No Bullsh*t Strategy: The Art of Being the Only One

Drew: Hello, Renegade Marketers! If this is your first time, welcome, and if you're a regular listener, welcome back. You're about to listen to a Career Huddle where our B2B community, CMO Huddles, gets exclusive access to the authors of some of the world's best-selling business books. The author at this particular huddle was Alex M. H. Smith, the author behind "No Bullsh*t Strategy". Alex shares his definition of strategy, and we dive into why "only" is better than "best", what that means in the B2B world, and how to craft a strategy that really moves the needle. If you like what you hear, please subscribe to the podcast and leave a review. You'll be supporting our quest to be the number 1 B2B marketing podcast. Alright, let's dive in.

Narrator: Welcome to Renegade Marketers Unite, possibly the best weekly podcast for CMOs and everyone else looking for innovative ways to transform their brand, drive demand, and just plain cut through. Proving that B2B does not mean boring to business. Here’s your host and Chief Marketing Renegade, Drew Neisser.

Drew: Hello, Huddlers! Joining us today is Alex Smith, the author of the best-selling book, "No Bullsh*t Strategy" (of course, the "I" has a little asterisk). So is there a way to say that, Alex, without saying bullshit? I don’t think so.

Alex: And unfortunately, on some search engines, it only comes up if you put the asterisk in, which is not something I thought about.

Drew: Oh, that's interesting. We'll get to that. So anyway, Alex has made a name for himself as a straight-talking strategist who cuts through the noise and delivers clear, actionable insights that drive real results. I have to say, I've been thinking about brand strategy, business strategy, for a long time in my career, and this really made me think about certain things just a little bit differently. So I love that. I think it's a must-read for anyone looking to navigate the complexities of modern business with clarity and conviction. But also, we talk a lot in CMO Huddles about this concept of CMO-plus. We talk about the luckiest CMO list and how CMOs who drive strategy for their CEOs get a seat at the table. So that's the plus. If I could choose one for every CMO in our community, it would be that you understand strategy and you can drive strategy, and your CEO looks to you for strategy. But you know what the hell is strategy? And there are so many words flying around. Fortunately, we've got Alex Smith to help us get through this. So Alex, welcome. How are you, and where are you this fine day?

Alex: I'm very well. I'm in my house in the countryside in Suffolk, and all the babies and the dogs and everything are swarming around. So apologies in advance for the inevitable interruption we're about to experience.

Drew: Yes, well, I did notice on your LinkedIn profile that there was a new baby in the household and that you had done some kind of chart. I honestly didn't see what that chart was, but was that a chart about the amount of sleep that you're getting?

Alex: No, no. It wasn't directly. What I realized, it could have been a coincidence, but I realized that my post-performance notably dipped in the weeks following the arrival of the baby. And I thought, is that a sign that just that little bit of fuzziness you could actually see on the metrics, how it actually knocks you off course in ways that you don't necessarily feel in the moment, but when you can see the numbers, you're like, wow, I really am just a bit worse now, aren't I?

Drew: Oh, that's hilarious. When our first child was born, I went on a job interview and I said, "Could you repeat that question? I'm suffering a little bit from baby brain." And this young lady looked at me cross-eyed, and that was pretty much the end of the interview. I did not get the job. It's a thing. There is no doubt it's a thing, alright, but that's not what we're gonna talk about. We're gonna both get out of our baby brains and bring some brilliant, strategic insights for our audience. So one of the things we like to do on this show and in these conversations is to give folks a reason to stick around and so right away give some value. So let's talk about three things marketers typically get wrong with strategy development.

Alex: So I'm not always—well, actually, mostly I'm not speaking to marketers, so I've got to sort of adjust my spiel, thinking about the audience. This is not what founders get wrong, for example, or not what CEOs get wrong. What marketers get wrong, though, I would say, and some of these are very much not their fault, and some of them are their fault, so to speak. I think that the three things are, number one—clearly this one mostly isn't their fault—was an over-focus on comms and ignoring the fact that, you know, strategy is about pulling all the levers of the business. I think that on paper, 99% of marketers will agree with that statement, and they'll say, "Well, of course, but real marketing is about the four Ps, you know, product and place and all the rest of it." But we all know, I guess, from experience, that most of the time marketers are not given that remit. So that's one that is, for the most part, I think, not a circumstantial issue, and not so much their fault, but you can get around in some ways.

The second thing is complexity, which is a general issue with strategy people. People make it out to be this more sophisticated thing than it really is, and marketers are worse for that than actually other people who deal with strategy. I think your average kind of entrepreneurial CEO doesn't fall into that trap so much—partially, I suppose, because, in a sense, they are often less educated on the topic. And it's one of those topics where, in some sense, the more uneducated you are, the better you are at it—not always, but sometimes, so too much education could be an issue for marketers, I think.

And then the final one—hang on, I wrote it down—the use of jargon, which, again, I think, is a particular marketer disease which is connected to that issue of, in some senses, being over-educated. There's a whole lexicon of terms which are sort of strategy-adjacent in the world of marketing, like positioning, vision, mission, purpose, proposition, etc., etc. All of this stuff, in principle, if you understood them with razor clarity, they could be very helpful, but for the most part, they actually contribute to making a pretty simple job a much more complicated job. And we could, we can talk about why that is, but this is sort of my perception from the outside anyway, never having been a CMO myself, but obviously having worked with many companies.

Drew: Right. Well, and I think we probably could tie all of those to either a lack of an effective strategy or a lack of chance of influencing the strategy. But let's go through them one by one. I just want to make sure that I'm clear. So on a comms standpoint, when they're not thinking about the whole business—what you're saying is they're sort of because I know you have this hierarchy of strategy, brand, product, operations, and marketing in your book, you talk about that, and marketing would be the fifth on that hierarchy.

Alex: I think that's a bit different, that particular chart you're referencing. I think the more simple and direct one to think about, which is somewhere else in the book, is to think about a kind of three-pronged thing, where strategy at the top is basically defining what the business actually does, but doing it in a way which obviously is going to be very high leverage in the market, which we can talk about the ingredients for that. But you know, strategy is essentially what the business does. And then below that you have, how is that thing delivered by essentially the operations of the business, the product, the channels, all of the moving parts, the sort of physical stuff of the business. And then the other thing that comes out of that is, how is that communicated? So all sort of like sales scripts, messaging, branding, whatever that's there. You got strategy. You got how it's delivered, how it's communicated. You add those three things together—that is like an entire business, the way that I look at it.

And so obviously, marketers are generally only given true control over the question of, "How are we communicating this thing?" But the problem that they obviously often have is that maybe the thing that they've been asked to communicate is not very good in the first place. So you can affect some—you can, through pure communication genius, you can turn a four out of 10 thing into a six out of 10, or maybe even a seven out of 10. You can't turn it into a 10 out of 10 because you actually have to go back to the source and say, "Guys, maybe what this business is actually doing from root is not particularly effective."

And by the same token, we all know that there are businesses out there where the core strategic offer of the business is so incredible that they almost—the marketing (what the colloquial use of the term marketing, the comms side of marketing) can actually be done badly or take a back seat because the rest of the business is carrying it so much. I mean, you know, like—it's not a good example, it's just the one that springs to mind—like Google, back in the day, they didn't become the world's leading search engine necessarily because they did fabulous comms marketing. There's a whole bunch of others going into it.

So that's the situation. So obviously, the ambition, I'm sure, for anyone in marketing is to as far as possible control the whole of that pie and not be shoved down into just the comms part of it.

Drew: And I think this is a really important point, sort of understand the difference between business strategy, which you define—because one is business strategy and then, but often marketers talk about strategy as marketing strategy. And suddenly we're now talking about target and go-to-market, and you have a very simple definition for strategy, and I'd love for you to just share that. I'll read it here: "The unique value the business brings to the market."

Alex: That's basically it. And let me just unpack that a bit, because something about like this also is a way of but we can also address the kind of like the jargon point here as well. The approach that I take to all of this is a first principles approach. I am a horribly uneducated person in the world of business, and, you know, I haven't done an MBA or like any sort of qualifications at all, and I'm quite murky on a lot of the kind of classical textbook stuff that people will be taught. Now, I think all of that stuff is right, but like I said before, it starts to all get a little bit sort of incestuous and self-referring. They're all wrapped up in itself, and it starts to actually undermine its own usefulness.

So my approach has always been a kind of first principles basis. And the first principle thing that we have to ask if we're going to develop a strategy for a business is: What is the business? What actually is the definition of a business? The definition which could apply to everything from selling friendship bracelets out of your bedroom to Halliburton, right? They all have something in common. But what is it?

And the answer to that is that all businesses are a system that people create, which is designed to deliver value out into the world and to receive value back in exchange. Obviously, in the form of money, that's true of every business. That is just what a business is. If the thing that you're doing isn't that, then it's not a business. It's something else.

So when we understand that, we can then say to ourselves, alright, well, how then would a business based on that definition, grow and succeed? Well, you want to increase the amount of value you're bringing in. So there's only one way you can do that, really. You increase the amount of value you're putting out. The more value you put out into the world, the more value you're going to bring in, and you're going to grow.

So a strategy then which needs to be completely focused on the what, on the creation of value, on the way that business creates value. That is why my definition of strategy is essentially like defining the value that the business creates, but it's not enough for it to just create value because there's that word unique in there as well. And this is the kind of like this is the rub, really. Like to put a form of value out there that people want, to do something that people need or want to buy, to solve a customer problem.

Now, very, very easy, right? But that's not enough. Almost every single business manages to tick that box. The issue that most businesses have is that whatever the value they're putting out there is, it's something that people can get from loads of other sources. And this is obviously what creates the conditions of competition.

The strategic challenge is, can you create, number one, give people want, but number two, they can't get anywhere else. That is the trick. Vanishingly few businesses manage to take both of those boxes. 

Drew: What was the first box? 

Alex: It's just give people something that they want, need. You know you're solving a problem. But two, that they can't get anywhere else.

Now, what you see is, you see, most businesses, they give people something they want, but they can get it somewhere else. Let's say you're running an ad agency, for sake of argument, and you make very creative ads. Well, that's all fine, and there are lots of companies out there who want that, but there are also lots of companies out there who deliver that. So that is a fundamentally un-strategic business.

You also get a smaller number of companies who do genuinely do something unique, but their bigger issue is that people don't want to, or there isn't a big market size for it. So this is what I would call the sort of vegan dog food problem. It's like you say, well, we're the only vegan dog food on the market. I would say, well, that's fine, but there aren't many people who want to buy vegan dog food. So you're still in trouble.

If you can actually, though, say that we have something that millions of people want, very large market wants, and we're the only source for that thing. How hard is the business going to be to run, if you manage to get into that situation? So that is fundamentally the essence of strategy. So when I say that strategy is unique value, that's basically what I mean.

And this is the existential core of the business. This is just the thing that the business has been built to do. There is nothing worth saying about a business other than what is the thing that this business has been built to do. It's such an incredibly obvious and basic point that people actually don't often ask it. They don't eventually stop and ask, well, what does this actually do? And is that thing something which is actually worth being done?

But when you actually do address the really simple problems like that, you start to see, oh, all of these readings and reams of kind of like positioning statements and brand data and stuff like that, have we actually answered this question? And sometimes, you have, a lot of the time you haven't.

Drew: So there are several thoughts going through my mind. When folks create a strategy, they'll often strive for unique and say we're the only business that does this. They're also the ones that will say we're the best at doing this. I mean, there are a lot of people out there, but we're the best. Talk a little bit, because I know you referenced that in the book, the difference between only and best.

Alex: Really, really fundamental point. So I explain all that stuff, let's say that I've explained that, and then I think, alright, well, I get that, you know, if I can give people something good, and I'm the only one doing it, then my business is going to be in a good position. The first thing that they then do is that they retreat to this idea of being better.

So whatever their field is, and they're like, Well, yes, okay, fine. It may be that you can technically get a similar thing elsewhere, but we are the best, and the market will reward us because we are the best. But the tragic truth is that the market never, ever rewards the best. Broadly speaking, you would say that the market interprets—if you say you're the best, what you're saying is we are the same as but a little bit more, right? And the market reads that as the same. So if you've got three businesses, wherever they are, and you're one of them, and you say, well, we're the best one, all the market sees is a blending of three. Now, which one of those three businesses is going to win? It's not going to be the one that is the best.

And by the way, what do you even mean by the best? Like, what's better? A paper bag or a Birkin bag? It's a nonsensical question, because what's the job? What's being done? The concept of best, a lot of the time doesn't make any sense.

But even if you are, even if you do think that you've got a leg to stand on, the one that's going to win will generally be the one with the highest name recognition, the highest level of availability, and the biggest budgets. You know how many challenger CPG brands who've come along saying, “Well, we're better. We're a cola that tastes better than Coke.” Come along and they go nowhere, because they don't realize that, like you can never beat coke with a cola that tastes better than them, because no matter how much better you taste, their scale and all the rest of it is going to wipe you out.

So in this case, you have to be the only alternative. You have to be the only thing, and you obviously have to think about it in terms of, like, broadly speaking, you know, existing in a category of one, because that's the only way that you're actually going to escape the pressures of competition. And that's the whole point here.

Because the things that destroy a business's profitability are the costs of competition, sort of like marketing spend, reducing price, or just various forms of investment, trying harder, all that stuff basically just cuts profit, and all of those things are just your attempts to beat the other companies that the market perceives as being the same as you. But of course, if you were the only one doing what you do, then you wouldn't have to bother with all of that. And even better, actually, you would sort of, it doesn't often work out this way, but just in principle, you would actually apportion your market between different businesses, each of whom owns a kind of segment of it. So, like, I sometimes think about this in terms of the relationship between Häagen-Dazs and Ben and Jerry's. Now, I'm not saying that Häagen-Dazs and Ben and Jerry's have this perfectly symbiotic relationship, but actually it's pretty solid because they're kind of like mirror images of each other in the ice cream category, and the things that each one is good at the other one's bad at, and they kind of share the space, and they don't really need to fight each other in a very brutal way because the market is sort of naturally sorted between them. So obviously the true details are a bit messier than that, but you get the general principle. So that is the kind of like competitive dynamic that you want to be creating, which we could almost go so far as to call it a collaborative dynamic.

Drew: When you talk about "only" in B2B, folks say, "Okay, we're going to create a category." And there are a lot of folks that have, particularly in the software thing, said, "We're not in marketing automation anymore. We're in the category of ABM." And that actually worked pretty well for Demandbase for a while. And then three or four other competitors came along and said, "You know what, we're better ABM because we got this and we got that." And so it became a competition.

And so there is this desire to create categories, but here's the tricky thing, in my opinion: it's not a category until you have competition, right? It's not a category until in the B2B world some analyst says it is a category because they've created a new quadrant for you, because so many people look at those things. It's not a category until someone's job is, for example, Tableau was the first in data visualization to sort of own that idea, and people had the job as data visualizers. So those two could now bring those people together as a category, as users. But I just wonder if that's also a trap that means you're in a category by yourself, and how that actually works from a B2B standpoint. Is that truly a position that you can stick with for a long time?

Alex: You make a very good point. Firstly, I broke my own sort of "no jargon" logic, because even the word category is jargon because we can mean different things when we say category. So like to your point, when I talk about the term category, I'm sort of in the universe of saying that Häagen-Dazs and Ben and Jerry's are in different quote-unquote categories. They are. They're in different categories of ice cream, but they're both in the category of ice cream.

So of course, like, you know, this is where it becomes murky. I think that the iPhone, for a long time, was a phone which had this real and still does, I think, have this walled garden within the phones category where people who buy iPhones don't consider other phones, and people who buy other phones often don't consider iPhones. That is a category because there's a sort of wall between them, but we recognize that they're all phones, right? In the market reporting data, they're all going to be called phones. So it's a bit more of a category in the customer's head than it is a kind of reporting category.

And this is super important, because to your point, and this is something where I think a lot of B2B businesses fall down for the first time. Everything needs to be rooted in something that people are buying. If you go too far beyond an established thing that people are buying, you're just going to be too weird and you're not going to be viable.

This is the problem that I've had with strategy, because what you find is that most broadly speaking, like, there aren't a lot of people going out there shopping for strategy. And so I actually knew a guy who worked in a company, and he'd done a kind of mapping exercise of the quote-unquote "strategy" market, and he put it into these sort of quadrants. One of them was branding, one of them was research, one of them was sort of management consultancy, operational consultancy, and the other one I can't remember. But what was interesting is that he was putting all the quote-unquote strategy consultancies into these different buckets. In other words, they were all rooting themselves to a bigger category.

So you had people who did strategy, but they were kind of stuck to brand. You had people who did strategy and they were kind of stuck to research. And they have to do this, because if you just go out there and do pure play strategy, no one's shopping for that, so no one's going to buy from you. So everything has to be a kind of a spin on something that people are already buying.

The sweet spot you want to be in is familiar but different. So certainly, if you start, you know, if you just say, “Go brazenly, we've got this totally unique thing, we've created this whole new space,” you're going to have just as much trouble, in fact, more trouble than the person who's got a completely undifferentiated offering. You've got to skirt that sweet spot. It's much better to just be a kind of like one-click out from what people are used to, than to go crazy. And so, yeah, that is much bigger track in B2B than B2C from what I've seen.

Drew: Yeah. That’s so intersting. So if I were to say for CMO Huddles, we are the only B2B marketing community that features penguins, you know, that would be unique. But nobody's shopping for a community with penguins. But we do have fun with penguins. And they are a group of penguins.

Alex: I hadn’t noticed how many penguins there are behind you.

Drew: A group of penguins is a huddle, just so you know, there's a connection to the brand. The thing that I was sort of getting at is familiar but different, okay, love that phrase. So we're grounding ourselves in shopping for tires, but now there's this new one that are made of glass. They're glass tires that never break, that never lose treads, right? Although, probably people would not buy glass tires because that sounds like something that would break easily, right?

Alex: Yeah. I mean, I think, sorry, I don't want to preempt where you're going, but I think that to that point, the second place where people are going to screw up here is, of course, this word "value" is a bit murky as well. So, like, just because your product is different in terms of the way that it operates—the tire is glass, or the huddle has penguins, or whatever—difference of stuff does not necessarily equate to difference of value. And difference of value is the key thing that we're searching for here.

I think this is something where the marketers probably are in quite a big advantage compared to other people because they've got a better understanding of how your product and the value your product delivers are not the same thing. Where we're looking for differentiation is in the value part, not the product part of things. You can just make a different, weird product, but if, fundamentally, it's kind of doing the same job as everything else, you actually haven't really done the thing you're looking for.

And actually, by the same token, you could have zero differentiation of product, but maybe through some sort of marketing move, you can massively differentiate the value that's being put out on the other side. Maybe it's not the best example, but the thing that springs to mind is, like Liquid Death on a product level, has got no difference than any other water, or certainly any other canned water. But you know, the way that people experience and interpret it, because of essentially the branding and all of that, is wildly different. So they have opened up a very, very different value space within the world of water that simply didn't exist before.

So, like, terms such as differentiation, USP, these kinds of things, they lull you into a sense of security where you feel like you've cracked it. Because you're like, "Oh, well, our USP is such and such," or "We're differentiated because of this and that." But you’re sort of in a features world there. You're not in the world of the macro strategy that is defining what this business is delivering to customers. There are all sorts of pitfalls.

Drew [AD Break]: This show is brought to you by CMO Huddles, the only marketing community dedicated to B2B greatness, and that donates 1% of revenue to the Global Penguin Society. Why? Well, it turns out that B2B CMOs and penguins have a lot in common. Both are highly curious and remarkable problem solvers. Both prevail in harsh environments by working together with peers, and both are remarkably mediagenic. And just as a group of penguins is called a Huddle, our community of over 300 B2B marketing leaders huddle together to gain confidence, colleagues, and coverage. If you’re a B2B CMO, why not dive into CMO Huddles by registering for our free starter program on CMOhuddles.com? Hope to see you in a Huddle soon.

Drew: We have a question from the audience, which is, "What is the difference between strategy and positioning?"

Alex: Aha. Well, so dangerous audience here, because obviously audience people who are doing positioning. So when I say normally, positioning is done as X, Y, Z, I want to flag up front. Maybe not the way you do it, but just the way that you broadly see it done and talked about. Conceptually, there is a massive, massive, massive overlap in the kinds of thinking that you're doing.

The primary difference is that mostly people tend to do positioning exercises sort of after the fact. So they make the company, and then they get somebody, a marketer, to sort of position it, which is sort of like after the horse has bolted. Because we come back to that issue of like, well, actually, what if we want to rethink what the business is doing in the first place, whereas the strategy is kind of a pre-product design? What won't necessarily happen pre-product design, but let's say everything is in scope. So we can tear down the whole thing. Or we could say, for sake of argument, we might say we're going to completely move geographies for this product.

Most positioning exercises that companies do, they don't open up the scope for somebody to say that if that was the right thing to do. So the thinking is super similar, but the remit of the job and when it tends to happen in the kind of life cycle of the business tends to be quite different. But certainly, if you were a CMO in a business, and you were thinking about positioning, and you then, through the thinking that you're doing in that work, had the ability to say to the company, "Hey, I think these are the sort of changes we should make," and they happen, well, then you’re doing a brilliant job, and you're in a company that's incredibly enlightened. But I think that's very unusual.

Drew: To me, a positioning exercise, as you said, is taking what you're given. I got my little penguin stress ball and saying for B2B marketers who are under a lot of stress, "This is the stress ball that will get you through the day." Okay, I'm just going with that. I'm not going to change and realize, "Wait, maybe penguin is the wrong form factor. Maybe stress ball is the wrong form factor."

To me, the difference—the subtle or important difference—is it's not a strategy if product doesn't change, if it doesn't impact product, if it doesn't impact service, that's where we get into this world of positioning, and branding, where we've changed colors. We changed things instead—we have a purple suit instead of a white suit—but we haven't fundamentally changed the product.

What you're saying is positioning is "Here's what you got, go figure out who it's for and what you're going to say about it." Strategy is saying, "Here's what we could be, here's what we should be, and here's how the product today or tomorrow needs to change in order so that we can be unique in the market that we would be the only one." Is that a fair way of looking at the two?

Alex: Yes, I like that. And another interesting way of putting it is that strategy is an organizing principle for the whole business. So when you write a strategy, it needs to kind of have something to say about all the parts of the business. Now, obviously, you could do a positioning statement that does that. But because the remit of the positioning statement tends to be narrower sometimes, let's say I'm just sort of making this up as I go along, but you'll get my point, you might say that the positioning can be very brandy and vibey, and it might not actually have an implication, for sake of argument, the routes to market of the business. But a strategy would have an implication on the routes to market of the business.

Let's take one of the all-time great strategy case studies—and sorry, that's a cliché, and everyone knows it, but it's a cliché for a good reason. So when Southwest Airlines created the low-cost airlines category, this had all of the components that a strategy should have, but a positioning statement, well, frankly, should have as well, but probably mostly won't.

Firstly, you're always going to have to start because most markets are really well catered for, and all the real customer problems are kind of adequately done. Almost always a strategy is going to have to involve some massive sacrifice on the behalf of the business. You know, there's rarely a free lunch, so you're probably going to have to choose to suck at something which your competitors do well at, so that you can open up leverage to offer something new.

Southwest basically were the first airline to say, "You know what, business travelers? We are not going to serve them. No more business class lounges. We're going to fly on super inconvenient routes, no more business class seats. The whole thing is just going to be a business traveler's nightmare." Other airlines wouldn't do that because they are the most lucrative segment, but Southwest Airlines decided to kill it.

First, you're going to have to have a huge thing to kill. Then I just listed a whole bunch of very significant operational changes that Southwest made because of that—so much was changing in that business. Literally, they chose to fly from different airports because they were like, "Well, we don't actually need to fly from convenient (expensive) airports anymore. We can fly from crappy airports because people aren't in such a rush." So this is the level of scope that is going into strategy, and then obviously this pulled through to the customer offer of the low-cost airlines, which now we're very familiar with. So that is just an absolute, quintessential, textbook, flawless piece of strategy.

Drew: I could build on that. There were a lot of operational things. They changed the side on which they put the gas because it would save them two or three minutes on the airplane. They actually did that because the whole deal is, the more hours the planes are in the air, the more money they make, the less hours they are. They had the same plane in everyone. They were the first to do the crews, where the crew would do the cleanup because that was one of the things that slowed it down. The faster you can turn a plane and get it back up, they figured out, "Whoa, that's on the wrong side of the gas tank." I love this notion—that's a Peter Drucker thing: It's not a strategy until you say no to something. But I think that's so important to really remind ourselves is, and this is such a great example because, yeah, “We're going to leave the business class folks behind. We're just saying, ignore that market.”

It's funny because JetBlue comes along and says, "Yeah, we're going to do what they do, but we're going to have better, more comfortable planes and a better experience." And now Southwest has lost their way. Everything that they started out building on, they're now adding—they're not saying no. They have assigned seats, they're starting to add business class. They've lost their mojo, that strategy, but it lasted. And for years and years and years, they were, regardless of everybody else, they were the only profitable airline for like 10 years running.

Alex: Well, everybody else over that time went bankrupt. But I suppose, like, we could speculate—and I’m in shaky territory, I don’t class myself as a sort of marketing expert—but I think that we could speculate that if Southwest had never done what they did, one of the airlines probably could have made a pretty good stab at positioning themselves as the airline for families and non-business travelers. I think you could have done that without doing all the stuff that Southwest did, and it could have been probably pretty effective and successful, but it would have ultimately been compared to their stuff, a bit of a posture.

Drew: I'm so glad that you asked the question about positioning versus strategy because I think a lot of time is spent on positioning, where you're given something and you're saying, "Okay, this is the best we can do. We can sell this to this group of people at this cost instead of this product because of this reason," and that sort of becomes the positioning statement.

What is not happening at that point is you are not influencing the direction of the business in the sense that you go, "You know, what if we tweaked our proposition? What if we moved the gas tank from the left side to the right side? If we did this and we were going to decide to really commit to small business, for example, we would do a bunch of things differently, like we would make it a lot easier to buy with one click instead of 10. We would make it easier to cancel."

When you reposition the product, you're forced to change the product. And this is the seat that, I think, CMOs would love to have. And when I hear CEOs talking great about CMOs, they're saying, "Yeah, they're my strategy person."

Alex: You know, it's a benefit that I think you do have with B2B, broadly speaking, is that I do think it's much easier for a CMO to do this in B2B, because B2B businesses tend to be more changeable than B2C businesses, largely because they don't have a very coherent or long-standing brand. So you can kind of turn on a dime, and sort of no one cares if you're a B2B business a lot of the time. So like, you can just randomly add a new thing over here and take away something over there, and chop and change things. So probably the capacity to influence that kind of change in B2B is much greater. That's certainly what I've seen. Because it's like the stakes are kind of a lot lower, whereas, like, you can't very well make a sort of seismic change to BMW or whatever without it being a really, really big deal that could completely sink the ship.

Drew: Yeah. And I was thinking, I mean, another great classic example, and you've talked about that in your book, is IKEA. And again, the difference between their story sometimes changed, but the innovation of affordable design in every household and that system that they built in order to do that and deliver it, everything backs up to this big idea strategy. Yeah, the furniture might change a little bit. So alright, let's keep moving on this. When a strategy is right, we've made a tweak. What are you seeing? What happens to the organization and how does this sort of filter down? So we've got the strategy. We're unique and clear. Where our value proposition exists, who we're talking to, what we deliver. We got that down. What else, from a strategic standpoint, do we need to understand or people often misunderstand, when we finally start to translate from strategy business to marketing?

Alex: Like I said, you've got this organizing principle for the whole business. So in theory, what you would start to do is you would make everything into a very coherent system that is pointed at one single thing. And what that one single thing is everybody in the business should be able to effortlessly talk about it and talk about why it's a good thing in their own words. And certainly, until that happens, then you could basically say strategy doesn't exist. That's the sort of an effect you're going to want to see. What I really like about B2B businesses is that they often tend to be pitching businesses. And what that means is that it's very easy for them to test different offers, different angles, and sort of different strategies. So when I work with B2B clients, what quite often we would do is we would sort of because, like, I say, no one's really paying attention to a B2B company. So they can just sort of say whatever they want and just figure it out later. You know, you can actually, like first things first, right? But we've got three pitches next week. We're just going to rewrite our pitch deck, and we're just going to go in and we're going to present as this business, and obviously, bearing in mind that you know, all of this stuff is laddering back to customer value, so what you say in the pitch is going to be a very direct reflection of what's going to be the driving force of your strategy. And then you can just go and see like you should be expecting instant, clear, positive feedback you should be coming out of those meetings and instantly saying, "This is better than the meetings that we did last week." So I think it's very fair in B2B to expect that because you do have the ability to do that sort of experimentation. So marketing and latterly, comms is such a huge part of this. It is the biggest part because if we are defining strategy as the unique value that the business puts out there in the world, marketing is going to have to go out there and quite literally say that to customers. And obviously,  you're going to find a way of saying it that's more powerful than what you had written internally on your strategy piece of paper, whatever. But that is a direct translation job from internal language to external language. And yeah, you should expect to see immediate positive feedback. And if you don't, then I think you can back up and you can say, well, hang on a second. What are we getting wrong here? Is this right to go forward with, going back to the triangle vein, you know, the thing that you want to go out there and deliver, you know, the thing this business wants to be all about, you say, "You guys over there, you're going to have to make this change, this change and this change to the product if we're really going to deliver on this." And you guys over there, you're going to have to change all of the messaging so that you're saying this rather than whatever incoherent thing it was that we were saying before.

Drew: I'm going to go back to something, but before we do, I want to make sure you talk about ‘why’ and why that could be a trap. You know, in the Simon Sinek sense of ‘why’. Talk a little bit about your perspective on when it makes sense and when it doesn't make sense, and why, ‘why’ is problematic, and I think particularly for B2B businesses.

Alex: I had an epiphany on this just the other day, actually, so I'm glad you brought it up. So sort of new thinking that wasn't in the book, but in the world of sort of purposeful brands, brands who sort of stand for some kind of like, you know, noble big picture social cause, there's this sort of belief that you sometimes get that like, well, people will buy from us because we're nice, because it's the right thing to do, because we believe in these higher ideals, whatever it might be. Although those things are great to have, they are not strategy, and because the strategy is always going to basically be the commercial lever by which people are choosing your business over other businesses. And unfortunately, people won't do that because you're more environmentally friendly, or this, that, and the other. And there are a lot of brands out there where we say, “oh, yeah, but what about like Patagonia,” or whatever people choose them, blah, blah, blah. You pull the thread on any, on any sort of purposeful brand, and you'll see that, like, look at it this way, do customers make a sacrifice to choose Patagonia over other outdoor jacket brands? No, no, they do not. It's more appealing on a completely just sort of like straightforward, self-interested level. There is no sacrifice. If people were buying brands based on kind of like, higher ideals, purpose, mission, why, and stuff like that, that would mean that they would basically go out there and say, right, I know that this brand is worse for me as a consumer, but I'm going to do it. I'm going to buy it anyway because it's the right thing to do. That doesn't happen. The clever, purposeful brands are the ones who have their cake and eat it too, where they've got a hardcore commercial strategy which appeals to the self-interested priorities of the buyer, and then they sort of wrapped it in this kind of halo of purpose. And so then the buyer almost has to kind of rationalization for like, "I wanted a Patagonia jacket anyway because all my buddies have got it or whatever. But I can tell people, well, you know, guys, it's made of recycled plastic. So of course, this is the one that I bought." So that's why those brands are so strong. They're kind of like a win, win, win. The problem happens is that when people only see the purposeful side of the business, and they don't see the kind of like the self-interested strategy underneath.

Now, none of this is to say that the ‘why’ and the mission and all that is not useful. It's super useful, but it's just useful in a different way. It's not primarily useful for your customers and for making sales, but what it is useful for is basically partners, by which I mean the staff, the people working in the business, or maybe, like other sort of businesses that you are kind of like partnering with in order to serve the customer, right? Because your staff are not your customer, your partners are not your customer. So you actually need to excite those people with a different message. The message that's going to excite your partners is not the message that's going to excite your customers. And so that is where the sort of, like the ‘why’, comes in. And you know Simon Sinek, when he was originally talking about ‘why’, Simon Sinek is the leadership expert, that's his field. A lot of people, sort of, like, have sort of misunderstood him as a sort of marketing expert, right? But he's a leadership expert. And so he's talking about a leadership principle and a ‘why’ is an incredible leadership principle, which you do need for your team and you do need for your partners. So what I would generally say is you want to have both. You have a hard-nosed commercial strategy for the customer, which is all about the customer saying, "What is in this for me? I don't care about anything else." They'll never say that directly, but that's basically what they're thinking. But then you have a much more sort of, like high-minded ‘why’, which is for communicating with partners. You get both of those two things there. That's golden. Then you'd have got like powerful message to say to everybody. And of course, those two things, you know, they can't be completely disconnected. They need to be connected.

Drew: And this is why CMO Huddles gives 1% of our revenue to the Global Penguin Society. But what you're saying is that's not going to help us attract new CMOs to our community, but it is a nice thing, and it's good for employees and any of our partners. Got it, anyway, I had to say that firmly with tongue in cheek, by the way. Alright, amazing. We have to wrap up, but I have this sort of pressing thing. So one of the things that I see CMOs do all the time, they come to a new company, they say, "The CEO says we have a brand problem." And, you know, based on their definitions, they'll say, "We have a brand problem." The CMO interprets that, "Okay, yeah, we need a new logo, we need new colors, we need a new promise, we probably need a new website." And not a single one of those things actually involves a strategic change to the organization. So it doesn't work.

Alex: This is so—I would, I mean, I'm completely making this a completely made-up stat, but probably, like, directionally true—like 90% of rebranding projects, there was no problem with the branding. as in, like, the stuff that is bought from the branding agency. So, yeah, the wrong problem is being solved. You could probably say that about sales stuff as well. Sometimes people think, "Oh, well, sales teams aren't doing very well, so the salespeople must be crap." And again, like, you know, it's the same dynamic.

Drew: Yeah, okay, so we're going to wrap up with two do's and one don't for creating effective business strategies. I'm not saying marketing strategy, effective business strategies. Two do's, one don't.

Alex: I'll keep it very simple. Number one: ‘Only’ is better than ‘best’. So just focus on being the ‘only’ and not the best. And number two, this is even more important. If you don't change something about the business, then you can't expect to see a change in results. I'm about to release this sort of like course—kind of strategy development system—and it has this sort of like framework that you can kind of go through and sort of spit something out. And the key bit in there: You should write this on any kind of strategy piece of paper, or whatever that you have. I have a section that is titled something like, "Here's the Way That We Were Wrong Before." And underneath it, you put down the thing that you thought before this strategy that now you realize is wrong, harmful bullshit, whatever. If you can't actually humiliate your former self with this strategy, then chances are there's absolutely no content there. You're just kind of doing the classic sort of hot air sort of work that most strategy stuff is. But if you've managed to find that thing that you were like, "Crap, we had to just stop doing that"—well, it may not be a good strategy, but it is at least a strategy. So that's something.

Drew: I love it. I worked with a southern creative director of Shy of Day, who had this expression: "Well, that just seems like we're polishing the turd and buff up that sucker, but it's still not gonna be great anyway." Speaking of great, Alex, thank you so much. I have so many more questions, but we can't possibly get to them. So how do people find you?

Alex: So my main channel is LinkedIn, so if you search Alex M H Smith—obviously Alex Smith is not very searchable—you'll find me there, and I'm putting out stuff every single day. And then if you go to my website, Basic Arts (arts.org), I've got a newsletter putting out a new sort of like strategy framework every single week on Wednesday. That's all free, so you can sign up to that as well.

Drew: And I also encourage you to follow Alex on LinkedIn, except for the last month, when his brain was obviously a little less functional than before, as this chart showed, but seriously, always great stuff. I love it. It inspires me, and so I appreciate you and all the work that you're doing, and look forward to seeing you in London. Thank you, Alex.

Alex: Absolutely. Cheers.

Drew: If you're a B2B CMO, and you want to hear more conversations like this one, find out if you qualify to join our community of sharing, caring, and daring CMOs at cmohuddles.com.

Show Credits

Renegade Marketers Unite is written and directed by Drew Neisser. Hey, that's me! This show is produced by Melissa Caffrey, Laura Parkyn, and Ishar Cuevas. The music is by the amazing Burns Twins and the intro Voice Over is Linda Cornelius. To find the transcripts of all episodes, suggest future guests, or learn more about B2B branding, CMO Huddles, or my CMO coaching service, check out renegade.com. I'm your host, Drew Neisser. And until next time, keep those Renegade thinking caps on and strong!