• Manage your professional profile conveniently.
• Manage your credentials anytime.
• Share your experiences and ideas with The Strategy Institute.

Account Login

• Remember Password
• Forgot Password?

Forgot Password

Small Business Trends

How to create a business plan: examples & free template.

This guide has been designed to help you create a winning plan that stands out in the ever-evolving marketplace. U sing real-world examples and a free downloadable template, it will walk you through each step of the process.

Table of Contents

How to Write a Business Plan

Executive summary.

The Executive Summary serves as the gateway to your business plan, offering a snapshot of your venture’s core aspects. This section should captivate and inform, succinctly summarizing the essence of your plan.

Example: EcoTech is a technology company specializing in eco-friendly and sustainable products designed to reduce energy consumption and minimize waste. Our mission is to create innovative solutions that contribute to a cleaner, greener environment.

Overview and Business Objectives

This part of the plan demonstrates to investors and stakeholders your vision for growth and the practical steps you’ll take to get there.

Company Description

Include information about the company’s founders, their expertise, and why they are suited to lead the business to success. This section should paint a vivid picture of your business, its values, and its place in the industry.

Define Your Target Market

Example: Our target market comprises environmentally conscious consumers and businesses looking for innovative solutions to reduce their carbon footprint. Our ideal customers are those who prioritize sustainability and are willing to invest in eco-friendly products.

Market Analysis

Our research indicates a gap in the market for high-quality, innovative eco-friendly technology products that cater to both individual and business clients.

SWOT Analysis

Competitive analysis.

In this section, you’ll analyze your competitors in-depth, examining their products, services, market positioning, and pricing strategies. Understanding your competition allows you to identify gaps in the market and tailor your offerings to outperform them.

Organization and Management Team

Example: EcoTech’s organizational structure comprises the following key roles: CEO, CTO, CFO, Sales Director, Marketing Director, and R&D Manager. Our management team has extensive experience in technology, sustainability, and business development, ensuring that we are well-equipped to execute our business plan successfully.

Products and Services Offered

Marketing and sales strategy.

Describe the nature of your advertising campaigns and promotional activities, explaining how they will capture the attention of your target audience and convey the value of your products or services. Outline your sales strategy, including your sales process, team structure, and sales targets.

Logistics and Operations Plan

Inventory control is another crucial aspect, where you explain strategies for inventory management to ensure efficiency and reduce wastage. The section should also describe your production processes, emphasizing scalability and adaptability to meet changing market demands.

Financial Projections Plan

In the Financial Projections Plan, lay out a clear and realistic financial future for your business. This should include detailed projections for revenue, costs, and profitability over the next three to five years.

Income Statement

The income statement , also known as the profit and loss statement, provides a summary of your company’s revenues and expenses over a specified period. It helps you track your business’s financial performance and identify trends, ensuring you stay on track to achieve your financial goals.

Cash Flow Statement

Tips on Writing a Business Plan

3. Set realistic goals: Your business plan should outline achievable objectives that are specific, measurable, attainable, relevant, and time-bound (SMART). Setting realistic goals demonstrates your understanding of the market and increases the likelihood of success.

FREE Business Plan Template

To help you get started on your business plan, we have created a template that includes all the essential components discussed in the “How to Write a Business Plan” section. This easy-to-use template will guide you through each step of the process, ensuring you don’t miss any critical details.

What is a Business Plan?

Why you should write a business plan, what are the different types of business plans.

In today’s fast-paced business world, having a well-structured roadmap is more important than ever. A traditional business plan provides a comprehensive overview of your company’s goals and strategies, helping you make informed decisions and achieve long-term success. There are various types of business plans, each designed to suit different needs and purposes. Let’s explore the main types:

Using Business Plan Software

Enloop is a robust business plan software that automatically generates a tailored plan based on your inputs. It provides industry-specific templates, financial forecasting, and a unique performance score that updates as you make changes to your plan. Enloop also offers a free version, making it accessible for businesses on a budget.

Business Plan FAQs

What is a good business plan, what are the 3 main purposes of a business plan, can i write a business plan by myself.

We also have examples for specific industries, including a using food truck business plan , salon business plan , farm business plan , daycare business plan , and restaurant business plan .

Is it possible to create a one-page business plan?

How long should a business plan be, what is a business plan outline, what are the 5 most common business plan mistakes, what questions should be asked in a business plan.

A business plan should address questions such as: What problem does the business solve? Who is the specific target market ? What is the unique selling proposition? What are the company’s objectives? How will it achieve those objectives?

What’s the difference between a business plan and a strategic plan?

How is business planning for a nonprofit different.

The 7 Best Business Strategy Examples I've Ever Seen

Most entrepreneurs dream of an innovative product or service that surprises their rivals and takes new markets by storm. What they tend to forget is that there needs to be an excellent business strategy accompanying the product. 

I get it - it’s not nearly as interesting to fantasize about a competitive strategy. Yet without it, even genius products can quickly drown in the harsh business sea. Most strategies fail. A sobering 9 out of 10 organizations fail to execute their strategy.

I’ve already written about the 5 worst business strategy examples of all time and why many strategies fail . But today, we’ll flip the script and take a look at products and strategies that delighted their target customers and wildly exceeded initial business goals.

From Tesla, Airbnb, and Toyota to Hubspot, Apple, and Paypal - let’s dive into their business strategies and see why these 7 are the best ones I’ve ever seen:

• Tesla - Playing the long game
• Airbnb - Forgetting all about scalability
• Toyota - Humility can be the best business strategy
• HubSpot - Creating an industry then dominating it
• Apple - iPhone launch shows tremendous restraint
• PayPal - Daring to challenge the status quo
• Spotify - Changing the rules of the music industry

But before we get into these business strategy examples, let's briefly go over some of the basics...

What is a business strategy?

A business strategy , also known as a company strategy, is a crucial aspect of running a successful business. It is a defined plan of action that outlines the direction a business wants to take and defines how the plan will cascade through the organization by the allocation of resources. The importance of a business strategy cannot be overstated as it sets the direction for the entire organization and helps to align all employees towards a common goal . Overall, a business strategy serves as a roadmap for a company, guiding its actions and decisions to achieve its goals and stay competitive in the marketplace. 

👉 If you have any unanswered questions about business strategies, check our FAQs at the end of this article! 

🎁 Struggling to build your Business Strategy? Use our free customizable  Business Strategy Template to easily develop and execute it!

Best business strategies #1: Tesla Playing the long game

Conventional business logic is that when you're starting something new, you create a 'Minimal Viable Product' or MVP.

Essentially that means that you make a version of your product that is very light in terms of functionality and focuses mostly on showcasing your main competitive advantage.

It also means that the first version of your product usually has to be sold at a reasonably low starting price to compensate for its lack of features and generate interest.

Some organizations (including many tech startups) take this concept even further and base their growth strategy around a freemium pricing model . In this business model, the most basic version of the product or service is free, but any new or upgraded features cost money. 

Tesla, on the other hand, did things the other way around. It's been known for a long time that Tesla's long-term goal is to be the biggest car company in the world. They know that in order to become the biggest by volume, they're going to have to succeed in the lower-end consumer car space (price tag US$30,000 or less).

But Tesla did not focus on this market first. It did not create a cheap low-featured version of their electric car (and therefore benefit from economies of scale ).

Instead, Tesla created the most luxurious, expensive, fully-featured sports car they could afford. That car was the Tesla Roadster, and for context, the newest generation of the Roadster will retail from upwards of US$200,000 for the base model. 

This was the first car they ever produced - knowing that they couldn't achieve the necessary scale or efficiency to turn a profit (even at such a high price). However, such a car was in-line with Tesla’s vision statement where they aim “to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles.”

Fast-forward to today, and Tesla dwarfs the competition as the most valuable car company in the world. So their differentiation strategy certainly seems to be working, but why?

What can we learn from Tesla?

The first thing to note is that Tesla has made incredible progress towards its business objective of mass-produced, affordable electric cars. They've even made a genuine annual profit for the first time in their history. 

Secondly, much of Tesla's business strategy was actually forced upon it. There was no way they could have created a cost-effective mass-market electric car.

As a startup, they didn’t have the resources or capabilities to reap the benefits of economies of scale. Because they were creating such a unique car, they couldn't rely on outsourcing or suppliers to gain mass-production benefits.

Fortunately, Tesla's supply chain strategy is one of the most brilliant moves they've made. They knew early on that batteries would present the biggest technological hurdle to their cars and the biggest bottleneck to production.

Rather than let this derail them, they took complete control of their supply chain by investing in battery manufacturers. This has the additional benefit of simplifying diversification as Tesla can use those same batteries in parallel business ventures such as their Powerwall.

Of course, Tesla’s business strategy required vast capital and fundraising (Elon is rich but not quite rich enough to fund it all himself). That's where the marketing genius of Tesla kicks in. 

For the most part, their marketing efforts are only partially about their cars. Tesla is seen as Elon Musk's personal brand, and that had an enormous impact on whether or not they got the investment they needed.

He's smart, divisive, wild, and ambitious. But whatever you think about Elon Musk, you'd be hard-pressed to traverse more than a couple of consecutive news cycles without seeing him on the front page. And that's a fantastic recipe for getting the attention of investors.

Tesla studied and adapted to the industry and business environment they would operate in. They knew their strengths, understood their market position, and built their strategy around their own findings instead of following conventional wisdom.

👉 Use the Tesla Strategy Plan Template to get inspired by Tesla's Strategy to build your own!

📚Learn more about Tesla in our Strategy Study: How Tesla Became The World’s Most Valuable Automotive Company.

Best business strategies #2: Airbnb Forgetting all about scalability

Airbnb is one of the fastest-growing tech companies. Shortly after their IPO in December 2020, they reached a US$100B+ valuation, and the company has quite possibly changed the way we travel forever. But did you know they started out about as low-tech as you can get?

It all began with co-founders Brian and Joe renting out 3 air mattresses on their apartment’s floor. They made $80 per guest. It seemed like a great idea for a startup, so they launched a website and invited other people to list their own mattresses for hire.

They got a few bookings here and there, but things didn't go well for the most part. So much so that in 2008, they resorted to selling cereal to make ends meet.

They had plenty of listings on the site and plenty of site traffic. Potential customers were out there, but they weren’t making enough bookings.

They identified the most likely problem - the low quality of listings that were simply not enticing. So Brian and Joe decided to take matters into their own hands.

The co-founders grabbed their cameras and visited every one of their NYC listings. They persuaded the owners to let them take a ton of photographs of their places.

They touched them up a bit and uploaded them to the website, replacing the old, usually bad photos. Within a month of starting this strategy, sales doubled. Then tripled. The rest is history.

What can we learn from Airbnb?

The thing I love the most about this story is that it opposes one of the most commonly stated principles of building a tech startup - “everything must be scalable” .

What Brian and Joe did was anything but scalable. But it got them enough traction to prove that their concept could work. 

Later, they did scale their initial solution by hiring young photographers in major locations and paying them to take professional photos of owners’ listings (at no charge to the owner).

They also added a bunch of guidelines and articles on the site to educate owners on how they can make more money by taking better photos.

Airbnb's story shows that business strategies don’t have to be grand and super long-term affairs.

They can revolve around a specific challenge preventing the business from taking off. Once the challenge is solved, the company progresses on its roadmap and integrates the solution into the revamped business strategy.

Source: Airbnb third quarter 2022 financial results

👉 Use the Airbnb Strategy Plan Template to get inspired by Airbnb's Strategy to build your own!

Best business strategies #3: Toyota Humility can be the best business strategy

In 1973, the 'Big Three' car makers in the USA had over 82% of the market share. Today they have less than 50%. Why? Because of the aggressive (and unexpected) entry of Japanese carmakers into the US market in the 1970s - led by Toyota.

Cars are big, heavy, and expensive to ship around in large numbers. That's one of the reasons the US market was caught off guard when Toyota started selling Japanese-made cars in the US at lower prices than they could match.

The car industry was a huge contributor to the US economy, so one of the first reactions from the government was the implementation of protectionist taxes on all imported cars - thus making Japanese cars as expensive as locally made cars.

But the tactic failed. Within a few years, Toyota had managed to establish production on US soil, thus eliminating the need to pay any of the hefty new import taxes. At first, US carmakers weren't all that worried.

Surely by having to move production to the US, the costs for the Japanese carmakers would be roughly the same as those of the local car companies. 

Well, that didn't happen. Toyota continued its cost leadership strategy. It still manufactured cars for significantly less money than US companies could.

Their finely honed production processes were so efficient and lean that they could beat US carmakers at their own game. You've probably heard of the notion of ' continuous improvement '. In manufacturing, Toyota is pretty much synonymous with the term.

US Car Sales Graph- January through May 2021 vs 2020

Source: GOODCARBADCAR

What can we learn from Toyota?

Most business success stories involve bold moves and daring ideas. But not this one. 

Toyota spent years studying the production lines of American carmakers such as Ford. They knew that the US car industry was more advanced and efficient than the Japanese industry. So they decided to be patient.

They studied their competitors and tried to copy what the Americans did so well. They blended these processes with their strengths and came up with something even better.

Toyota proved that knowing one's weaknesses can be the key to success - and be one of the best business strategies you can ever deploy.

Not just that. Can you name a single famous executive at Toyota? I can't. And one of the reasons is that Toyota's number one corporate value is humility. It helped them crack the US market, and it runs deep in the organization - from top management to assembly workers.

Toyota’s success is based on continuously improving its functional level strategy , which focuses on day-to-day operations , decisions, and goals. They understood that the bigger picture consists of thousands of small tasks and employees.

They took a big goal, such as “becoming a cost leader in our category without compromising quality”, and ensured that their mission impacted every level of the organization while staying true to their core values.

👉 Use the Toyota Strategy Plan Template to get inspired by Toyota's Strategy to build your own!

📚Learn more about Toyota in our Strategy Study: How Toyota Went From Humble Beginnings To Automotive Giant .

Best business strategies #4: HubSpot Creating an industry then dominating it

HubSpot might not be as famous as Airbnb or Toyota. However, being valued at $22.72 billion in 2022 means, they’re certainly no slouch.

And most impressively, they’ve become such a successful company in an industry that didn’t even exist before they invented it.

Most of the marketing we experience is known as 'interruption' marketing. This is where adverts are pushed out to you whether you like it or not. Think tv adverts, billboards, Google Adwords, etc. 

In 2004, HubSpot created a software platform that aimed to turn this marketing concept on its head. The HubSpot marketing platform helped companies write blog posts, create eBooks, and share their content on social media.

The theory was that if you could produce enough good quality content to pull people to your website, then enough of them might stick around to take a look at the product you're actually selling. Useful content created specifically for your target market should also increase customer retention.

This approach was a big deal. I can tell you from personal experience that 'interruption marketing' is really expensive. We pay Google around $10 each time someone clicks on one of our AdWords adverts. Remember, that's $10 per click, not per sale. It adds up pretty fast.

On the other hand, this blog receives more than one million clicks per year. Each article keeps generating clicks at no additional costs once it’s written and published. 

Inbound marketing basically saved our business - so it's fair to say that this example is pretty close to my heart!

Hubspot coined the term 'inbound marketing' - and long story short, they're now one of the biggest SaaS companies in the world. But that's not the interesting part of the story.

What can we learn from HubSpot?

Hubspot’s successful business strategy is based on a new type of marketing. Now here’s the twist that separates it from generic strategies: Hubspot used their new marketing approach to market their own company, whose sole purpose was to sell a platform that created that new type of marketing. Head hurting yet? Mine too.

Most companies would have taken that new approach and applied it to something they were already selling. But instead, the HubSpot guys decided to monetize the marketing strategy itself. 

They took a whole bunch of concepts that already existed (blogging, eBooks, etc.) and packaged them into an innovative product - ‘a new way of doing things'. 

They created an awesome narrative and proved how powerful their new way of marketing could be by building a business worth billions around it. 

Their best and biggest case study was their own product, and they had all the numbers and little details to showcase to the world it really works.

Source: Hubspot overview

👉 Use the Hubspot Strategy Plan Template to get inspired by Hubspot's Strategy to build your own!

Best business strategies #5: Apple iPhone launch shows tremendous restraint

Ok, I hear you - this is such an obvious inclusion for the 'best business strategies'. But as one of the first people to adopt smartphones when they came out in the 1990s, this is something else that's close to my heart. 

I remember using Windows Mobile (the original version ) on a touchscreen phone with a stylus - and it was horrible. I loved the fact that I had access to my email and my calendar on my phone.

But I hated that my phone was the size of a house and required you to press the screen with ox-like strength before any kind of input would register.

Thankfully, a few years later, BlackBerry came along and started to release phones that were not only smart but much more usable. Sony Ericsson, Nokia, HTC, and a whole host of other manufacturers came out with reasonably solid smartphones well before 2007 when Apple finally released the iPhone.

I remember arriving at the office one day, and my boss had somehow gotten his hands on one of the first iPhones to be sold in the UK. I was shocked. Normally I was the early adopter. I was the one showing people what the future looked like.

And yet, here was this guy in his mid 50's, with his thick glasses, showing off a bit of technology that I'd never even seen before.

Apple could easily have created a phone much earlier than it did and sold it to me and a few other early adopters.

But it didn't. Instead, it waited until the technology was mature enough to sell it to my boss - someone who is far less tech-savvy than me. But also far more financially equipped to spend plenty of money on new tech products.

What can we learn from Apple?

The big learning here is that first-mover advantage is often not an advantage. A well-executed 'follower' strategy will outperform a less well-executed 'first mover' strategy every single time. 

One of the most common misconceptions in the startup world is that it's the 'idea' that matters the most. The truth is, the world's most successful companies were rarely the original innovators. I'm looking at you, Nokia. At you, Kodak. And at you as well, Yahoo.

In fact, being first is probably a disadvantage more often than it's an advantage. Why?

• Your market isn't well defined and doesn't even know your product type exists.
• If you have a market, it's probably just the early adopters - by definition, that's a niche market.
• Technology will often hold you back rather than power you to success.
• Every business that comes after you will have the advantage of learning from your mistakes.

People, and especially tech companies, get carried away with being first and forget that it’s a competitive position with pros and cons. Deciding to be a 'first mover' or 'smart follower' is crucial for strategic planning .

It’s a decision that should be based on research such as swot analysis and not on pride or blind optimism as it can make all the difference between success and failure.

Bonus reading : 18 Free Strategic Plan Templates (Excel & Cascade)

👉 Use the Apple Strategy Plan Template to get inspired by Apple's Strategy to build your own!

📚Learn more about Apple in our Strategy Study: How Apple Became the Top Non-Corporate Tech Brand .

Best business strategies #6: PayPal Daring to challenge the status quo

There are certain industries that you just don't mess with. Industries like aerospace, big supermarkets, semiconductors, and banking. Actually, banking is probably the toughest industry to try to disrupt because the barrier to entry is huge.

You need mountains of capital, a ton of regulatory approval, and years of building trust with your customers around their most important asset - cash.

Banks are old. Their business models have been essentially unchanged for hundreds of years. They're insanely powerful and almost impossible to displace. But for some crazy reason - PayPal didn't seem to care.

I can tell you from personal experience (I worked for a bank) that the name which strikes the most fear into the executives of the banks is PayPal.

Here's why:

• PayPal spends less money on technology than even a medium-sized bank does. Yet its technology platform is far superior.
• Consumers trust PayPal as much if not more than they trust their bank. Even though PayPal has been around for a fraction of the time.
• When a customer uses their PayPal account, the bank has no clue what the customer bought. The transaction appears on the bank statement as merely 'PayPal'. That gives PayPal all the power when it comes to data mining.
• PayPal is quicker to market with just about any kind of payment innovation.
• PayPal refuses to partner with banks - instead opting to partner with retailers directly.

In a very short time, PayPal has emerged as a new payment method - giving a very real alternative to your trusty debit or credit card. PayPal has also become one of the best payment platforms for digital nomads , tapping into one of the fastest-growing business trends in the world.

But how the heck did it manage to do it? Let's take a look at why PayPal had one of the best business strategies ever.

What can we learn from PayPal?

There are two main reasons behind PayPal's success story. 

The first is simple - stone-cold balls. They got a fairly lucky break when they accidentally became the favored payment provider for eBay transactions. A few years later, Paypal was even acquired by eBay for US$1.5bn.

eBay was smart enough to mostly leave Paypal alone, and their newfound sense of boldness saw them strike a series of deals with other online retailers to try and replicate the success they'd had with eBay.

This is where the second reason comes in. Partnerships. Banks had always been wary about forming partnerships with retailers directly. Instead, they relied on their scheme partners (Visa / MasterCard) to do it for them.

They didn't want the hassle of managing so many different relationships and were extremely confident that credit and debit cards would always be at the heart of the payment system. But the problem was that MasterCard was already working on a partnership with PayPal. 

Today, PayPal commends an amazing 54% share of the payment processing market. Almost all of that growth has come from their direct relationships with large and small merchants.

It shows that even in the toughest and most competitive markets, you can still find opportunities worth exploring and uncover a key to a very good business strategy.

Market share of online payment processing software technologies worldwide Sep 2022. Source: Statista

👉 Use the PayPal Strategy Plan Template to get inspired by Paypal's Strategy to build your own!

Best business strategies #7: Spotify Changing the rules of the music industry

Before Spotify came along, the world of online music streaming was pretty lackluster. Sure, you had platforms like Napster and The Pirate Bay, but they were illegal and you never knew when they would get shut down. And even if you did use them, you were still pretty limited in terms of what you could listen to. On the other hand, you had platforms like iTunes and Pandora, but they had their own set of problems. With iTunes, you had to pay for each and every song, which was a total bummer. And Pandora, you couldn't listen to whatever song you wanted, it was more like a radio station. Basically, people were craving for a better way to listen to music, one that was legal and gave them the freedom to choose what they wanted to listen to. And that's where Spotify comes in. When Spotify launched in 2008, it was a game-changer. They took the best parts of platforms like Napster and The Pirate Bay (the ability to share music), but made it legal. And they also took the best parts of platforms like iTunes and Pandora (the ability to choose what you want to listen to), and made it better. As we all know, it turned out to be quite an effective business strategy.

What can we learn from Spotify?

Spotify nailed it by putting their customers at the forefront of their business strategy. They saw that people were fed up with the limitations of other music streaming platforms and decided to create a service that put the customer's needs and wants first. They invested in technology and engineers to ensure the experience was seamless and easy for listeners, and it worked like a charm. People flocked to Spotify like bees to honey because it gave them the freedom and control over their music choices that they craved. Another big part of Spotify's success was (and still is) their freemium business model. They offered a free version of the service, but also had premium options for those who wanted more features and services. This allowed them to attract a huge user base and generate revenue from both the free and paying users. This model helped Spotify grow its user base and revenue quickly, more than exceeding their business goals.

And let's not forget about their data-driven approach. They invested heavily in data analysis and machine learning, which allowed them to create algorithms to predict which songs and artists users will like and recommend them accordingly - going one step further into user personalization. This helped to drive engagement and loyalty, making Spotify the go-to platform for discovering new music and creating playlists.

👉 Use the Spotify Strategy Plan Template to get inspired by Spotify's Strategy to build your own!

📚Learn more about Spotify in our Strategy Study: How Spotify Became The Standard In Convenience And Accessibility .

More excellent business strategy examples

You just got familiar with my personal selection of top business strategies. But these 7 are just the tip of the iceberg! If you’re looking for more examples and lessons from the very best businesses in the world, download the free 56 strategies report . It’s a selection of cases that covers plenty of really interesting situations. Trust me, you won’t regret it.

What's the difference between a business strategy and a corporate strategy?

A business strategy refers to the business plan for a specific business unit level within a company, while a corporate strategy deals with the overall direction and scope of the entire organization at the functional level.

A successful business strategy focuses on achieving specific business objectives within a certain market or industry, and is often developed as part of a larger business plan. While a corporate-level strategy focuses on achieving corporate objectives and aligning the entire organization's key components to achieve competitive advantage and meet organizational goals.

What are the key components of a successful business strategy?

A successful business strategy includes the following key components:

• Identifying and targeting a specific market or industry
• Developing a unique value proposition
• Creating a business plan with relevant focus areas to achieve the business objectives
• Define the specific actions that will ensure those objectives are met
• Determine the measures or KPIs that will drive success and ensure execution
• Continuously monitoring and adjusting the strategy to meet the organizational goals

How does a business strategy contribute to achieving corporate objectives?

A business strategy is designed to achieve specific business objectives within a certain market or industry, which in turn contributes to achieving the overall corporate objectives of the organization .

By aligning the efforts of the individual business units with the overall direction and scope of the company, a business strategy helps to create a unified approach towards achieving competitive advantage and meeting organizational goals.

Popular articles

Viva Goals Vs. Cascade: Goal Management Vs. Strategy Execution

What Is A Maturity Model? Overview, Examples + Free Assessment

How To Implement The Balanced Scorecard Framework (With Examples)

The Best Management Reporting Software For Strategy Officers (2024 Guide)

Your toolkit for strategy success.

• Business Essentials
• Leadership & Management
• Credential of Leadership, Impact, and Management in Business (CLIMB)
• Entrepreneurship & Innovation
• Digital Transformation
• Finance & Accounting
• Business in Society
• For Organizations
• Support Portal
• Media Coverage
• Founding Donors
• Leadership Team

• Harvard Business School →
• HBS Online →
• Business Insights →

Business Insights

Harvard Business School Online's Business Insights Blog provides the career insights you need to achieve your goals and gain confidence in your business skills.

• Career Development
• Communication
• Decision-Making
• Earning Your MBA
• Negotiation
• News & Events
• Productivity
• Staff Spotlight
• Student Profiles
• Work-Life Balance
• AI Essentials for Business
• Alternative Investments
• Business Analytics
• Business Strategy
• Business and Climate Change
• Design Thinking and Innovation
• Digital Marketing Strategy
• Disruptive Strategy
• Economics for Managers
• Entrepreneurship Essentials
• Financial Accounting
• Global Business
• Launching Tech Ventures
• Leadership Principles
• Leadership, Ethics, and Corporate Accountability
• Leading Change and Organizational Renewal
• Leading with Finance
• Management Essentials
• Negotiation Mastery
• Organizational Leadership
• Power and Influence for Positive Impact
• Strategy Execution
• Sustainable Business Strategy
• Sustainable Investing
• Winning with Digital Platforms

What Is Business Strategy & Why Is It Important?

• 20 Oct 2022

Every business leader wants their organization to succeed. Turning a profit and satisfying stakeholders are worthy objectives but aren’t feasible without an effective business strategy.

To attain success, leaders must hone their skills and set clear business goals by crafting a strategy that creates value for the firm, customers, suppliers, and employees. Here's an overview of business strategy and why it's essential to your company’s success.

Access your free e-book today.

What’s a Business Strategy?

Business strategy is the strategic initiatives a company pursues to create value for the organization and its stakeholders and gain a competitive advantage in the market. This strategy is crucial to a company's success and is needed before any goods or services are produced or delivered.

According to Harvard Business School Online's Business Strategy course, an effective strategy is built around three key questions:

• How can my business create value for customers?
• How can my business create value for employees?
• How can my business create value by collaborating with suppliers?

Many promising business initiatives don’t come to fruition because the company failed to build its strategy around value creation. Creativity is important in business , but a company won't last without prioritizing value.

The Importance of Business Strategy

A business strategy is foundational to a company's success. It helps leaders set organizational goals and gives companies a competitive edge. It determines various business factors, including:

• Price: How to price goods and services based on customer satisfaction and cost of raw materials
• Suppliers: Whether to source materials sustainably and from which suppliers
• Employee recruitment: How to attract and maintain talent
• Resource allocation: How to allocate resources effectively

Without a clear business strategy, a company can't create value and is unlikely to succeed.

Creating Value

To craft a successful business strategy, it's necessary to obtain a thorough understanding of value creation. In the online course Business Strategy , Harvard Business School Professor Felix Oberholzer-Gee explains that, at its core, value represents a difference. For example, the difference between a customer's willingness to pay for a good or service and its price represents the value the business has created for the customer. This difference can be visualized with a tool known as the value stick.

The value stick has four components, representing the value a strategy can bring different stakeholders.

• Willingness to pay (WTP) : The maximum amount a customer is willing to pay for a company's goods or services
• Price : The actual price of the goods or services
• Cost : The cost of the raw materials required to produce the goods or services
• Willingness to sell (WTS) : The lowest amount suppliers are willing to receive for raw materials, or the minimum employees are willing to earn for their work

The difference between each component represents the value created for each stakeholder. A business strategy seeks to widen these gaps, increasing the value created by the firm’s endeavors.

Increasing Customer Delight

The difference between a customer's WTP and the price is known as customer delight . An effective business strategy creates value for customers by raising their WTP or decreasing the price of the company’s goods or services. The larger the difference between the two, the more value is created for customers.

A company might focus on increasing WTP with its marketing strategy. Effective market research can help a company set its pricing strategy by determining target customers' WTP and finding ways to increase it. For example, a business might differentiate itself and increase customer loyalty by incorporating sustainability into its business strategy. By aligning its values with its target audiences', an organization can effectively raise consumers' WTP.

Increasing Firm Margin

The value created for the firm is the difference between the price of an item and its cost to produce. This difference is known as the firm’s margin and represents the strategy's financial success. One metric used to quantify this margin is return on invested capital (ROIC) . This metric compares a business's operating income with the capital necessary to generate it. The formula for ROIC is:

Return on Invested Capital = Net Operating Cost After Tax (NOCAT) / Invested Capital (IC)

ROIC tells investors how successful a company is at turning its investments into profit. By raising WTP, a company can risk increasing prices, thereby increasing firm margin. Business leaders can also increase this metric by decreasing their costs. For example, sustainability initiatives—in addition to raising WTP—can lower production costs by using fewer or more sustainable resources. By focusing on the triple bottom line , a firm can simultaneously increase customer delight and margin.

Increasing Supplier Surplus & Employee Satisfaction

By decreasing suppliers' WTS, or increasing costs, a company can create value for suppliers—or supplier surplus . Since increasing costs isn't sustainable, an effective business strategy seeks to create value for suppliers by decreasing WTS. How a company accomplishes this varies. For example, a brick-and-mortar company might partner with vendors to showcase its products in exchange for a discount. Suppliers may also be willing to offer a discount in exchange for a long-term contract.

In addition to supplier WTS, companies are also responsible for creating value for another key stakeholder: its employees. The difference between employee compensation and the minimum they're willing to receive is employee satisfaction . There are several ways companies can increase this difference, including:

• Increasing compensation: While most companies hesitate to raise salaries, some have found success in doing so. For example, Dan Price, CEO of Gravity Payments, increased his company's minimum wage to $80,000 per year and enjoyed substantial growth and publicity as a result.
• Increasing benefits: Companies can also decrease WTS by making working conditions more desirable to prospective employees. Some offer remote or hybrid working opportunities to give employees more flexibility. Several have also started offering four-day work weeks , often experiencing increased productivity as a result.

There are several ways to increase supplier surplus and employee satisfaction without hurting the company's bottom line. Unfortunately, most managers only devote seven percent of their time to developing employees and engaging stakeholders. Yet, a successful strategy creates value for every stakeholder—both internal and external.

Strategy Implementation

Crafting a business strategy is just the first step in the process. Implementation takes a strategy from formulation to execution . Successful implementation includes the following steps :

• Establish clear goals and key performance indicators (KPIs)
• Set expectations and ensure employees are aware of their roles and responsibilities
• Delegate work and allocate resources effectively
• Put the plan into action and continuously monitor its progress
• Adjust your plan as necessary
• Ensure your team has what they need to succeed and agrees on the desired outcome
• Evaluate the results of the plan

Throughout the process, it's important to remember to adjust your plan throughout its execution but to avoid second-guessing your decisions. Striking this balance is challenging, but crucial to a business strategy's success.

Learn More About Creating a Successful Business Strategy

Business strategy constantly evolves with changing consumer expectations and market conditions. For this reason, business leaders should continuously educate themselves on creating and executing an effective strategy.

One of the best ways to stay up-to-date on best practices is to take an online course, such as HBS Online's Business Strategy program. The course will provide guidance on creating a value-driven strategy for your business.

Do you want to learn how to craft an effective business strategy and create value for your company's stakeholders? Explore our online course Business Strategy , or other strategy courses , to develop your strategic planning skills. To determine which strategy course is right for you, download our free flowchart .

About the Author

3 Inspiring Business Strategy Examples and Templates

By Status.net Editorial Team on November 8, 2023 — 11 minutes to read

• Types of Business Strategies Part 1
• Building a Winning Business Strategy Part 2
• Business Strategy Template with Examples Part 3
• Additional Sections to Include in a Business Strategy Part 4
• Objective Setting Template Part 5
• Business Strategy Action Plan Template Part 6

Part 1 Types of Business Strategies

Growth strategies.

When it comes to growth strategies, you have several options to consider. One popular method is market penetration, where you aim to increase the market share of your existing products or services through promotions, discounts, and advertising. You could also explore market development, in which you target new markets using your existing products. Expanding into new territories, partnering with other businesses, or catering to a different demographic can help broaden your customer base.

Another possibility is product development, where you develop new products or upgrade existing ones to attract more customers or maintain your position in the market. Finally, diversification is another approach where you introduce entirely new products or services to your business, which may cater to a new market or complement your existing offerings.

Cost Leadership Strategies

Focusing on cost leadership strategies, your goal is to become the most cost-efficient provider in your industry. To achieve this, you can invest in process improvements, technology, or economies of scale to reduce operational costs and increase productivity. By offering lower prices than your competitors while maintaining quality, you can attract more customers and improve your market share.

Maintaining low overheads, negotiating better deals with suppliers, and exploiting the advantages of vertical integration are some ways to achieve cost leadership. Remember to carefully balance cost cutting with quality and customer satisfaction, as neglecting these aspects can negatively impact your business.

Differentiation Strategies

Differentiation strategies aim to make your business stand out from the competition by offering unique products or services that customers value. It’s about identifying your target market’s needs and preferences, and tailoring your offerings to meet those expectations.

To create differentiation, you can focus on innovation, design, quality, customer service, or branding. For example, developing cutting-edge technology, offering exceptional after-sales support, or creating a strong brand image can give your business a competitive edge. These factors help you charge a premium price, attract loyal customers, and build long-lasting relationships with them.

Part 2 Building a Winning Business Strategy

Conducting a swot analysis.

A great starting point for building a winning business strategy is conducting a SWOT analysis. It helps you assess your strengths, weaknesses, opportunities, and threats. To perform this analysis:

• List your company’s internal strengths and weaknesses.
• Identify external opportunities and threats from your market or industry.

This exercise gives you valuable insights into which areas of your business need improvement and which assets you can leverage. Related: Advantages of SWOT Analysis (6 Benefits and 4 Limitations)

Creating a Competitive Advantage

To create a competitive advantage, analyze your competitors and determine what sets you apart from them. Some common avenues for distinction include:

• Offering superior products or services
• Developing a unique brand
• Providing exceptional customer service

Think about what makes your business unique and how to capitalize on those aspects.

Formulating an Action Plan

Once you have performed a SWOT analysis and determined your competitive advantage, you can develop an action plan to reach your goals. Here are a few components of an effective action plan:

• Define clear and measurable objectives for your business.
• Break down your objectives into smaller tasks with deadlines.
• Assign responsibilities to specific team members.
• Monitor progress regularly and adjust your plan as needed.

Part 3 Business Strategy Template

Company overview.

– Company name – Brief description of business/industry – Mission/vision statements

Current Situation Analysis

– Market analysis – Target market – Customer segments – Industry trends – Competitive landscape – Organizational analysis – Core competencies – Resources/assets – Operational processes – Financial analysis – Revenue streams – Cost structure – Profitability

SWOT Analysis

– Strengths – List of key internal strengths – Weaknesses – List of key internal weaknesses – Opportunities – List of external opportunities – Threats – List of external threats

(To create a SWOT analysis, organize your thoughts using four columns or quadrants:

• Strengths : List your company’s strong points, such as an experienced team, a unique product, or a solid customer base.
• Weaknesses : Identify areas for improvement or bottlenecks, like a sluggish decision-making process or insufficient funding.
• Opportunities : Note external factors that present chances for growth and success, such as market trends or new technologies.
• Threats : Consider external aspects that could prove challenging or harmful, including competitors, regulatory changes, or rising raw material costs.)

Goals and Objectives

– 3-5 year goals – 1 year objectives to support goals – Metrics to measure progress

Strategic Options

– Growth strategies – Product/market expansion – Diversification – Mergers/acquisitions – Competitive strategies – Differentiation – Cost leadership – Focus

Action Plan

– Strategic initiatives to achieve objectives – Timeline for implementation – Budget and resource requirements – Responsibilities assigned

Contingency Plan

– Potential risks and challenges – Backup plans if risks are realized

Financial Projections

– 3-5 year projected income statement – Projected balance sheet – Cash flow statement – Assumptions

Monitoring and Control

– Performance metrics – Progress reporting procedures – Process for course corrections

Business Strategy Example

(The business strategy example provided is intended solely for illustrative purposes to demonstrate how to populate the template. Please note that in practice, a real business strategy would include far more comprehensive and detailed analyses, projections, action plans, etc. tailored specifically to the unique industry, resources, goals, and challenges of the company.)

Company Overview – Company name: ABCX Electronics – Brief description: ABCX Electronics is a manufacturer and distributor of consumer electronics. – Mission: To become the #1 provider of innovative consumer tech solutions.

Current Situation Analysis – Market: Growing demand for smart home devices – Target: Households with incomes over $100K – Customer segments: Retailers, online shoppers – Trends: IoT, virtual assistance, 5G – Competition: Large tech companies – Resources: R&D team, manufacturing plants, distribution centers – Financials: $500M revenue, 15% profit margins

SWOT Analysis – Strengths: Established brand, global distribution, R&D expertise – Weaknesses: High overhead, product return rates – Opportunities: Expand into smart home market, partner with carriers – Threats: Supply chain disruptions, new entrants

Goals and Objectives – 3 years: $750M revenue, 20% profit margins – 1 year: Launch smart home line, reduce returns by 5%

Strategic Options – Product expansion: Develop smart home devices – Partnerships: Bundle devices with carrier plans – Cost leadership: Automate processes, source cheaper materials

Action Plan – Initiative 1: Develop smart speaker and thermostat (12 months) – Initiative 2: Negotiate carrier partnerships (6 months) – Initiative 3: Automate returns processing (9 months) – Budget: $20M capex, $5M opex – Responsibilities: VP of each division

Contingency Plan – Risks: Regulatory issues, IP theft – Backups: Alternative components, pricing adjustments

Financial Projections – 3 year income statement, balance sheet, cash flows – Assumes revenue growth from new products and partnerships

Monitoring and Control – Metrics: Revenue, margins, product launch dates – Quarterly reports to board, adjust as needed

Part 4 Additional Sections to Include in a Business Strategy

Brand strategy.

– How the brand positioning and messaging needs to evolve

Marketing & sales strategy

– Plans to attract, acquire and retain customers

Innovation strategy

– Approach to developing new products/services

People strategy

– Acquiring/developing talent needed to execute strategy

Stakeholder Analysis

– Identification of key internal and external stakeholders – Assessment of their interests, influence, priorities

Value Proposition

– Clear articulation of the unique value provided to target customers

Core Competencies

– Identification and assessment of organizational strengths that provide competitive advantage

Critical Success Factors

– Key factors that must be achieved to meet objectives and be successful

Resource Audit

– Inventory of available physical, financial, intellectual, and human resources

Gap Analysis

– Comparison of current capabilities vs. requirements to achieve strategic goals

Environmental analysis

– Assessing sustainability impacts and opportunities

Risk Management Plan

– Potential risks identified through SWOT and other analyses – Risk likelihood and impact ratings – Risk mitigation strategies for high-priority risks

Change Management Plan

– Organizational changes required to implement strategy – Plan to manage change and ensure adoption

Scenario planning

– Alternative future scenarios to consider

Performance Dashboard

– Visual dashboard to track key metrics over time

– Detailed supporting plans, charts, graphs, etc.

Part 5 Objective Setting Template

Company Name:

Period Covered:

Department/Team:

Objective 1: Specific goal: Measurable metrics: Attainable timeline: Relevant to strategy/mission: Time-bound deadline:

Objective 2: Specific goal: Measurable metrics: Attainable timeline: Relevant to strategy/mission: Time-bound deadline:

Objective 3: Specific goal: Measurable metrics: Attainable timeline: Relevant to strategy/mission: Time-bound deadline:

Objective 4: Specific goal: Measurable metrics: Attainable timeline: Relevant to strategy/mission: Time-bound deadline:

Objective 5: Specific goal: Measurable metrics: Attainable timeline: Relevant to strategy/mission: Time-bound deadline:

Part 6 Business Strategy Action Plan Template

With your objectives set, it’s time to create an action plan. Outline the necessary steps, assign responsibilities, and establish timelines. An action plan might include these components:

• Tasks : Define each task or initiative required to meet your objectives.
• Responsibilities : Assign a team member or department responsible for each task.
• Resources : Identify required resources, such as funding, materials, or labor.
• Timeline : Establish deadlines and milestones for each task.
• Monitoring : Set up a method for tracking progress and evaluating performance.

Organize your action plan in a way that’s easy to follow, and keep it up-to-date as circumstances change. This ensures your team stays on target and allows for adjustments when needed.

Business Strategy Action Plan

Objectives – Clearly state the objectives your action plan aims to achieve. These should align with your overall business strategy goals.

Tasks – List each specific task or initiative required to meet your objectives. Be as detailed as possible.

– Example tasks: – Launch new marketing campaign by Q1 – Hire additional sales representative by March 15 – Develop new product prototype by May 1

Responsibilities – Assign an individual or department responsible for completing each task.

– Example responsibilities: – Marketing department – Launch new marketing campaign – HR manager – Hire additional sales representative – Product development team – Develop new product prototype

Resources Required – Identify any resources (funding, materials, labor etc.) needed to complete each task.

– Example resources: – $X marketing budget – $Y for new hire salary and benefits – $Z engineering budget

Timeline – Establish deadlines and milestones for completing each task. Include start and end dates.

– Example timeline: – Campaign launch: Start Jan 15, End March 31 – Hire sales rep: Post job Feb 1, Hire by March 15 – Prototype development: Start Feb 1, Working prototype by May 1

Monitoring – Set up methods for tracking progress, evaluating performance and making adjustments. Identify who will monitor.

– Example monitoring: – Monthly marketing report from Director of Marketing – Biweekly check-ins with HR manager – Weekly product development update meetings

Frequently Asked Questions

What are some common templates for business strategy planning.

There are several templates you can use to plan your business strategy. Some popular ones include:

• Business Model Canvas – Helps you visualize and test your business model assumptions
• Lean Startup Canvas – Focuses on quickly iterating and validating business ideas
• Value Proposition Canvas – Helps refine your customer proposition and value delivery
• One-Page Strategic Plan – Breaks down your business strategy into a succinct one-page document
• Strategic Roadmap – Outlines the major milestones and action items needed to achieve your goals

How can I find examples of successful business strategies?

To find examples of successful business strategies, look for case studies, articles, and books highlighting the achievements of well-known companies. Business schools, online publications, and industry reports often feature in-depth analysis of company strategies. Additionally, you can attend events, conferences, and webinars discussing best practices and real-life examples.

Which tools or frameworks do companies often use for strategizing?

Some popular tools and frameworks for business strategy development include:

• Porter’s Five Forces – Analyzes competition and industry structure
• PEST Analysis – Explores the macro-environment (political, economic, social, and technological factors)
• Blue Ocean Strategy – Focuses on creating uncontested market spaces
• Ansoff Matrix – Evaluates growth strategies by analyzing market and product diversification
• Balanced Scorecard – Aligns business activities with strategy and measures performance

What are the key elements to consider when creating a business strategy?

When creating a business strategy, consider the following key elements:

• Goals and objectives – Define your main aims and what you want to achieve
• Market and customer analysis – Understand the target market, customer needs, preferences, and pain points
• Competitive and internal analysis – Assess your competitors, strengths, weaknesses, opportunities, and threats
• Value proposition – Determine the unique value you offer customers and how it differs from competitors
• Channels and resources – Decide on the best resources and channels to deliver your products or services

Can you suggest any business strategy resources or guidelines?

Some helpful resources for business strategy development include:

• Books – E.g., “Good to Great” by Jim Collins, “Blue Ocean Strategy” by W. Chan Kim and Renée Mauborgne
• Online courses – Platforms like Coursera or Skillshare offer strategy-related courses and webinars
• Consulting firms – Some offer free resources and tools, like McKinsey & Company’s Strategy Compass
• Industry publications – Subscribe to relevant newsletters, blogs, or podcasts for insights

What role do SWOT and competitor analyses play in business strategy development?

SWOT and competitor analyses are essential for creating an effective business strategy. SWOT analysis identifies your strengths, weaknesses, opportunities, and threats, helping you craft strategies that leverage your strengths and address areas requiring improvement. Competitor analysis examines the strengths, weaknesses, and strategies of your competitors, enabling you to differentiate your offerings and stay ahead of market changes. Both analyses provide crucial insights to inform your strategic decision-making.

• Business Formal vs. Business Professional Attire
• A Comprehensive Guide to Business Attire (with Examples)
• 2 Templates and Examples: Individual Development Plan
• 3 Root Cause Analysis Templates (and Examples)
• Root Cause Analysis (RCA) Methods for Effective Problem Solving
• Personal SWOT Analysis: Unlock Your Potential in 4 Steps

A successful business strategy dictates the allocation of resources and outlines how a company will achieve its strategic goals. Whether the organization is focused on developing new products or marketing an existing service to an under-served demographic, having a solid strategy will help an organization realize its long-term goals. Typically, a strategy will be informed by core business objectives and keep key performance indicators (KPIs) in mind. It’s also essential to understand an organization’s market position, as the following business strategy examples will show.

Types of business strategy

Over the last decades, researchers and business leaders have identified a handful of so-called “generic strategies” with broad application across the business landscape. These core business strategies are:

• Broad cost leadership strategy
• Broad differentiation strategy
• Focused differentiation strategy
• Focused cost leadership strategy

But there are dozens of variations on these core concepts, and an organization may choose to enact certain types of strategies at different points. Good business strategies are carefully considered, but that doesn’t mean they’re static. Successful leaders will routinely review a strategy’s key components and update their plans.

For instance, entrepreneurs looking to increase profits might pursue a cost-cutting strategy, while a business hoping to expand would consider a growth strategy. If customer churn or dissatisfaction is a particular issue, a customer retention strategy would be more appropriate.

For economically healthy companies attempting to move into new markets, a diversification strategy—involving new customers or product lines—or a partnership strategy—involving the acquisition of new companies—might be best.

Still, exploring the core generic strategies can provide insight into how some of the world’s most successful corporations have leveraged market research to create phenomenally profitable roadmaps. Some examples of business strategies that embody these foundational theories are explored below.

Broad cost leadership strategy example: Walmart

When Sam Walton, the founder of Walmart, started his retail career in the 1940s, he had a simple idea: To find less expensive suppliers than those who served his competition and pass those savings on to the customers in his variety stores. Where many business leaders might attempt to profit directly from such favorable margins, Walton decided to pursue an economy of scale , profiting by attracting more customers rather than charging those customers more. In the more than seven decades since, Walmart has become one of the most famous examples of cost leadership strategy, which undercuts competition by offering goods or services at the lowest possible price.

As the company grew, it was able to take advantage of its ubiquity to demand lower prices from suppliers and sell goods for even less over time. Many of these savings have then been passed on to customers shopping in the stores, resulting in progressively cheaper goods. The retailer’s advertisements underscore this fact, encouraging customers to “Save money. Live Better.”

By the early 2000s, Walmart’s cost leadership strategy had been so successful one-third of Americans were frequent Walmart customers , illustrating how winning the price game can lead to a massively successful bottom line. This has been crucial for the big-box retailer as it increasingly competes with e-commerce giants like Amazon.

Broad differentiation business strategy example: Starbucks

When Starbucks was founded as a small business in 1971, high-end coffee was a niche market in the United States. But Howard Schultz, the company’s founder, believed there was an opportunity to import Italian coffee culture and differentiate his business from competitors like Dunkin Donuts.

To gain a competitive advantage over stores offering cheap coffee in fast food-type settings, Schultz opened a series of cozy cafes that encouraged long visits. Though the items sold at Starbucks were more expensive than those of the competitors, they were highlighted in marketing campaigns as unique and superior quality goods. Starbucks also paid careful attention to its supply chain, ensuring is products were ethically sourced and offering specialty drinks that in some geographic locations could be difficult to find. The company’s early focus on talent management for service employees was a major differentiator, as well.

Over time Starbucks also focused heavily on personalization, encouraging customers to create favorite drinks. Later in the company’s tenure, the company introduced loyalty cards and other advantages for repeat customers to encourage customer retention.

Today, Starbucks stores are ubiquitous across the globe, and the company’s success has made it one of the prime examples of differentiation strategy that undercuts competition by providing a premium product that is significantly more desirable than existing goods.

Focused differentiation strategy example: REI

A focused differentiation strategy—unlike a broad differentiation strategy, which seeks to gain massive market share by providing a premium good—tailors its business plan to a select group of consumers. The outdoor outfitter REI has had significant success in focused differentiation through a series of business decisions and marketing strategies that underscore the values of its target demographic. In REI’s case, product differentiation relies on how the business communicates its core values and provides a unique customer experience.

REI frequently positions itself as an ethical and sustainable outdoor brand: As the company says, it prefers to put “ purpose before profits. ” Since its inception, the company has underscored initiatives like its co-op membership model and sustainability commitments as a way to distinguish itself from competitors catering to more general audiences. Recently, the brand engaged in a relatively risky marketing strategy that reflects its goal of capturing a specific group of loyal customers.

Starting in 2015, REI closed its stores on Black Friday , the most popular shopping day of the year, and encouraged employees to spend the day outdoors. The initiative was accompanied by a social media campaign to bolster the brand’s reach. REI might sell products at a higher cost than its competitors, and operate fewer than 200 stores, but its business model is based on the idea that a loyal group of customers will find its messages and products relevant enough to pay a premium for goods they could easily find somewhere else.

Focused cost leadership strategy example: Dollar General

Where Walmart’s cost leadership strategy relied on becoming ubiquitous and operating at massive scales, the discount chain Dollar General has captured price-conscious consumers in more specific markets. Rather than trying to enter an entirely new market, the company focused on providing low-cost goods to rural consumers. Its strategy has been to open small stores in areas where big-box stores might not be and offer a complementary pricing strategy that attracts budget-conscious consumers.

This strategy has allowed Dollar General to grow into a smart and efficient operation with a strong target market and relatively low overhead. Typically, the chain leases its stores and keeps them small and bare bones, saving money on real estate and extensive labor costs. Stores also typically stock a smaller number of products targeted to its specific customer base, cutting costs and allowing it precise control of its supply chain process. By spending less to open stores, allocating fewer resources to advertising, and targeting regional cost-conscious customers, the chain expanded successfully into a niche market.

The importance of agility in business strategy

As the previous effective business strategies illustrate, strategic planning is crucial for an organization working to achieve its business goals. A strong sense of where the company should be heading makes decision-making easier, and can guide operations across all business units, from the organization’s corporate-level strategy to its product development plans. At their most effective, business strategies can be utilized on a functional level, meaning every department from finance to human resources is guided by the business’ broader goals.

But not all successful businesses strategies will conform precisely to the four generic models outlined above. Often, a company will combine aspects of one or more strategies, or pivot as markets and technologies change . This has been particularly true for startups, which often serve a diverse set of stakeholders and may base their value proposition on new technologies. Still, as the above examples show, the optimization of a business’ operations relies on thinking critically about how its disparate parts can work together to achieve a singular goal.

Business strategy and IBM

Emerging technology and social forces are creating new customer experiences that result in changing expectations and demands and disrupt business models. IBM Consulting’s professional services for business help organizations navigate an increasingly dynamic, complex and competitive world by aligning transformation with business strategy to create competitive advantage and a clear focus on business impact.

More from Business transformation

Rethink it spend in the age of generative ai.

3 min read - It’s the burning question for today’s CIOs: what do you spend your IT budget on? Cloud costs were already a challenge—in a recent survey, 24% estimated they wasted software spend. The explosion of generative AI makes it critical for organizations to consider frameworks like FinOps and technology business management (TBM) for visibility and accountability of all tech spend. But what does this all mean in practice? How can organizations shift to a more disciplined, value-driven approach to IT spend? What…

6 hard truths CEOs must confront in the generative AI era

5 min read - The rise of generative AI is a make-or-break moment for CEOs. All eyes are on them and the decisions they make now to steer their organizations into the future. There is an exciting canvas of opportunity ahead with generative AI: improving productivity across virtually every enterprise function, delivering exciting new kinds of customer experiences, and powering the development of new digital products and services—all underpinned by transformed technology delivery. To turn these opportunities into reality, IBM’s recent AI Academy episode…

Immutable backup strategies with cloud storage

4 min read - Cyberthreats, once a mostly predictable risk limited to isolated incidents, are now pervasive. Attackers aided by advancements in AI and global connectivity are continually seeking out vulnerabilities in security defenses so they can access critical infrastructure and customer data. Eventually, an attack will compromise an administrative account or a network component, or exploit a software vulnerability, ultimately gaining access to production infrastructure. These inevitable attacks are why having immutable offsite backups for both application and customer data is critical to…

IBM Newsletters

How to Write a Business Plan: Step-by-Step Guide + Examples

Noah Parsons

24 min. read

Updated May 7, 2024

Writing a business plan doesn’t have to be complicated. 

In this step-by-step guide, you’ll learn how to write a business plan that’s detailed enough to impress bankers and potential investors, while giving you the tools to start, run, and grow a successful business.

• The basics of business planning

If you’re reading this guide, then you already know why you need a business plan . 

You understand that planning helps you: 

• Raise money
• Grow strategically
• Keep your business on the right track 

As you start to write your plan, it’s useful to zoom out and remember what a business plan is .

At its core, a business plan is an overview of the products and services you sell, and the customers that you sell to. It explains your business strategy: how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

Most business plans also include financial forecasts for the future. These set sales goals, budget for expenses, and predict profits and cash flow. 

A good business plan is much more than just a document that you write once and forget about. It’s also a guide that helps you outline and achieve your goals. 

After completing your plan, you can use it as a management tool to track your progress toward your goals. Updating and adjusting your forecasts and budgets as you go is one of the most important steps you can take to run a healthier, smarter business. 

We’ll dive into how to use your plan later in this article.

There are many different types of plans , but we’ll go over the most common type here, which includes everything you need for an investor-ready plan. However, if you’re just starting out and are looking for something simpler—I recommend starting with a one-page business plan . It’s faster and easier to create. 

It’s also the perfect place to start if you’re just figuring out your idea, or need a simple strategic plan to use inside your business.

Dig deeper : How to write a one-page business plan

Brought to you by

Create a professional business plan

Using ai and step-by-step instructions.

Secure funding

Validate ideas

Build a strategy

• What to include in your business plan

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally just one to two pages. Most people write it last because it’s a summary of the complete business plan.

Ideally, the executive summary can act as a stand-alone document that covers the highlights of your detailed plan. 

In fact, it’s common for investors to ask only for the executive summary when evaluating your business. If they like what they see in the executive summary, they’ll often follow up with a request for a complete plan, a pitch presentation , or more in-depth financial forecasts .

Your executive summary should include:

• A summary of the problem you are solving
• A description of your product or service
• An overview of your target market
• A brief description of your team
• A summary of your financials
• Your funding requirements (if you are raising money)

Dig Deeper: How to write an effective executive summary

Products and services description

This is where you describe exactly what you’re selling, and how it solves a problem for your target market. The best way to organize this part of your plan is to start by describing the problem that exists for your customers. After that, you can describe how you plan to solve that problem with your product or service. 

This is usually called a problem and solution statement .

To truly showcase the value of your products and services, you need to craft a compelling narrative around your offerings. How will your product or service transform your customers’ lives or jobs? A strong narrative will draw in your readers.

This is also the part of the business plan to discuss any competitive advantages you may have, like specific intellectual property or patents that protect your product. If you have any initial sales, contracts, or other evidence that your product or service is likely to sell, include that information as well. It will show that your idea has traction , which can help convince readers that your plan has a high chance of success.

Market analysis

Your target market is a description of the type of people that you plan to sell to. You might even have multiple target markets, depending on your business. 

A market analysis is the part of your plan where you bring together all of the information you know about your target market. Basically, it’s a thorough description of who your customers are and why they need what you’re selling. You’ll also include information about the growth of your market and your industry .

Try to be as specific as possible when you describe your market. 

Include information such as age, income level, and location—these are what’s called “demographics.” If you can, also describe your market’s interests and habits as they relate to your business—these are “psychographics.” 

Related: Target market examples

Essentially, you want to include any knowledge you have about your customers that is relevant to how your product or service is right for them. With a solid target market, it will be easier to create a sales and marketing plan that will reach your customers. That’s because you know who they are, what they like to do, and the best ways to reach them.

Next, provide any additional information you have about your market. 

What is the size of your market ? Is the market growing or shrinking? Ideally, you’ll want to demonstrate that your market is growing over time, and also explain how your business is positioned to take advantage of any expected changes in your industry.

Dig Deeper: Learn how to write a market analysis

Competitive analysis

Part of defining your business opportunity is determining what your competitive advantage is. To do this effectively, you need to know as much about your competitors as your target customers. 

Every business has some form of competition. If you don’t think you have competitors, then explore what alternatives there are in the market for your product or service. 

For example: In the early years of cars, their main competition was horses. For social media, the early competition was reading books, watching TV, and talking on the phone.

A good competitive analysis fully lays out the competitive landscape and then explains how your business is different. Maybe your products are better made, or cheaper, or your customer service is superior. Maybe your competitive advantage is your location – a wide variety of factors can ultimately give you an advantage.

Dig Deeper: How to write a competitive analysis for your business plan

Marketing and sales plan

The marketing and sales plan covers how you will position your product or service in the market, the marketing channels and messaging you will use, and your sales tactics. 

The best place to start with a marketing plan is with a positioning statement . 

This explains how your business fits into the overall market, and how you will explain the advantages of your product or service to customers. You’ll use the information from your competitive analysis to help you with your positioning. 

For example: You might position your company as the premium, most expensive but the highest quality option in the market. Or your positioning might focus on being locally owned and that shoppers support the local economy by buying your products.

Once you understand your positioning, you’ll bring this together with the information about your target market to create your marketing strategy . 

This is how you plan to communicate your message to potential customers. Depending on who your customers are and how they purchase products like yours, you might use many different strategies, from social media advertising to creating a podcast. Your marketing plan is all about how your customers discover who you are and why they should consider your products and services. 

While your marketing plan is about reaching your customers—your sales plan will describe the actual sales process once a customer has decided that they’re interested in what you have to offer. 

If your business requires salespeople and a long sales process, describe that in this section. If your customers can “self-serve” and just make purchases quickly on your website, describe that process. 

A good sales plan picks up where your marketing plan leaves off. The marketing plan brings customers in the door and the sales plan is how you close the deal.

Together, these specific plans paint a picture of how you will connect with your target audience, and how you will turn them into paying customers.

Dig deeper: What to include in your sales and marketing plan

Business operations

The operations section describes the necessary requirements for your business to run smoothly. It’s where you talk about how your business works and what day-to-day operations look like. 

Depending on how your business is structured, your operations plan may include elements of the business like:

• Supply chain management
• Manufacturing processes
• Equipment and technology
• Distribution

Some businesses distribute their products and reach their customers through large retailers like Amazon.com, Walmart, Target, and grocery store chains. 

These businesses should review how this part of their business works. The plan should discuss the logistics and costs of getting products onto store shelves and any potential hurdles the business may have to overcome.

If your business is much simpler than this, that’s OK. This section of your business plan can be either extremely short or more detailed, depending on the type of business you are building.

For businesses selling services, such as physical therapy or online software, you can use this section to describe the technology you’ll leverage, what goes into your service, and who you will partner with to deliver your services.

Dig Deeper: Learn how to write the operations chapter of your plan

Key milestones and metrics

Although it’s not required to complete your business plan, mapping out key business milestones and the metrics can be incredibly useful for measuring your success.

Good milestones clearly lay out the parameters of the task and set expectations for their execution. You’ll want to include:

• A description of each task
• The proposed due date
• Who is responsible for each task

If you have a budget, you can include projected costs to hit each milestone. You don’t need extensive project planning in this section—just list key milestones you want to hit and when you plan to hit them. This is your overall business roadmap. 

Possible milestones might be:

• Website launch date
• Store or office opening date
• First significant sales
• Break even date
• Business licenses and approvals

You should also discuss the key numbers you will track to determine your success. Some common metrics worth tracking include:

• Conversion rates
• Customer acquisition costs
• Profit per customer
• Repeat purchases

It’s perfectly fine to start with just a few metrics and grow the number you are tracking over time. You also may find that some metrics simply aren’t relevant to your business and can narrow down what you’re tracking.

Dig Deeper: How to use milestones in your business plan

Organization and management team

Investors don’t just look for great ideas—they want to find great teams. Use this chapter to describe your current team and who you need to hire . You should also provide a quick overview of your location and history if you’re already up and running.

Briefly highlight the relevant experiences of each key team member in the company. It’s important to make the case for why yours is the right team to turn an idea into a reality. 

Do they have the right industry experience and background? Have members of the team had entrepreneurial successes before? 

If you still need to hire key team members, that’s OK. Just note those gaps in this section.

Your company overview should also include a summary of your company’s current business structure . The most common business structures include:

• Sole proprietor
• Partnership

Be sure to provide an overview of how the business is owned as well. Does each business partner own an equal portion of the business? How is ownership divided? 

Potential lenders and investors will want to know the structure of the business before they will consider a loan or investment.

Dig Deeper: How to write about your company structure and team

Financial plan

Last, but certainly not least, is your financial plan chapter. 

Entrepreneurs often find this section the most daunting. But, business financials for most startups are less complicated than you think, and a business degree is certainly not required to build a solid financial forecast. 

A typical financial forecast in a business plan includes the following:

• Sales forecast : An estimate of the sales expected over a given period. You’ll break down your forecast into the key revenue streams that you expect to have.
• Expense budget : Your planned spending such as personnel costs , marketing expenses, and taxes.
• Profit & Loss : Brings together your sales and expenses and helps you calculate planned profits.
• Cash Flow : Shows how cash moves into and out of your business. It can predict how much cash you’ll have on hand at any given point in the future.
• Balance Sheet : A list of the assets, liabilities, and equity in your company. In short, it provides an overview of the financial health of your business. 

A strong business plan will include a description of assumptions about the future, and potential risks that could impact the financial plan. Including those will be especially important if you’re writing a business plan to pursue a loan or other investment.

Dig Deeper: How to create financial forecasts and budgets

This is the place for additional data, charts, or other information that supports your plan.

Including an appendix can significantly enhance the credibility of your plan by showing readers that you’ve thoroughly considered the details of your business idea, and are backing your ideas up with solid data.

Just remember that the information in the appendix is meant to be supplementary. Your business plan should stand on its own, even if the reader skips this section.

Dig Deeper : What to include in your business plan appendix

Optional: Business plan cover page

Adding a business plan cover page can make your plan, and by extension your business, seem more professional in the eyes of potential investors, lenders, and partners. It serves as the introduction to your document and provides necessary contact information for stakeholders to reference.

Your cover page should be simple and include:

• Company logo
• Business name
• Value proposition (optional)
• Business plan title
• Completion and/or update date
• Address and contact information
• Confidentiality statement

Just remember, the cover page is optional. If you decide to include it, keep it very simple and only spend a short amount of time putting it together.

Dig Deeper: How to create a business plan cover page

How to use AI to help write your business plan

Generative AI tools such as ChatGPT can speed up the business plan writing process and help you think through concepts like market segmentation and competition. These tools are especially useful for taking ideas that you provide and converting them into polished text for your business plan.

The best way to use AI for your business plan is to leverage it as a collaborator , not a replacement for human creative thinking and ingenuity. 

AI can come up with lots of ideas and act as a brainstorming partner. It’s up to you to filter through those ideas and figure out which ones are realistic enough to resonate with your customers. 

There are pros and cons of using AI to help with your business plan . So, spend some time understanding how it can be most helpful before just outsourcing the job to AI.

Learn more: 10 AI prompts you need to write a business plan

• Writing tips and strategies

To help streamline the business plan writing process, here are a few tips and key questions to answer to make sure you get the most out of your plan and avoid common mistakes .  

Determine why you are writing a business plan

Knowing why you are writing a business plan will determine your approach to your planning project. 

For example: If you are writing a business plan for yourself, or just to use inside your own business , you can probably skip the section about your team and organizational structure. 

If you’re raising money, you’ll want to spend more time explaining why you’re looking to raise the funds and exactly how you will use them.

Regardless of how you intend to use your business plan , think about why you are writing and what you’re trying to get out of the process before you begin.

Keep things concise

Probably the most important tip is to keep your business plan short and simple. There are no prizes for long business plans . The longer your plan is, the less likely people are to read it. 

So focus on trimming things down to the essentials your readers need to know. Skip the extended, wordy descriptions and instead focus on creating a plan that is easy to read —using bullets and short sentences whenever possible.

Have someone review your business plan

Writing a business plan in a vacuum is never a good idea. Sometimes it’s helpful to zoom out and check if your plan makes sense to someone else. You also want to make sure that it’s easy to read and understand.

Don’t wait until your plan is “done” to get a second look. Start sharing your plan early, and find out from readers what questions your plan leaves unanswered. This early review cycle will help you spot shortcomings in your plan and address them quickly, rather than finding out about them right before you present your plan to a lender or investor.

If you need a more detailed review, you may want to explore hiring a professional plan writer to thoroughly examine it.

Use a free business plan template and business plan examples to get started

Knowing what information to include in a business plan is sometimes not quite enough. If you’re struggling to get started or need additional guidance, it may be worth using a business plan template. 

There are plenty of great options available (we’ve rounded up our 8 favorites to streamline your search).

But, if you’re looking for a free downloadable business plan template , you can get one right now; download the template used by more than 1 million businesses. 

Or, if you just want to see what a completed business plan looks like, check out our library of over 550 free business plan examples . 

We even have a growing list of industry business planning guides with tips for what to focus on depending on your business type.

Common pitfalls and how to avoid them

It’s easy to make mistakes when you’re writing your business plan. Some entrepreneurs get sucked into the writing and research process, and don’t focus enough on actually getting their business started. 

Here are a few common mistakes and how to avoid them:

Not talking to your customers : This is one of the most common mistakes. It’s easy to assume that your product or service is something that people want. Before you invest too much in your business and too much in the planning process, make sure you talk to your prospective customers and have a good understanding of their needs.

• Overly optimistic sales and profit forecasts: By nature, entrepreneurs are optimistic about the future. But it’s good to temper that optimism a little when you’re planning, and make sure your forecasts are grounded in reality. 
• Spending too much time planning: Yes, planning is crucial. But you also need to get out and talk to customers, build prototypes of your product and figure out if there’s a market for your idea. Make sure to balance planning with building.
• Not revising the plan: Planning is useful, but nothing ever goes exactly as planned. As you learn more about what’s working and what’s not—revise your plan, your budgets, and your revenue forecast. Doing so will provide a more realistic picture of where your business is going, and what your financial needs will be moving forward.
• Not using the plan to manage your business: A good business plan is a management tool. Don’t just write it and put it on the shelf to collect dust – use it to track your progress and help you reach your goals.
• Presenting your business plan

The planning process forces you to think through every aspect of your business and answer questions that you may not have thought of. That’s the real benefit of writing a business plan – the knowledge you gain about your business that you may not have been able to discover otherwise.

With all of this knowledge, you’re well prepared to convert your business plan into a pitch presentation to present your ideas. 

A pitch presentation is a summary of your plan, just hitting the highlights and key points. It’s the best way to present your business plan to investors and team members.

Dig Deeper: Learn what key slides should be included in your pitch deck

Use your business plan to manage your business

One of the biggest benefits of planning is that it gives you a tool to manage your business better. With a revenue forecast, expense budget, and projected cash flow, you know your targets and where you are headed.

And yet, nothing ever goes exactly as planned – it’s the nature of business.

That’s where using your plan as a management tool comes in. The key to leveraging it for your business is to review it periodically and compare your forecasts and projections to your actual results.

Start by setting up a regular time to review the plan – a monthly review is a good starting point. During this review, answer questions like:

• Did you meet your sales goals?
• Is spending following your budget?
• Has anything gone differently than what you expected?

Now that you see whether you’re meeting your goals or are off track, you can make adjustments and set new targets. 

Maybe you’re exceeding your sales goals and should set new, more aggressive goals. In that case, maybe you should also explore more spending or hiring more employees. 

Or maybe expenses are rising faster than you projected. If that’s the case, you would need to look at where you can cut costs.

A plan, and a method for comparing your plan to your actual results , is the tool you need to steer your business toward success.

Learn More: How to run a regular plan review

Free business plan templates and examples

Kickstart your business plan writing with one of our free business plan templates or recommended tools.

Free business plan template

Download a free SBA-approved business plan template built for small businesses and startups.

Download Template

One-page plan template

Download a free one-page plan template to write a useful business plan in as little as 30-minutes.

Sample business plan library

Explore over 500 real-world business plan examples from a wide variety of industries.

View Sample Plans

How to write a business plan FAQ

What is a business plan?

A document that describes your business , the products and services you sell, and the customers that you sell to. It explains your business strategy, how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

What are the benefits of a business plan?

A business plan helps you understand where you want to go with your business and what it will take to get there. It reduces your overall risk, helps you uncover your business’s potential, attracts investors, and identifies areas for growth.

Having a business plan ultimately makes you more confident as a business owner and more likely to succeed for a longer period of time.

What are the 7 steps of a business plan?

The seven steps to writing a business plan include:

• Write a brief executive summary
• Describe your products and services.
• Conduct market research and compile data into a cohesive market analysis.
• Describe your marketing and sales strategy.
• Outline your organizational structure and management team.
• Develop financial projections for sales, revenue, and cash flow.
• Add any additional documents to your appendix.

What are the 5 most common business plan mistakes?

There are plenty of mistakes that can be made when writing a business plan. However, these are the 5 most common that you should do your best to avoid:

• 1. Not taking the planning process seriously.
• Having unrealistic financial projections or incomplete financial information.
• Inconsistent information or simple mistakes.
• Failing to establish a sound business model.
• Not having a defined purpose for your business plan.

What questions should be answered in a business plan?

Writing a business plan is all about asking yourself questions about your business and being able to answer them through the planning process. You’ll likely be asking dozens and dozens of questions for each section of your plan.

However, these are the key questions you should ask and answer with your business plan:

• How will your business make money?
• Is there a need for your product or service?
• Who are your customers?
• How are you different from the competition?
• How will you reach your customers?
• How will you measure success?

How long should a business plan be?

The length of your business plan fully depends on what you intend to do with it. From the SBA and traditional lender point of view, a business plan needs to be whatever length necessary to fully explain your business. This means that you prove the viability of your business, show that you understand the market, and have a detailed strategy in place.

If you intend to use your business plan for internal management purposes, you don’t necessarily need a full 25-50 page business plan. Instead, you can start with a one-page plan to get all of the necessary information in place.

What are the different types of business plans?

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. Here are a few common business plan types worth considering.

Traditional business plan: The tried-and-true traditional business plan is a formal document meant to be used when applying for funding or pitching to investors. This type of business plan follows the outline above and can be anywhere from 10-50 pages depending on the amount of detail included, the complexity of your business, and what you include in your appendix.

Business model canvas: The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea.

One-page business plan: This format is a simplified version of the traditional plan that focuses on the core aspects of your business. You’ll typically stick with bullet points and single sentences. It’s most useful for those exploring ideas, needing to validate their business model, or who need an internal plan to help them run and manage their business.

Lean Plan: The Lean Plan is less of a specific document type and more of a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, test, review, refine, and take action based on performance. It’s faster, keeps your plan concise, and ensures that your plan is always up-to-date.

What’s the difference between a business plan and a strategic plan?

A business plan covers the “who” and “what” of your business. It explains what your business is doing right now and how it functions. The strategic plan explores long-term goals and explains “how” the business will get there. It encourages you to look more intently toward the future and how you will achieve your vision.

However, when approached correctly, your business plan can actually function as a strategic plan as well. If kept lean, you can define your business, outline strategic steps, and track ongoing operations all with a single plan.

Noah is the COO at Palo Alto Software, makers of the online business plan app LivePlan. He started his career at Yahoo! and then helped start the user review site Epinions.com. From there he started a software distribution business in the UK before coming to Palo Alto Software to run the marketing and product teams.

Table of Contents

• Use AI to help write your plan
• Common planning mistakes
• Manage with your business plan
• Templates and examples

Related Articles

5 Min. Read

How To Write a Business Plan for a Life Coaching Business + Free Example

3 Min. Read

What to Include in Your Business Plan Appendix

7 Min. Read

How to Write a Bakery Business Plan + Sample

1 Min. Read

How to Calculate Return on Investment (ROI)

The Bplans Newsletter

The Bplans Weekly

Subscribe now for weekly advice and free downloadable resources to help start and grow your business.

We care about your privacy. See our privacy policy .

The quickest way to turn a business idea into a business plan

Fill-in-the-blanks and automatic financials make it easy.

No thanks, I prefer writing 40-page documents.

Discover the world’s #1 plan building software

• Sources of Business Finance
• Small Business Loans
• Small Business Grants
• Crowdfunding Sites
• How to Get a Business Loan
• Small Business Insurance Providers
• Best Factoring Companies
• Types of Bank Accounts
• Best Banks for Small Business
• Best Business Bank Accounts
• Open a Business Bank Account
• Bank Accounts for Small Businesses
• Free Business Checking Accounts
• Best Business Credit Cards
• Get a Business Credit Card
• Business Credit Cards for Bad Credit
• Build Business Credit Fast
• Business Loan Eligibility Criteria
• Small-Business Bookkeeping Basics
• How to Set Financial Goals
• Business Loan Calculators
• How to Calculate ROI
• Calculate Net Income
• Calculate Working Capital
• Calculate Operating Income
• Calculate Net Present Value (NPV)
• Calculate Payroll Tax

How to Write a Business Plan in 9 Steps (+ Template and Examples)

Every successful business has one thing in common, a good and well-executed business plan. A business plan is more than a document, it is a complete guide that outlines the goals your business wants to achieve, including its financial goals . It helps you analyze results, make strategic decisions, show your business operations and growth.

If you want to start a business or already have one and need to pitch it to investors for funding, writing a good business plan improves your chances of attracting financiers. As a startup, if you want to secure loans from financial institutions, part of the requirements involve submitting your business plan.

Writing a business plan does not have to be a complicated or time-consuming process. In this article, you will learn the step-by-step process for writing a successful business plan.

You will also learn what you need a business plan for, tips and strategies for writing a convincing business plan, business plan examples and templates that will save you tons of time, and the alternatives to the traditional business plan.

Let’s get started.

What Do You Need A Business Plan For?

Businesses create business plans for different purposes such as to secure funds, monitor business growth, measure your marketing strategies, and measure your business success.

1. Secure Funds

One of the primary reasons for writing a business plan is to secure funds, either from financial institutions/agencies or investors.

For you to effectively acquire funds, your business plan must contain the key elements of your business plan . For example, your business plan should include your growth plans, goals you want to achieve, and milestones you have recorded.

A business plan can also attract new business partners that are willing to contribute financially and intellectually. If you are writing a business plan to a bank, your project must show your traction , that is, the proof that you can pay back any loan borrowed.

Also, if you are writing to an investor, your plan must contain evidence that you can effectively utilize the funds you want them to invest in your business. Here, you are using your business plan to persuade a group or an individual that your business is a source of a good investment.

2. Monitor Business Growth

A business plan can help you track cash flows in your business. It steers your business to greater heights. A business plan capable of tracking business growth should contain:

• The business goals
• Methods to achieve the goals
• Time-frame for attaining those goals

A good business plan should guide you through every step in achieving your goals. It can also track the allocation of assets to every aspect of the business. You can tell when you are spending more than you should on a project.

You can compare a business plan to a written GPS. It helps you manage your business and hints at the right time to expand your business.

3. Measure Business Success

A business plan can help you measure your business success rate. Some small-scale businesses are thriving better than more prominent companies because of their track record of success.

Right from the onset of your business operation, set goals and work towards them. Write a plan to guide you through your procedures. Use your plan to measure how much you have achieved and how much is left to attain.

You can also weigh your success by monitoring the position of your brand relative to competitors. On the other hand, a business plan can also show you why you have not achieved a goal. It can tell if you have elapsed the time frame you set to attain a goal.

4. Document Your Marketing Strategies

You can use a business plan to document your marketing plans. Every business should have an effective marketing plan.

Competition mandates every business owner to go the extraordinary mile to remain relevant in the market. Your business plan should contain your marketing strategies that work. You can measure the success rate of your marketing plans.

In your business plan, your marketing strategy must answer the questions:

• How do you want to reach your target audience?
• How do you plan to retain your customers?
• What is/are your pricing plans?
• What is your budget for marketing?

How to Write a Business Plan Step-by-Step

1. create your executive summary.

The executive summary is a snapshot of your business or a high-level overview of your business purposes and plans . Although the executive summary is the first section in your business plan, most people write it last. The length of the executive summary is not more than two pages.

Generally, there are nine sections in a business plan, the executive summary should condense essential ideas from the other eight sections.

A good executive summary should do the following:

• A Snapshot of Growth Potential. Briefly inform the reader about your company and why it will be successful)
• Contain your Mission Statement which explains what the main objective or focus of your business is.
• Product Description and Differentiation. Brief description of your products or services and why it is different from other solutions in the market.
• The Team. Basic information about your company’s leadership team and employees
• Business Concept. A solid description of what your business does.
• Target Market. The customers you plan to sell to.
• Marketing Strategy. Your plans on reaching and selling to your customers
• Current Financial State. Brief information about what revenue your business currently generates.
• Projected Financial State. Brief information about what you foresee your business revenue to be in the future.

The executive summary is the make-or-break section of your business plan. If your summary cannot in less than two pages cannot clearly describe how your business will solve a particular problem of your target audience and make a profit, your business plan is set on a faulty foundation.

Avoid using the executive summary to hype your business, instead, focus on helping the reader understand the what and how of your plan.

View the executive summary as an opportunity to introduce your vision for your company. You know your executive summary is powerful when it can answer these key questions:

• Who is your target audience?
• What sector or industry are you in?
• What are your products and services?
• What is the future of your industry?
• Is your company scaleable?
• Who are the owners and leaders of your company? What are their backgrounds and experience levels?
• What is the motivation for starting your company?
• What are the next steps?

Writing the executive summary last although it is the most important section of your business plan is an excellent idea. The reason why is because it is a high-level overview of your business plan. It is the section that determines whether potential investors and lenders will read further or not.

The executive summary can be a stand-alone document that covers everything in your business plan. It is not uncommon for investors to request only the executive summary when evaluating your business. If the information in the executive summary impresses them, they will ask for the complete business plan.

If you are writing your business plan for your planning purposes, you do not need to write the executive summary.

2. Add Your Company Overview

The company overview or description is the next section in your business plan after the executive summary. It describes what your business does.

Adding your company overview can be tricky especially when your business is still in the planning stages. Existing businesses can easily summarize their current operations but may encounter difficulties trying to explain what they plan to become.

Your company overview should contain the following:

• What products and services you will provide
• Geographical markets and locations your company have a presence
• What you need to run your business
• Who your target audience or customers are
• Who will service your customers
• Your company’s purpose, mission, and vision
• Information about your company’s founders
• Who the founders are
• Notable achievements of your company so far

When creating a company overview, you have to focus on three basics: identifying your industry, identifying your customer, and explaining the problem you solve.

If you are stuck when creating your company overview, try to answer some of these questions that pertain to you.

• Who are you targeting? (The answer is not everyone)
• What pain point does your product or service solve for your customers that they will be willing to spend money on resolving?
• How does your product or service overcome that pain point?
• Where is the location of your business?
• What products, equipment, and services do you need to run your business?
• How is your company’s product or service different from your competition in the eyes of your customers?
• How many employees do you need and what skills do you require them to have?

After answering some or all of these questions, you will get more than enough information you need to write your company overview or description section. When writing this section, describe what your company does for your customers.

The company description or overview section contains three elements: mission statement, history, and objectives.

• Mission Statement

The mission statement refers to the reason why your business or company is existing. It goes beyond what you do or sell, it is about the ‘why’. A good mission statement should be emotional and inspirational.

Your mission statement should follow the KISS rule (Keep It Simple, Stupid). For example, Shopify’s mission statement is “Make commerce better for everyone.”

When describing your company’s history, make it simple and avoid the temptation of tying it to a defensive narrative. Write it in the manner you would a profile. Your company’s history should include the following information:

• Founding Date
• Major Milestones
• Location(s)
• Flagship Products or Services
• Number of Employees
• Executive Leadership Roles

When you fill in this information, you use it to write one or two paragraphs about your company’s history.

Business Objectives

Your business objective must be SMART (specific, measurable, achievable, realistic, and time-bound.) Failure to clearly identify your business objectives does not inspire confidence and makes it hard for your team members to work towards a common purpose.

3. Perform Market and Competitive Analyses to Proof a Big Enough Business Opportunity

The third step in writing a business plan is the market and competitive analysis section. Every business, no matter the size, needs to perform comprehensive market and competitive analyses before it enters into a market.

Performing market and competitive analyses are critical for the success of your business. It helps you avoid entering the right market with the wrong product, or vice versa. Anyone reading your business plans, especially financiers and financial institutions will want to see proof that there is a big enough business opportunity you are targeting.

This section is where you describe the market and industry you want to operate in and show the big opportunities in the market that your business can leverage to make a profit. If you noticed any unique trends when doing your research, show them in this section.

Market analysis alone is not enough, you have to add competitive analysis to strengthen this section. There are already businesses in the industry or market, how do you plan to take a share of the market from them?

You have to clearly illustrate the competitive landscape in your business plan. Are there areas your competitors are doing well? Are there areas where they are not doing so well? Show it.

Make it clear in this section why you are moving into the industry and what weaknesses are present there that you plan to explain. How are your competitors going to react to your market entry? How do you plan to get customers? Do you plan on taking your competitors' competitors, tap into other sources for customers, or both?

Illustrate the competitive landscape as well. What are your competitors doing well and not so well?

Answering these questions and thoughts will aid your market and competitive analysis of the opportunities in your space. Depending on how sophisticated your industry is, or the expectations of your financiers, you may need to carry out a more comprehensive market and competitive analysis to prove that big business opportunity.

Instead of looking at the market and competitive analyses as one entity, separating them will make the research even more comprehensive.

Market Analysis

Market analysis, boarding speaking, refers to research a business carried out on its industry, market, and competitors. It helps businesses gain a good understanding of their target market and the outlook of their industry. Before starting a company, it is vital to carry out market research to find out if the market is viable.

The market analysis section is a key part of the business plan. It is the section where you identify who your best clients or customers are. You cannot omit this section, without it your business plan is incomplete.

A good market analysis will tell your readers how you fit into the existing market and what makes you stand out. This section requires in-depth research, it will probably be the most time-consuming part of the business plan to write.

• Market Research

To create a compelling market analysis that will win over investors and financial institutions, you have to carry out thorough market research . Your market research should be targeted at your primary target market for your products or services. Here is what you want to find out about your target market.

• Your target market’s needs or pain points
• The existing solutions for their pain points
• Geographic Location
• Demographics

The purpose of carrying out a marketing analysis is to get all the information you need to show that you have a solid and thorough understanding of your target audience.

Only after you have fully understood the people you plan to sell your products or services to, can you evaluate correctly if your target market will be interested in your products or services.

You can easily convince interested parties to invest in your business if you can show them you thoroughly understand the market and show them that there is a market for your products or services.

How to Quantify Your Target Market

One of the goals of your marketing research is to understand who your ideal customers are and their purchasing power. To quantify your target market, you have to determine the following:

• Your Potential Customers: They are the people you plan to target. For example, if you sell accounting software for small businesses , then anyone who runs an enterprise or large business is unlikely to be your customers. Also, individuals who do not have a business will most likely not be interested in your product.
• Total Households: If you are selling household products such as heating and air conditioning systems, determining the number of total households is more important than finding out the total population in the area you want to sell to. The logic is simple, people buy the product but it is the household that uses it.
• Median Income: You need to know the median income of your target market. If you target a market that cannot afford to buy your products and services, your business will not last long.
• Income by Demographics: If your potential customers belong to a certain age group or gender, determining income levels by demographics is necessary. For example, if you sell men's clothes, your target audience is men.

What Does a Good Market Analysis Entail?

Your business does not exist on its own, it can only flourish within an industry and alongside competitors. Market analysis takes into consideration your industry, target market, and competitors. Understanding these three entities will drastically improve your company’s chances of success.

You can view your market analysis as an examination of the market you want to break into and an education on the emerging trends and themes in that market. Good market analyses include the following:

• Industry Description. You find out about the history of your industry, the current and future market size, and who the largest players/companies are in your industry.
• Overview of Target Market. You research your target market and its characteristics. Who are you targeting? Note, it cannot be everyone, it has to be a specific group. You also have to find out all information possible about your customers that can help you understand how and why they make buying decisions.
• Size of Target Market: You need to know the size of your target market, how frequently they buy, and the expected quantity they buy so you do not risk overproducing and having lots of bad inventory. Researching the size of your target market will help you determine if it is big enough for sustained business or not.
• Growth Potential: Before picking a target market, you want to be sure there are lots of potential for future growth. You want to avoid going for an industry that is declining slowly or rapidly with almost zero growth potential.
• Market Share Potential: Does your business stand a good chance of taking a good share of the market?
• Market Pricing and Promotional Strategies: Your market analysis should give you an idea of the price point you can expect to charge for your products and services. Researching your target market will also give you ideas of pricing strategies you can implement to break into the market or to enjoy maximum profits.
• Potential Barriers to Entry: One of the biggest benefits of conducting market analysis is that it shows you every potential barrier to entry your business will likely encounter. It is a good idea to discuss potential barriers to entry such as changing technology. It informs readers of your business plan that you understand the market.
• Research on Competitors: You need to know the strengths and weaknesses of your competitors and how you can exploit them for the benefit of your business. Find patterns and trends among your competitors that make them successful, discover what works and what doesn’t, and see what you can do better.

The market analysis section is not just for talking about your target market, industry, and competitors. You also have to explain how your company can fill the hole you have identified in the market.

Here are some questions you can answer that can help you position your product or service in a positive light to your readers.

• Is your product or service of superior quality?
• What additional features do you offer that your competitors do not offer?
• Are you targeting a ‘new’ market?

Basically, your market analysis should include an analysis of what already exists in the market and an explanation of how your company fits into the market.

Competitive Analysis

In the competitive analysis section, y ou have to understand who your direct and indirect competitions are, and how successful they are in the marketplace. It is the section where you assess the strengths and weaknesses of your competitors, the advantage(s) they possess in the market and show the unique features or qualities that make you different from your competitors.

Many businesses do market analysis and competitive analysis together. However, to fully understand what the competitive analysis entails, it is essential to separate it from the market analysis.

Competitive analysis for your business can also include analysis on how to overcome barriers to entry in your target market.

The primary goal of conducting a competitive analysis is to distinguish your business from your competitors. A strong competitive analysis is essential if you want to convince potential funding sources to invest in your business. You have to show potential investors and lenders that your business has what it takes to compete in the marketplace successfully.

Competitive analysis will s how you what the strengths of your competition are and what they are doing to maintain that advantage.

When doing your competitive research, you first have to identify your competitor and then get all the information you can about them. The idea of spending time to identify your competitor and learn everything about them may seem daunting but it is well worth it.

Find answers to the following questions after you have identified who your competitors are.

• What are your successful competitors doing?
• Why is what they are doing working?
• Can your business do it better?
• What are the weaknesses of your successful competitors?
• What are they not doing well?
• Can your business turn its weaknesses into strengths?
• How good is your competitors’ customer service?
• Where do your competitors invest in advertising?
• What sales and pricing strategies are they using?
• What marketing strategies are they using?
• What kind of press coverage do they get?
• What are their customers saying about your competitors (both the positive and negative)?

If your competitors have a website, it is a good idea to visit their websites for more competitors’ research. Check their “About Us” page for more information.

If you are presenting your business plan to investors, you need to clearly distinguish yourself from your competitors. Investors can easily tell when you have not properly researched your competitors.

Take time to think about what unique qualities or features set you apart from your competitors. If you do not have any direct competition offering your product to the market, it does not mean you leave out the competitor analysis section blank. Instead research on other companies that are providing a similar product, or whose product is solving the problem your product solves.

The next step is to create a table listing the top competitors you want to include in your business plan. Ensure you list your business as the last and on the right. What you just created is known as the competitor analysis table.

Direct vs Indirect Competition

You cannot know if your product or service will be a fit for your target market if you have not understood your business and the competitive landscape.

There is no market you want to target where you will not encounter competition, even if your product is innovative. Including competitive analysis in your business plan is essential.

If you are entering an established market, you need to explain how you plan to differentiate your products from the available options in the market. Also, include a list of few companies that you view as your direct competitors The competition you face in an established market is your direct competition.

In situations where you are entering a market with no direct competition, it does not mean there is no competition there. Consider your indirect competition that offers substitutes for the products or services you offer.

For example, if you sell an innovative SaaS product, let us say a project management software , a company offering time management software is your indirect competition.

There is an easy way to find out who your indirect competitors are in the absence of no direct competitors. You simply have to research how your potential customers are solving the problems that your product or service seeks to solve. That is your direct competition.

Factors that Differentiate Your Business from the Competition

There are three main factors that any business can use to differentiate itself from its competition. They are cost leadership, product differentiation, and market segmentation.

1. Cost Leadership

A strategy you can impose to maximize your profits and gain an edge over your competitors. It involves offering lower prices than what the majority of your competitors are offering.

A common practice among businesses looking to enter into a market where there are dominant players is to use free trials or pricing to attract as many customers as possible to their offer.

2. Product Differentiation

Your product or service should have a unique selling proposition (USP) that your competitors do not have or do not stress in their marketing.

Part of the marketing strategy should involve making your products unique and different from your competitors. It does not have to be different from your competitors, it can be the addition to a feature or benefit that your competitors do not currently have.

3. Market Segmentation

As a new business seeking to break into an industry, you will gain more success from focusing on a specific niche or target market, and not the whole industry.

If your competitors are focused on a general need or target market, you can differentiate yourself from them by having a small and hyper-targeted audience. For example, if your competitors are selling men’s clothes in their online stores , you can sell hoodies for men.

4. Define Your Business and Management Structure

The next step in your business plan is your business and management structure. It is the section where you describe the legal structure of your business and the team running it.

Your business is only as good as the management team that runs it, while the management team can only strive when there is a proper business and management structure in place.

If your company is a sole proprietor or a limited liability company (LLC), a general or limited partnership, or a C or an S corporation, state it clearly in this section.

Use an organizational chart to show the management structure in your business. Clearly show who is in charge of what area in your company. It is where you show how each key manager or team leader’s unique experience can contribute immensely to the success of your company. You can also opt to add the resumes and CVs of the key players in your company.

The business and management structure section should show who the owner is, and other owners of the businesses (if the business has other owners). For businesses or companies with multiple owners, include the percent ownership of the various owners and clearly show the extent of each others’ involvement in the company.

Investors want to know who is behind the company and the team running it to determine if it has the right management to achieve its set goals.

Management Team

The management team section is where you show that you have the right team in place to successfully execute the business operations and ideas. Take time to create the management structure for your business. Think about all the important roles and responsibilities that you need managers for to grow your business.

Include brief bios of each key team member and ensure you highlight only the relevant information that is needed. If your team members have background industry experience or have held top positions for other companies and achieved success while filling that role, highlight it in this section.

A common mistake that many startups make is assigning C-level titles such as (CMO and CEO) to everyone on their team. It is unrealistic for a small business to have those titles. While it may look good on paper for the ego of your team members, it can prevent investors from investing in your business.

Instead of building an unrealistic management structure that does not fit your business reality, it is best to allow business titles to grow as the business grows. Starting everyone at the top leaves no room for future change or growth, which is bad for productivity.

Your management team does not have to be complete before you start writing your business plan. You can have a complete business plan even when there are managerial positions that are empty and need filling.

If you have management gaps in your team, simply show the gaps and indicate you are searching for the right candidates for the role(s). Investors do not expect you to have a full management team when you are just starting your business.

Key Questions to Answer When Structuring Your Management Team

• Who are the key leaders?
• What experiences, skills, and educational backgrounds do you expect your key leaders to have?
• Do your key leaders have industry experience?
• What positions will they fill and what duties will they perform in those positions?
• What level of authority do the key leaders have and what are their responsibilities?
• What is the salary for the various management positions that will attract the ideal candidates?

Additional Tips for Writing the Management Structure Section

1. Avoid Adding ‘Ghost’ Names to Your Management Team

There is always that temptation to include a ‘ghost’ name to your management team to attract and influence investors to invest in your business. Although the presence of these celebrity management team members may attract the attention of investors, it can cause your business to lose any credibility if you get found out.

Seasoned investors will investigate further the members of your management team before committing fully to your business If they find out that the celebrity name used does not play any actual role in your business, they will not invest and may write you off as dishonest.

2. Focus on Credentials But Pay Extra Attention to the Roles

Investors want to know the experience that your key team members have to determine if they can successfully reach the company’s growth and financial goals.

While it is an excellent boost for your key management team to have the right credentials, you also want to pay extra attention to the roles they will play in your company.

Organizational Chart

Adding an organizational chart in this section of your business plan is not necessary, you can do it in your business plan’s appendix.

If you are exploring funding options, it is not uncommon to get asked for your organizational chart. The function of an organizational chart goes beyond raising money, you can also use it as a useful planning tool for your business.

An organizational chart can help you identify how best to structure your management team for maximum productivity and point you towards key roles you need to fill in the future.

You can use the organizational chart to show your company’s internal management structure such as the roles and responsibilities of your management team, and relationships that exist between them.

5. Describe Your Product and Service Offering

In your business plan, you have to describe what you sell or the service you plan to offer. It is the next step after defining your business and management structure. The products and services section is where you sell the benefits of your business.

Here you have to explain how your product or service will benefit your customers and describe your product lifecycle. It is also the section where you write down your plans for intellectual property like patent filings and copyrighting.

The research and development that you are undertaking for your product or service need to be explained in detail in this section. However, do not get too technical, sell the general idea and its benefits.

If you have any diagrams or intricate designs of your product or service, do not include them in the products and services section. Instead, leave them for the addendum page. Also, if you are leaving out diagrams or designs for the addendum, ensure you add this phrase “For more detail, visit the addendum Page #.”

Your product and service section in your business plan should include the following:

• A detailed explanation that clearly shows how your product or service works.
• The pricing model for your product or service.
• Your business’ sales and distribution strategy.
• The ideal customers that want your product or service.
• The benefits of your products and services.
• Reason(s) why your product or service is a better alternative to what your competitors are currently offering in the market.
• Plans for filling the orders you receive
• If you have current or pending patents, copyrights, and trademarks for your product or service, you can also discuss them in this section.

What to Focus On When Describing the Benefits, Lifecycle, and Production Process of Your Products or Services

In the products and services section, you have to distill the benefits, lifecycle, and production process of your products and services.

When describing the benefits of your products or services, here are some key factors to focus on.

• Unique features
• Translating the unique features into benefits
• The emotional, psychological, and practical payoffs to attract customers
• Intellectual property rights or any patents

When describing the product life cycle of your products or services, here are some key factors to focus on.

• Upsells, cross-sells, and down-sells
• Time between purchases
• Plans for research and development.

When describing the production process for your products or services, you need to think about the following:

• The creation of new or existing products and services.
• The sources for the raw materials or components you need for production.
• Assembling the products
• Maintaining quality control
• Supply-chain logistics (receiving the raw materials and delivering the finished products)
• The day-to-day management of the production processes, bookkeeping, and inventory.

Tips for Writing the Products or Services Section of Your Business Plan

1. Avoid Technical Descriptions and Industry Buzzwords

The products and services section of your business plan should clearly describe the products and services that your company provides. However, it is not a section to include technical jargons that anyone outside your industry will not understand.

A good practice is to remove highly detailed or technical descriptions in favor of simple terms. Industry buzzwords are not necessary, if there are simpler terms you can use, then use them. If you plan to use your business plan to source funds, making the product or service section so technical will do you no favors.

2. Describe How Your Products or Services Differ from Your Competitors

When potential investors look at your business plan, they want to know how the products and services you are offering differ from that of your competition. Differentiating your products or services from your competition in a way that makes your solution more attractive is critical.

If you are going the innovative path and there is no market currently for your product or service, you need to describe in this section why the market needs your product or service.

For example, overnight delivery was a niche business that only a few companies were participating in. Federal Express (FedEx) had to show in its business plan that there was a large opportunity for that service and they justified why the market needed that service.

3. Long or Short Products or Services Section

Should your products or services section be short? Does the long products or services section attract more investors?

There are no straightforward answers to these questions. Whether your products or services section should be long or relatively short depends on the nature of your business.

If your business is product-focused, then automatically you need to use more space to describe the details of your products. However, if the product your business sells is a commodity item that relies on competitive pricing or other pricing strategies, you do not have to use up so much space to provide significant details about the product.

Likewise, if you are selling a commodity that is available in numerous outlets, then you do not have to spend time on writing a long products or services section.

The key to the success of your business is most likely the effectiveness of your marketing strategies compared to your competitors. Use more space to address that section.

If you are creating a new product or service that the market does not know about, your products or services section can be lengthy. The reason why is because you need to explain everything about the product or service such as the nature of the product, its use case, and values.

A short products or services section for an innovative product or service will not give the readers enough information to properly evaluate your business.

4. Describe Your Relationships with Vendors or Suppliers

Your business will rely on vendors or suppliers to supply raw materials or the components needed to make your products. In your products and services section, describe your relationships with your vendors and suppliers fully.

Avoid the mistake of relying on only one supplier or vendor. If that supplier or vendor fails to supply or goes out of business, you can easily face supply problems and struggle to meet your demands. Plan to set up multiple vendor or supplier relationships for better business stability.

5. Your Primary Goal Is to Convince Your Readers

The primary goal of your business plan is to convince your readers that your business is viable and to create a guide for your business to follow. It applies to the products and services section.

When drafting this section, think like the reader. See your reader as someone who has no idea about your products and services. You are using the products and services section to provide the needed information to help your reader understand your products and services. As a result, you have to be clear and to the point.

While you want to educate your readers about your products or services, you also do not want to bore them with lots of technical details. Show your products and services and not your fancy choice of words.

Your products and services section should provide the answer to the “what” question for your business. You and your management team may run the business, but it is your products and services that are the lifeblood of the business.

Key Questions to Answer When Writing your Products and Services Section

Answering these questions can help you write your products and services section quickly and in a way that will appeal to your readers.

• Are your products existing on the market or are they still in the development stage?
• What is your timeline for adding new products and services to the market?
• What are the positives that make your products and services different from your competitors?
• Do your products and services have any competitive advantage that your competitors’ products and services do not currently have?
• Do your products or services have any competitive disadvantages that you need to overcome to compete with your competitors? If your answer is yes, state how you plan to overcome them,
• How much does it cost to produce your products or services? How much do you plan to sell it for?
• What is the price for your products and services compared to your competitors? Is pricing an issue?
• What are your operating costs and will it be low enough for you to compete with your competitors and still take home a reasonable profit margin?
• What is your plan for acquiring your products? Are you involved in the production of your products or services?
• Are you the manufacturer and produce all the components you need to create your products? Do you assemble your products by using components supplied by other manufacturers? Do you purchase your products directly from suppliers or wholesalers?
• Do you have a steady supply of products that you need to start your business? (If your business is yet to kick-off)
• How do you plan to distribute your products or services to the market?

You can also hint at the marketing or promotion plans you have for your products or services such as how you plan to build awareness or retain customers. The next section is where you can go fully into details about your business’s marketing and sales plan.

6. Show and Explain Your Marketing and Sales Plan

Providing great products and services is wonderful, but it means nothing if you do not have a marketing and sales plan to inform your customers about them. Your marketing and sales plan is critical to the success of your business.

The sales and marketing section is where you show and offer a detailed explanation of your marketing and sales plan and how you plan to execute it. It covers your pricing plan, proposed advertising and promotion activities, activities and partnerships you need to make your business a success, and the benefits of your products and services.

There are several ways you can approach your marketing and sales strategy. Ideally, your marketing and sales strategy has to fit the unique needs of your business.

In this section, you describe how the plans your business has for attracting and retaining customers, and the exact process for making a sale happen. It is essential to thoroughly describe your complete marketing and sales plans because you are still going to reference this section when you are making financial projections for your business.

Outline Your Business’ Unique Selling Proposition (USP)

The sales and marketing section is where you outline your business’s unique selling proposition (USP). When you are developing your unique selling proposition, think about the strongest reasons why people should buy from you over your competition. That reason(s) is most likely a good fit to serve as your unique selling proposition (USP).

Target Market and Target Audience

Plans on how to get your products or services to your target market and how to get your target audience to buy them go into this section. You also highlight the strengths of your business here, particularly what sets them apart from your competition.

Before you start writing your marketing and sales plan, you need to have properly defined your target audience and fleshed out your buyer persona. If you do not first understand the individual you are marketing to, your marketing and sales plan will lack any substance and easily fall.

Creating a Smart Marketing and Sales Plan

Marketing your products and services is an investment that requires you to spend money. Like any other investment, you have to generate a good return on investment (ROI) to justify using that marketing and sales plan. Good marketing and sales plans bring in high sales and profits to your company.

Avoid spending money on unproductive marketing channels. Do your research and find out the best marketing and sales plan that works best for your company.

Your marketing and sales plan can be broken into different parts: your positioning statement, pricing, promotion, packaging, advertising, public relations, content marketing, social media, and strategic alliances.

Your Positioning Statement

Your positioning statement is the first part of your marketing and sales plan. It refers to the way you present your company to your customers.

Are you the premium solution, the low-price solution, or are you the intermediary between the two extremes in the market? What do you offer that your competitors do not that can give you leverage in the market?

Before you start writing your positioning statement, you need to spend some time evaluating the current market conditions. Here are some questions that can help you to evaluate the market

• What are the unique features or benefits that you offer that your competitors lack?
• What are your customers’ primary needs and wants?
• Why should a customer choose you over your competition? How do you plan to differentiate yourself from the competition?
• How does your company’s solution compare with other solutions in the market?

After answering these questions, then you can start writing your positioning statement. Your positioning statement does not have to be in-depth or too long.

All you need to explain with your positioning statement are two focus areas. The first is the position of your company within the competitive landscape. The other focus area is the core value proposition that sets your company apart from other alternatives that your ideal customer might consider.

Here is a simple template you can use to develop a positioning statement.

For [description of target market] who [need of target market], [product or service] [how it meets the need]. Unlike [top competition], it [most essential distinguishing feature].

For example, let’s create the positioning statement for fictional accounting software and QuickBooks alternative , TBooks.

“For small business owners who need accounting services, TBooks is an accounting software that helps small businesses handle their small business bookkeeping basics quickly and easily. Unlike Wave, TBooks gives small businesses access to live sessions with top accountants.”

You can edit this positioning statement sample and fill it with your business details.

After writing your positioning statement, the next step is the pricing of your offerings. The overall positioning strategy you set in your positioning statement will often determine how you price your products or services.

Pricing is a powerful tool that sends a strong message to your customers. Failure to get your pricing strategy right can make or mar your business. If you are targeting a low-income audience, setting a premium price can result in low sales.

You can use pricing to communicate your positioning to your customers. For example, if you are offering a product at a premium price, you are sending a message to your customers that the product belongs to the premium category.

Basic Rules to Follow When Pricing Your Offering

Setting a price for your offering involves more than just putting a price tag on it. Deciding on the right pricing for your offering requires following some basic rules. They include covering your costs, primary and secondary profit center pricing, and matching the market rate.

• Covering Your Costs: The price you set for your products or service should be more than it costs you to produce and deliver them. Every business has the same goal, to make a profit. Depending on the strategy you want to use, there are exceptions to this rule. However, the vast majority of businesses follow this rule.
• Primary and Secondary Profit Center Pricing: When a company sets its price above the cost of production, it is making that product its primary profit center. A company can also decide not to make its initial price its primary profit center by selling below or at even with its production cost. It rather depends on the support product or even maintenance that is associated with the initial purchase to make its profit. The initial price thus became its secondary profit center.
• Matching the Market Rate: A good rule to follow when pricing your products or services is to match your pricing with consumer demand and expectations. If you price your products or services beyond the price your customer perceives as the ideal price range, you may end up with no customers. Pricing your products too low below what your customer perceives as the ideal price range may lead to them undervaluing your offering.

Pricing Strategy

Your pricing strategy influences the price of your offering. There are several pricing strategies available for you to choose from when examining the right pricing strategy for your business. They include cost-plus pricing, market-based pricing, value pricing, and more.

• Cost-plus Pricing: This strategy is one of the simplest and oldest pricing strategies. Here you consider the cost of producing a unit of your product and then add a profit to it to arrive at your market price. It is an effective pricing strategy for manufacturers because it helps them cover their initial costs. Another name for the cost-plus pricing strategy is the markup pricing strategy.
• Market-based Pricing: This pricing strategy analyses the market including competitors’ pricing and then sets a price based on what the market is expecting. With this pricing strategy, you can either set your price at the low-end or high-end of the market.
• Value Pricing: This pricing strategy involves setting a price based on the value you are providing to your customer. When adopting a value-based pricing strategy, you have to set a price that your customers are willing to pay. Service-based businesses such as small business insurance providers , luxury goods sellers, and the fashion industry use this pricing strategy.

After carefully sorting out your positioning statement and pricing, the next item to look at is your promotional strategy. Your promotional strategy explains how you plan on communicating with your customers and prospects.

As a business, you must measure all your costs, including the cost of your promotions. You also want to measure how much sales your promotions bring for your business to determine its usefulness. Promotional strategies or programs that do not lead to profit need to be removed.

There are different types of promotional strategies you can adopt for your business, they include advertising, public relations, and content marketing.

Advertising

Your business plan should include your advertising plan which can be found in the marketing and sales plan section. You need to include an overview of your advertising plans such as the areas you plan to spend money on to advertise your business and offers.

Ensure that you make it clear in this section if your business will be advertising online or using the more traditional offline media, or the combination of both online and offline media. You can also include the advertising medium you want to use to raise awareness about your business and offers.

Some common online advertising mediums you can use include social media ads, landing pages, sales pages, SEO, Pay-Per-Click, emails, Google Ads, and others. Some common traditional and offline advertising mediums include word of mouth, radios, direct mail, televisions, flyers, billboards, posters, and others.

A key component of your advertising strategy is how you plan to measure the effectiveness and success of your advertising campaign. There is no point in sticking with an advertising plan or medium that does not produce results for your business in the long run.

Public Relations

A great way to reach your customers is to get the media to cover your business or product. Publicity, especially good ones, should be a part of your marketing and sales plan. In this section, show your plans for getting prominent reviews of your product from reputable publications and sources.

Your business needs that exposure to grow. If public relations is a crucial part of your promotional strategy, provide details about your public relations plan here.

Content Marketing

Content marketing is a popular promotional strategy used by businesses to inform and attract their customers. It is about teaching and educating your prospects on various topics of interest in your niche, it does not just involve informing them about the benefits and features of the products and services you have,

Businesses publish content usually for free where they provide useful information, tips, and advice so that their target market can be made aware of the importance of their products and services. Content marketing strategies seek to nurture prospects into buyers over time by simply providing value.

Your company can create a blog where it will be publishing content for its target market. You will need to use the best website builder such as Wix and Squarespace and the best web hosting services such as Bluehost, Hostinger, and other Bluehost alternatives to create a functional blog or website.

If content marketing is a crucial part of your promotional strategy (as it should be), detail your plans under promotions.

Including high-quality images of the packaging of your product in your business plan is a lovely idea. You can add the images of the packaging of that product in the marketing and sales plan section. If you are not selling a product, then you do not need to include any worry about the physical packaging of your product.

When organizing the packaging section of your business plan, you can answer the following questions to make maximum use of this section.

• Is your choice of packaging consistent with your positioning strategy?
• What key value proposition does your packaging communicate? (It should reflect the key value proposition of your business)
• How does your packaging compare to that of your competitors?

Social Media

Your 21st-century business needs to have a good social media presence. Not having one is leaving out opportunities for growth and reaching out to your prospect.

You do not have to join the thousands of social media platforms out there. What you need to do is join the ones that your customers are active on and be active there.

Businesses use social media to provide information about their products such as promotions, discounts, the benefits of their products, and content on their blogs.

Social media is also a platform for engaging with your customers and getting feedback about your products or services. Make no mistake, more and more of your prospects are using social media channels to find more information about companies.

You need to consider the social media channels you want to prioritize your business (prioritize the ones your customers are active in) and your branding plans in this section.

Strategic Alliances

If your company plans to work closely with other companies as part of your sales and marketing plan, include it in this section. Prove details about those partnerships in your business plan if you have already established them.

Strategic alliances can be beneficial for all parties involved including your company. Working closely with another company in the form of a partnership can provide access to a different target market segment for your company.

The company you are partnering with may also gain access to your target market or simply offer a new product or service (that of your company) to its customers.

Mutually beneficial partnerships can cover the weaknesses of one company with the strength of another. You should consider strategic alliances with companies that sell complimentary products to yours. For example, if you provide printers, you can partner with a company that produces ink since the customers that buy printers from you will also need inks for printing.

Steps Involved in Creating a Marketing and Sales Plan

1. Focus on Your Target Market

Identify who your customers are, the market you want to target. Then determine the best ways to get your products or services to your potential customers.

2. Evaluate Your Competition

One of the goals of having a marketing plan is to distinguish yourself from your competition. You cannot stand out from them without first knowing them in and out.

You can know your competitors by gathering information about their products, pricing, service, and advertising campaigns.

These questions can help you know your competition.

• What makes your competition successful?
• What are their weaknesses?
• What are customers saying about your competition?

3. Consider Your Brand

Customers' perception of your brand has a strong impact on your sales. Your marketing and sales plan should seek to bolster the image of your brand. Before you start marketing your business, think about the message you want to pass across about your business and your products and services.

4. Focus on Benefits

The majority of your customers do not view your product in terms of features, what they want to know is the benefits and solutions your product offers. Think about the problems your product solves and the benefits it delivers, and use it to create the right sales and marketing message.

Your marketing plan should focus on what you want your customer to get instead of what you provide. Identify those benefits in your marketing and sales plan.

5. Focus on Differentiation

Your marketing and sales plan should look for a unique angle they can take that differentiates your business from the competition, even if the products offered are similar. Some good areas of differentiation you can use are your benefits, pricing, and features.

Key Questions to Answer When Writing Your Marketing and Sales Plan

• What is your company’s budget for sales and marketing campaigns?
• What key metrics will you use to determine if your marketing plans are successful?
• What are your alternatives if your initial marketing efforts do not succeed?
• Who are the sales representatives you need to promote your products or services?
• What are the marketing and sales channels you plan to use? How do you plan to get your products in front of your ideal customers?
• Where will you sell your products?

You may want to include samples of marketing materials you plan to use such as print ads, website descriptions, and social media ads. While it is not compulsory to include these samples, it can help you better communicate your marketing and sales plan and objectives.

The purpose of the marketing and sales section is to answer this question “How will you reach your customers?” If you cannot convincingly provide an answer to this question, you need to rework your marketing and sales section.

7. Clearly Show Your Funding Request

If you are writing your business plan to ask for funding from investors or financial institutions, the funding request section is where you will outline your funding requirements. The funding request section should answer the question ‘How much money will your business need in the near future (3 to 5 years)?’

A good funding request section will clearly outline and explain the amount of funding your business needs over the next five years. You need to know the amount of money your business needs to make an accurate funding request.

Also, when writing your funding request, provide details of how the funds will be used over the period. Specify if you want to use the funds to buy raw materials or machinery, pay salaries, pay for advertisements, and cover specific bills such as rent and electricity.

In addition to explaining what you want to use the funds requested for, you need to clearly state the projected return on investment (ROI) . Investors and creditors want to know if your business can generate profit for them if they put funds into it.

Ensure you do not inflate the figures and stay as realistic as possible. Investors and financial institutions you are seeking funds from will do their research before investing money in your business.

If you are not sure of an exact number to request from, you can use some range of numbers as rough estimates. Add a best-case scenario and a work-case scenario to your funding request. Also, include a description of your strategic future financial plans such as selling your business or paying off debts.

Funding Request: Debt or Equity?

When making your funding request, specify the type of funding you want. Do you want debt or equity? Draw out the terms that will be applicable for the funding, and the length of time the funding request will cover.

Case for Equity

If your new business has not yet started generating profits, you are most likely preparing to sell equity in your business to raise capital at the early stage. Equity here refers to ownership. In this case, you are selling a portion of your company to raise capital.

Although this method of raising capital for your business does not put your business in debt, keep in mind that an equity owner may expect to play a key role in company decisions even if he does not hold a major stake in the company.

Most equity sales for startups are usually private transactions . If you are making a funding request by offering equity in exchange for funding, let the investor know that they will be paid a dividend (a share of the company’s profit). Also, let the investor know the process for selling their equity in your business.

Case for Debt

You may decide not to offer equity in exchange for funds, instead, you make a funding request with the promise to pay back the money borrowed at the agreed time frame.

When making a funding request with an agreement to pay back, note that you will have to repay your creditors both the principal amount borrowed and the interest on it. Financial institutions offer this type of funding for businesses.

Large companies combine both equity and debt in their capital structure. When drafting your business plan, decide if you want to offer both or one over the other.

Before you sell equity in exchange for funding in your business, consider if you are willing to accept not being in total control of your business. Also, before you seek loans in your funding request section, ensure that the terms of repayment are favorable.

You should set a clear timeline in your funding request so that potential investors and creditors can know what you are expecting. Some investors and creditors may agree to your funding request and then delay payment for longer than 30 days, meanwhile, your business needs an immediate cash injection to operate efficiently.

Additional Tips for Writing the Funding Request Section of your Business Plan

The funding request section is not necessary for every business, it is only needed by businesses who plan to use their business plan to secure funding.

If you are adding the funding request section to your business plan, provide an itemized summary of how you plan to use the funds requested. Hiring a lawyer, accountant, or other professionals may be necessary for the proper development of this section.

You should also gather and use financial statements that add credibility and support to your funding requests. Ensure that the financial statements you use should include your projected financial data such as projected cash flows, forecast statements, and expenditure budgets.

If you are an existing business, include all historical financial statements such as cash flow statements, balance sheets and income statements .

Provide monthly and quarterly financial statements for a year. If your business has records that date back beyond the one-year mark, add the yearly statements of those years. These documents are for the appendix section of your business plan.

8. Detail Your Financial Plan, Metrics, and Projections

If you used the funding request section in your business plan, supplement it with a financial plan, metrics, and projections. This section paints a picture of the past performance of your business and then goes ahead to make an informed projection about its future.

The goal of this section is to convince readers that your business is going to be a financial success. It outlines your business plan to generate enough profit to repay the loan (with interest if applicable) and to generate a decent return on investment for investors.

If you have an existing business already in operation, use this section to demonstrate stability through finance. This section should include your cash flow statements, balance sheets, and income statements covering the last three to five years. If your business has some acceptable collateral that you can use to acquire loans, list it in the financial plan, metrics, and projection section.

Apart from current financial statements, this section should also contain a prospective financial outlook that spans the next five years. Include forecasted income statements, cash flow statements, balance sheets, and capital expenditure budget.

If your business is new and is not yet generating profit, use clear and realistic projections to show the potentials of your business.

When drafting this section, research industry norms and the performance of comparable businesses. Your financial projections should cover at least five years. State the logic behind your financial projections. Remember you can always make adjustments to this section as the variables change.

The financial plan, metrics, and projection section create a baseline which your business can either exceed or fail to reach. If your business fails to reach your projections in this section, you need to understand why it failed.

Investors and loan managers spend a lot of time going through the financial plan, metrics, and projection section compared to other parts of the business plan. Ensure you spend time creating credible financial analyses for your business in this section.

Many entrepreneurs find this section daunting to write. You do not need a business degree to create a solid financial forecast for your business. Business finances, especially for startups, are not as complicated as they seem. There are several online tools and templates that make writing this section so much easier.

Use Graphs and Charts

The financial plan, metrics, and projection section is a great place to use graphs and charts to tell the financial story of your business. Charts and images make it easier to communicate your finances.

Accuracy in this section is key, ensure you carefully analyze your past financial statements properly before making financial projects.

Address the Risk Factors and Show Realistic Financial Projections

Keep your financial plan, metrics, and projection realistic. It is okay to be optimistic in your financial projection, however, you have to justify it.

You should also address the various risk factors associated with your business in this section. Investors want to know the potential risks involved, show them. You should also show your plans for mitigating those risks.

What You Should In The Financial Plan, Metrics, and Projection Section of Your Business Plan

The financial plan, metrics, and projection section of your business plan should have monthly sales and revenue forecasts for the first year. It should also include annual projections that cover 3 to 5 years.

A three-year projection is a basic requirement to have in your business plan. However, some investors may request a five-year forecast.

Your business plan should include the following financial statements: sales forecast, personnel plan, income statement, income statement, cash flow statement, balance sheet, and an exit strategy.

1. Sales Forecast

Sales forecast refers to your projections about the number of sales your business is going to record over the next few years. It is typically broken into several rows, with each row assigned to a core product or service that your business is offering.

One common mistake people make in their business plan is to break down the sales forecast section into long details. A sales forecast should forecast the high-level details.

For example, if you are forecasting sales for a payroll software provider, you could break down your forecast into target market segments or subscription categories.

Your sales forecast section should also have a corresponding row for each sales row to cover the direct cost or Cost of Goods Sold (COGS). The objective of these rows is to show the expenses that your business incurs in making and delivering your product or service.

Note that your Cost of Goods Sold (COGS) should only cover those direct costs incurred when making your products. Other indirect expenses such as insurance, salaries, payroll tax, and rent should not be included.

For example, the Cost of Goods Sold (COGS) for a restaurant is the cost of ingredients while for a consulting company it will be the cost of paper and other presentation materials.

2. Personnel Plan

The personnel plan section is where you provide details about the payment plan for your employees. For a small business, you can easily list every position in your company and how much you plan to pay in the personnel plan.

However, for larger businesses, you have to break the personnel plan into functional groups such as sales and marketing.

The personnel plan will also include the cost of an employee beyond salary, commonly referred to as the employee burden. These costs include insurance, payroll taxes , and other essential costs incurred monthly as a result of having employees on your payroll.

3. Income Statement

The income statement section shows if your business is making a profit or taking a loss. Another name for the income statement is the profit and loss (P&L). It takes data from your sales forecast and personnel plan and adds other ongoing expenses you incur while running your business.

Every business plan should have an income statement. It subtracts your business expenses from its earnings to show if your business is generating profit or incurring losses.

The income statement has the following items: sales, Cost of Goods Sold (COGS), gross margin, operating expenses, total operating expenses, operating income , total expenses, and net profit.

• Sales refer to the revenue your business generates from selling its products or services. Other names for sales are income or revenue.
• Cost of Goods Sold (COGS) refers to the total cost of selling your products. Other names for COGS are direct costs or cost of sales. Manufacturing businesses use the Costs of Goods Manufactured (COGM) .
• Gross Margin is the figure you get when you subtract your COGS from your sales. In your income statement, you can express it as a percentage of total sales (Gross margin / Sales = Gross Margin Percent).
• Operating Expenses refer to all the expenses you incur from running your business. It exempts the COGS because it stands alone as a core part of your income statement. You also have to exclude taxes, depreciation, and amortization. Your operating expenses include salaries, marketing expenses, research and development (R&D) expenses, and other expenses.
• Total Operating Expenses refers to the sum of all your operating expenses including those exemptions named above under operating expenses.
• Operating Income refers to earnings before interest, taxes, depreciation, and amortization. It is simply known as the acronym EBITDA (earnings before interest, taxes, depreciation, and amortization). Calculating your operating income is simple, all you need to do is to subtract your COGS and total operating expenses from your sales.
• Total Expenses refer to the sum of your operating expenses and your business’ interest, taxes, depreciation, and amortization.
• Net profit shows whether your business has made a profit or taken a loss during a given timeframe.

4. Cash Flow Statement

The cash flow statement tracks the money you have in the bank at any given point. It is often confused with the income statement or the profit and loss statement. They are both different types of financial statements. The income statement calculates your profits and losses while the cash flow statement shows you how much you have in the bank.

5. Balance Sheet

The balance sheet is a financial statement that provides an overview of the financial health of your business. It contains information about the assets and liabilities of your company, and owner’s or shareholders’ equity.

You can get the net worth of your company by subtracting your company’s liabilities from its assets.

6. Exit Strategy

The exit strategy refers to a probable plan for selling your business either to the public in an IPO or to another company. It is the last thing you include in the financial plan, metrics, and projection section.

You can choose to omit the exit strategy from your business plan if you plan to maintain full ownership of your business and do not plan on seeking angel investment or virtual capitalist (VC) funding.

Investors may want to know what your exit plan is. They invest in your business to get a good return on investment.

Your exit strategy does not have to include long and boring details. Ensure you identify some interested parties who may be interested in buying the company if it becomes a success.

Key Questions to Answer with Your Financial Plan, Metrics, and Projection

Your financial plan, metrics, and projection section helps investors, creditors, or your internal managers to understand what your expenses are, the amount of cash you need, and what it takes to make your company profitable. It also shows what you will be doing with any funding.

You do not need to show actual financial data if you do not have one. Adding forecasts and projections to your financial statements is added proof that your strategy is feasible and shows investors you have planned properly.

Here are some key questions to answer to help you develop this section.

• What is your sales forecast for the next year?
• When will your company achieve a positive cash flow?
• What are the core expenses you need to operate?
• How much money do you need upfront to operate or grow your company?
• How will you use the loans or investments?

9. Add an Appendix to Your Business Plan

Adding an appendix to your business plan is optional. It is a useful place to put any charts, tables, legal notes, definitions, permits, résumés, and other critical information that do not fit into other sections of your business plan.

The appendix section is where you would want to include details of a patent or patent-pending if you have one. You can always add illustrations or images of your products here. It is the last section of your business plan.

When writing your business plan, there are details you cut short or remove to prevent the entire section from becoming too lengthy. There are also details you want to include in the business plan but are not a good fit for any of the previous sections. You can add that additional information to the appendix section.

Businesses also use the appendix section to include supporting documents or other materials specially requested by investors or lenders.

You can include just about any information that supports the assumptions and statements you made in the business plan under the appendix. It is the one place in the business plan where unrelated data and information can coexist amicably.

If your appendix section is lengthy, try organizing it by adding a table of contents at the beginning of the appendix section. It is also advisable to group similar information to make it easier for the reader to access them.

A well-organized appendix section makes it easier to share your information clearly and concisely. Add footnotes throughout the rest of the business plan or make references in the plan to the documents in the appendix.

The appendix section is usually only necessary if you are seeking funding from investors or lenders, or hoping to attract partners.

People reading business plans do not want to spend time going through a heap of backup information, numbers, and charts. Keep these documents or information in the Appendix section in case the reader wants to dig deeper.

Common Items to Include in the Appendix Section of Your Business Plan

The appendix section includes documents that supplement or support the information or claims given in other sections of the business plans. Common items you can include in the appendix section include:

• Additional data about the process of manufacturing or creation
• Additional description of products or services such as product schematics
• Additional financial documents or projections
• Articles of incorporation and status
• Backup for market research or competitive analysis
• Bank statements
• Business registries
• Client testimonials (if your business is already running)
• Copies of insurances
• Credit histories (personal or/and business)
• Deeds and permits
• Equipment leases
• Examples of marketing and advertising collateral
• Industry associations and memberships
• Images of product
• Intellectual property
• Key customer contracts
• Legal documents and other contracts
• Letters of reference
• Links to references
• Market research data
• Organizational charts
• Photographs of potential facilities
• Professional licenses pertaining to your legal structure or type of business
• Purchase orders
• Resumes of the founder(s) and key managers
• State and federal identification numbers or codes
• Trademarks or patents’ registrations

Avoid using the appendix section as a place to dump any document or information you feel like adding. Only add documents or information that you support or increase the credibility of your business plan.

Tips and Strategies for Writing a Convincing Business Plan

To achieve a perfect business plan, you need to consider some key tips and strategies. These tips will raise the efficiency of your business plan above average.

1. Know Your Audience

When writing a business plan, you need to know your audience . Business owners write business plans for different reasons. Your business plan has to be specific. For example, you can write business plans to potential investors, banks, and even fellow board members of the company.

The audience you are writing to determines the structure of the business plan. As a business owner, you have to know your audience. Not everyone will be your audience. Knowing your audience will help you to narrow the scope of your business plan.

Consider what your audience wants to see in your projects, the likely questions they might ask, and what interests them.

• A business plan used to address a company's board members will center on its employment schemes, internal affairs, projects, stakeholders, etc.
• A business plan for financial institutions will talk about the size of your market and the chances for you to pay back any loans you demand.
• A business plan for investors will show proof that you can return the investment capital within a specific time. In addition, it discusses your financial projections, tractions, and market size.

2. Get Inspiration from People

Writing a business plan from scratch as an entrepreneur can be daunting. That is why you need the right inspiration to push you to write one. You can gain inspiration from the successful business plans of other businesses. Look at their business plans, the style they use, the structure of the project, etc.

To make your business plan easier to create, search companies related to your business to get an exact copy of what you need to create an effective business plan. You can also make references while citing examples in your business plans.

When drafting your business plan, get as much help from others as you possibly can. By getting inspiration from people, you can create something better than what they have.

3. Avoid Being Over Optimistic

Many business owners make use of strong adjectives to qualify their content. One of the big mistakes entrepreneurs make when preparing a business plan is promising too much.

The use of superlatives and over-optimistic claims can prepare the audience for more than you can offer. In the end, you disappoint the confidence they have in you.

In most cases, the best option is to be realistic with your claims and statistics. Most of the investors can sense a bit of incompetency from the overuse of superlatives. As a new entrepreneur, do not be tempted to over-promise to get the interests of investors.

The concept of entrepreneurship centers on risks, nothing is certain when you make future analyses. What separates the best is the ability to do careful research and work towards achieving that, not promising more than you can achieve.

To make an excellent first impression as an entrepreneur, replace superlatives with compelling data-driven content. In this way, you are more specific than someone promising a huge ROI from an investment.

4. Keep it Simple and Short

When writing business plans, ensure you keep them simple throughout. Irrespective of the purpose of the business plan, your goal is to convince the audience.

One way to achieve this goal is to make them understand your proposal. Therefore, it would be best if you avoid the use of complex grammar to express yourself. It would be a huge turn-off if the people you want to convince are not familiar with your use of words.

Another thing to note is the length of your business plan. It would be best if you made it as brief as possible.

You hardly see investors or agencies that read through an extremely long document. In that case, if your first few pages can’t convince them, then you have lost it. The more pages you write, the higher the chances of you derailing from the essential contents.

To ensure your business plan has a high conversion rate, you need to dispose of every unnecessary information. For example, if you have a strategy that you are not sure of, it would be best to leave it out of the plan.

5. Make an Outline and Follow Through

A perfect business plan must have touched every part needed to convince the audience. Business owners get easily tempted to concentrate more on their products than on other sections. Doing this can be detrimental to the efficiency of the business plan.

For example, imagine you talking about a product but omitting or providing very little information about the target audience. You will leave your clients confused.

To ensure that your business plan communicates your full business model to readers, you have to input all the necessary information in it. One of the best ways to achieve this is to design a structure and stick to it.

This structure is what guides you throughout the writing. To make your work easier, you can assign an estimated word count or page limit to every section to avoid making it too bulky for easy reading. As a guide, the necessary things your business plan must contain are:

• Table of contents
• Introduction
• Product or service description
• Target audience
• Market size
• Competition analysis
• Financial projections

Some specific businesses can include some other essential sections, but these are the key sections that must be in every business plan.

6. Ask a Professional to Proofread

When writing a business plan, you must tie all loose ends to get a perfect result. When you are done with writing, call a professional to go through the document for you. You are bound to make mistakes, and the way to correct them is to get external help.

You should get a professional in your field who can relate to every section of your business plan. It would be easier for the professional to notice the inner flaws in the document than an editor with no knowledge of your business.

In addition to getting a professional to proofread, get an editor to proofread and edit your document. The editor will help you identify grammatical errors, spelling mistakes, and inappropriate writing styles.

Writing a business plan can be daunting, but you can surmount that obstacle and get the best out of it with these tips.

Business Plan Examples and Templates That’ll Save You Tons of Time

1. hubspot's one-page business plan.

The one-page business plan template by HubSpot is the perfect guide for businesses of any size, irrespective of their business strategy. Although the template is condensed into a page, your final business plan should not be a page long! The template is designed to ask helpful questions that can help you develop your business plan.

Hubspot’s one-page business plan template is divided into nine fields:

• Business opportunity
• Company description
• Industry analysis
• Target market
• Implementation timeline
• Marketing plan
• Financial summary
• Funding required

2. Bplan’s Free Business Plan Template

Bplans' free business plan template is investor-approved. It is a rich template used by prestigious educational institutions such as Babson College and Princeton University to teach entrepreneurs how to create a business plan.

The template has six sections: the executive summary, opportunity, execution, company, financial plan, and appendix. There is a step-by-step guide for writing every little detail in the business plan. Follow the instructions each step of the way and you will create a business plan that impresses investors or lenders easily.

3. HubSpot's Downloadable Business Plan Template

HubSpot’s downloadable business plan template is a more comprehensive option compared to the one-page business template by HubSpot. This free and downloadable business plan template is designed for entrepreneurs.

The template is a comprehensive guide and checklist for business owners just starting their businesses. It tells you everything you need to fill in each section of the business plan and how to do it.

There are nine sections in this business plan template: an executive summary, company and business description, product and services line, market analysis, marketing plan, sales plan, legal notes, financial considerations, and appendix.

4. Business Plan by My Own Business Institute

My Own Business Institute (MOBI) which is a part of Santa Clara University's Center for Innovation and Entrepreneurship offers a free business plan template. You can either copy the free business template from the link provided above or download it as a Word document.

The comprehensive template consists of a whopping 15 sections.

• The Business Profile
• The Vision and the People
• Home-Based Business and Freelance Business Opportunities
• Organization
• Licenses and Permits
• Business Insurance
• Communication Tools
• Acquisitions
• Location and Leasing
• Accounting and Cash Flow
• Opening and Marketing
• Managing Employees
• Expanding and Handling Problems

There are lots of helpful tips on how to fill each section in the free business plan template by MOBI.

5. Score's Business Plan Template for Startups

Score is an American nonprofit organization that helps entrepreneurs build successful companies. This business plan template for startups by Score is available for free download. The business plan template asks a whooping 150 generic questions that help entrepreneurs from different fields to set up the perfect business plan.

The business plan template for startups contains clear instructions and worksheets, all you have to do is answer the questions and fill the worksheets.

There are nine sections in the business plan template: executive summary, company description, products and services, marketing plan, operational plan, management and organization, startup expenses and capitalization, financial plan, and appendices.

The ‘refining the plan’ resource contains instructions that help you modify your business plan to suit your specific needs, industry, and target audience. After you have completed Score’s business plan template, you can work with a SCORE mentor for expert advice in business planning.

6. Minimalist Architecture Business Plan Template by Venngage

The minimalist architecture business plan template is a simple template by Venngage that you can customize to suit your business needs .

There are five sections in the template: an executive summary, statement of problem, approach and methodology, qualifications, and schedule and benchmark. The business plan template has instructions that guide users on what to fill in each section.

7. Small Business Administration Free Business Plan Template

The Small Business Administration (SBA) offers two free business plan templates, filled with practical real-life examples that you can model to create your business plan. Both free business plan templates are written by fictional business owners: Rebecca who owns a consulting firm, and Andrew who owns a toy company.

There are five sections in the two SBA’s free business plan templates.

• Executive Summary
• Company Description
• Service Line
• Marketing and Sales

8. The $100 Startup's One-Page Business Plan

The one-page business plan by the $100 startup is a simple business plan template for entrepreneurs who do not want to create a long and complicated plan . You can include more details in the appendices for funders who want more information beyond what you can put in the one-page business plan.

There are five sections in the one-page business plan such as overview, ka-ching, hustling, success, and obstacles or challenges or open questions. You can answer all the questions using one or two sentences.

9. PandaDoc’s Free Business Plan Template

The free business plan template by PandaDoc is a comprehensive 15-page document that describes the information you should include in every section.

There are 11 sections in PandaDoc’s free business plan template.

• Executive summary
• Business description
• Products and services
• Operations plan
• Management organization
• Financial plan
• Conclusion / Call to action
• Confidentiality statement

You have to sign up for its 14-day free trial to access the template. You will find different business plan templates on PandaDoc once you sign up (including templates for general businesses and specific businesses such as bakeries, startups, restaurants, salons, hotels, and coffee shops)

PandaDoc allows you to customize its business plan templates to fit the needs of your business. After editing the template, you can send it to interested parties and track opens and views through PandaDoc.

10. Invoiceberry Templates for Word, Open Office, Excel, or PPT

InvoiceBerry is a U.K based online invoicing and tracking platform that offers free business plan templates in .docx, .odt, .xlsx, and .pptx formats for freelancers and small businesses.

Before you can download the free business plan template, it will ask you to give it your email address. After you complete the little task, it will send the download link to your inbox for you to download. It also provides a business plan checklist in .xlsx file format that ensures you add the right information to the business plan.

Alternatives to the Traditional Business Plan

A business plan is very important in mapping out how one expects their business to grow over a set number of years, particularly when they need external investment in their business. However, many investors do not have the time to watch you present your business plan. It is a long and boring read.

Luckily, there are three alternatives to the traditional business plan (the Business Model Canvas, Lean Canvas, and Startup Pitch Deck). These alternatives are less laborious and easier and quicker to present to investors.

Business Model Canvas (BMC)

The business model canvas is a business tool used to present all the important components of setting up a business, such as customers, route to market, value proposition, and finance in a single sheet. It provides a very focused blueprint that defines your business initially which you can later expand on if needed.

The sheet is divided mainly into company, industry, and consumer models that are interconnected in how they find problems and proffer solutions.

Segments of the Business Model Canvas

The business model canvas was developed by founder Alexander Osterwalder to answer important business questions. It contains nine segments.

• Key Partners: Who will be occupying important executive positions in your business? What do they bring to the table? Will there be a third party involved with the company?
• Key Activities: What important activities will production entail? What activities will be carried out to ensure the smooth running of the company?
• The Product’s Value Propositions: What does your product do? How will it be different from other products?
• Customer Segments: What demography of consumers are you targeting? What are the habits of these consumers? Who are the MVPs of your target consumers?
• Customer Relationships: How will the team support and work with its customer base? How do you intend to build and maintain trust with the customer?
• Key Resources: What type of personnel and tools will be needed? What size of the budget will they need access to?
• Channels: How do you plan to create awareness of your products? How do you intend to transport your product to the customer?
• Cost Structure: What is the estimated cost of production? How much will distribution cost?
• Revenue Streams: For what value are customers willing to pay? How do they prefer to pay for the product? Are there any external revenues attached apart from the main source? How do the revenue streams contribute to the overall revenue?

Lean Canvas

The lean canvas is a problem-oriented alternative to the standard business model canvas. It was proposed by Ash Maurya, creator of Lean Stack as a development of the business model generation. It uses a more problem-focused approach and it majorly targets entrepreneurs and startup businesses.

Lean Canvas uses the same 9 blocks concept as the business model canvas, however, they have been modified slightly to suit the needs and purpose of a small startup. The key partners, key activities, customer relationships, and key resources are replaced by new segments which are:

• Problem: Simple and straightforward number of problems you have identified, ideally three.
• Solution: The solutions to each problem.
• Unfair Advantage: Something you possess that can't be easily bought or replicated.
• Key Metrics: Important numbers that will tell how your business is doing.

Startup Pitch Deck

While the business model canvas compresses into a factual sheet, startup pitch decks expand flamboyantly.

Pitch decks, through slides, convey your business plan, often through graphs and images used to emphasize estimations and observations in your presentation. Entrepreneurs often use pitch decks to fully convince their target audience of their plans before discussing funding arrangements.

Considering the likelihood of it being used in a small time frame, a good startup pitch deck should ideally contain 20 slides or less to have enough time to answer questions from the audience.

Unlike the standard and lean business model canvases, a pitch deck doesn't have a set template on how to present your business plan but there are still important components to it. These components often mirror those of the business model canvas except that they are in slide form and contain more details.

Using Airbnb (one of the most successful start-ups in recent history) for reference, the important components of a good slide are listed below.

• Cover/Introduction Slide: Here, you should include your company's name and mission statement. Your mission statement should be a very catchy tagline. Also, include personal information and contact details to provide an easy link for potential investors.
• Problem Slide: This slide requires you to create a connection with the audience or the investor that you are pitching. For example in their pitch, Airbnb summarized the most important problems it would solve in three brief points – pricing of hotels, disconnection from city culture, and connection problems for local bookings.
• Solution Slide: This slide includes your core value proposition. List simple and direct solutions to the problems you have mentioned
• Customer Analysis: Here you will provide information on the customers you will be offering your service to. The identity of your customers plays an important part in fundraising as well as the long-run viability of the business.
• Market Validation: Use competitive analysis to show numbers that prove the presence of a market for your product, industry behavior in the present and the long run, as well as the percentage of the market you aim to attract. It shows that you understand your competitors and customers and convinces investors of the opportunities presented in the market.
• Business Model: Your business model is the hook of your presentation. It may vary in complexity but it should generally include a pricing system informed by your market analysis. The goal of the slide is to confirm your business model is easy to implement.
• Marketing Strategy: This slide should summarize a few customer acquisition methods that you plan to use to grow the business.
• Competitive Advantage: What this slide will do is provide information on what will set you apart and make you a more attractive option to customers. It could be the possession of technology that is not widely known in the market.
• Team Slide: Here you will give a brief description of your team. Include your key management personnel here and their specific roles in the company. Include their educational background, job history, and skillsets. Also, talk about their accomplishments in their careers so far to build investors' confidence in members of your team.
• Traction Slide: This validates the company’s business model by showing growth through early sales and support. The slide aims to reduce any lingering fears in potential investors by showing realistic periodic milestones and profit margins. It can include current sales, growth, valuable customers, pre-orders, or data from surveys outlining current consumer interest.
• Funding Slide: This slide is popularly referred to as ‘the ask'. Here you will include important details like how much is needed to get your business off the ground and how the funding will be spent to help the company reach its goals.
• Appendix Slides: Your pitch deck appendix should always be included alongside a standard pitch presentation. It consists of additional slides you could not show in the pitch deck but you need to complement your presentation.

It is important to support your calculations with pictorial renditions. Infographics, such as pie charts or bar graphs, will be more effective in presenting the information than just listing numbers. For example, a six-month graph that shows rising profit margins will easily look more impressive than merely writing it.

Lastly, since a pitch deck is primarily used to secure meetings and you may be sharing your pitch with several investors, it is advisable to keep a separate public version that doesn't include financials. Only disclose the one with projections once you have secured a link with an investor.

Advantages of the Business Model Canvas, Lean Canvas, and Startup Pitch Deck over the Traditional Business Plan

• Time-Saving: Writing a detailed traditional business plan could take weeks or months. On the other hand, all three alternatives can be done in a few days or even one night of brainstorming if you have a comprehensive understanding of your business.
• Easier to Understand: Since the information presented is almost entirely factual, it puts focus on what is most important in running the business. They cut away the excess pages of fillers in a traditional business plan and allow investors to see what is driving the business and what is getting in the way.
• Easy to Update: Businesses typically present their business plans to many potential investors before they secure funding. What this means is that you may regularly have to amend your presentation to update statistics or adjust to audience-specific needs. For a traditional business plan, this could mean rewriting a whole section of your plan. For the three alternatives, updating is much easier because they are not voluminous.
• Guide for a More In-depth Business Plan: All three alternatives have the added benefit of being able to double as a sketch of your business plan if the need to create one arises in the future.

Business Plan FAQ

Business plans are important for any entrepreneur who is looking for a framework to run their company over some time or seeking external support. Although they are essential for new businesses, every company should ideally have a business plan to track their growth from time to time.  They can be used by startups seeking investments or loans to convey their business ideas or an employee to convince his boss of the feasibility of starting a new project. They can also be used by companies seeking to recruit high-profile employee targets into key positions or trying to secure partnerships with other firms.

Business plans often vary depending on your target audience, the scope, and the goals for the plan. Startup plans are the most common among the different types of business plans.  A start-up plan is used by a new business to present all the necessary information to help get the business up and running. They are usually used by entrepreneurs who are seeking funding from investors or bank loans. The established company alternative to a start-up plan is a feasibility plan. A feasibility plan is often used by an established company looking for new business opportunities. They are used to show the upsides of creating a new product for a consumer base. Because the audience is usually company people, it requires less company analysis. The third type of business plan is the lean business plan. A lean business plan is a brief, straight-to-the-point breakdown of your ideas and analysis for your business. It does not contain details of your proposal and can be written on one page. Finally, you have the what-if plan. As it implies, a what-if plan is a preparation for the worst-case scenario. You must always be prepared for the possibility of your original plan being rejected. A good what-if plan will serve as a good plan B to the original.

A good business plan has 10 key components. They include an executive plan, product analysis, desired customer base, company analysis, industry analysis, marketing strategy, sales strategy, financial projection, funding, and appendix. Executive Plan Your business should begin with your executive plan. An executive plan will provide early insight into what you are planning to achieve with your business. It should include your mission statement and highlight some of the important points which you will explain later. Product Analysis The next component of your business plan is your product analysis. A key part of this section is explaining the type of item or service you are going to offer as well as the market problems your product will solve. Desired Consumer Base Your product analysis should be supplemented with a detailed breakdown of your desired consumer base. Investors are always interested in knowing the economic power of your market as well as potential MVP customers. Company Analysis The next component of your business plan is your company analysis. Here, you explain how you want to run your business. It will include your operational strategy, an insight into the workforce needed to keep the company running, and important executive positions. It will also provide a calculation of expected operational costs.  Industry Analysis A good business plan should also contain well laid out industry analysis. It is important to convince potential investors you know the companies you will be competing with, as well as your plans to gain an edge on the competition. Marketing Strategy Your business plan should also include your marketing strategy. This is how you intend to spread awareness of your product. It should include a detailed explanation of the company brand as well as your advertising methods. Sales Strategy Your sales strategy comes after the market strategy. Here you give an overview of your company's pricing strategy and how you aim to maximize profits. You can also explain how your prices will adapt to market behaviors. Financial Projection The financial projection is the next component of your business plan. It explains your company's expected running cost and revenue earned during the tenure of the business plan. Financial projection gives a clear idea of how your company will develop in the future. Funding The next component of your business plan is funding. You have to detail how much external investment you need to get your business idea off the ground here. Appendix The last component of your plan is the appendix. This is where you put licenses, graphs, or key information that does not fit in any of the other components.

The business model canvas is a business management tool used to quickly define your business idea and model. It is often used when investors need you to pitch your business idea during a brief window.

A pitch deck is similar to a business model canvas except that it makes use of slides in its presentation. A pitch is not primarily used to secure funding, rather its main purpose is to entice potential investors by selling a very optimistic outlook on the business.

Business plan competitions help you evaluate the strength of your business plan. By participating in business plan competitions, you are improving your experience. The experience provides you with a degree of validation while practicing important skills. The main motivation for entering into the competitions is often to secure funding by finishing in podium positions. There is also the chance that you may catch the eye of a casual observer outside of the competition. These competitions also provide good networking opportunities. You could meet mentors who will take a keen interest in guiding you in your business journey. You also have the opportunity to meet other entrepreneurs whose ideas can complement yours.

Exlore Further

• 12 Key Elements of a Business Plan (Top Components Explained)
• 13 Sources of Business Finance For Companies & Sole Traders
• 5 Common Types of Business Structures (+ Pros & Cons)
• How to Buy a Business in 8 Steps (+ Due Diligence Checklist)

Was This Article Helpful?

Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

Ecommerce · Strategy · Consulting

What is Strategy? Definition, Components & Examples Explained

by Martin Heubel

• Share on LinkedIn
• Email this Page
• Share on WhatsApp

The success of any business is determined by the effectiveness of the strategy it follows. A strategy explains how a company plans to compete in a market and how it intends to grow at a profit.

Businesses worldwide sell goods and services in competitive markets that require them to increase the value for owners and shareholders to secure their future existence.

This calls for a plan that helps managers guide their decisions and use resources effectively to achieve key objectives. This plan is also known as a business strategy.

This article will cover:

• What a business strategy is
• The difference between strategy and tactics
• Corporate level strategies
• Business level strategies
• Functional level strategies
• Why having a business strategy is important

Step 1: Define your vision

Step 2: set your top-level objectives, step 3: analyse your business and the market, step 4: define how to gain competitive advantage, step 5: build a strategy framework, types of business strategies, how to measure strategy success.

• Business strategy examples

What is a business strategy?

The definition is as straight forward as it can be confusing when reading it first:

A business strategy outlines the plan of action to achieve the vision and set objectives of an organization and guides the decision-making processes to improve the company’s financial stability in a competing market.

In an attempt to reduce complexity, many online sources refer to a simpler definition of strategy as:

A high-level plan that helps a business achieve its goals.

While this is still accurate, it does not give a good understanding of how these goals are actually achieved.

To allow for a better and more granular understanding, I will refer to the former definition in the following chapters.

How is strategy different from tactics?

Before we get into the details of building a strategy, it is vital to understand how a strategy differs from a tactic.

While both terms are often interchangeably conf used, they are two entirely different things:

A strategy refers to an organization’s long-term goals and how it plans to reach them. In other words, it shows the path to achieve the defined vision.

A tactic refers to the specific actions taken to reach the set goals in line with the strategy.

For example, company A’s strategy might be to become the cheapest provider in the smartphone market. Their managers then need to negotiate with suppliers to reduce the costs of the electronic components used in production. This is a tactic to achieve the set strategy.

Or, as the English comedian and writer Frank Muir put it:

Strategy is buying a bottle of fine wine when you take someone out for dinner. Tactics is getting them to drink it. Frank Muir

Levels of business strategies

There are three levels at which strategies are typically used: The corporate , business and functional level.

All three levels form the strategic framework of an organization:

1. Corporate Level: Corporate level strategies are the strategic plans of an organisation’s top management. They form the mission and vision statement and have a fundamental impact on the firm’s long-term performance. They guide decisions around growth, acquisitions, diversification and investments.

2. Business Level: Business level strategies integrate into the corporate vision, but with a focus on a specific business. At this level, the vision and objectives are turned into concrete strategies that inform how a business is going to compete in the market.

3. Functional Level: Functional level strategies are designed to answer how functional departments like Marketing, HR or R&D can support the defined business and corporate strategies of an organization.

It’s not uncommon for a firm to have multiple strategies at each level. In fact, this is essential to ensure that the different needs of each layer are accurately reflected.

Although multiple strategies carry the risk of conflicting priorities and objectives, these risks can be reduced if managed correctly. We will come back to this point in a second.

Why is having a business strategy important?

The existence of a strategy is a critical success factor for any business.

Essentially, it reflects the strengths and weaknesses of the company and answers how the company plans to respond to the threats and opportunities in the market in which it operates.

A strategy takes into account the resources at hand and how to best deploy them to achieve its set objectives.

That’s why a strategy is often called the lighthouse for a company’s management: It aligns the efforts of all functional departments and gives its employees a Northstar that guides their daily decision making.

To make this point even clearer, let’s say a business would not have a strategy on how it will compete in a market:

The absence of such a blueprint would lead to disordered actions in each department, limiting the organisation’s effectiveness as a whole. This incoherence always results in a loss of competitive power that will be exploited in the market.

How do you formulate a business strategy?

The above definition already gives some practical advice on how to build an effective strategy:

A strategy needs to outline the vision of a business, define its targets and how it is going to grow and compete long-term.

The strategy building process can be broken down into five steps:

• Define your vision
• Set your top-level objectives
• Analyse your business and the market
• Define how to gain competitive advantage
• Build a strategy framework

Most online sources suggest that strategy formulation should begin by defining the objectives of an organization. But this reaches too far too fast, as it presumes that the offering, the market and the target customers have already been defined.

For a strategy to be successful, it must first consider the company’s core values and its desired future position in the market. This is also known as the company’s vision .

Examples of vision statements from some of the largest companies include:

“Apple strives to bring the best personal computing experience to students, educators, creative professionals, and consumers around the world through its innovative hardware, software, and internet offerings.” Apple

“To be earth’s most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online.” Amazon

Based on a firm’s vision, the offer , its customers and the market can be defined.

This is an important step in the strategy building process because it ensures that the designed strategy reflects the actual needs of the relevant market.

Offer & Value Proposition

An effective business strategy builds directly on the company’s offering and value proposition.

The former lays out what goods and services are offered, while the value proposition explains why people should buy them in the first place.

Note that the value proposition answers why a firm exists and how it is different from its rivals. In other words, it explains how a firm plans to create demand and compete in the market.

To illustrate this with an example, take a look at Shopify . Their value proposition is to offer a single ecommerce platform that lets its customers sell across multiple channels.

Another vital step in building an effective business strategy is to define the type of customer a company serves.

Customers are either categorized as consumers (B2C) or businesses (B2B).

Both groups have different criteria, reasons and motivations for purchasing goods and services. Knowing them allows a firm to accurately address their specific needs and wants in its strategy.

Target Market

Finally, strategy builders need to be clear about the market their offering and value proposition are targeting.

• If a firm sells to consumers (B2C) , a market can be defined by demographic and socio-economic factors, such as gender, age, occupation, education, income, wealth and where someone lives.
• If, however, the offering targets other businesses (B2B) , markets are typically defined by using factors such as the industry, business or sales model of the targeted customer groups.

I recommend reading this article from Annmarie Hanlon if you want to learn more about the specifics of segmenting a market.

After defining the vision, the next step in formulating a business strategy is to set an organisation’s top-level objectives .

These objectives are usually focused on increasing a firm’s sales and profits, as they ensure its existence and improve the shareholder value if publicly traded.

That’s why a strategy essentially aims to answer the question of how a business can compete in the market to grow its revenue, while also improving its financial position.

Note that the formulation of high-level objectives does not include any goals to achieve a company’s mission or to reflect its core values.

This is because the sole purpose of a generic business strategy is to increase the company’s economic value for its owners or shareholders.

The core values and mission are later taken into account when designing the lower-level strategies, such as the marketing or operational strategy.

Once the vision and objectives are defined, strategy builders need to become aware of their business’s strengths and weaknesses and the opportunities and challenges in the marketplace.

This can be done using a SWOT analysis ( S trengths, W eaknesses, O pportunities, T hreats):

The information obtained in the course of a SWOT analysis serves as a basis for the strategy formulation that considers the company’s internal characteristics and the external situation of the market segment.

These insights allow decision-makers to ensure that a firm’s strengths exploit the opportunities in the market, while also addressing potential weaknesses and threats that can limit the organization’s long-term success.

The fourth step in the strategy formulation answers the question of how the set objectives are achieved.

Firms that sell in competitive industries need to define how they want to compete in the market, create demand and increase their sales and margins.

Harvard Business School professor Michael E. Porter identified three types of generic strategies that businesses can choose from when defining their competitive advantage:

• Cost Leadership,
• Differentiation, or

However, firms can also fail to pursue one of these generic strategies effectively. Porter refers to this as being “stuck in the middle” .

In this case, a company does not offer a product or service unique enough to entice customers to buy. At the same time, the price of the offering is too high to compete effectively in the market.

Failure to gain a competitive advantage will result in a poor sales performance, which threatens the future company’s existence.

Let’s take a closer look at the different ways a company can gain a competitive advantage:

Cost Leadership

Cost leadership refers to a company’s ability to produce a product at the lowest cost in its industry.

This cost advantage can be achieved by using economies of scale, proprietary technologies or the ability to create and maintain cost benefits along the supply chain.

The cost leadership strategy requires a firm to effectively lower its cost structures while charging prices for its products that are in line with the industry average.

Example: Low fare airline Ryanair is a typical example of a firm that applies a cost leadership strategy. They successfully compete in the airline industry by driving down costs and utilize economies of scale. For that reason, Ryanair only operates one type of aircraft (Boeing 737-200) in its entire fleet.

Differentiation

In a differentiation strategy, a firm seeks to create a unique offer that is valued by its target customers. Buyers must perceive the offer as far more valuable compared to other alternatives in the industry. In return, a company is able to demand higher prices for its products.

Example: Starbucks is a great example of a firm that has successfully implemented a differentiation strategy. While it sells coffee as a widely available commodity, its well-designed stores, and the unrivalled number of flavour variations are the reason why customers are willing to pay a premium.

The generic strategy of focus aims at only a small number of target market segments. Porter’s matrix defines the competitive scope in these cases as narrow, as a firm only aims at a small portion of the wider market segment.

In that case, a company can either have a cost focus or a differentiation focus :

When a firm seeks to gain a cost advantage, it follows a cost-focused strategy. The firm’s offer is a low-cost alternative to the leading product in the market that still appeals to a specific group of buyers.

On the other hand, the differentiation focus seeks to cater to a specific need in a customer segment. This differentiation focus is the classic niche marketing strategy many small and local businesses follow to compete against the larger chains in their market.

Example: Small online shops that specialize in offering vegan and vegetarian products are a good example of firms that follow a generic focus strategy. Their narrow target scope allows them to become the preferred choice of environmental and health-conscious customer segments.

Based on the execution of the previous steps, a generic business strategy can be formulated.

However, functions such as marketing or finance will not contribute effectively to this generic strategy unless it is translated into more specific lower-level strategies.

The formation of these lower-level strategies that sit underneath a generic business strategy is called a strategy framework .

It ensures the success of the generic business plan, as it captures the vision and needs of the single departments and aligns them with the higher-level objectives.

Product, branding, marketing or operational strategies are only a few examples that contribute to the success of a firm’s overall generic business strategy.

Business strategies are successful when they are directly responsible for growth and improved competitive or financial performance.

The success of a strategic plan can be evaluated by monitoring a range of Key Performance Indicators (KPIs).

However, it is important that …

• … these KPIs measure the level of achievement of the objectives defined in step two of the strategy formulation process.
• … the KPIs are defined before the strategy implementation takes place to ensure accurate measurement.

Normally, some or all of the following KPIs are measured when implementing a new business strategy:

• Sales revenue
• Number of customers
• Repeat customer sales
• Customer retention rate
• Conversion Rate
• Average Order Value (AOV)
• Business Volume

Competitive Position

• Market share
• Market position
• Sales win rate
• Brand awareness & press mentions
• Margin position vs. industry average
• Sales growth vs. industry average

Financial Performance

• Gross Profit
• Operating Profit
• EBIT and EBITDA
• Return on Assets
• Free Cash Flow
• Operating Cash Flow

In practice, companies may measure strategy success in a more granular way. This is because individual departments define their own lower-level strategies.

A more realistic KPI overview is shown in the following chart:

Business Strategy Examples

To illustrate the earlier discussed principles, I have compiled two examples of companies that have successfully implemented their generic business strategy: Amazon and Reckitt Benckiser .

Example 1: Amazon

Amazon is known for its great customer service and fast shipping options.

And while its vision is to be earth’s most customer-centric company , Amazon makes this a reality by continually innovating in existing and new markets. The result? Further growth and greater shareholder value.

In his first shareholder letter from 1997 , Jeff Bezos himself outlined the four principles that guide the company: customer obsession rather than competitor focus, passion for invention , commitment to operational excellence and long-term thinking .

Amazon’s generic business strategy is to gain a competitive advantage by driving down costs (cost leadership), paired with its ability to innovate in competitive markets.

The focus is always the same: serving the needs of end-customers.

This allows Amazon to overtake its competition that often struggles to catch up with the tech giant within several years ( ST-Strategy ).

Its lower-level strategies (operational, marketing, etc.) all follow the generic strategy of focusing on choice, price and economies of scale to create value for customers.

This strategic framework has allowed Amazon to become one of the most successful tech companies in the 21st century.

Example 2: Reckitt Benckiser

Although the company’s name is not known by many consumers, Reckitt’s brand portfolio consists of major household brands, such as Finish, Dettol, Nurofen, Vanish, or Durex.

Faced with slowing sales and increased competition back in 2012, the company had to change its business strategy to return to a path of solid growth.

Under the new strategy, RB:

• Focused on R&D for new product lines that allowed it to achieve its high-level objectives to increase sales and margins;
• Increased its budgets in markets that grew above-average to stimulate further growth;
• Overhauled its brand and marketing strategies and increased budgets in those areas;
• Set and closely monitored multiple key performance indicators with the aim to increase its net revenue growth by +200bps vs. market average each year until 2017.

While Reckitt could not achieve all of its set targets, the modifications of its business strategy helped the company to grow its sales and profits above the market average.

As a result, RB grew £33bn in value for its shareholders between 2012 and 2017.

Still have questions about business strategy?

If you need help to come up with a strategy for your ecommerce business, then get in touch . I offer tailored advice that will help you get clarity about your vision, objectives and how to build a more effective business.

Enjoyed this article? Here are more things you might like:

Porter’s Five Forces Analysis – A complete guide to Michael E. Porter’s 5 Forces Analysis to help you assess your competitive landscape.

The Importance of the Product Life Cycle – A complete break down of the individual stages of the product life cycle to plan your next marketing moves.

Ecommerce Glossary – Stop the guessing. My glossary explains every ecommerce term in under 30 seconds.

10 Key Business Development Strategies (with Examples)

In today’s world, if you want your business to grow and succeed, you need a good plan for making it happen.

There are many different ways to help your business grow, and in this article, we’ll discuss some of the best business development strategies and techniques available.

There’s a lot you can do, from finding more customers for what you already sell to coming up with new products to sell or even teaming up with other businesses.

We’ll also examine how using the Internet and technology can benefit your business and why it’s important to consider how your business affects the world and people’s lives.

What is a Business Development Strategy?

A business development strategy is a plan that a company follows to grow and get better.

Imagine it like a map that helps a business decide where to go next to make more money, find more customers, or introduce new products.

It involves figuring out what the business is good at, what customers want, and how to reach more people or sell more things.

The goal of a business development strategy is not just to grow sales, but also to build a sustainable business model that can adapt to changing market conditions and capitalize on new opportunities.

A well-crafted business development strategy ensures that a company remains competitive and continues to thrive in its industry.

Business Development Strategies

Download the above infographic in PDF

1. Market Penetration Strategy

When we talk about business development strategies, a market penetration strategy is like the bread and butter for companies aiming to grow. It’s all about making your existing products or services a bigger hit in the markets you’re already playing in. Imagine trying to sell more ice cream in a town that loves your flavors — that’s market penetration.

Why it’s important: It’s less about reinventing the wheel and more about pushing the pedal on what already works. You can cut prices to outdo the competition, ramp up your marketing to make sure everyone knows your name, or offer deals that customers can’t resist.

Examples: Let’s say you run a coffee shop in a bustling neighborhood. To increase your market share, you might introduce a loyalty card that gives customers a free drink after they buy ten. This not only encourages repeat business but can also bring in more foot traffic as word spreads.

Why it’s a smart move: By focusing on market penetration , you’re building on your existing successes. It’s a tried and true method among business development techniques that can lead to increased sales without the costs and risks associated with targeting entirely new markets or developing new products from scratch.

In essence, beefing up your presence in current markets with strategies that have proven their worth can be a game-changer for your business. It’s about maximizing what you already do best and making sure as many people as possible know about it.

2. Market Development Strategy

Diving deeper into our exploration of business development strategies, let’s chat about the market development strategy. It’s like being an explorer, charting unknown territories, except instead of new lands, you’re venturing into new markets or customer segments with your tried-and-true products or services.

Why it’s exciting: Market development is thrilling because it opens up a world of possibilities. You could take your existing product and introduce it to a different city, country, or even a completely new demographic. It’s about finding new playgrounds where your product can shine.

Examples: Imagine you’ve been selling an innovative bike lock in urban areas where biking is a popular mode of transportation. A market development strategy might involve launching this product in suburban areas where there’s a growing interest in biking, thanks to new bike-friendly infrastructure.

How it works: This approach requires research and understanding of the new market. You’ll need to know what these new customers want, how they shop, and what kind of messaging speaks to them. It’s a classic technique in business development strategies that can pay off by expanding your customer base and opening new revenue streams.

Why it’s a brilliant tactic: By leveraging market development, you’re not just sticking to the safe confines of your existing market. Instead, you’re taking a calculated risk to grow your business. It’s a powerful way to utilize your existing successes and replicate them in a new context, making it a cornerstone among business development techniques.

In conclusion, market development is about seizing new opportunities and taking your successful product or service to new frontiers. It’s an adventurous and strategic move that requires understanding and adapting to new markets, but with the right approach, it can significantly amplify your business’s growth.

3. Product Development Strategy

The product development strategy stands out as a beacon for innovation. This strategy is about bringing new products or services to the table in your existing market. It’s akin to a chef creating a new, exquisite dish to wow patrons who already love the menu.

Why it sparkles with potential:  Product development is exhilarating because it taps into your creative resources to meet evolving customer needs or fill gaps in the market. It’s your chance to say, “Look what we can do!” and strengthen your position in the market with fresh offerings.

Examples:  Consider a tech company known for its consumer electronics. They might leverage a product development strategy by introducing smart home devices to their lineup, catering to their tech-savvy customer base’s desire for a more connected living experience.

The practical part:  Successful product development hinges on understanding your customers’ needs and staying ahead of industry trends. It requires a blend of market research, product innovation, and sometimes, a dash of daring. Among business development techniques, this one is particularly challenging because it involves creating something new, yet it’s also immensely rewarding.

Why it wins:  Embarking on product development can reinvigorate your brand and encourage customer loyalty. By continuously evolving your product offerings, you’re showing customers that you’re committed to innovation and addressing their changing needs. It’s a way to keep your audience engaged and interested in what you’ll do next.

In essence, a product development strategy is about breathing new life into your business with innovative offerings that captivate your existing market. It’s a vibrant testament to your commitment to growth and adaptation, positioning you as a forward-thinking leader in your industry.

4. Diversification Strategy

Diversification strategy is all about spreading your wings and flying into new territories with new products or services. It’s like opening a new chapter in your business’s story, venturing into uncharted waters to uncover new opportunities and revenue streams.

What makes it intriguing: Diversification is exciting because it pushes your business beyond its comfort zone. You’re not just expanding; you’re transforming. This could mean developing new products that complement your existing offerings or stepping into a completely different market with something innovative.

Examples: Consider a company that manufactures high-end cameras. They decide to diversify by entering the smartphone market with a device that boasts superior photography features. This move not only taps into the lucrative smartphone market but also leverages the company’s expertise in imaging technology.

How to implement it: Successful diversification requires thorough market research , innovation, and sometimes, a bit of courage. It’s important to assess how your new product or service fits with your brand and whether it addresses a genuine need in the market.

Why it’s a game-changer: Diversification is among the more ambitious business development techniques because it can significantly reduce risk by not putting all your eggs in one basket. Plus, it can rejuvenate your brand, making it relevant to a broader audience.

In summary , a diversification strategy is about boldly expanding your business into new areas with new offerings. It’s a move that requires careful strategic planning and a deep understanding of both your capabilities and the needs of the market. When done right, diversification can be a transformative growth strategy, setting your business on a path to new heights and successes.

5. Strategic Partnerships and Alliances

This strategy is about joining forces with other businesses to achieve common goals, leveraging each other’s strengths to unlock new opportunities.

Why it’s compelling: Strategic partnerships are like having a buddy system in the business world. They allow you to share resources, knowledge, and markets with another organization, making it easier to tackle ambitious projects or enter new markets. It’s about creating a win-win situation where both parties can grow and succeed.

Examples: Imagine a software company offering custom software development services and specializing in educational technology. By forming an alliance with a content creation firm that produces high-quality educational material, they can offer a more comprehensive learning platform. This partnership not only enhances their product offering but also opens up new customer segments.

How it works: Forming a strategic partnership or alliance involves identifying potential partners who share your vision and complementary strengths. The key is to clearly define the terms of the partnership, including roles, responsibilities, and how success will be measured.

Why it’s effective: This approach is one of the more synergistic business development techniques, as it enables companies to combine their efforts for greater impact. Partnerships can help businesses achieve objectives that would be difficult or impossible to achieve alone, such as expanding into new geographical markets or combining technologies to create innovative solutions.

In essence, strategic partnerships and alliances are about collaboration and mutual growth. By carefully selecting the right partners and aligning your goals, businesses can unlock new potentials and navigate the path to success more efficiently.

6. Mergers and Acquisitions

Mergers and acquisitions (M&A) represent a powerful avenue among business development strategies, where companies either merge with or acquire another company to boost growth, access new markets , or enhance capabilities. Think of it as joining forces with others to conquer territories or pooling resources to build an empire. It’s a fast track to expansion that can otherwise take years to achieve organically.

Why it’s impactful: M&A can dramatically change the scale of your business, providing instant access to new customers, technologies, and resources. It’s a strategy that can lead to significant market power and competitive advantages almost overnight.

Examples: A classic example would be a large tech company acquiring a smaller startup that offers innovative technology or services that complement the larger company’s product offerings. This not only eliminates a potential competitor but also integrates new technologies into the company’s portfolio, driving further innovation and growth.

Executing the strategy: Success in M&A requires diligent due diligence, strategic alignment, and effective integration planning. It’s crucial to ensure that the companies’ cultures, values, and business models align to avoid integration challenges post-acquisition.

Why it’s a savvy move: From a business development perspective, mergers and acquisitions can offer a shortcut to growth that organic methods can’t match. It allows companies to diversify their offerings, enter new markets rapidly, and acquire strategic assets or skills they lack.

In essence, M&A is about making bold moves to accelerate your company’s growth trajectory. While it comes with its set of challenges and risks, including cultural integration and financial investment, the potential rewards in terms of market expansion, enhanced capabilities, and increased competitiveness make it a crucial tactic in the arsenal of business development strategies.

7. Customer Retention Strategies

Venturing further into our journey through business development strategies, let’s zero in on customer retention strategies. Unlike the exploratory nature of entering new markets or launching new products, customer retention is all about deepening relationships with the customers you already have.

Why it matters: Retaining customers is often more cost-effective than acquiring new ones. Loyal customers not only continue to buy from you but are also more likely to recommend your products or services to others, acting as brand ambassadors.

Examples: An online streaming service introduces a tiered membership program, offering exclusive content and early access to new releases for premium members. This not only incentivizes longer subscription commitments but also enhances the perceived value of the service.

Key techniques: Effective customer retention strategies can include loyalty programs, exceptional customer service, feedback loops for continual improvement, and personalized marketing efforts. These techniques recognize and reward customer loyalty, creating a more personalized and satisfying experience.

Why it’s a cornerstone strategy: Focusing on customer retention is a crucial component of business development strategies because it builds a stable revenue base and fosters a community of loyal customers. This, in turn, can lead to more predictable sales and a stronger brand.

In essence, customer retention strategies are about showing appreciation for your current customers, ensuring they feel valued and understood. This not only secures their continued business but also transforms them into vocal supporters of your brand, contributing to a virtuous cycle of growth and loyalty.

8. Networking and Relationship Building

Let’s talk about networking and relationship building. Unlike direct sales tactics or digital marketing efforts, networking is about cultivating long-term relationships that can lead to opportunities, referrals, and partnerships down the line.

Why it matters: In the realm of business development, who you know can be just as important as what you know. Building a strong network can open doors to new clients, insights into industry trends, potential partners, and even investors. It’s about creating a web of connections where value is exchanged mutually over time.

Example: Imagine attending industry conferences, not with the primary goal of immediate sales, but with the intention of meeting other professionals in your field, sharing knowledge, and learning about their needs and challenges. Over time, these connections can lead to collaborative projects, referrals, or simply valuable advice.

How to approach it: Effective networking is rooted in genuine interest in others and a willingness to offer help and resources without the immediate expectation of getting something in return. It’s about building trust and rapport by being reliable, knowledgeable, and generous.

Why it’s a strategic move: Networking and relationship building are fundamental business development techniques because they leverage the power of human connections. Relationships built on trust and mutual respect can be the most durable and valuable assets in your business development arsenal.

N etworking and relationship building aim to cultivate meaningful relationships that can evolve into powerful catalysts for business growth.

9. Digital Transformation and Innovation

As we dive deeper into the world of business development strategies, it’s impossible to overlook the immense impact of digital transformation and innovation. This strategy is about leveraging the latest digital technologies to fundamentally change how your business operates and delivers value to customers. Think of it as the process of turning your traditional analog business into a smart, tech-savvy enterprise ready to face the modern digital world head-on.

Why it’s crucial: In today’s fast-paced business environment, technology can be a major differentiator. Digital transformation not only streamlines operations but also enhances customer experiences, opens up new channels for engagement, and fosters innovation. It’s about staying relevant and competitive in a digital-first world.

Examples: Consider a traditional brick-and-mortar retailer that adopts an omnichannel approach, integrating their in-store experience with a seamless online shopping platform. This might include a mobile app that customers can use to scan products in-store, read reviews, check out online, and even receive personalized recommendations based on their shopping history.

How to implement it: Embracing digital transformation requires a clear vision, strong leadership, and a willingness to invest in new technologies. It often involves adopting cloud computing, leveraging big data analytics, automating processes with AI, and enhancing customer interactions through digital channels.

Why it’s a game-changer: Digital transformation and innovation can revolutionize the way you do business, making you more agile, efficient, and customer-centric. It’s a powerful business development technique that not only drives growth but also builds resilience against disruptions in the market.

The journey towards digital transformation and innovation is about reimagining your business for the digital age. It offers a unique opportunity to innovate, differentiate, and deliver exceptional value to your customers.

10. Corporate Social Responsibility (CSR)

CSR is about businesses taking responsibility for their impact on society and the environment. It’s a strategy that aligns a company’s operations with social values and environmental sustainability practices. Think of it as doing well by doing good; when companies invest in CSR, they not only contribute positively to the world but also build trust and loyalty among customers and employees.

Why it’s important: Today’s consumers and workers are increasingly conscious of the ethical practices of the companies they buy from and work for. Implementing CSR initiatives can enhance your brand’s reputation, attract and retain top talent, and open up new business opportunities with like-minded partners and customers.

Examples: Imagine a clothing manufacturer that decides to source materials exclusively from suppliers that adhere to fair labor practices and environmental standards. Additionally, they might launch a recycling program, encouraging customers to return used items for recycling in exchange for a discount on their next purchase.

How to engage in CSR: Effective CSR goes beyond one-time charitable donations; it involves integrating sustainable and ethical practices into everyday business operations. This might include reducing carbon footprints, enhancing employee welfare programs, engaging in community development projects, or supporting social causes through partnerships with non-profits.

Why it’s a strategic move: CSR is among the most impactful business development techniques because it builds a strong emotional connection with stakeholders. Companies that are seen as socially responsible can differentiate themselves in crowded markets, foster loyalty among customers, and create a positive corporate image that attracts investment and partnership opportunities.

Corporate Social Responsibility is not just a moral obligation; it’s a strategic business development approach that can drive long-term success. By prioritizing CSR, companies not only contribute to a better world but also build a strong, sustainable brand that resonates with today’s ethically minded consumers and employees. It’s a testament to the power of combining profit with purpose to achieve growth and impact.

FAQs on Business Development Strategies

1. What is the purpose of a business development strategy? The primary purpose of a business development strategy is to identify and implement opportunities for growth within and outside a company. This can include increasing revenue, expanding into new markets, developing new products or services, enhancing customer relationships, and forming strategic partnerships or alliances.

2. How do I choose the right business development strategy for my company? Choosing the right business development strategy involves understanding your business’s current position, goals, and the specific challenges and opportunities in your industry. Analyze your target market, competition, internal capabilities, and resources. It’s also essential to align the strategy with your company’s overall vision and mission.

3. Can you give examples of effective business development techniques? Effective business development techniques include networking and relationship building, leveraging social media and digital marketing, attending industry events and trade shows, conducting market research to identify new opportunities, and employing customer feedback to improve products and services.

4. How does market penetration differ from market development? Market penetration focuses on increasing the market share of an existing product within its current market, often through competitive pricing, marketing initiatives, and sales promotions. Market development, on the other hand, aims to enter new markets or target new customer segments with existing products, requiring adaptations to marketing strategies and possibly the product itself to meet different customer needs.

5. What role does innovation play in business development strategies? Innovation is crucial for sustaining growth and staying competitive. It involves developing new or improved products, services, processes, or business models that meet emerging customer needs or create new markets. Innovation can differentiate a company from competitors and drive long-term success.

6. How important are strategic partnerships and alliances in business development? Strategic partnerships and alliances are vital for leveraging complementary strengths, resources, and markets to achieve mutual growth objectives that might be difficult to accomplish independently. These collaborations can provide access to new markets, technologies, expertise, and customer bases.

7. What are some common mistakes in implementing business development strategies? Common mistakes include failing to conduct thorough market research, not aligning the strategy with the company’s core competencies and goals, underestimating the resources required, neglecting existing customers in pursuit of new ones, and not adapting to market feedback or changing conditions.

8. How can a company measure the success of its business development strategies? Success can be measured through various metrics, including revenue growth, market share expansion, customer acquisition and retention rates, profitability improvements, and achievement of strategic goals. Regularly reviewing these metrics and adjusting strategies as necessary is key to sustained growth.

9. Why is customer retention considered a business development strategy? Customer retention is crucial because acquiring new customers can be significantly more expensive than keeping existing ones. Retained customers often make repeat purchases and can become brand advocates. Effective retention strategies can lead to sustained revenue growth and profitability.

10. How does CSR (Corporate Social Responsibility) enhance business development? CSR enhances business development by building a positive brand image, fostering customer loyalty, attracting and retaining talent, and potentially opening up new markets or customer segments. Companies that are viewed as socially responsible can differentiate themselves from competitors and achieve sustainable growth.

Conclusion and Key Takeaways

In conclusion, navigating the complexities of today’s business landscape requires a strategic approach to development that encompasses a broad range of tactics and methodologies.

From diving into the depths of market penetration and development strategies to exploring the innovative horizons of digital transformation, businesses have at their disposal a plethora of paths to achieve growth and sustainability.

The key takeaways from our exploration into business development strategies and techniques underscore the importance of a multifaceted approach tailored to your company’s unique goals and market conditions.

Key Takeaways:

• Strategic Alignment: Ensure that your business development strategies are in harmony with your company’s overall vision, mission, and capabilities. Tailoring strategies to fit your unique strengths and market position can lead to more effective and sustainable growth.
• Customer-Centric Approach: Whether it’s through retention strategies, innovation, or CSR initiatives, keeping the customer at the heart of your business development efforts is crucial. Understanding and addressing their needs can drive loyalty and long-term success.
• Adaptability and Innovation: In a rapidly changing business environment, staying adaptable and open to innovation can set you apart from competitors. Embrace digital transformation and continually seek new ways to improve your offerings and processes.
• The Power of Relationships: Building and maintaining strong relationships through networking, strategic partnerships, and alliances can open up new opportunities and resources critical for growth.
• Measure and Adjust: Regularly measuring the success of your business development strategies with clear metrics is essential. Be prepared to adjust your approach based on performance data and shifting market dynamics.
• Sustainability and Responsibility: Incorporating CSR into your business development strategies not only contributes positively to society but also enhances your brand’s reputation and appeal to modern consumers and employees.

By embracing these key insights, businesses can develop a robust framework for growth that leverages the best practices in business development strategies and techniques.

Remember, the path to success involves not just the pursuit of growth for its own sake but doing so in a manner that is sustainable, responsible, and aligned with your core values.

Here’s to your business’s continued growth and success in navigating the exciting challenges and opportunities that lie ahead.

About The Author

Silvia Valcheva

Silvia Valcheva is a digital marketer with over a decade of experience creating content for the tech industry. She has a strong passion for writing about emerging software and technologies such as big data, AI (Artificial Intelligence), IoT (Internet of Things), process automation, etc.

One Response

A very good and educative article

Leave a Reply Cancel Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed .

300+ Business Plan Examples

With over two decades of experience, Growthink has assisted more than 1 million companies in developing effective business plans to launch and expand their businesses. Trust in our expertise to guide you through developing a business plan that drives your success. In addition to our sample plans, below you’ll learn the answers to key business plan questions and gain insightful tips on writing your business plan.

  Quick Links to Sections On this Page:

• Sample Business Plans By Business Category

Answers to Key Sample Business Plan Questions

Shoutmouth business plan example, business plan examples by business category.

Clothing & Fashion Business Plan Templates & Samples

Clothing Store Business Plan

Embroidery Business Plan

Fashion Business Plan

Jewelry Business Plan

Construction, Interior Design & Home Services Business Plan Templates & Samples

Consumer Services Business Plan Templates & Samples

Business Services Business Plan Templates & Samples

Events Business Plan Templates & Samples

Banquet Hall Business Plan

Event Planning Business Plan

Event Venue Business Plan

Sample Event Venue Business Plan

Party Rental Business Plan

Photo Booth Business Plan

Table and Chair Rental Business Plan

Wedding Planning Business Plan

Farm Business Plan Templates & Samples

Financial Services Business Plan Templates & Samples

Fitness & Beauty Business Plan Templates & Samples

Food & Beverage Business Plan Templates & Samples

Medical & Health Business Plan Templates & Samples

Music & Entertainment Business Plan Templates & Samples

Music Business Plan

Party Bus Business Plan

Podcast Business Plan

Production Company Business Plan

Record Label Business Plan

Recording Studio Business Plan

Nonprofit Business Plan Templates & Samples

Sample Non-Profit Business Plan

Charity Business Plan

Sample Nonprofit Business Plan PDF

Social Enterprise Business Plan

Real Estate Business Plan Templates & Samples

Sample Airbnb Business Plan

House Flipping Business Plan

Property Development Business Plan

Property Management Business Plan

Real Estate Business Plan

Real Estate Agent Business Plan

Real Estate Business Plan PDF

Real Estate Development Business Plan

Real Estate Investment Business Plan

Retail & Ecommerce Business Plan Templates & Samples

Technology Business Plan Templates & Samples

Biodiesel Business Plan

Blogging Business Plan

Clean Tech Business Plan

Mobile App Business Plan

Saas Business Plan

Software Company Business Plan

Technology Business Plan

Transportation Business Plan Templates & Samples

Travel and Lodging Business Plan Templates & Samples

Bed and Breakfast Business Plan

Campground Business Plan

Glamping Business Plan

Hotel Business Plan

Mobile Home Park Business Plan

Resort Business Plan

RV Park Business Plan

Travel Agency Business Plan

1. Why is utilizing an example business plan a good idea?

Sample business plans can help you quickly and easily write a business plan for your own business. Business plans are an important tool for any business, but they can be challenging to create. A sample business plan will help you understand the business plan format , the benefit of market research, and how to write a compelling executive summary. It can also serve as a guide for creating your own business plan, outlining the key sections and providing examples of successful plans. Utilizing the best business plan template can save you time and ensure that your plan is well-structured and comprehensive.

Business plan examples may even help you with the different sections of a plan, including market analysis, business description, cash flow statements/business financial statements, and more. Business plans can also show you how a quality plan in your exact business plan category is organized and shows you the appropriate business communications style to use when writing your business plan.

2. Who would benefit from using an example business plan?

Any entrepreneur or business owner who has never written a business plan before can benefit from an example or sample plan. New business owners often start with business plan templates , which are helpful but are sometimes more useful after reviewing other sample business plans.

A good sample plan can be a step-by-step guide as you work on your business planning and business idea. Once you have a sense for the flow, specs, and details, etc. that business plans have, utilizing a business plan template will help you pull everything together, helping you create a plan investors and other stakeholders will value. A solid business plan will also help you if you need a bank loan, which may require a startup business plan. Download our free business plan template to help you get started on your own business plan.

Free Download : Free Business Plan Template PDF

3. How do you get started with a sample business plan and maximize its benefit?

First you should read the business plan thoroughly. Study both the type of information provided in key sections like the executive summary, target market analysis, summary, etc., as well as the format and style of the plan. As you read, you may find yourself thinking through things such as improving or evaluating your business planning process, your business idea, or reconsidering who you want to write your business plan for. This is OK and part of the process. In fact, when you start writing a business plan for the first time, it will be much easier because you’ve gone through this process.

After this initial read, outline your business plan and copy in from the sample plan sections that apply to your business. For instance, if the sample plan included public relations in their marketing strategy and sales plan, and you will also use this tactic, you can copy it into your plan and edit it as appropriate. Finally, answer the other questions answered in the sample plan in ways that reflect your unique business and target customers.

Writing a business plan can seem daunting. Starting your business plan writing process by reviewing a plan that’s already been created can remove a lot of mental and emotional barriers while helping you craft the best plan you can.

4. When should you not use a sample business plan?

If your business is unlike any other, using a sample business plan will not be as effective. In this situation, writing a business plan from scratch utilizing a business plan template is probably your best path forward.

As an example, Facebook’s early business plan was unlike others since it was paving a new path and way of doing business. But, groundbreaking new businesses like Facebook are not the norm, and the vast majority of companies will benefit from utilizing sample business plans.

5. How do you choose the right type of business plan for your venture?

Selecting the appropriate type of business plan depends on your business’s stage, needs, and goals. Let’s explore the different types of business plans and how to determine which business plan format is right for you.

• Startup Business Plan : This type of plan is for businesses just starting out and seeking funding or investment. It typically includes a detailed analysis of the market, target audience, competition, and financial projections.
• Traditional Business Plan : Traditional business plans are the most common type of business plan, used by established businesses to outline their goals and strategies. It includes all the key sections such as market analysis, company description, and financial statements.
• Internal Business Plan : Internal business plans are used for internal purposes, to guide the day-to-day operations and decision making of the business. It may not be as detailed as a traditional business plan, but still includes important information such as company mission, objectives, and key performance indicators.
• Feasibility Business Plan : A feasibility business plan is used to assess the viability of a new product or service in the market. It includes detailed research and analysis to determine if the business idea is feasible and profitable.
• One-Page Business Plan : As the name suggests, this type of business plan is condensed into one page and includes the most critical information about the business. It can be a useful tool for pitching to potential investors or partners.
• Strategic Business Plan : A strategic plan looks at the big picture and long-term business goals of a company. It may include the company’s mission statement, core values, and overarching strategies for achieving success.

Ultimately, the type of business plan you choose will depend on your business’s specific needs and goals. It may also be beneficial to combine elements from different types of plans to create a customized plan that best fits your business. Carefully consider your objectives and resources before deciding on the right type of plan for your venture.

Finish Your Business Plan in 1 Day!

Don’t you wish there was a faster, easier way to finish your business plan?

With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!

The business plan example below is for Shoutmouth, a company that enjoyed much success in the early 2000’s and which was able to raise funding. While the plan’s premise (social networking) is not as unique now as it was then, the format and structure of this business plan still holds.

I. Executive Summary

Business Overview

Launched in late February 2007, Shoutmouth.com is the most comprehensive music news website on the Internet .

Music is one of the most searched and accessed interests on the Internet. Top music artists like Akon receive over 3 million searches each month. In addition, over 500 music artists each receive over 25,000 searches a month.

However, music fans are largely unsatisfied when it comes to the news and information they seek on the artists they love. This is because most music websites (e.g., RollingStone.com, MTV.com, Billboard.com, etc.) cover only the top eight to ten music stories each day – the stories with mass appeal. This type of generic coverage does not satisfy the needs of serious music fans. Music fans generally listen to many different artists and genres of music. By publishing over 100 music stories each day, Shoutmouth enables these fans to read news on all their favorite artists.

In addition to publishing comprehensive music news on over 1200 music artists, Shoutmouth is a social network that allows fans to meet and communicate with other fans about music, and allows them to:

• Create personal profiles
• Interact with other members
• Provide comments on news stories and music videos
• Submit news stories and videos
• Recommend new music artists to add to the community
• Receive customized news and email alerts on their favorite artists

Success Factors

Shoutmouth is uniquely qualified to succeed due to the following reasons:

• Entrepreneurial track record : Shoutmouth’s CEO and team have helped launch numerous successful ventures.
• Affiliate marketing track record : Online affiliate marketing expertise has been cited as one of MySpace’s key success factors. Over the past two years, Shoutmouth’s founders have run one of the most successful online affiliate marketing programs, having sold products to over 500,000 music customers online.
• Key milestones completed : Shoutmouth’s founders have invested $500,000 to-date to staff the company (we currently have an 11-person full-time team), build the core technology, and launch the site. We have succeeded in gaining initial customer traction with 50,000 unique visitors in March, 100,000 unique visitors in April, and 200,000 unique visitors in May 2007.

Unique Investment Metrics

The Shoutmouth investment opportunity is very exciting due to the metrics of the business.

To begin, over the past two years, over twenty social networks have been acquired. The value in these networks is their relationships with large numbers of customers, which allow acquirers to effectively sell to this audience.

The sales price of these social networks has ranged from $25 to $137 per member. Shoutmouth has the ability to enroll members at less than $1 each, thus providing an extraordinary return on marketing expenditures. In fact, during an April 2007 test, we were able to sign-up 2,000 members to artist-specific Shoutmouth newsletters at a cost of only 43 cents per member.

While we are building Shoutmouth to last, potential acquirers include many types of companies that seek relationships with music fans such as music media/publishing (e.g., MTV, Rolling Stone), ticketing (e.g., Ticketmaster, LiveNation) and digital music sales firms (e.g., iTunes, The Orchard).

Financial Strategy, Needs and Exit Strategy

While Shoutmouth’s technological, marketing and operational infrastructure has been developed, we currently require $3 million to execute on our marketing and technology plan over the next 24 months until we hit profitability.

Shoutmouth will primarily generate revenues from selling advertising space. As technologies evolve that allow us to seamlessly integrate music sampling and purchasing on our site, sales of downloadable music are also expected to become a significant revenue source. To a lesser extent, we may sell other music-related items such as ringtones, concert tickets, and apparel.

Topline projections over the next three years are as follows:

II. Shoutmouth Overview

What is Shoutmouth?

Shoutmouth is an operating company of The Kisco Group Inc. (TKG). Since 2003, TKG has capitalized on web-based marketing opportunities via launching targeted websites and generating web-based leads. TKG revenues in 2005 exceeded $1.3 million and grew to $3.5 million in 2006. Shoutmouth is currently the sole focus of TKG; all other TKG business units have been divested.

Development of Shoutmouth began in August 2006 and the site officially launched on February 21, 2007. Shoutmouth (located at www.shoutmouth.com) is the most comprehensive music news community on the Internet. The website covers 1,200 popular bands and music artists and offers more than 100 new music articles each day. In addition to providing news, Shoutmouth is a web community. That is, Shoutmouth members can actively participate on the site, by doing things such as commenting on news stories and submitting their own stories.

The Market Size and Need for Shoutmouth

The music market is clearly vast. According to IFPI, which represents the recording industry worldwide, global music sales were $33.5 billion in 2005, with the U.S. accounting for $12.3 billion of that amount. Importantly, digitally music sales are seeing substantial growth, with IFPI reporting sales of $400 million in 2004, $1.1 billion in 2005 and $2 billion in 2006.

Online, music is the one of the most frequently searched and accessed interests. For example, according to Wordtracker, the music artist Eminem received over 1.7 million web searches in December 2006, while band Green Day received 534,000 searches.

To put these figures in perspective, top celebrities in other entertainment fields receive but a fraction of this search volume. For example, December 2006 search volumes for select sports stars and actors were as follows: Kobe Bryant, 122K; Tiger Woods, 88K; Cameron Diaz, 332K; and Tom Cruise, 82K.

Conversely, 225 music artists received over 100,000 searches in December 2006, and over 500 music artists received over 25,000 searches.

This data is corroborated by Nielsen BuzzMetrics which plots the most popular topics bloggers are posting about. The chart to the right plots September 25, 2006 to March 25, 2007 and shows how music dominates other entertainment sectors online.

When searching for music artists online, fans, which are primarily between the ages of 13 and 35, are looking for news, pictures, lyrics, videos and audio files. In addition, fans enjoy publicly voicing their opinions about music and interacting with other fans.

There is currently no website besides Shoutmouth that provides comprehensive music news. Currently, to get the latest news on their favorite artists, fans must visit the official websites or fan websites of each of the artists they like . Even then, it is unlikely that the fan will get all the news that has occurred. To solve this problem, Shoutmouth scours the web and uncovers news from thousands of web sites.

What Shoutmouth Does and Will Offer

As of May 2007, the site covers the 1,200 most popular music artists (popularity primarily based on the number of web searches over the past 12 months for each artist).

Shoutmouth currently offers members the ability to:

• Read over 500 new music articles each week
• Read special features such as album reviews, interviews, new album release dates, top quotes of the week and other special reports
• Watch and rate music videos
• Listen to select music audio clips
• Comment on news stories and music videos
• Submit news stories that they see/hear of elsewhere
• Suggest new music artists to add to the site
• View articles by music artist or by genre (current genres include Rock, Pop, Rap, R&B, Country, and Electronic)
• Create a user profile that includes their favorite music artists, Shoutmouth friends, news stories submitted to Shoutmouth, and comments made. Members have the ability to find other members based on their favorite artists and via our search functions.
• Receive customized news and email alerts. Members can customize their “My News” page to include only artists they specify. Likewise, they can choose to receive email alerts whenever there is a new story on one of their favorite artists.

While establishing itself as the premier music news community, Shoutmouth will embark on the more aggressive goal of becoming the premier music community online . To accomplish this, Shoutmouth will begin to offer additional content (more videos, audio, pictures, lyrics, etc.) and additional functionality (music compatibility testing (e.g., if you like this, you’ll like this), voting capabilities, member-to-member messaging, etc.). We have already begun mapping out our content and technology growths plans to achieve this goal upon financing.

Importantly, Shoutmouth expects to be able to add massive amounts of relevant content (e.g., lyrics, reviews, pictures, video files, audio files, etc.) via member submissions and moderation. This is the same way that YouTube has been able to quickly add millions of videos and Wikipedia has been able to add millions of articles. Importantly, since established music websites (e.g., MTV, RollingStone.com, Billboard.com, etc.) are not community based, they would have to hire thousands of staff members to rival the content that Shoutmouth will have.

How We Get and Publish Our News

Currently, news stories that appear on Shoutmouth are gathered from numerous online sources. Shoutmouth’s staff writers find these stories by using RSS and News feeds that cover thousands of websites. In addition, Shoutmouth community members have the ability to submit stories they find elsewhere.

Typical stories include factual information plus the insight of the author. Shoutmouth editors ensure that all stories are properly classified by artist and genre, and that duplicate articles are filtered out.

Over the past three months, Shoutmouth has developed a solid infrastructure, which we consider a core competitive advantage, that that allows us to provide comprehensive music news . This infrastructure includes:

• Setting up hundreds of RSS feeds based on comprehensive research regarding sites from which to receive feeds
• Training our editorial team regarding identifying a story and weeding out duplicates
• Assigning music artists among our five-person editorial team to better manage work flow and avoid duplicate articles

We are working on a system to ensure that member-submitted articles are automatically routed to the appropriate member of Shoutmouth’s editorial team to improve our efficiencies further.

Shoutmouth’s Goal to Break News First

The majority (approximately 90%) of Shoutmouth’s articles are currently developed by our in-house editorial team, while the balance is submitted by members. In addition, virtually all of our articles are based on information gleaned from other websites. As such, we are generally not the first to publish news; however we are the first and only site to publish all the news in one easily-accessible place. The one current exception is news which is published on bands’ official MySpace pages; Shoutmouth generally publishes articles on this news 24 to 48 hours before it is reported by other news or music sites (due to our efficiencies in finding news).

Shoutmouth realizes that it will gain a key competitive advantage, and will generate significant market buzz, if it is able to report on music news stories before other media sources . To accomplish this, we have begun contacting publicity departments at record labels to gain direct access to music news. We expect these contacts to enable us to gain immediate and sometimes exclusive access to news which will help further establish Shoutmouth as the canonical source for music news. We also plan to more aggressively solicit member submissions of new, buzzworthy news events and will consider offering rewards for unique substantiated news (much the way paparazzi are compensated).

III. Competition in the Online Music Market

This section of the business plan provides a competitive analysis, which is an overview of the competitive landscape, discusses both indirect and direct competitors and then details Shoutmouth’s competitive advantages.

Because consumer demand for music on the Internet is so great, there are a vast number of music websites. In summary, we consider most sectors of the online music market (which are discussed below) to be indirect competitors and potentially partners, rather than direct competitors, because none of them focus on music news.

The reason we believe that no one focuses on music news is that it is very difficult to do. Because news is very important to music fans, most music websites offer news. However, they primarily get their news from organizations such as CNN, Reuters, the Associated Press and BBC. These large organizations only write about the music stories that have mass appeal, which traditionally amounts to 8-10 music news stories per day. However, since music fans are often zealots when it comes to their favorite artists, they are not merely interested in cover stories. For instance, a U2 fan cares about any U2 news, particularly news that a non-U2 fan might consider insignificant.

In fact, because Shoutmouth is the sole one-stop shop for getting comprehensive music news, there might be an opportunity to license our content to other music websites.

Sectors of the Online Music Market

Shoutmouth specifically comPs in the community-based music news market. While players in this market represent direct competitors, Shoutmouth faces indirect competitors in the following markets:

• Community-Based Sites
• Community-Based News Sites
• Community-Based Music Sites
• Traditional Music Websites
• Official Artist and Fan Sites

Each of these markets is described below.

A. Community-Based Sites

Community-based sites, also known as social networking sites, are websites in which members can create profiles, leave comments throughout the site, and communicate with other members among other features.

A June 2006 report by Piper Jaffray entitled “Silk Road: Social Networking is Here to Stay” effectively sums up the power and longevity of social networking:

“We believe social networking sites have become a permanent part of the fabric of web applications and are rapidly becoming one of the most popular activities online, potentially impacting how other popular services such as email, IM, and maybe even search are accessed.

As a clear indication of the growth rate and scale of social networking, consider this: MySpace monthly page views have now surpassed MSN or AOL in the U.S. and are nearly 75% of the size of Yahoo!. Social networking has filled a gap that was left by all the existing portals and web services and it is fulfilling a very important and basic function for millions of users: allowing them to express themselves and connect with their friends, with the two functions tightly integrated.

The leading sites such as MySpace (News Corp), Facebook, and others are amassing significant power in the new landscape of the Internet and the existing Internet companies are likely to have to work with these newcomers as they may yield material control on the flow of traffic to other applications.”

Social networking sites such as MySpace.com, Facebook.com, Tagged.com, and TagWorld.com have educated consumers regarding the value of these sites and how to use them. Their success has spurred genre-specific social networks such as community-based/social networking news sites and music sites, which are discussed below.

Shoutmouth doesn’t view established social networking sites as competitors since these sites have a general focus. That is, members talk about all aspects of life, from dating to music to movies, etc. Conversely, Shoutmouth is solely focused on music.

B. Community-Based News Sites

Community-based news sites are sites in which members decide what’s newsworthy and what’s not. For instance, on Digg.com, the most prominent community-based news site, members “Digg” stories that they feel are most newsworthy. The stories that the community feels are most important rise to Digg’s homepage, while less important stories get little attention.

Digg’s one million members can submit stories, “digg” stories, and comment on stories. Digg focuses on general news with a slant towards technology, gaming and unique/sensational news. While Digg does have a Music area within its Entertainment section, this receives little focus. In fact, at the time of the writing of this plan, Digg’s music home page only includes one article submitted within the past 48 hours. Furthermore, Digg doesn’t pare down the music category into sub-categories such as Rock and individual music artists. Conversely, these sub-categories are the entire focus of Shoutmouth.

Other sites that are similar to Digg include Newsvine.com, Spotback.com and Gabbr.com. Of most relevance is the Digg-like site for music, Noisetap.com, which was launched by Ticketmaster in January 2007.

Like Digg, Noisetap.com allows members to submit and vote for music stories. Noisetap.com is organized by music genre and not by music artist. This most likely will not satisfy the needs of many music fans since they don’t have the ability to find news on the specific artists they care most about. Likewise, without a full-time staff actively researching and publishing news stories at the artist-level, Noisetap.com will never be able to offer the comprehensive news that Shoutmouth does.

While Shoutmouth is currently similar to community-based news sites in that members can submit stories and comment on the news they find most interesting, no established player in the market provides a comprehensive focus on music. In addition, Shoutmouth sees these sites as marketing partners as we have and will continue to submit our stories on them to increase our readership.

C. Community-Based Music Sites

There are many community-based music websites, although none focuses on music news such as Shoutmouth. Conversely, these sites generally give members the ability to create and listen to song play lists. The community acts to help individual members find new music and new friends based on similarities in their music tastes. Prominent sites in this genre include Last.fm, Finetune, Pandora, RadioBlogClub, MyStrands, iLike[1] and iJigg.

Last.fm is the most prominent community-based music site and is a good model with which to compare Shoutmouth. Likewise, we will benchmark our performance against Last.fm as we reach of goal of becoming the premier music news community and focus on becoming the premier music community.

According to Alexa, Last.fm is the 359th most visited site on the Internet. While Last.fm focuses on allowing members to create customized Internet stations based on their music tastes, the site has much additional content and social networking features. For instance, for each artist, Last.fm includes pictures, a bio, concert dates, discography, fans on Last.fm, and similar artists. Fans are also able to create journals and communicate with other fans. Key features that Last.fm doesn’t currently focus on include news and video.

D. Traditional Music Websites

Traditional music websites such as MTV.com, RollingStone.com, Billboard.com, NME.com, AOL Music, and Yahoo! Music tend to have many features such as news, reviews, pictures, videos and audio. While these sites are generally very well done and extremely popular, they are under-serving visitors in two core areas: music news and community .

These sites’ lack of music news stems from the difficulty in creating this news, specifically that it requires filtering through thousands of articles and websites to find relevant stories. Likewise, as discussed, these firms might wish to license our news content in the future.

Regarding community , none of the top music sites are thriving communities. Rather, either these sites offer no community features or they recently began offering select features (e.g., submitting reviews or commenting on articles). Even when available, the community features on these sites are afterthoughts and are not engrained within the core fabric of the sites.

While they haven’t been able to transform their current sites into communities, top music websites clearly understand the power of online music communities and have an appetite for them. For example, in January 2007, MTV invested in social networking website TagWorld. MTV also acquired RateMyProfessors.com and Quizilla.com (teen social network) in January 2007 and October 2006 respectively.

As mentioned previously, our vision is to build and incorporate additional technologies, and use our “army” of members to publish vast amounts of music content on Shoutmouth, in order to fully satisfy music fans and leapfrog traditional music sites in terms of their music content.

E. Official Artist and Fan Sites

Shoutmouth com’s with official music artist websites and fan websites. These sites often include news about the specific artist as well as pictures, videos and other relevant information.

On one hand, official music artist and fan websites are direct competitors to Shoutmouth. This is because some of these sites offer comprehensive news on the specific artist they cover. In addition, many offer forums, discussion boards or other ways to communicate with other fans.

However, two factors separate Shoutmouth from these types of sites: 1) breadth and 2) sophistication.

• Breadth : Most music fans love more than one artist. As such, in order to get the news they want, they would have to visit/join multiple fan or artist websites rather than getting all of their news from Shoutmouth.
• Sophistication : While some official music artist websites are technologically sophisticated, offering forums, networking and other worthwhile features, the majority of artist and fan websites have limited usability, functionality and networking ability. In fact, this deficiency has lead to the success of MusicToday, which provides front and back-end technology to power artist websites.

Specifically, MusicToday offers web design and hosting, develops sophisticated online stores, builds online fan clubs and offers web ticketing among other services to select top music artists such as Dave Matthews Band, Christina Aguilera, Kenny Chesney, Britney Spears and Usher. While offering sophisticated tools for select music artist websites, MusicToday offers little to no music news nor advanced social networking functions. For instance, the official Dave Matthews Band website offers less than one news story per month.

F. Direct Competitors: Community-Based Music News Sites

Shoutmouth’s direct competitors are other music news websites that have social or community features that allow users to join the site, submit articles, comment on articles, create public profiles and/or communicate with other members. Shoutmouth has identified one significant player who offers this service, AbsolutePunk.net.

AbsolutePunk.net has done a good job of building a user base (the site claims 125,000+ registered members and nearly 500,000 un-registered members). In addition, the user base is very active — the average story on their site receives approximately 20 comments. AbsolutePunk.net offers music news, reviews, pictures and interviews among other features.

On the negative side, AbsolutePunk.net’s articles are generally posted by one staff writer (as opposed to Shoutmouth’s five writers), most articles are simply one sentence posts rather than full articles, and no attempt seems to have been made to cover all news stories. In addition, the site only covers the punk music genre. Although “punk” is broadly defined on the site, the site doesn’t cater to genres such as R&B, rap and country among others, failing to satisfy the broader market.

AbsolutePunk.net is owned by Indieclick, a Los Angeles-based media company. According to the AbsolutePunk.net website, the site:

• Has developed a loyal (72% return rate) reader base
• 5,182,147 Posts
• 163,535 Threads
• 126,448 Members
• 1,711 Artist Profiles
• 20,774 Multimedia Files
• Approx 76,000 visits per day.
• Approx 276,000 pageviews per day.

Shoutmouth’s Competitive Advantage

In addition to being the first to fill the untapped market void for comprehensive music news, Shoutmouth’s competitive advantage in the market primarily includes the following:

Online Marketing Sophistication

Content Development Experience and Expertise

Shoutmouth’s team, primarily team members DL and PF, has operated an affiliate marketing business focusing on music for the past four years. Affiliate marketing is defined as a system of revenue sharing between one site (the affiliate) which features an ad or content designed to drive traffic to another site (the merchant). The affiliate receives a fee based on traffic to the merchant which converts to sales.

Our affiliate business has focused on connecting music fans, primarily aged 13 to 30, with music offers such as iPods and ringtones. Over the past two years, we have successful sold affiliated offers to over 500,000 customers. We have become a significant online advertiser, receiving Google’s “over 1 million leads” award, and are recognized as a major player among the top affiliate networks.

It is important to note that affiliate marketing success has been credited with part of MySpace’s success. This is because effective affiliate marketers understand how to drive and convert on Internet traffic.

Shoutmouth will employ its affiliate marketing techniques to drive traffic to Shoutmouth.com and enroll members. We will utilize technologies and proprietary techniques that allow us to monitor multiple metrics such as the cost per visitor, cost per member sign-up, etc., so that we can set and maintain profitable metrics.

Another venture that Shoutmouth team members, primarily PK and DL, launched was the development of over 3,000 niche websites. To create the content for these websites, we employed a virtual work force of over 90 researchers in India and 30 writers and editors in the US.

This experience taught us how to manage a large workforce, train writers to improve content quality and motivate a large group of people. These skill sets will be critical in allowing Shoutmouth to grow the content of the site, as developed by both staff and members, while maintaining quality standards.

IV. Marketing Plan

Shoutmouth’s marketing plan includes the following:

Online Advertising : Shoutmouth will initiate pay-per-click advertising campaigns on Google and Yahoo! in order to inexpensively drive traffic to the site. Specifically, Shoutmouth believes it can drive qualified traffic to the site for 20 cents per visitor and achieve a 20% member conversion rate, thus generating members at a cost of $1.00 per member.

Keys to Shoutmouth’s success in achieving this metric include:

• Conducting thorough keyword research and advertising on appropriate keywords and keyword groups
• Creating advertising text that maximizes click through rates
• Creating landing pages that maximize conversions while maintaining the highest Google AdWords quality score possible
• Closely monitoring conversions to quickly stop and/or modify unprofitable campaigns
• Getting individuals to enter their email address to join the newsletter is much easier than getting them to join a site where they have to create a username, select a password, etc. As such, step one will be to get visitors to sign up for artist-specific newsletters.
• Once on the newsletter distribution list, members will constantly receive messages (embedded in their daily newsletter) regarding the benefits of participating more on Shoutmouth.
• Active Shoutmouth Membership: the constant reminders regarding Shoutmouth’s value proposition in the daily newsletters will influence members to participate more actively on the site (e.g., customize their profile, visit the site more often, etc.).

Invite-A-Friend : Shoutmouth is in the process of creating an aggressive invite-a-friend/member referral program. In doing so, we are following the lead of social movie community, Flixster, which grew to 5 million members within 10 months. It did this by encouraging members, during their initial registration process, to upload and send an invitation to multiple contacts in their email address books. The technology to develop this process is fairly complex and we expect to be completed with and to rollout this program in June 2007.

Direct Email Marketing : Shoutmouth will directly contact bloggers and prominent music fans we find online to tell them about Shoutmouth, encourage them to join, and encourage them to write about Shoutmouth on their blogs and online journals .

Creating/Distributing Buzzworthy/Viral Content : Shoutmouth plans to have several buzzworthy/viral articles (i.e., content that people would want to email to their friends since it is funny, interesting, etc.) on the site each day. With a single click, visitors will be able to send these articles to social bookmarking sites such as Digg.com or Fark.com, where these articles could receive widespread attention. In addition to our traditional news stories, Shoutmouth will also periodically create special reports/features in order to satisfy our members and visitors and to try to get widespread exposure.

An example of the power of such buzzworthy content, Shoutmouth has already succeeded in having two stories accepted by Fark and Digg, which have brought in over 50,000 unique visitors.

Super Fans/Street Team Development : Shoutmouth also plans to recruit “super fans.” Super fans are individuals who are passionate about a certain music artist/band and actively contribute articles and/or comments on Shoutmouth. We will recruit these fans, reward them with status (e.g., adding a gold Shoutmouth headphones image to their profile page) and encourage them to more aggressively promote the site by:

• Submitting more news to Shoutmouth
• Commenting on more articles on Shoutmouth
• Growing the Shoutmouth community around their favorite artist(s) by actively recruiting new members to join the site (such as actively posting Shoutmouth-related comments on their MySpace pages, on other music forums, etc.)

Public Relations : Upon financing, Shoutmouth will hire a public relations firm to help us get mentions in media sources ranging from magazines, newspapers, radio, television and blogs. To date, we have developed and issued press releases via Billboard Publicity Wire which have been syndicated throughout the web. An effective PR firm will enable Shoutmouth to quickly reach a wide audience.

Widgets : Shoutmouth will create artist-specific and genre-specific music news widgets. For example, our U2 widget (see example on right) would include all of the recent U2 articles published on Shoutmouth. The widget can easily be placed on MySpace pages, blogs, etc. Each story title in the widget links to the full article on Shoutmouth.

Shoutmouth has great expectations for our widget. To begin, no such widget currently exists as there is no one place to get comprehensive news for specific music artists. Secondly, each time someone places a Shoutmouth widget on their blog or social networking page, it will effectively market Shoutmouth to a wide audience at zero cost to us.

V. Technology/Site Development Plan

This section provides a brief roadmap of the initial and future functionality of Shoutmouth.

Initial Site Functionality

The initial Shoutmouth website will include the following features:

• Ability to submit and comment on news stories
• Ability to suggest new music artists to add to the site
• Ability to create user profiles
• Ability to receive customized news and email alerts
• Articles categorized by artist and core genre (e.g., Rock, Rap, Pop, etc.)
• Music artist sections which includes News, Bio and Fans

Future Site Functionality

Shoutmouth will use news and basic functionality as the platform though which we will build a thriving music community. After initial launch, the Shoutmouth technology team will work on incorporating additional features such as:

• Ability to message other members via the site (e.g., members will have an Inbox on the site)
• Event calendars: members will receive online calendars. With the click of a button, the member will be able to add tour dates of their favorite artists/bands to their calendar.
• Articles also categorized by sub-genre (e.g., Alternative Rock, West Coast Rap, etc.)
• Music artist sections to also include videos, audio files, photo galleries, reviews and event calendars to which members can upload files and vote on top content.
• Forums and member blogs
• Music compatibility testing (suggestions on song/artists members might like)
• Trivia quizzes
• Music playlists

VI. Financial Plan

Revenue Model

During the first six months, Shoutmouth will not generate any revenues as it will not sell advertising space nor offer products for sale. This decision has been made to spur the growth of the Shoutmouth community. By initially positioning Shoutmouth more as a non-profit, for-the-people-by-the-people venture, members will be more prone to promote the site and invite their friends than if the site looks too commercial.

Starting in September 2007, Shoutmouth will primarily generate revenues from selling advertising space. As technologies (such as the Snocap music widget) evolve that allow us to seamlessly integrate music sampling and purchasing on our site, sales of downloadable music are also expected to be a significant revenue source. To a lesser extent, we may sell other music-related items such as ringtones, concert tickets, and apparel.

Funding To Date

To date, Shoutmouth’s founders have invested $500,000 in Shoutmouth, with which we have accomplished the following:

• Built the site’s core technology
• Hired and trained our core staff (we currently maintain an 11-person full-time team)
• Populated the website with content (over 10,000 articles and 1,200 artist bios)
• Generated brand awareness among music fans, including driving 50,000 unique visitors in March, 100,000 unique visitors in April, and 200,000 unique visitors in May 2007.

Funding Requirements/Use of Funds

Shoutmouth is currently seeking $3 million to provide funding for the next 24 months. At this point, the site will be profitable and can grow organically, or additional capital may be sought to more aggressively expand our member base.

The capital will be used as follows:

• Execution of Marketing plan : in order for Shoutmouth to grow its visitor and member base, we need to invest dollars in online advertising and public relations. With regards to online advertising, we are confident that we can enroll members at a cost of $1 per member, which is a fraction of the value of the members to an acquirer (minimum $25 per member), thus providing a significant return on our marketing investments.
• Execution of Technology plan : in order to build a thriving community, Shoutmouth needs to offer its visitors a “stickier” website and enhanced features. We currently maintain a vast “wish list” of features, such as members uploading and rating pictures and videos, trivia quizzes, and member-to-member messaging, that will significantly improve the site’s functionality and value proposition.
• Staffing : In order to reach our goals, we will have to hire additional technical and operations personnel.

Financial Projections

Below is an overview of Shoutmouth’s Financial Projections for the next three years. Please see the Appendix for the full financial projections and key assumptions.

Exit Strategy / Valuation Metric

Shoutmouth’s most likely exit strategy is to be acquired by a traditional music website or property (e.g., Viacom/MTV, Ticketmaster, Rolling Stone), an entertainment/media conglomerate (e.g., Yahoo!, IAC/InterActiveCorp, NBC), or a large social networking site (e.g., News Corp/MySpace).

This strategy is supported by the significant M&A activity in the social networking market, which includes the following transactions over the past 24 months:

Regarding valuation, below are the estimated valuations of social networking companies on a per member basis upon exit:

• Del.icio.us: $50 – $100 per member
• MySpace: $25 per member
• Xing (business social network): $137 per member at IPO in 10/06
• Flickr: $56 – $130 per member
• Grouper: $130 per member

Based on this data, not only are social networking sites a promising investment, but sites that can acquire members for less than $25 each (a conservative valuation estimate based on the figures above), should earn a solid return on investment. As discussed above, Shoutmouth’s goal is to acquire members for no more than $1 each.

In addition, per the membership projections above, Shoutmouth’s valuation at the end of 2009, at a $25 valuation per member, is expected to be $239 million. A more conservative, using a 24.4 time EBITDA multiple (the average multiple of tech M&A deals in 2006 according to The M&A Advisor), yields a $121 million valuation in 2009.

Shoutmouth’s founding team includes entrepreneurs and managers with a track record of success and a history of successfully working together.

Management Team

DL, Co-Founder and CEO

D has a history of successfully launching and growing businesses of all sizes. As president and co-founder of an entrepreneurial services firm., D has personally assisted in the launch and development of over 100 ventures.

Over the past three years, D founded and has managed The Kisco Group which includes an affiliate marketing division (2006 revenues exceeded $3 million), a search engine optimization business which includes a network of 3,000 websites (2006 revenues exceeded $500,000) and an e-commerce business (which includes TopPayingKeywords.com and ShowerHeadsEtc.com).

D earned his Bachelors degree from the University of South Carolina.

PK, Co-Founder and Vice President of Operations

For the past two years, P has managed The Kisco Group’s search engine optimization business where he hired, trained and managed nearly 100 employees and a dozen outside firms. During this time, P has honed his management skills with regards to content development, marketing and operations.

P has had a passion for music since childhood and has been a semi-professional drummer for the past 15 years.

P earned his Bachelors of Arts degree, magna cum laude, from Clemson University.

PF, Co-Founder and Vice President of Technology

For the past year, P has managed The Kisco Group’s affiliate marketing business. In addition to setting up and managing widespread marketing campaigns, P has developed sophisticated analytic techniques to precisely analyze web traffic in order to optimize profitability.

Since August 2006, P has shifted his efforts and leveraged his technology skills in developing the Shoutmouth website. P has been instrumental in selecting the Content Management Platform upon which Shoutmouth is built, and finding and managing the technology team.

P earned his Bachelor of Arts degree from Swarthmore College.

AB, Marketing Manager

A’s background in music includes being a singer, songwriter, guitarist and producer. He has also worked on the marketing side of music, having marketed Veritas Records through the development and distribution of promotional materials.

A’s career also includes psychological research and administration, having served as a Research Assistant with the Interpersonal Perception And Communication Laboratory in Cambridge, MA.

A earned his Bachelor of Arts degree in Psychology from Ohio State University.

M, Lead Technology Developer

M is an experienced web programmer with expertise in web design, application development and database development among others.

M’s work experience includes serving as a Senior Developer at Spheres. M has also engaged in multiple, long term freelance projects including serving as a Database Developer Consultant with The Penn Group and a Web Developer Consultant with Volution Media Group and Allied Online Consulting Group.

M earned his Bachelors degree in Computer Science with a minor in Cognitive Science from Rutgers University.

Content Development Team

Shoutmouth’s writing team, managed by PK, includes the following members:

• JS, Editorial Manager: former content manager and copywriter for Scholastic Inc. and Promotions.com.
• TZ: former music intern (Virgin Records and WRRV) and author of the blog, The Tom Z Show .
• ML: former assistant editor for Adventure Publishing; author of the blog Certified Gangsta ; and former editor-in-chief of Fordham University’s newspaper The Paper .
• SB: former staff writer for Paste Magazine , The Clarion Ledger , and Nightclub and Bar Magazine among others.
• CSJ: former editorial intern for Rolling Stone and Editorial Assistant for Psychology Today .

Outsourced Technology Team

Shoutmouth works very closely with 2skies, a technology firm based in Australia with staff in Australia and the United States. 2skies is run by JDN, one of the co-founding developers of XE, the platform upon which Shoutmouth is built.

XE is an extensible, Open Source web application framework written in PHP and licensed under the GNU General Public License. XE delivers the requisite infrastructure and tools to create custom web applications that include fully dynamic multi-platform Content Management Solutions (CMS).

VIII. Appendix: Shoutmouth Financial Projections   3-Year Income Statement

3-Year Balance Sheet

As of December 31

3-Year Cash Flow Statement

• Start free trial

Start selling with Shopify today

Start your free trial with Shopify today—then use these resources to guide you through every step of the process.

Free Business Plan Template for Small Businesses (2024)

Use this free business plan template to write your business plan quickly and efficiently.

A good business plan is essential to successfully starting your business —  and the easiest way to simplify the work of writing a business plan is to start with a business plan template.

You’re already investing time and energy in refining your business model and planning your launch—there’s no need to reinvent the wheel when it comes to writing a business plan. Instead, to help build a complete and effective plan, lean on time-tested structures created by other  entrepreneurs and startups. 

Ahead, learn what it takes to create a solid business plan and download Shopify's free business plan template to get started on your dream today. 

What this free business plan template includes

• Executive summary
• Company overview
• Products or services offered
• Market analysis
• Marketing plan
• Logistics and operations plan
• Financial plan

This business plan outline is designed to ensure you’re thinking through all of the important facets of starting a new business. It’s intended to help new business owners and entrepreneurs consider the full scope of running a business and identify functional areas they may not have considered or where they may need to level up their skills as they grow.

That said, it may not include the specific details or structure preferred by a potential investor or lender. If your goal with a business plan is to secure funding , check with your target organizations—typically banks or investors—to see if they have business plan templates you can follow to maximize your chances of success.

Our free business plan template includes seven key elements typically found in the traditional business plan format:

1. Executive summary

This is a one-page summary of your whole plan, typically written after the rest of the plan is completed. The description section of your executive summary will also cover your management team, business objectives and strategy, and other background information about the brand. 

2. Company overview

This section of your business plan will answer two fundamental questions: “Who are you?” and “What do you plan to do?” Answering these questions clarifies why your company exists, what sets it apart from others, and why it’s a good investment opportunity. This section will detail the reasons for your business’s existence, its goals, and its guiding principles.

3. Products or services offered

What you sell and the most important features of your products or services. It also includes any plans for intellectual property, like patent filings or copyright. If you do market research for new product lines, it will show up in this section of your business plan.

4. Market analysis

This section includes everything from estimated market size to your target markets and competitive advantage. It’ll include a competitive analysis of your industry to address competitors’ strengths and weaknesses. Market research is an important part of ensuring you have a viable idea.

5. Marketing plan

How you intend to get the word out about your business, and what strategic decisions you’ve made about things like your pricing strategy. It also covers potential customers’ demographics, your sales plan, and your metrics and milestones for success.

6. Logistics and operations plan

Everything that needs to happen to turn your raw materials into products and get them into the hands of your customers.

7. Financial plan

It’s important to include a look at your financial projections, including both revenue and expense projections. This section includes templates for three key financial statements: an income statement, a balance sheet, and a cash-flow statement . You can also include whether or not you need a business loan and how much you’ll need.

Business plan examples

What do financial projections look like on paper? How do you write an executive summary? What should your company description include?  Business plan examples  can help answer some of these questions and transform your business idea into an actionable plan.

Professional business plan example

Inside our template, we’ve filled out a sample business plan featuring a fictional ecommerce business . 

The sample is set up to help you get a sense of each section and understand how they apply to the planning and evaluation stages of a business plan. If you’re looking for funding, this example won’t be a complete or formal look at business plans, but it will give you a great place to start and notes about where to expand.

Lean business plan example

A lean business plan format is a shortened version of your more detailed business plan. It’s helpful when modifying your plan for a specific audience, like investors or new hires. 

Also known as a one-page business plan, it includes only the most important, need-to-know information, such as:

• Company description
• Key members of your team
• Customer segments

💡 Tip: For a step-by-step guide to creating a lean business plan (including a sample business plan), read our guide on how to create a lean business plan .

Benefits of writing a solid business plan

It’s tempting to dive right into execution when you’re excited about a new business or side project, but taking the time to write a thorough business plan and get your thoughts on paper allows you to do a number of beneficial things:

• Test the viability of your business idea. Whether you’ve got one business idea or many, business plans can make an idea more tangible, helping you see if it’s truly viable and ensure you’ve found a target market. 
• Plan for your next phase. Whether your goal is to start a new business or scale an existing business to the next level, a business plan can help you understand what needs to happen and identify gaps to address.
• Clarify marketing strategy, goals, and tactics. Writing a business plan can show you the actionable next steps to take on a big, abstract idea. It can also help you narrow your strategy and identify clear-cut tactics that will support it.
• Scope the necessary work. Without a concrete plan, cost overruns and delays are all but certain. A business plan can help you see the full scope of work to be done and adjust your investment of time and money accordingly.
• Hire and build partnerships. When you need buy-in from potential employees and business partners, especially in the early stages of your business, a clearly written business plan is one of the best tools at your disposal. A business plan provides a refined look at your goals for the business, letting partners judge for themselves whether or not they agree with your vision.
• Secure funds. Seeking financing for your business—whether from venture capital, financial institutions, or Shopify Capital —is one of the most common reasons to create a business plan.

Why you should you use a template for a business plan

A business plan can be as informal or formal as your situation calls for, but even if you’re a fan of the back-of-the-napkin approach to planning, there are some key benefits to starting your plan from an existing outline or simple business plan template.

No blank-page paralysis

A blank page can be intimidating to even the most seasoned writers. Using an established business planning process and template can help you get past the inertia of starting your business plan, and it allows you to skip the work of building an outline from scratch. You can always adjust a template to suit your needs.

Guidance on what to include in each section

If you’ve never sat through a business class, you might never have created a SWOT analysis or financial projections. Templates that offer guidance—in plain language—about how to fill in each section can help you navigate sometimes-daunting business jargon and create a complete and effective plan.

Knowing you’ve considered every section

In some cases, you may not need to complete every section of a startup business plan template, but its initial structure shows you you’re choosing to omit a section as opposed to forgetting to include it in the first place.

Tips for creating a successful business plan

There are some high-level strategic guidelines beyond the advice included in this free business plan template that can help you write an effective, complete plan while minimizing busywork.

Understand the audience for your plan

If you’re writing a business plan for yourself in order to get clarity on your ideas and your industry as a whole, you may not need to include the same level of detail or polish you would with a business plan you want to send to potential investors. Knowing who will read your plan will help you decide how much time to spend on it.

Know your goals

Understanding the goals of your plan can help you set the right scope. If your goal is to use the plan as a roadmap for growth, you may invest more time in it than if your goal is to understand the competitive landscape of a new industry.

Take it step by step

Writing a 10- to 15-page document can feel daunting, so try to tackle one section at a time. Select a couple of sections you feel most confident writing and start there—you can start on the next few sections once those are complete. Jot down bullet-point notes in each section before you start writing to organize your thoughts and streamline the writing process.

Maximize your business planning efforts

Planning is key to the financial success of any type of business , whether you’re a startup, non-profit, or corporation.

To make sure your efforts are focused on the highest-value parts of your own business planning, like clarifying your goals, setting a strategy, and understanding the target market and competitive landscape, lean on a business plan outline to handle the structure and format for you. Even if you eventually omit sections, you’ll save yourself time and energy by starting with a framework already in place.

• How to Start an Online Boutique- A Complete Playbook
• How To Source Products To Sell Online
• The Ultimate Guide To Dropshipping (2024)
• How to Start a Dropshipping Business- A Complete Playbook for 2024
• 6 Creative Ways to Start a Business With No Money in 2024
• What is Shopify and How Does it Work?
• What Is Affiliate Marketing and How to Get Started
• How to Price Your Products in 3 Simple Steps
• 10 Common Small Business Mistakes to Avoid
• How to Turn a Hobby into a Business in 8 Steps

Business plan template FAQ

What is the purpose of a business plan.

The purpose of your business plan is to describe a new business opportunity or an existing one. It clarifies the business strategy, marketing plan, financial forecasts, potential providers, and more information about the company.

How do I write a simple business plan?

• Choose a business plan format, such as a traditional or a one-page business plan. 
• Find a business plan template.
• Read through a business plan sample.
• Fill in the sections of your business plan.

What is the best business plan template?

If you need help writing a business plan, Shopify’s template is one of the most beginner-friendly options you’ll find. It’s comprehensive, well-written, and helps you fill out every section.

What are the 5 essential parts of a business plan?

The five essential parts of a traditional business plan include:

• Executive summary: This is a brief overview of the business plan, summarizing the key points and highlighting the main points of the plan.
• Business description: This section outlines the business concept and how it will be executed.
• Market analysis: This section provides an in-depth look at the target market and how the business will compete in the marketplace.
• Financial plan: This section details the financial projections for the business, including sales forecasts, capital requirements, and a break-even analysis.
• Management and organization: This section describes the management team and the organizational structure of the business.

Are there any free business plan templates?

There are several free templates for business plans for small business owners available online, including Shopify’s own version. Download a copy for your business.

Keep up with the latest from Shopify

Get free ecommerce tips, inspiration, and resources delivered directly to your inbox.

By entering your email, you agree to receive marketing emails from Shopify.

popular posts

The point of sale for every sale.

Subscribe to our blog and get free ecommerce tips, inspiration, and resources delivered directly to your inbox.

Unsubscribe anytime. By entering your email, you agree to receive marketing emails from Shopify.

Latest from Shopify

Jun 18, 2024

Jun 17, 2024

Learn on the go. Try Shopify for free, and explore all the tools you need to start, run, and grow your business.

Try Shopify for free, no credit card required.

How to Create a Social Media Marketing Strategy in 9 Easy Steps [Free Template]

Creating your social media marketing strategy doesn’t need to be painful. Create an effective plan for your business in 9 simple steps.

A social media marketing strategy is a summary of everything you plan to do and hope to achieve on social media. It guides your actions and lets you know whether you’re succeeding or failing.

The more specific your plan is, the more effective it will be. Keep it concise. Don’t make it so lofty and broad that it’s unattainable or impossible to measure.

In this post, we’ll walk you through a nine-step plan to create a winning social media strategy of your own. We’ve even got expert insights from Amanda Wood, Hootsuite’s Senior Manager of Social Marketing.

How to create a social media strategy:

Bonus: Get a free social media strategy template   to quickly and easily plan your own strategy. Also use it to track results and present the plan to your boss, teammates, and clients.

What is a social media marketing strategy?

A social media strategy is a document outlining your social media goals, the tactics you will use to achieve them and the metrics you will track to measure your progress.

Your social media marketing strategy should also list all of your existing and planned social media accounts along with goals specific to each platform you’re active on. These goals should align with your business’s larger digital marketing strategy.

Finally, a good social media plan should define the roles and responsibilities within your team and outline your reporting cadence.

Create. Schedule. Publish. Engage. Measure. Win.

Creating your own social media marketing strategy (video guide)

No time to read the whole article? Let Amanda, Hootsuite’s own Senior Manager of Social Media Marketing, guide you through our free social media marketing strategy template in less than 10 minutes:

How to create a social media marketing strategy in 9 steps

Step 1. choose goals that align to business objectives, set s.m.a.r.t. goals.

The first step to creating a winning social media strategy is to establish clear objectives and goals. Without goals, you have no way to measure success and return on investment (ROI) .

Each of your social media marketing goals should be SMART : s pecific, m easurable, a ttainable, r elevant and t ime-bound.

Psst: Need help getting started? We’ve got social strategy guides for small businesses , financial services , government , higher education , healthcare , real estate , law firms , and non-profits .

Oh, and if you need examples of smart social media goals , we’ve got you covered there too.

Once you’ve decided on your goals, track them in a social media strategy doc — grab our free template if you don’t have one already.

Track meaningful metrics

Vanity metrics like number of followers and likes are easy to track, but it’s hard to prove their real value. Instead, focus on things like engagement, click-through, and conversion rates.

For inspiration, take a look at these 19 essential social media metrics .

You may want to track different goals for different social media networks, or even different uses for each network.

For example, if you use LinkedIn to drive traffic to your website, you would measure click-throughs. If Instagram is for brand awareness, you might track the number of Instagram Story views. And if you advertise on Facebook, cost-per-click (CPC) is a common success metric.

Social media goals should align with your overall marketing objectives. This makes it easier to show the value of your work and secure buy-in from your boss.

Start developing a successful social media marketing plan by writing down at least three goals for social media.

“ It’s easy to get overwhelmed by deciding what to post and which metrics to track, but you need to focus on what you want to get out of social media to begin with,” says Amanda Wood, Hootsuite’s Senior Manager of Social Marketing. “Don’t just start posting and tracking everything: match your goals to your business, and your metrics to your goals.”

Step 2. Learn everything you can about your audience

Get to know your fans, followers, and customers as real people with real wants and needs, and you will know how to target and engage them on social media.

When it comes to your ideal customer, you should know things like:

• Average income
• Typical job title or industry

Here’s a simple guide and template for creating audience/buyer personas .

Don’t forget to document this information in your strategy doc!

Social media analytics can also provide a ton of valuable information about who your followers are, where they live, and how they interact with your brand on social media. These insights allow you to refine your strategy and better target your audience.

Jugnoo, an Uber-like service for auto-rickshaws in India, used Facebook Analytics to learn that 90% of their users who referred other customers were between 18- and 34-years-old, and 65% of that group was using Android. They used that information to target their ads, resulting in a 40% lower cost per referral.

Check out our guide to using social media analytics and the tools you need to track them .

Step 3. Get to know your competition

Odds are your competitors are already using social media, and that means you can learn from what they’re doing.

Conduct a competitive analysis

A competitive analysis allows you to understand who the competition is and what they’re doing well (and not so well). You’ll get a good sense of what’s expected in your industry, which will help you set social media targets of your own.

It will also help you spot opportunities and weaknesses you can document in your social strategy doc.

Maybe one of your competitors is dominant on Facebook, for example, but has put little effort into X (Twitter) or Instagram. You might want to focus on the social media platforms where your audience is underserved, rather than trying to win fans away from a dominant player.

Use social media listening

Social listening is another way to keep an eye on your competitors.

Do searches of the competition’s company name, account handles, and other relevant keywords on social media. Find out what they’re sharing and what other people are saying about them. If they’re using influencer marketing, how much engagement do those campaigns earn them?

Pro tip : Use Hootsuite Streams to monitor relevant keywords, hashtags and accounts in real-time.

Try Hootsuite for free. You can cancel anytime.

As you track, you may notice shifts in how your competitors and industry leaders are using social media. You may come across new, exciting trends. You might even spot specific social content or a campaign that really hits the mark—or totally bombs.

Use this kind of intel to optimize and inform your own social media marketing strategy.

Just don’t go overboard on the spy tactics, Amanda advises. “ Make sure you aren’t ALWAYS comparing yourself to the competition — it can be a distraction. I’d say checking in on a monthly basis is healthy. Otherwise, focus on your own strategy and results.”

Step 4. Do a social media audit

If you’re already using social media, take stock of your efforts so far. Ask yourself the following questions:

• What’s working, and what’s not?
• Who is engaging with you?
• What are your most valuable partnerships?
• Which networks does your target audience use?
• How does your social media presence compare to the competition?

Once you collect that information, you’ll be ready to start thinking about ways to improve.

We’ve created an easy-to-follow social media audit guide and template to walk you through each step of this process.

Your audit should give you a clear picture of what purpose each of your social accounts serves. If the purpose of an account isn’t clear, think about whether it’s worth keeping.

To help you decide, ask yourself the following questions:

• Is my audience here?
• If so, how are they using this platform?
• Can I use this account to help achieve my goals?

Asking these tough questions will keep your social media strategy focused.

Look for impostor accounts

During the audit, you may discover fake accounts using your business name or the names of your products.

These imposters can be harmful to your brand—never mind that they’re capturing followers that should be yours.

You may want to get your accounts verified too to ensure your fans know they are dealing with the real you.

Here’s how to get verified on:

• X (Twitter)

Step 5. Set up accounts and improve profiles

Decide which networks to use.

As you decide which social networks to use, you will also need to define your strategy for each.

Benefit Cosmetics’ social media manager, Angela Purcaro, told eMarketer : “For our makeup tutorials … we’re all about Snapchat and Instagram Stories. [X], on the other hand, is designated for customer service.”

Hootsuite’s own social team even designates different purposes for formats within networks. On Instagram, for example, they use the feed to post high-quality educational infographics and product announcements and Stories to cover live events or quick social media updates.

View this post on Instagram A post shared by Hootsuite 🦉 (@hootsuite)

Pro tip : Write out a mission statement for each network. A one-sentence declaration to keep you focused on a specific goal.

Example: “We will use X for customer support to keep email and call volumes down.”

Or: “We will use LinkedIn for promoting and sharing our company culture to help with recruitment and employee advocacy.”

One more: “We will use Instagram to highlight new products and repost quality content from influencers.”

If you can’t create a solid mission statement for a particular social media channel, you may want to ask yourself if it’s worth it.

Note : While larger businesses can and do tackle every platform, small businesses may not be able to — and that’s ok! Prioritize social platforms that will have the most impact on your business and make sure your marketing team has the resources to handle content for those networks. If you need help focusing your efforts, check out our 18-minute social media plan .

Set up your profiles

Once you’ve decided which networks to focus on, it’s time to create your profiles. Or improve existing ones so they align with your strategy.

• Make sure you fill out all profile fields
• Include keywords people would use to search for your business
• Use consistent branding (logos, images, etc.) across networks so your profiles are easily recognizable

Pro tip : Use high-quality images that follow the recommended dimensions for each network. Check out our always-up-to-date social media image size cheat sheet for quick reference.

We’ve also got step-by-step guides for each network to walk you through the process:

• Create a Facebook business page
• Create an Instagram business account
• Create a TikTok account
• Create a X (Twitter) business account
• Create a Snapchat account
• Create a LinkedIn Company Page
• Create a Pinterest business account
• Create a YouTube channel

Don’t let this list overwhelm you. Remember, it’s better to use fewer channels well than to stretch yourself thin trying to maintain a presence on every network.

Optimize your profiles (and content) for search

Never heard of social SEO ? It’s time to learn.

44% of Gen Z consumers use social platforms to research their purchase decisions, which means it’s extra critical that your channels are optimized for social search.

That means making sure your profile names are clear and descriptive, you’re including relevant hashtags and keywords in your bio and on every post, and you’re using features like alt text and captions to include your target keywords as naturally as possible.

Step 6. Find inspiration

While it’s important that your brand be unique, you can still draw inspiration from other businesses that are great on social.

“ I consider it my job to stay active on social: to know what’s trending, which campaigns are winning, what’s new with the platforms, who’s going above and beyond,” says Amanda. “This might be the most fun step for you, or the hardest one, but it’s just as crucial as the rest of them.”

Social media success stories

You can usually find these on the business section of the social network’s website. ( Here’s Facebook’s , for example.)

Case studies can offer valuable insights that you can apply to your own social media plan.

Award-winning accounts and campaigns

You could also check out the winners of The Facebook Awards or The Shorty Awards for examples of brands that are at the top of their social media game.

For learning and a laugh, check out Fridge-Worthy, Hootsuite’s bi-weekly awards show highlighting brands doing smart and clever things on social media.

Your favorite brands on social media

Who do you enjoy following on social media? What do they do that compels people to engage and share their content?

National Geographic, for example, is one of the best on Instagram, combining stunning visuals with compelling captions.

View this post on Instagram A post shared by National Geographic (@natgeo)

Then there’s Shopify. The ecommerce brand uses Facebook to sell themselves by showcasing customer stories and case studies.

And Lush Cosmetics is a great example of superior customer service on X. They use their 280 characters to answer questions and solve problems in an extremely charming and on-brand way.

Source: lushcosmetics on X

Notice that each of these accounts has a consistent voice, tone, and style. That’s key to letting people know what to expect from your feed. That is, why should they follow you? What’s in it for them?

Consistency also helps keep your content on-brand even if you have multiple people on your social media team.

For more on this, read our guide on establishing a compelling brand voice on social media .

Ask your followers

Consumers can also offer social media inspiration.

What are your target customers talking about online? What can you learn about their wants and needs?

If you have existing social channels, you could also ask your followers what they want from you. Just make sure that you follow through and deliver what they ask for.

Step 7. Create a social media content calendar

Sharing great content is essential, of course, but it’s equally important to have a plan in place for when you’ll share content to get the maximum impact.

Your social media content calendar also needs to account for the time you spend interacting with the audience (although you need to allow for some spontaneous engagement as well).

Set your posting schedule

Your social media content calendar lists the dates and times at which you will publish types of content on each channel. It’s the perfect place to plan all of your social media activities—from images, link sharing, and re-shares of user-generated content to blog posts and videos. It includes both your day-to-day posting and content for social media campaigns.

Your calendar also ensures your posts are spaced out appropriately and published at the best times to post .

Pro tip: You can plan your whole content calendar and get recommended best times to post on every network based on your past engagement rate, impressions, or link click data in Hootsuite.

Hootsuite’s Best Time to Publish feature

Determine the right content mix

Make sure your content strategy and calendar reflect the mission statement you’ve assigned to each social profile, so that everything you post is working to support your business goals.

(We know, it’s tempting to jump on every meme, but there should always be a strategy behind your social media marketing efforts!)

You might decide that:

• 50% of content will drive traffic back to your website
• 25% of content will be curated from other sources
• 20% of content will support lead-generation goals (newsletter sign-ups, ebook downloads, etc.)
• 5% of content will be about your company culture

Placing these different post types in your content calendar will ensure you maintain the right mix.

If you’re starting from scratch and you’re not sure what types of content to post, try the 80-20 rule :

• 80% of your posts should inform, educate, or entertain your audience
• 20% can directly promote your brand.

You could also try the social media content marketing rule of thirds :

• One-third of your content promotes your business, converts readers, and generates profit.
• One-third of your content shares ideas and stories from thought leaders in your industry or like-minded businesses.
• One-third of your content is personal interactions with your audience

Whatever you decide on, be sure to document it in your strategy doc.

Don’t post too much or too little

If you’re starting a social media marketing strategy from scratch, you may not have figured out how often to post to each network for maximum engagement yet.

Post too frequently and you risk annoying your audience. But, if you post too little, you risk looking like you’re not worth following.

Start with these posting frequency recommendations:

• Instagram (feed): 3-7 times per week
• TikTok: 3-5 times per week
• Facebook: 1-2 times per day
• X (Twitter): 1-5 times per day
• LinkedIn: 1-5 times per day

Pro tip : Once you have your social media content calendar planned out, use a scheduling tool to prepare messages in advance rather than updating constantly throughout the day.

We might be biased, but we think Hootsuite is the best social media management tool. You can schedule social media posts to every network and the intuitive calendar view gives you a full picture of all your social activity each week.

Try It Free

Step 8. Create compelling content

Remember those mission statements you created for each channel in Step 5? Well, it’s time to go a bit deeper, a.k.a. provide some examples of the type of content you’ll post to fulfill your mission on each network.

If you’re not sure what to post, here’s a long list of social media content ideas to get you started. Or (to make it even easier) you can use an AI tool like OwlyWriter to generate on-brand content in a flash.

The idea here is to:

• Keep your content aligned with the purpose of each network;
• Show other stakeholders (if applicable) what kind of content they can expect to see on each network.

This last point especially will help you avoid any tension when your colleagues want to know why you haven’t posted their case study/whitepaper/blog post to TikTok yet. It’s not in the strategy, Linda!

Ideally, you will generate content types that are both suited to the network and the purpose you’ve set out for that network.

For example, you wouldn’t want to waste time posting brand awareness tweets if you’ve designated X/Twitter for primarily customer support. And you wouldn’t want to post super polished corporate video ads to TikTok, as users expect to see short, unpolished videos on that platform.

It might take some testing over time to figure out which type of content works best on which type of network, so prepare to update this section frequently.

We won’t lie: content creation isn’t as easy as everyone not on the social team seems to think. But if you’re struggling, Amanda suggests going back to basics.

The first question to ask is: is there cohesion between your content types? Is your content providing value? Do you have a good mix of entertaining, or educational content? What does it offer that makes a person stop and spend time? Creating a few different content pillars or categories that encompass different aspects of storytelling for your brand, and what you can offer your audience is a good start.

This brings us to Step 9.

Step 9. Track performance and make adjustments

Your social media marketing strategy is a hugely important document for your business, and you can’t assume you’ll get it exactly right on the first try.

As you start to implement your plan and track your results, you may find that some strategies don’t work as well as you’d anticipated, while others are working even better than expected.

That’s why it’s important to document your progress along the way.

Look at performance metrics

In addition to the analytics within each social network (see Step 2), you can use UTM parameters to track social visitors as they move through your website, so you can see exactly which social posts drive the most traffic to your website.

Benchmark your results

You’ve got your numbers, but how do they stack up to the competition in your industry? Industry benchmarks are a great way to evaluate your performance against other businesses in your category.

If you’ve got Hootsuite Analytics , you can use our built-in social media benchmarking tool to compare the performance of your social accounts against the average of brands in your industry with just a couple of clicks.

You can set up custom timeframes, switch between networks — Instagram, Facebook, X (Twitter), LinkedIn, and TikTok — and look up benchmarks for metrics like followers, audience growth rate, engagement rate, clicks, shares, and much more.

You’ll also find resources to improve your performance  right in the summary section:

Re-evaluate, test, and do it all again

Once this data starts coming in, use it to re-evaluate your strategy regularly. You can also use this information to test different posts, social marketing campaigns, and strategies against one another. Constant testing allows you to understand what works and what doesn’t, so you can refine your social media marketing strategy in real time.

You’ll want to check the performance of all your channels at least once a week and get to know the basics of social media reporting so you can track your growth over time.

Pro tip: If you use Hootsuite, you can review the performance of all your posts on every network in one place. Once you get the hang of checking your analytics, you may even want to customize different reports to show specific metrics over a variety of different time periods.

Surveys can also be a great way to find out how well your social media strategy is working. Ask your followers, email list, and website visitors whether you’re meeting their needs and expectations, and what they’d like to see more of. Then make sure to deliver on what they tell you.

Finalizing your social media strategy

Spoiler alert: nothing is final.

Social media moves fast. New networks emerge, others go through demographic shifts.

Your business will go through periods of change as well.

All of this means that your social media marketing strategy should be a living document that you review and adjust as needed. Refer to it often to stay on track, but don’t be afraid to make changes so that it better reflects new goals, tools, or plans.

When you update your social strategy, make sure to watch our 5-step video on how to updating your social media strategy for 2024:

Social media strategy template

Ready to start documenting? Grab your free social media strategy template below!

What’s next? When you’re ready to put your plan into action, we’re here to help…

Save time managing your social media marketing strategy with Hootsuite. From a single dashboard you can easily:

• Plan, create, and schedule posts to every network
• Track relevant keywords, topics, and accounts
• Stay on top of engagement with a universal inbox
• Get easy-to-understand performance reports and improve your strategy as needed

Try Hootsuite for Free

With files from Shannon Tien .

Do it better with Hootsuite , the all-in-one social media tool. Stay on top of things, grow, and beat the competition.

Become a better social marketer.

Get expert social media advice delivered straight to your inbox.

Christina Newberry is an award-winning writer and editor whose greatest passions include food, travel, urban gardening, and the Oxford comma—not necessarily in that order.

Amanda Wood is a senior social marketing professional who combines analytical and creative thinking to build brands.

As head of social at Hootsuite, Amanda oversees the global social strategy encompassing organic and paid social on Instagram, Facebook, Twitter, TikTok, and LinkedIn, a social engagement and listening strategy, and an employee advocacy program.

As the leader of a high-performing social team, she has extensive experience collaborating with creatives to bring campaigns to life on social and drive business results.

Related Articles

How To Set and Exceed Social Media Goals [9 Examples]

Struggling to structure your efforts on social? Set yourself up for success with our guide to setting and exceeding smart social media goals.

How To Run the Easiest Social Media Audit [FREE TEMPLATES]

A social media audit is the best way to review and improve any social marketing strategy. Our free checklist and template make it easy.

How to Create a Social Media Calendar and Stay Organized

Social media content calendars are the best way to plan and organize your content. Build one in 4 easy steps or use our free templates.

Social Media Marketing Tools: The Complete Guide

Automate your work, save time, and build better relationships with your audience by using the right social media marketing tools.

• SUGGESTED TOPICS
• The Magazine
• Newsletters
• Managing Yourself
• Managing Teams
• Work-life Balance
• The Big Idea
• Data & Visuals
• Reading Lists
• Case Selections
• HBR Learning
• Topic Feeds
• Account Settings
• Email Preferences

Share Podcast

How to Future-Proof Your Strategy

Understand which investments will allow your organization to thrive—even in a crisis.

• Apple Podcasts

So much has been written about how to future-proof a strategy. But Peter Scoblic says that too many companies still rely on short-sighted strategies that don’t effectively plan for different potential future scenarios.

Scoblic is a co-founder and principal of the consultancy Event Horizon Strategies. In this episode, he explains how thoughtful and ongoing scenario-planning exercises can help organizations decide which investments will allow them to thrive — even in a crisis. He also shares how to balance short-term factors with longer term modeling and why it’s so important to ensure that your planning team is truly diverse. As he says, “This is a case where diversity absolutely matters, in all senses of the word, because what you want is to get people to think outside of the box.  It’s very difficult to do that if you don’t recognize the box that you’re in.”

Key episode topics include: strategy, strategic planning, crisis management, scenario panning, modeling.

HBR On Strategy curates the best case studies and conversations with the world’s top business and management experts, to help you unlock new ways of doing business. New episodes every week.

• Listen to the full HBR IdeaCast episode: Future-Proofing Your Strategy with Scenario Planning (2020)
• Find more episodes of HBR IdeaCast
• Discover 100 years of Harvard Business Review articles, case studies, podcasts, and more at HBR.org

HANNAH BATES: Welcome to HBR On Strategy , case studies and conversations with the world’s top business and management experts, hand-selected to help you unlock new ways of doing business.

So much has been written about how to future-proof a strategy. But Peter Scoblic says that too many companies still rely on short-sighted strategies that don’t effectively plan for difference potential futures.

Scoblic is co-founder and principal of the consultancy Event Horizon Strategies. In this episode, he explains how thoughtful and ongoing scenario planning exercises can help organizations decide which investments will allow them to thrive in varying circumstances and navigate many types of crisis.  You’ll also learn how to balance short-term factors with longer term modeling and why it’s so important to ensure your planning team is truly diverse.

This episode originally aired on HBR IdeaCast in July 2020 amid the global COVID pandemic. But its insights remain valid for scenario planning in any context. Here it is.

ALISON BEARD:  Welcome to the HBR IdeaCast from Harvard Business Review.  I’m Alison Beard.

We live in volatile, uncertain, complex and ambiguous times.  VUCA is the acronym we’ve all used to use and it’s a really tough environment in which to make business decisions.

Technology is advancing rapidly, geopolitics are unstable, and we’re so interconnected that it’s truly impossible to predict the future.  Sometimes world changing events like 911, the global financial crisis, or a world spanning pandemic take us by complete surprise.

So, how do we plan and prepare anyway?  How do we make sure we’re ready for the next emergency? Today’s guest says that leaders and organizations need to develop strategic foresight and that involves inclusive, in depth and ongoing scenario planning.

Peter Scoblic is cofounder and principal of the consultancy of Event Horizon Strategies, and a senior fellow at the International Security Program at New America.  He wrote the HBR article, “Learning from the Future: How to Make Robust Strategy in Times of Deep Uncertainty”.

Peter, thanks so much for joining us today.

PETER SCOBLIC:  Thank you so much for having me.

ALISON BEARD:  So, scenario planning has been around for quite some time.  What’s different about how organizations should be using it now?

PETER SCOBLIC:  Well, I think that the difference between the way that organizations often use it and the way that it should be used is that it’s sometimes seen as a one-off exercise, at moments of perhaps extreme crisis or in moments where leadership is trying to determine a particular strategy going forward.  Sometimes it’s the kind of thing that you tack onto the end of a corporate retreat.

The way that I think scenario planning ought to be used and strategic foresight ought to be used more generally is in an iterative fashion.  A constant cycle between imagining the future and acting in the present.  So that you reduce the potential for surprise and you increase your ability to sense, shape and adapt to the future as it emerges.

One of the conclusions that I’ve come to in my research is that imagination is a woefully undervalued strategic resource.  And that what organizations can benefit from tremendously is the institutionalization of imagination.

ALISON BEARD:  I think time becomes the issue though, right?  Because we are in this fast-moving world and leaders, organizations, teams are trying to adapt to it, to respond to what’s happening now on the ground.  And so, it’s really hard to shift to that long-term focus all the time.  How do you work with companies to do it?

PETER SCOBLIC:  The short-term is a constant demand.  We’re all subject to the tyranny of the present – whether it’s coming in the form of countless emails in the inbox, or the need for quarterly earnings reports, or the stresses of putting out the various sub crisis that have emerged from the pandemic.

There are no futurists in foxholes.  When there’s incoming fire it’s all that you can think about.  But I think that leaders and managers tend to overestimate the amount of time and resources that it takes to incorporate thinking about the future and iterating on visions of the future into their planning.

One of the in-depth case studies that I’ve done was of the U.S. Coast Guard.  And one of the things that amazed me was actually how few resources they dedicated to their strategic foresight program, to their scenario planning exercises, and yet it was able to have an outsized impact on Coast Guard strategy and a positive one, I think.

Often when you talk to foresight experts you’ll hear them say, we really need to change the culture of organizations so that they’re focused on the future.  And that is a really heavy lift.  That’s an almost impossible thing to do.  What the Coast Guard showed me was that you could do foresight in what I call a scrappy fashion.

ALISON BEARD:  So, what exactly did the Coast Guard do?

PETER SCOBLIC:  So, in 1998, Admiral James Loy, who was then the Commandant, the top officer in the Coast Guard, recognized that the organization was not adequately prepared for the changes it was likely to face in its operating environment.  And the Coast Guard had traditionally been a very, very reactive, short -erm focused organization.  They liked to say that they are constantly deployed, conducting search and rescues operations, drug interdictions, maritime safety operations, what have you.  And he saw this as having taken over the organization to the point where there was no sense of strategy.

So, he decided to hold a scenario planning exercise.  And he established a small strategic planning shop that reported directly to him, gave them a few hundred thousand dollars a year, which they used to bring in an outside consulting firm, and they held a scenario planning exercise called Project Longview.  Which envisioned a range of alternative far futures that they then sort of back stepped from to develop a set of robust strategies. And the effort was so successful in the ways that it helped the organization to adapt after the 9/11 attacks, that the Coast Guard then institutionalized the process, made it regular.

ALISON BEARD:  And so that’s obviously a military organization.  But you think that the lessons learned are applicable to the private sector as well?

PETER SCOBLIC:  Absolutely.  I think that if anything, the fact that a small military organization like the Coast Guard could pull this off so well, suggests that organizations that are both larger and that have more flexibility can do so far more easily.  It’s important to remember that as a military organization, the Coast Guard is very hierarchical.  It is subject to the budget dictated by Congress.  There are a lot of constraints that the Coast Guard is operating under.  For firms and for other organizations that have somewhat fewer constraints, there’s a lot more flexibility.

ALISON BEARD:  So, if I’m the leader of an organization, what would be the first few steps that I would take to get this going?

PETER SCOBLIC:  The first few steps I would take would be to, you know, socialize the idea among maybe the immediate top leadership.  But to the extent that you have the authority to put into place a strategic foresight process, I would set up a small office dedicated to that purpose that reports directly to you.  And then, to the extent that you need to engage outside resources, including consulting firms that specialize in this sort of thinking.  Have them work both with your strategic planning team and then a core team of individuals from throughout the organization to paint a broad picture of the trends that are likely to affect the organization in the coming years and even decades. And the potential uncertainties that it faces, and how those things could combine to create a range of possible futures.

And then, through that process, paint a picture of the futures the organization might encounter and involve the rest of the leadership in the organization in creating a set of what I would call robust strategies.  Strategies that would serve the company well, or the organization well, no matter which one of the futures that you outlined came to pass.

ALISON BEARD:  So, I want to pick apart that process a little bit.  You talk about imagination.  How do you find people who are going to be able to think out of the box and imagine those future scenarios that maybe they’ve never seen in their own experience?

PETER SCOBLIC:  It’s funny.  I feel like imagination is both the most difficult hurdle to get over and also the maybe most overestimated hurdle, or the hurdle whose height is most overestimated.  When I talked about the Coast Guard example, the people that were chosen to lead this project were not necessarily people who had been identified specifically for their strategic prowess.  Most of them were operators.  They were pilots, or ship drivers.

At the same time, it is absolutely a challenge to take people who are more analytical in their day to day work and ask them to envision a far future that in some ways is going to seem so divorced from our own, as to be silly.  But there are ways to engage the imagination.  Simply asking a group of executives to envision that they are a competing organization – a firm in their competitive space that they face every day, can radically expand their perception of reality and of what is possible, and what the competitive space actually looks like and what their own company’s competitive advantage is.

ALISON BEARD:  And are you pulling in people from all levels of the organization?

PETER SCOBLIC:  I think it’s important to pull in people from both all levels of the organization and from different functions within the organization.  This is a case where diversity absolutely matters, in all senses of the word.  Because what you want to do is as you say, get people to think outside of the box.  It’s very difficult to do that if you don’t recognize the box that you’re in.  It’s far easier to do if you have to interact, if you’re an engineer who has to then interact with designers, or you’re an accountant who has to operate with someone who is in the field in a different way.  Simply interacting with colleagues that you might not encounter on a day to day basis can broaden your mind significantly.

ALISON BEARD:  And so then after this initial brainstorming you settle on several future scenarios that you want to explore further?

PETER SCOBLIC:  That’s right.

ALISON BEARD:  And how do you narrow in on which ones you should choose?

PETER SCOBLIC:  I think what you want to do is articulate the set of futures that best captures the potential environments you might be facing while still remaining plausible.  So, you want futures that are distinctive of each other, that are plausible and that therefore together represent as much as you can of the possible future.  It’s impossible to imagine everything that might occur, but you want to capture as wide a swath of it as you can.

So, for example, when the Coast Guard ran Project Longview, they identified four forces for change that they thought would significantly impact the future.  So, they looked at the role of the Federal Government, whether it was sort of narrow, or whether it was expansive.  They considered the strength of the U.S. economy.  Would it be strong or would it be weak?  Would the threats to U.S. society be wide ranging or would they be fairly narrow?  And then being the Coast Guard they asked themselves about the potential demand for maritime services.

So, they sort of looked at these four dimensions and if you took the extreme values for each of them, you could generate 16 possible worlds.  And then they looked at those potential combinations and said OK, so here are five that we think are distinct from each other and they’re a little bit out there, but they’re still plausible.  These could happen.

So, they described a world called “Taking on Water.”  And that was a future in which the U.S. economy was struggling and there was significant environmental damage.  They had a somewhat ironically titled future “Pax Americana” in which the United States had been humbled by its efforts to intervene in the world.  And instead, it was confronting a world filled with political instability and economic unrest, but it was doing so from a position of relative weakness.  They had one called “Planet Enterprise” in which transnational corporations had really become the dominate actors internationally.

And so, you can see how the fundamental things that were sort of the most conspicuous characteristics of each of these future worlds were very different.  And the question was, OK, if we’re the Coast Guard and that is the future that we’re going to have to be operating in, what would we need today to best set us up for that world, for that future?

ALISON BEARD:  So you see how all these different scenarios play out for your own organization and then where do you take it from there to make sure that it’s actually changing what you’re doing currently?

PETER SCOBLIC:  So, this is no small challenge.  It is one thing to identify strategies that make sense in the face of these futures. It can be a much, much different thing to actually implement those strategies. The idea being that the futures that you can create, put some guardrails around uncertainty.  I t’s neither true nor useful to say that absolutely anything can happen.  But let’s paint a picture of the things that could happen and identify strategies that would serve us well no matter which one of those things happened.

The Coast Guard for example came up with this set of 10 strategies that all made tremendous sense to them.  The Coast Guard had traditionally been siloed into roughly two halves.  There was a side that handled maritime issues, more sort of safety, environmental regulation and then there was the more operational side that people who flew helicopters and conducted operations and so on an so forth.

Those two halves of the Coast Guard didn’t really talk to each other particularly well.  And what they realized was that in no future did it really make sense for the Coast Guard to be divided in that way.  That going forward, the missions that they were likely to face was likely to involve both halves of the organization.  But tearing down siloes within an organization is not an easy thing to do.  That’s a massive restructuring.

The Coast Guard began to experiment with it little by little, in certain ways, but it actually took the shock of 9/11 for them to recognize that the entire structure of the organization needed to be rethought.

ALISON BEARD:  But the idea is to get momentum for it before that crisis hits?

PETER SCOBLIC:  Absolutely.  Absolutely.  But one of the, one of the benefits of strategic foresight of, in this case, the scenario planning process, was that it not only articulates strategies that you want to act on in the present, but even in the event that you are not able to act on those strategies immediately for whatever reason, whether it’s a lack of resources, or a lack of consensus, it does provide a foundation so that if crisis hits you are able to respond more nimbly.

ALISON BEARD:  Are there any private sector organizations that you’ve seen do a really good job of this so far?

PETER SCOBLIC:  There are organizations that are beginning to.  The iconic organization that has scenario planning as a continual part of its strategy process is Shell.  Which really brought scenario planning into the corporate world back in the 1970s and in fact, one of its, one of its progenitors wrote two articles for Harvard Business Review in the 80s, detailing their process.  That process in an updated form continues to this day.  But there aren’t a tremendous number of organizations that have successfully institutionalized it.

ALISON BEARD:  Because we have been hit by this surprise pandemic, which some people did predict, but no one really prepared for, I’d love to just explore how a company might have engaged in strategic foresight and scenario planning to plan for this new reality we’re in now.

PETER SCOBLIC:  Yeah.  It is a bit, it’s difficult to call it a surprise as you suggest given the number of exercises in various forms that have been held over the decades about the possibility not only of a pandemic, but post 9/11 and the anthrax attacks of a bioterror attack.  It’s difficult to call it a surprise given that we have dealt with pandemics in just the past decade and the fact that the Obama administration left the Trump administration a playbook on how to handle this exact sort of thing.

I think companies in a range of sectors can think about potential disruptions that they might face and how they would effect operations.  That doesn’t mean that you have to anticipate the precise nature of the disruption.  Nobody precisely anticipated what this pandemic would look like even if they thought it could happen someday.  But that’s not the only sort of disruption there might be.  We can certainly envision terrorist attacks.  We can certainly envision natural disasters. It’s worth asking to what extent your firm or your organization can cope with disruptions of that kind.

Or, even if you’re not thinking about disruptions and you’re simply thinking about a range of futures, what do the trends suggest that your organization would want to be doing now, no matter which potential future emerged?  Whether that had a massive disruption in it or not.  I was reading the New York Times this morning which has a story about how the ubiquity of the fax machine in health insurance claim processing or just in the health industry general, has served as a bottleneck to both treating people during the pandemic, and gathering information.

And as I was reading that I thought to myself, if you are a healthcare organization, and five years ago, or 10 years ago, you had sat down and said OK, well what are the trends and the potential uncertainties that we face?  One of the trends you likely would have identified was an increasing trend towards digitization and an increasing amount of information as the patient base grew older and so on, as just as the population increased.  It strikes me that a strategic foresight exercise held in the healthcare industry would have identified as a robust strategy a desire to develop, or a need to develop a more streamlined digital way of processing information.  That would have been a robust strategy that would serve us well.  When Washington State has to call in the National Guard to do data entry because its systems are so antiquated it suggests that something’s gone wrong.

ALISON BEARD:  Do you see companies in some sectors doing a much better job of this than others?  Like our tech companies much more creative about thinking about the future than say old school industrial companies.

PETER SCOBLIC:  I think that tech companies are more creative in thinking about the future in the sense that they have a much greater sense of agency.  They believe that they can shape the future. And of course, like we, companies can shape the future to some extent, but there’s also a tremendous amount that lies outside of our control.  And so, not only do you need to be able to shape the future, you need to be able to adapt to it as it emerges and you need to be able to sense it as it begins to emerge in the present.  A number of tech companies are very good at beginning to sense change and where things are headed and take advantage of that.  And a lot of older companies in more placid industries are less so.

I think one of the key management competencies of the future, if not the key competency, is going to be able, is going to have the flexibility to change your mental model of how the world works.  We all carry around in our heads these ideas of how the world works, maps of what reality looks like.  But in incredibly uncertain times, when the territory is shifting so fast, our minds have trouble keeping up.  And so, companies in industries that haven’t had a shake up in a long time tend to be less flexible.  And companies who, companies that are, who, for whom you know, change is part of what they are trying to drive, do tend to be a bit better.

ALISON BEARD:  Should leaders derive strategies solely from these kinds of exercises?  Because surely they also have to take a short term factors into account, even when we’re not in crisis mode?

PETER SCOBLIC:  Absolutely.  Strategic foresight is not meant to be the be all and end all of the way an organization behaves.  One of the key ideas in business scholarship is the notion of ambidexterity.  That organizations need to be able to act in the present and think in the future.  They need to be able to both sort of exploit their existing competencies and explore new ones.  So, you need to be able to learn how to make widgets better and more efficiently, at the same time you have to be able to think about well, what’s the next widget going to be that’s really going to drive my segment, that’s really going to matter to my organization?

What strategic foresight lets you do is link those two things.  The problem is that the short term and the long terms sort of require different ways of thinking.  They require different organizational structures.  They can require different allocations of resources.  The nice thing about strategic foresight is that it’s not simply about thinking about the far future and creating some kind of science fiction world that you can think of, hey how well would we do in that world?  It’s about linking the present and the future more tightly.  So that the thinking that you do, do about the long term actually improves your performance in the short term.  The two things are not in contradiction.  They’re actually complimentary.

ALISON BEARD:  Peter, thank you so much for joining us today.

PETER SCOBLIC:  It’s my pleasure.  Thank you for having me.

HANNAH BATES: That was Peter Scoblic in conversation with Alison Beard on the HBR IdeaCast . Scoblic is a cofounder and principal of the consultancy Event Horizon Strategies.

We’ll be back next Wednesday with another hand-picked conversation about business strategy from Harvard Business Review. If you found this episode helpful, share it with your friends and colleagues, and follow our show on Apple Podcasts, Spotify, or wherever you get your podcasts. While you’re there, be sure to leave us a review.

And when you’re ready for more podcasts, articles, case studies, books, and videos with the world’s top business and management experts, find it all at HBR.org.

This episode was produced by Mary Dooe, Anne Saini, and me, Hannah Bates. Ian Fox is our editor. And special thanks to Maureen Hoch, Nicole Smith, Erica Truxler, Ramsey Khabbaz, Anne Bartholomew, and you – our listener. See you next week.

• Subscribe On:

Latest in this series

This article is about strategy.

• Strategic planning
• Crisis management

Partner Center

7 Organizational Structure Types (With Examples)

Updated: May 29, 2024, 5:39pm

Table of Contents

What is an organizational structure, 4 common types of organizational structures, 3 alternative organizational structures, how to choose the best organizational structure, frequently asked questions (faqs).

Every company needs an organizational structure—whether they realize it or not. The organizational structure is how the company delegates roles, responsibilities, job functions, accountability and decision-making authority. The organizational structure often shows the “chain of command” and how information moves within the company. Having an organizational structure that aligns with your company’s goals and objectives is crucial. This article describes the various types of organizational structures, the benefits of creating one for your business and specific elements that should be included.

Employees want to understand their job responsibilities, whom they report to, what decisions they can and should make and how they interact with other people and teams within the company. An organizational structure creates this framework. Organizational structures can be centralized or decentralized, hierarchical or circular, flat or vertical.

Centralized vs. Decentralized

Many companies use the traditional model of a centralized organizational structure. With centralized leadership, there is a transparent chain of command and each role has well-defined responsibilities.

Conversely, with a decentralized organizational structure, teams have more autonomy to make decisions and there may be cross-collaboration between groups. Decentralized leadership can help companies remain agile and adapt to changing needs.

Hierarchical vs. Circular

A hierarchical organization structure is the pyramid-shaped organization chart many people are used to seeing. There is one role at the top of the pyramid and the chain of command moves down, with each level decreasing in responsibilities and authority.

On the other hand, a circular organization chart looks like concentric circles with company leadership in the center circle. Instead of information flowing down to the next “level,” information flows out to the next ring of management.

Vertical vs. Flat

A vertical organizational chart has a clear chain of command with a small group of leaders at the top—or in the center, in the case of a circular structure—and each subsequent tier has less authority and responsibility. As discussed below, functional, product-based, market-based and geographical organizational structures are vertical structures.

With a flat organization structure, a person may report to more than one person and there may be cross-department responsibilities and decision-making authority. The matrix organizational structure described below is an example of a flat structure.

Benefits of Creating an Organizational Structure

There are many benefits to creating an organizational structure that aligns with the company’s operations, goals and objectives. Clearly disseminating this information to employees:

• Provides accountability
• Clarifies expectations
• Documents criteria for promotion
• Designates decision-making authority
• Creates efficiency
• Fosters collaboration

Essential Elements of Clear Organizational Structure

Regardless of the special type of organizational structure you choose, it should have the following components:

• Chain of command
• Roles and responsibilities
• Scope of control
• Decision-making authority
• Departments or teams within the organization

Functional/Role-Based Structure

A functional—or role-based—structure is one of the most common organizational structures. This structure has centralized leadership and the vertical, hierarchical structure has clearly defined roles, job functions, chains of command and decision-making authority. A functional structure facilitates specialization, scalability and accountability. It also establishes clear expectations and has a well-defined chain of command. However, this structure runs the risk of being too confining and it can impede employee growth. It also has the potential for a lack of cross-department communication and collaboration.

Product- or Market-Based Structure

Along with the functional structure, the product- or market-based structure is hierarchical, vertical and centralized. However, instead of being structured around typical roles and job functions, it is structured around the company’s products or markets. This kind of structure can benefit companies that have several product lines or markets, but it can be challenging to scale. It can also foster inefficiency if product or market teams have similar functions, and without good communication across teams, companies run the risk of incompatibility among various product/market teams.

Geographical Structure

The geographical structure is a good option for companies with a broad geographic footprint in an industry where it is essential to be close to their customers and suppliers. The geographical structure enables the company to create bespoke organizational structures that align with the location’s culture, language and professional systems. From a broad perspective, it appears very similar to the product-based structure above.

Process-Based Structure

Similar to the functional structure, the process-based structure is structured in a way that follows a product’s or service’s life cycle. For instance, the structure can be broken down into R&D, product creation, order fulfillment, billing and customer services. This structure can foster efficiency, teamwork and specialization, but it can also create barriers between the teams if communication isn’t prioritized.

Matrix Structure

With a matrix organizational structure, there are multiple reporting obligations. For instance, a marketing specialist may have reporting obligations within the marketing and product teams. A matrix structure offers flexibility, enables shared resources and fosters collaboration within the company. However, the organizational structure can be complex, so it can cause confusion about accountability and communication, especially among new employees.

Circular Structure

Similar to the functional and product-based structure, a circular structure is also centralized and hierarchical, but instead of responsibility and decision-making authority flowing down vertically, responsibility and decision-making authority flow out from the center. A circular structure can promote communication and collaboration but can also be confusing, especially for new employees, because there is no clear chain of command.

Organic Structure

Unlike vertical structures, this structure facilitates communication between and among all staff. It is the most complex, but it can also be the most productive. Although it can be challenging to know who has ultimate decision-making authority, it can also foster a positive company culture because employees don’t feel like they have “superiors.” This structure can also be more cost-efficient because it reduces the need for middle managers.

There is no one “right” organizational structure. When deciding which structure will work best for your company, consider the following:

• Current roles and teams within the company. How are job functions currently organized? Does it foster communication and productivity? Does it impede or encourage employee growth?
• Your strategic plan. What are your company’s goals for the short-term and long-term?
• Feedback from employees, leadership and other stakeholders. What do those within your company say about how the company is structured? What feedback do you have from other stakeholders, such as customers and suppliers?
• Alignment. What structure will best support your strategic plans and address any feedback received?

What is the most common organizational structure?

A functional organizational structure is one of the most common organizational structures. If you are still determining what kind of structure to use, this organizational structure can be an excellent place to start.

What is the difference between an organizational structure and an organizational chart?

An organizational chart is a graphic that depicts the organizational structure. The chart may include job titles or it can be personalized to include names and photos.

What are the four types of organizational structures?

A functional—or role-based—structure is one of the most common organizational structures. The second type—the product- or market-based structure—is also hierarchical, vertical and centralized. Similar to these is the third structure—the process-based structure—which is structured in a way that follows a product’s or service’s life cycle. Lastly, the geographical structure is suitable for businesses with a broad geographic footprint.

• Best HR Software
• Best HCM Software
• Best HRIS Systems
• Best Employee Management Software
• Best Onboarding Software
• Best Talent Management Software
• Best HR Outsourcing Services
• Best Workforce Management Software
• Best Time And Attendance Software
• Best Employee Scheduling Software
• Best Employee Time Tracking Apps
• Best Free Time Tracking Apps
• Best Employee Training Software
• Best Employee Monitoring Software
• Best Enterprise Learning Management Systems
• Best Time Clock Software
• Best ERP Systems
• Zenefits Review
• Oracle HCM Review
• UKG Pro Review
• IntelliHR Review
• ADP Workforce Now Review
• ADP TotalSource Review
• SuccessFactors Review
• Connecteam Review
• What is Human Resources?
• Employee Benefits Guide
• What is Workforce Management?
• What is a PEO?
• What is Human Capital Management?
• HR Compliance Guide
• Strategic Human Resource Management
• Onboarding Checklist
• Benefits Administration Guide
• What Is Employee Training?
• Employee Development Plan
• 30-60-90 Day Plan Guide
• How To Calculate Overtime
• What Is Outplacement?
• New Hire Orientation Checklist
• HR Analytics Guide

Next Up In Business

• 10 Management Styles Of Effective Leaders
• Recruitment Process Outsourcing: The Ultimate Guide
• Attendance Policy Template
• What Is Rightsizing?
• Administrative Assistant Job Description
• What Are Voluntary Benefits?

Best Hawaii Registered Agent Services Of 2024

Best Arizona Registered Agent Services Of 2024

Free Mission Statement Template (With Examples)

How To Start A Print On Demand Business In 2024

HR For Small Businesses: The Ultimate Guide

How One Company Is Using AI To Transform Manufacturing

Christine is a non-practicing attorney, freelance writer, and author. She has written legal and marketing content and communications for a wide range of law firms for more than 15 years. She has also written extensively on parenting and current events for the website Scary Mommy. She earned her J.D. and B.A. from University of Wisconsin–Madison, and she lives in the Chicago area with her family.

The Ultimate Marketing Plan Template For 2024 [FREE]

The Ultimate Guide to Creating a Marketing Plan. Get our marketing plan template for FREE + Budget plan + Calculators + best marketing toolkit for 2024.

Rakefet is the CMO at Mayple. She manages all things marketing and leads our community of experts through live events, workshops, and expert interviews. MBA, 1 dog + 2 cats, and has an extensive collection of Chinese teas.

Learn about our

Natalie is a content writer and manager who is passionate about using her craft to empower others. She thrives on team dynamic, great coffee, and excellent content. One of these days, she might even get to her own content ideas.

Updated May 1, 2024.

It takes time to build a marketing plan and it will change anyway, right? 100%. But creating your digital marketing plan is worth every minute of your time. If you build a business without a marketing plan, it’s like constructing a house without a blueprint. And you need a really good marketing plan template to get you on the right track.

Before we give out all the information and knowledge you need to create your winning marketing plan, let's start by giving you a FREE Digital Marketing Plan Template for 2024 . This is a great example of a great marketing plan that looks snazzy, too 😉.

Click on the image below, and make your own copy or download it to start using this template today.

Now that you have your marketing plan template, let's go over some basics before diving into more advanced aspects of marketing planning.

What is a marketing plan?

A marketing plan is a document that details how you're going to execute your strategy. It's written for a specific period of time and explains both your current situation and your future plans.

What’s the difference between a marketing plan and a business plan?

A marketing plan may be part of an overall business plan. A solid online marketing strategy is the foundation of a well-written marketing plan. While a marketing plan contains a list of actions, without a sound strategic foundation, it is of little use to a business. It has to have a set of concrete tasks and marketing tactics to follow.

Why do you need a marketing plan?

There are a ton of reasons why every brand and marketing team needs a good marketing plan.

Here are the top 3 reasons:

Create better goals

When you have specific goals to achieve you can plan your way to achieve them. Having too general goals like "growing my business" VS. measurable KPIs like "I want to grow my revenue by $600K, and to do that I need 1,000 new customers" is different.

Actual KPIs can help you plan exactly what will get you there. We recommend you set up some SMART goals - which stands for specific, measurable, achievable, relevant, and time-framed.

Improve your focus

Marketing without focus can be very messy and super ineffective. Have you ever tried to run a company meeting without an agenda? Just like meetings, marketing needs focus.

The best tip we can give you is to focus on specific activities and have them done well. A digital marketing plan will help you focus on exactly the tasks that will impact your success.

Of course, things will change and your plan will change as well. But as long as you are using a good marketing plan outline you will have your next month’s tasks written down and your work will become that much more effective.

Stay consistent

The purpose of a marketing plan is to ensure that marketing activities are relevant and timely to achieve the organization's business objectives. It's a plan defining a sustainable competitive position and defining the resources necessary to achieve it.

Now that you know what a marketing plan is and what’s used for let’s talk about the key components that it’s built out of.

How do you make a good marketing plan?

A good marketing plan should have the following parts -

• Executive Summary
• Mission statement
• Market Analysis (SWOT)
• Competitor Analysis
• Target market & buyer personas
• Marketing objectives and KPIs
• Pricing strategy
• Growth strategy
• Marketing channels

And as a bonus we’ve added two more sections:

11. BONUS: How to assemble the right marketing team 12. BONUS: Top tools for marketing plan creation & design

Each of these key elements is vital for the right execution of your marketing strategy and I promise you it’s not as difficult as it looks.

Let’s dive in.

1. Create an executive summary

This might seem a little too formal for some marketers out there but it’s essential and I’ll explain why.

Marketing plans tend to get really long so it’s better to create a quick summary and highlight some of the key points of every aspect of your plan right at the beginning. This becomes the foundation of your marketing plan.

There is no set length for an executive summary but it should cover all of the main elements of your marketing plan. It should also quickly tell your story and highlight what you are trying to achieve. Add your KPIs, marketing channels, market strategy, and budget.

A good executive summary should give a quick taste of the entire plan and entice the reader (investor, upper management, CEO, etc) to read the rest.

Here’s a great 2-minute video from Hubspot that shows how to write an executive summary from start to finish.

The next section of the marketing plan has to do with your “why”.

2. Create a mission statement

A good mission should have 3 critical components -

• An overall mission or vision of the company
• The company’s core values
• The goals and marketing objectives

The key is to keep it precise, short, and powerful. Don’t write a long essay, don’t just throw a bunch of jargon around, and do get some input from the employees at the company.

Employee feedback on this is critical because marketing and sales activities have to align with the mission of the company so all the various teams in the business have to be in agreement on the general mission.

The worst thing you can do is have a mission that has no direct correlation to the actual activities or tasks. Such a mission won’t help you grow your business .

What’s the difference between the company vision and its mission?

The vision is like the why, the overarching goal and foundation of the company. The company’s mission includes the vision and adds to it the actions and activities that the company will do to help advance its vision. Here’s a great video by Simon Sinek that explains this concept.

Now let’s talk about how you are going to go about achieving that mission.

The first step is to understand the market and your particular industry.

3. Market analysis

Have you ever seen the TV show Shark Tank?

The first part of any pitch is a personal story and a quick description of the founders’ “why”. This is where you can find the vision and mission of the company.

Next, they almost always mention the size of the market and they quantify the opportunity that they are presenting to the sharks.

This is exactly what a market analysis is.

A market analysis is a quantitative and qualitative assessment of a market. It looks at the size of the market in terms of the value ($) and volume (quantity of product sold) and often highlights some of the latest trends or environmental conditions that define the opportunity cost.

So how do we do this?

A great way to structure this is by using the SWOT analysis technique.

What is a SWOT analysis?

A common marketing framework that can help you create a good marketing analysis is called the SWOT framework . It stands for strengths, weaknesses, opportunities, and threats .

Strengths - what is your company really good at? what makes you unique? what unique advantages do you have over your competition? What is your value proposition? What are some of the key resources, processes, and capabilities that your company has?

Weaknesses - what are the weakest points of the business? What are some of the areas in which you could improve on? What is your company lacking compared to your competitors?

Opportunities - what are the biggest trends in the market that could give your company an edge or an advantage? These could be demographic patterns, lifestyle choices, population dynamics, or governmental regulatory policies.

Threats - what are some of the external factors in the market that could negatively impact your business? What are some environmental factors that you should be aware of? What are some possible changes that could threaten your business performance and success?

Pro tip: Want to do your own SWOT analysis? Get our Marketing SWOT Analysis Template .

4. Competitive analysis

The next vital step is to understand your competition and what the competitive landscape looks like in your industry or niche.

The main questions your competitive analysis should answer are:

• Who are the competitors?
• What marketing strategies are they employing?
• And how are they going about achieving their goals?

Here’s one of my favorite competitive analysis frameworks from the renowned Myk Pono:

Now that you’ve completed your competitive analysis it’s time to zero in on your ideal customer.

5. Define your target market and buyer personas

The best way to create target personas for any brand is by creating a customer journey map. A customer journey map is a visual representation of all the various touchpoints that your brand has with a prospective customer.

This is a critical part of creating your marketing strategy.

Google introduced the moment of truth concept and this really relates to our discussion of marketing channels but it’s important to mention here as well.

Shoppers can find and interact with your brand through hundreds of channels, both online and brick-and-mortar. The Zero Moment of Truth (ZMOT) concepts represents that stage of the buyer’s journey that leads them to find your product or solution for their problem.

Identifying the specific problem that the customer is looking to solve is critical. This is how you define your persona and this is what ultimately affects the rest of your marketing decisions.

Here's a great buyer persona template from Hubspot to help you create better audience personas.

6. Define your goals and KPIs

The first step when building a marketing plan is to understand and define which business goals are the plan aiming to achieve. Business and marketing should always go hand-in-hand - remember that. Questions you should answer are:

• What are the business goals I need to achieve?
• What KPIs will get me to achieve my goals?
• What does my marketing funnel look like?

Pricing is often part of the market and competitive analysis sections but sometimes brands discuss it separately. It depends on how important price considerations are for your business and how competitive your market is. For example, if a major advantage in your business is that your product is priced significantly lower than your competition then a pricing strategy will play a key role in your marketing plan.

On the other hand, if you are a brand like Apple that is trading on the quality and its other features more than a price comparison, then your focus will be less on price.

There are 5 common pricing strategies:

1. Cost-based pricing

This is when the price is solely based on the costs of the products. The company simply takes the cost it takes to produce the product or service and adds a markup.

2. Value-based pricing

This strategy is based on the perceived value of your product. So a great example here is a company like Apple that prices its products significantly higher than its competitors because of the perceived value they provide.

3. Competitive pricing

This is when a company sets a price based on what the competition is charging. A great example here is gas stations. Each gas station competes with the other stations on the block, trying to outbid the other.

4. Price skimming

This strategy involves setting a high price and then lowering it as the market evolves. A lot of tech products have a high price when they first launch in order to maximize profit and increased their perceived value.

5. Penetration pricing

Penetration pricing is the exact opposite of price skimming. It involves pricing a product really low at first in order to enter a competitive market, and then increasing the price slowly over time.

Fit your pricing strategy to your target customers

It's important to fit your pricing strategy to the specific customer segment that you are trying to reach. If you are markeing to the early adopters then price skimming will work. If you want to be adopted by the early or late majority then you may have to try penetration pricing.

You can always use customer feedback to get more data on this and make a better decision.

As you can see, there are a lot of different pricing strategies out there. Picking the right one for your business will depend on the previous steps in your marketing plan - the customer (or buyer) pain point, the market analysis, and the competitive analysis.

8. Define your marketing budget

Your marketing budget plan depends on your business stage

Much like marketing goals and KPIs, your budget planning depends on your business lifecycle stage (are you a startup or an established brand). Normally, startups invest more in gaining market share and acquiring new customers, whereas established brands would invest more in retention and reputation.

Your niche is also a factor

Each industry has a different marketing structure and consumer behavior, so your niche defines your marketing budget allocation as well. eCommerce in a competitive niche like fashion, for example, will need ways to lower its CAC (customer-acquisition-cost) and upsell.

Spending tipping point

You can't expect that if you invested $20,000 and got 1,000 leads to keep the same proportion at $200. Every channel should have a different amount allocated to it based on the return on investment (ROI) and your profit margins.

So make sure you invest enough into each channel to move the needle. You can benchmark with other businesses in your niche, or use a rule-of-thumb by which at least 20% of your expected revenue should be invested in marketing.

Lead generation and branding

Start planning your budget.

The first step when planning your marketing budget is to understand what are the growth channels that have worked for you so far and are part of your digital marketing strategy for the next year. According to each channel's effectiveness and cost, you can start allocating your monthly and yearly spend.

Questions you should answer for that are:

• What are the most effective growth channels I have so far?
• Are there more growth channels I want to test next year?
• Does seasonality affect my sales?
• Align your budget with your KPIs (!)

Now that you’ve identified what and how to spend your marketing dollars, it’s time to pick the marketing channels that you will be using to grow your business.

9. Define your marketing channels

It's important to decide on the specific marketing mix that is best for your business. Social media platforms and other marketing channels have absolutely exploded in the last decade so you have a ton of channels to choose from.

Now, remember to have an authentic brand presence on every channel and only expand to ones that fit your brand strategy . Here are some of the top ones that you should consider for your marketing plan template:

Content marketing

Content marketing is very powerful for inbound marketing. Studies show that 60% of marketers create at least one piece of content per day and the year-over-year growth in traffic is 7.8X higher for content leaders.

Companies like Capterra and Quuu attribute their success to really good content.

Now, remember, content is a long-term game, short-term wins are very rare. You should create, design, and post content consistently and continue to optimize.

Social Media

Social media is another powerful marketing aspect of any brand’s marketing strategy. It provides an opportunity for you to present your brand in a visual way through images and videos.

Studies show that 90.4% of Millennials, 77.5% of Generation X, and 48.2% of Baby Boomers are active social media users, so don’t ignore these platforms if your brand isn’t “sexy” enough.

The marketing guru Gary Vaynerchuk has always said that brands in the construction or plumbing industries should absolutely post content and interact with their audience on social media. If you bring people value you will generate leads that will eventually convert into sales .

>> Want to get more engagement and traffic from social?

Email marketing

Email marketing has the highest ROI of any marketing channel. Studies show that marketers make $44 for every $1 they spend on email marketing. It’s 40X more effective than using social media to generate sales.

If you are a B2C company then this is an absolute must. You should be sending out weekly or biweekly campaigns, you should set up some automatic welcome and cart abandonment flows, and you should definitely set up some email automation for the customers that convert through a popup.

If you are primarily B2B you might think that email marketing is not as powerful for you but that is absolutely not the case. According to WordStream , 59% of B2B marketers say that this is the most effective way to generate sales.

Another great way to use this channel is for branding. For example, a lot of companies leveraged the global COVID pandemic to engage in new ways with their target customers. They used really creative ways to send really helpful and cheerful emails that helped lift people’s spirits.

Advertising

Last but not least, there’s advertising. This is our specialty here at Mayple . We have over 1,500 talented ads experts that we match with the brands that we work with. Advertising is an important aspect of your marketing strategy that you should absolutely have on your digital marketing plan template.

There are several ways you could utilize advertising as a marketing channel .

First, there is social advertising. You could advertise on platforms like Facebook, Instagram, Snapchat, Pinterest, LinkedIn, and Quora. Then there are Google Ads that come in the form of PPC or you could use a tool like Taboola or Outbrain to leverage Google’s Display Network.

You could also retarget your site visitors using ads on any of these networks. This type of advertising is particularly effective and we recommend it to all the brands that we work with.

Now let’s talk about your marketing or growth strategy.

10. Define your growth strategy

After you’ve set your marketing goals, KPIs, and budget, it's time to plan your marketing activities for this year! Ready? 💪

What to consider when planning your marketing?

After you figured out what are the channels you're going to invest in, the marketing plan should show all the activities you're going to run under each growth channel.

Here are some examples you can use:

Paid media marketing campaigns

To plan and design your paid campaigns correctly you should know what are the most effective channels you are going to start using and to build a marketing funnel that shows you when are you going to advertise to "first-touch" prospects (people that don't know you yet) and what will remarketing prospects will want to see in order to be persuaded to take the next move.

Now, plan the marketing activities for each of your marketing funnel stages (from the awareness stage to the decision stage) and prospects' journeys from the setup stage to the live campaign stage. You can also add special events and design seasonal promotions in your paid campaigns such as sales season and other special occasions.

Content strategy & distribution

Content marketing is all about connecting with your customer base and potential buyers at every level of the funnel. An effective content distribution strategy should take into consideration the types of content you want to publish and the ideal distribution channels for your potential customers at each stage of the marketing funnel.

Another important thing to remember about content is consistency.

Don't plan your content on social channels if you won't have the resources to be consistent with your posting. It's better to focus on fewer things and do them well. Content can include any valuable engagement you have with your audience, whether it's on your Facebook, on a blog post, or in your email marketing .

Some of your content efforts will be ongoing (for example, SEO) and some will be building assets for future use (for example, Video).

Offline / Local

Ok, so we’ve covered all the aspects of an effective marketing plan.

Now let’s talk about the type of expertise you will need to assemble to execute your strategy.

11. BONUS: How do you build the perfect marketing team?

As we all know, marketing management can be lonely (at every size of business by the way), so a crucial factor in your marketing success is building a good team to execute your marketing plan. It can be an in-house team, a team of experts you hire, or as in most cases, a hybrid of in-house employees combined with marketing service providers ( agencies or freelancers).

3 Fundamentals of a good marketing team:

Here are the three top elements of a really effective marketing team.

I'll start by saying a good marketing team depends first and foremost on its leader (Yeah, that's you!). When you choose the right people and know how to manage them right, your success rates are already good. At the end of the day, good marketing starts with a good strategy, continues with a reasonable plan, and depends on great execution.

Expertise blend

Your strategy and plan require specific human capabilities so they will be executed well. If you're planning on running paid media campaigns, you better start your year with an expert on your team that knows the job and that you can count on to deliver on your expectations.

To decide whether to hire an in-house employee or a service provider, you should consider two things:

• What is more important for you - flexibility or control?
• Do you have access to

In my experience, experienced marketing professionals either demand very high salaries or work independently / in small agencies (for example ecommerce SEO agencies ).

Measurement and performance

We're back talking about your Key Performance Indicators (KPIs), and so should you in every marketing decision you make. After you made sure you have all the needed resources in terms of human talent to get your plan running, you'll need to keep tracking, measuring, and motivating them to be focused on achieving your goals and KPIs.

Not an easy task, especially when you need to measure both in-house employees and service providers. It’s important to understand what KPIs are relevant to each of your team members, and how to run these tracking sessions in a way that will bring everyone together to achieving better results for your business.

Questions to ask a

Questions to assess their experience, with respect to your unique business requirements:

• What industry-relevant experience do you possess?
• What kinds of campaigns have you previously managed?
• Can you show me some examples?

Questions that assess their ability to build the campaign strategy you need:

• How do you plan a campaign?
• How do you decide on each campaign’s distribution?
• Do you A/B test different campaign messages?

Questions about reporting and KPIs - clear expectations!

• Which KPIs do you think are relevant to us?
• Which KPIs do you expect to reach?
• Which reporting format do you use?
• What would be the frequency of the reports you generate?

Excellent. You now know how to assemble your marketing team.

And you might be asking yourself, how do I write this marketing plan? It’s going to take me ages! There is so much research that goes into it, do I have to do it all manually?

The answer is no way! There are a ton of marketing tools & software that can help you create your actionable marketing plan way faster.

Here are a few.

12. BONUS: What are the best tools to use to create a marketing plan?

Here are some of the top marketing tools to use to create your marketing plan.

Tools for research

There are numerous tools to use to obtain all the market research and business analytics for your marketing plan.

Alexa is a great tool to get insights into your market and your competitors. It has some really great advanced features that can show you your site demographics, where your traffic comes from, and the traffic sources of your competitors.

Similarweb is another great tool for research. It’s like Alexa in that it has some very similar features but has more reporting capability, and has other metrics like geography, referring sites, and SEO metrics.

Ahrefs is one of the top SEO tools out there. It can give you some of the most sophisticated information about the types of backlinks you or your competitors have, search engine rankings, and much more.

Tools for collaboration

Basecamp is a great tool for team collaboration. You can use it to message your team, store and organize project files efficiently, and work better with your team. There are so many data points to gather for your marketing plan and you will need to collaborate with multiple teams in your company.

Slack is another great tool for team collaboration. Though it’s more focused on communication it does provide a great way to store information and collaborate with co-workers (and it has a slick design and an easy-to-use interface).

Speaking of design, let’s talk about visual design tools and software for your marketing plan.

Tools for charts and presentations

This is a great design tool for making charts. They have a really easy-to-use drag and drop design interface that allows you to create fancy charts and diagrams for your marketing plan in minutes.

Canva is a great design tool for all kinds of design projects. It has a wide range of features that you could use to design amazing graphics and download them for your marketing plan.

13. BONUS: Top marketing plan examples

There are so many areas of digital marketing and if you want to be really efficient you should make a plan for each one. The best way to learn is from the experts so let’s look at some of the best sample marketing plans. You can download any of these or save a copy for yourself.

Content Marketing Strategy Template - by Buffer

This is a really great plan for your content. It breaks down every process from discovering your ideal customers, to creating their buyer persona, finding the main challenges that your content could solve, and so on. This is a really in-depth guide designed for any content marketing out there.

Simple Marketing Plan - from Cengage

Here’s another really great marketing plan example. This one looks really old school, so if you are a visual learner this one is probably not for you. But if you want to see a really well-written explanation of every section of a traditional marketing plan, you will get a lot of this example. Download it and fill it out, you will get a lot of value out of it.

One Page Marketing Plan Template - from SmartSheet

Ok, if that wasn’t simple enough for you, here’s a quick one-page cheat sheet that you can use to quickly summarize your entire marketing plan. This one is really useful for a quick brainstorming session, especially when working with a remote team.

Marketing Strategy Template for Increasing Blog Traffic - from Sumo

Sumo has some incredible marketing plan templates. I used one of their templates to grow an Instagram account from 0-30k subscribers in 18 months. And here they strike again with a super-specific template & strategy on how to take your blog traffic to 10,000 visits in just 12 weeks.

Marketing plan infographic for specific projects - from Visme

Speaking of content, let’s talk about video.

Creating a video strategy for a brand can be a pretty complex task. You have a bunch of teams, a variety of factors to consider, and it can become a big mess pretty quickly. So, if you want to create a strategic marketing plan template for a specific project like that, then use this infographic template from Visme to display everything and make it all really easy for the whole team to follow.

This format is especially powerful when you’ve hired a digital marketing consultant because that’s when things can get a little unclear. So organizing every project into a quick infographic can provide a really great way to keep everyone organized.

Email List Marketing Strategy Template

An email list is one of the most powerful tools any business has. It’s really hard to grow your list and keep subscribers engaged. Here’s a great marketing plan example for growing a list to over 1,500 new subscribers in 12 weeks.

Email Marketing Plan Template - from Hubspot

Here’s a great email marketing planning template from Hubspot that helps you create better emails. Hubspot is an incredible software product for any brand and they make incredible templates and guides on virtually every aspect of digital marketing. This template in particular has 3 parts - email planning, analytics, and A/B testing.

Ecommerce Marketing Plan Template - from Sumo

We’ve been focusing more and more on eCommerce businesses recently, and you can learn all about it in our eCommerce marketing guide . Here’s an example of a marketing plan that takes you through all the steps of growing your eCommerce revenue in 12 weeks.

eCommerce Marketing Plan Example - from Drip

Here’s another great marketing plan example from Drip. This one is a broad overview of each section and has some additional tracking info to fill out, that the other plans didn’t cover. It’s a quick and easy one.

14. How to Create a Social Media Marketing Template

This is something that we get asked often. Sometimes a marketing manager or brand owner doesn’t want to design a whole new marketing plan from scratch, but only wants to focus on their social media.

How do you go about creating a social media marketing plan ?

Here’s a high-level overview of how to go about it.

1. Choose your SMART Goals.

We’ve spoken about this at the beginning of this article, and it’s super crucial that any kind of plan starts with some goals that make sense.

SMART stands for -

Here’s an example of a vague goal:

-We will increase our blog traffic to 100k monthly uniques.

Here’s how you turn that into a SMART goal:

- We will increase our blog traffic by 10% each month for the next 12 months by increasing all of our posts to 3,000 words and optimizing on-page content.

Did you notice how I set a deadline on that SMART goal?

T stands for time-bound and deadlines are absolutely crucial.

2. Define your target audience

It’s time to narrow down who your ideal customer is.

First, start by looking at your data on Google Analytics or any other tool you’re using. Find out as much information on your audience as you can.

This could include:

• Average income
• Shopping habits

3. Look at your competitors

4. analyze your social data.

Now that you know what your competitors are doing, compare that to where you are holding with your current marketing efforts.

Look at the following things on each channel:

• How many followers do you have
• How much engagement (likes & comments) you get
• Which types of posts are most successful
• Days of the week and times your account gets the most engagement
• Best times to post

5. Decide on accounts & channels

Next, choose the right social media platforms for your business. Decide which ones you want to use and for what purposes. It could be that one channel you could use for impressions, and on the other one, you really care about the engagement.

Here’s what we do at Mayple:

• Facebook - Organic impressions + ads to get new brands and marketing experts signed up -> lead generation and sales
• Instagram - Organic impressions + engagement aimed at marketers
• LinkedIn - Organic engagement + traffic for brand growth

You might find that Pinterest is a perfect platform to get traffic, while Instagram is primarily for sales. It totally depends on the industry, design, content format, and type of business you have.

6. Get some inspiration

Now that you’ve decided on the channels you’re going after, look at some of the best social media posts for your niche and make an inspiration wall for yourself.

Look for posts or videos that catch your eye, designs, color schemes & messaging that would work well for your content.

7. Decide on post types and formats

Next, decide on the exact types and formats of your posts.

Here are a few post formats you could pick from:

• Carousel posts
• Instagram Stories
• Short-form content
• Long-form content

I recommend deciding on 4-5 formats and testing them out for a few weeks.

8. Create a social media calendar

Now it’s time to put it all together into one calendar.

Use a scheduling app like eClincher , Sendible , CoSchedule , or Later .

They all have different features, so find something that fits your needs and budget.

Once you upload all of your posts into one calendar you can see it all visually, and see your post frequency for each platform.

9. Test for 30-60 days and re-evaluate

Are you excited? It’s time to launch this thing!

Launch your posts for the next 1-2 months and see how they do. After 2 months, re-evaluate your progress, and double down on the posts that did really well.

Take out the posts that didn’t do so well.

Continue optimizing as you go along.

Top Social Media Plan Templates

Here are a few of our favorite social media plan templates. You can use these to plan your calendar, to better optimize your strategy, and to rock out like the top brands out there.

Social Media Audit Template by Hootsuite

This template is a really great general for all of your needs. They have a separate tab for Instagram, Facebook, Twitter, LinkedIn, Snapchat, and Pinterest. Each tab is divided into a grid for all your accounts, performance, audience, goals, and even a SWOT analysis. These guys cover it all!

Get it ->

We’ve covered pretty much everything you need to know about how to plan, create, and design your digital marketing plan. Your plan should be the basis for all of the marketing initiatives of your marketing department. It should serve as the guideline for creative marketing material, setting up your campaigns, and your plan of action.

We’ve already created a really effective marketing plan template, which you can get - here .

Related Articles

Ben Kazinik

The Ultimate Beginner's Guide to Klaviyo [2024]

What is Behavioral Targeting? How it Works + Key Strategies

Amazon Listing Optimization: The Ultimate Seller Guide + Best Practices [2024]

Octavia Drexler

11 Ways To Stay Compliant with Mailchimp GDPR (2024 Update)

John Marquez

Top 16 Social Media Platforms You Should Try in 2024

JavaScript is disabled in your browser. To view the website properly, please enable JavaScript in your browser settings and refresh the page.

Apply for and manage a grant or program for your business.

Manage your interactions with the R&D Tax Incentive program.

• Business plans

Develop your business plan

On this page

Why you need a business plan

Use our business plan tool, download a detailed business plan template, tips to help you write your business plan.

Whether you've just started out or have been running your business for years, business planning can be the key to your success. Having a business plan:

• helps you to prioritise – it gives your business direction, defines your objectives, maps out how you'll achieve your goals and helps you to manage possible bumps in the road
• gives you control over your business – the planning process helps you learn about the different things that could affect your success. If you're already in business, it helps you to step back and look at what's working and what you can improve on
• helps you seek finance – if you're seeking finance for your business, you'll need to show banks and investors why they should invest in your business.

It will help you to develop a shorter business plan to:

• evaluate a new business idea
• set some goals for the year ahead
• keep your business on track.

Use this template if you are seeking finance for your business or want to include more detail in your business plan.

Business plan template

1. Determine what your plan is for

Does your business plan have more than one purpose? Will you use it internally, or will you share it externally, for example with potential investors or banks?

Deciding what the purpose is, can help you develop your plan for the right audience. If the plan has been developed for third parties, you will need to determine what they’ll be most interested in.

2. Prepare your finances

Use our detailed business plan template if you are seeking finance.

Lenders and investors will want to know if your finances are in order and your business is in a strong financial position. They'll want to know how much money you currently have, how much money you need and how much you expect to make in the near future. While a bit of extra funding will help you ensure you’re covered for unexpected costs, be realistic and avoid asking for more than you need.

If you're starting out and don't have financial information yet, our template provides resources to help you get your finances ready.

3. Write your summary last

Summarise the main points of your business plan using as few words as possible. You want to get to the point but not overlook important facts. This is your opportunity to sell yourself, but don't overdo it. The summary should include details about your business, market, goals and what makes you different from other businesses.

4. Get help

Don't leave your business plan to the last minute. It takes time, research and careful preparation to develop an effective business plan.

If you aren't confident in completing the plan yourself, consider getting a professional to look over it and provide advice.

There are a number of government services available to help you plan, start or grow your business. These services can provide general advice, workshops, seminars and networking events, and can even match you with a mentor or business coach.

Get expert help from a business adviser in your area .

5. Review your plan regularly

As your business changes, your plan will need to change to ensure your business is still heading in the right direction. Having your plan up-to-date can keep you focused on where you are heading.

It's a good idea to keep a record of each version of your business plan.

6. Protect your plan

Having an understanding with third parties when distributing a plan could be enough protection for some businesses. But if you have innovative business practices, products or services, you may want people to sign a confidentiality agreement to protect your innovations.

It may also be a good idea to include some words in your plan asking the reader not to disclose the details of your plan.

Start writing and developing your marketing strategy.

Find out what you need to register for when starting a business., was this page helpful, thanks for sharing your feedback with us..

Our live chat service is open from 8am - 8pm, Monday to Friday, across Australia (excluding national public holidays ).

Learn about the other ways you can contact us .

All our experts are busy now. Please try again later or contact us another way

We're open from 8am - 8pm, Monday to Friday, across Australia (excluding national public holidays ).

We use cookies to give you a better experience on our website. Learn more about how we use cookies and how you can select your preferences.