To SOSTAC® or not to SOSTAC®, that is the question?
During my so-far brief time as a marketing student, the one thing that has become evident to me is marketers love acronyms! We have the 4 P’s, now extended to the 7 P’s, the 6 C’s, OVP, SEO, and now SOSTAC ®, to name a few. Throw a few marketing terms out there, put them in an order that best suits what you are working on, and wallah, you have created a new marketing concept or strategy. Okay, maybe it is not that easy, but several different strategies exist, with very fancy acronyms, and deciding which one is best for your business can be a daunting task on its own.
This week, we look at SOSTAC ®, which writer and speaker PR Smith created in the 1990s. As a framework, start-up companies to multi-national corporations have used it, and it is one of the most popular marketing tools around. SOSTAC ® stands for: Situation Analysis; Objectives; Strategy; Tactics; Action; Control. We are going to unpack each of these terms and discuss how this framework could be implemented by SME’s today.
- Situation Analysis — Where are we now?
First and foremost, you cannot know where you are going if you do not know where you have been. The starting point of the framework is, therefore, to take a snapshot of your business. Review the internal and external factors that impact it — who you are, what you do, how you interact with customers, etc. An excellent way to do this is by conducting a SWOT analysis.
SWOT-analysis helps look at both the internal (Strengths and Weaknesses) and external (Opportunities and Threats) factors that affect the business. Team members conducting a SWOT-analysis should think laterally, across the entire organisation, and not only at the marketing aspects. Gathering evidence and communicating with various stakeholders via surveys, interviews, or reviews helps identify what impacts the business daily.
In addition to a SWOT-analysis, it is crucial to analyse the sales environment that the business currently works within. Understanding your customers, who they are, what they buy, how they interact with your business, who your competitors are and what they offer, which distribution channels do you offer products through, etc., will all help paint a picture of where you currently stand as a business.
2. Objectives — Where do we want to be?
The next step within the framework is to establish clear and obtainable objectives or goals. Long-term goals that set out the businesses marketing vision and mission are essential, but short-term attainable objectives are also crucial to any marketing plan. PR Smith developed the 5 S’s to assist with creating short-term goals:
Sell — Goals that will assist with the growth of sales and market share.
Serve — Goals that will add value to what you offer the customer.
Sizzle — Goals that create a wow factor and new experience for the customer.
Speak — Goals that encourage two-way communication with customers.
Save — Goals that can be quantified and show efficiency gains for the business.
In addition to the 5 S’s, it is encouraged to make sure that goals are SMART — Specific, Measurable, Actionable, Relevant and Time-related.
Objectives that SME’s could place focus on include: lead generation, new acquisitions, new engagements or retentions of the customer. E.g. Decrease the number of abandoned carts by 50% for online sales by the end of July 2021.
3. Strategy — How do we get there?
In essence, the strategy deployed is how the business plans to achieve its objectives and goals set, as well as identify the market segments that the company aims to target with its plan. A clear understanding of how the company’s competitors are deploying their strategies and how to differentiate yourself from them would also need to be addressed.
The strategy portion of the framework can often be the most difficult, as many businesses know that they need to do it, but how they can do it can often prove challenging. A popular marketing tool suggested in formulating the strategy of the business is Segmentation. Segmenting customers into various target markets allows the company to create strategies specific to each segment. Segmentation also provides the company with an understanding of which market segments to pursue and which to abandon. Designing an effective segmentation strategy can also help the company identify customers they may not have thought of before, with specific needs, and target them specifically.
4. Tactics — What we need to get there?
Tactics are the specific tools and methods that the business will choose to deploy to realise the objectives and strategy of the marketing plan. Focusing on key strengths and opportunities while remaining realistic regarding the potential lack of resources when compared to competitors will ensure that tactics are implemented effectively.
Making use of the 7 Ps of the marketing mix is a tool that can be made use of to develop the tactics needed by the company: Product, price, place, promotion, people, process, and partnership.
Product: Developing the habit of looking at your products from the outside and objectively assessing whether they are the right products for the business at a given time is essential for the continued growth and success of the company.
Price: Continuously examining and re-examining the prices of products and services make sure they will be appropriate to the current market’s realities.
Place: Reviewing and reflecting the exact locations of where customer interact and purchase your product, and adjusting if necessary, will assist with consistent and sales growth.
Promotion: This includes how you promote and communicate with customers about your products and services, how you market to them, and importantly how you sell to them.
People: Thinking about people inside your company responsible for sales marketing activities is essential, as all decisions made need to be carried out by specific people with the skill set necessary to perform the job. People can be more critical to your success than all the other P’s put together.
Process: Ensuring that internal processes function correctly and do not become a barrier to deliver value to the customer is essential.
Partnership: Exploring potential strategic partnerships with companies in non-competing segments can create a point of difference to other competitors, providing additional options to consumers to connect with your brand.
5. Action — How do we bring the plan to life?
The action section of the framework brings to life what needs to be achieved for each of the tactics identified to realise the marketing plan’s objectives. This is the section where you describe in detail the tactics and determine who does what. Assessing whether the company has the necessary skills internally to execute the marketing plan or if the company needs to obtain help from outside agencies or consultants needs to be considered. In addition, process and systems the company currently use need to reviewed and changed accordingly.
An example of actionable points about Search Engine Optimisation (SEO) would be:
Keyword analysis: What keywords are being targeted?
On-page optimisation: Optimise the company webpages based on the keywords identified above. The goal is to ensure that your webpage receives the best rankings on Google.
Content: Create new content to build relationships and propel your brand’s proposition. Look to incorporate industry-leading blogger, influencers and forums.
Link building: Target websites with similar keywords, seen as high authority sites, and bring your pages together
This step in the process should not be an afterthought. Drafting a phenomenal marketing plan and being unable to execute it will categorically lead to a failed campaign, and the company will not achieve its objectives.
6. Control — How do we monitor the performance?
The final stage of the framework lays out the plan to monitor and measure the marketing plan’s performance based on the objectives identified in the second stage. Setting KPI’s that link back to tactics, setting up regular reporting, and analysing the data recorded to ensure that the company is on track to meet the marketing objectives.
Various monitoring techniques are available to businesses, such as web analytics, KPIs, site visitor profiles, usability testing, and customer satisfaction surveys. Frequency of reporting, who reports to whom and what happens to that feedback also forms part of this monitoring process
Most importantly, communicating the company’s plan with the broader team ensures there is buy-in across the business, and everyone is working towards a common goal.
Final Thoughts
Using the SOSTAC ® framework will provide a detailed, transparent structure that is simple to remember and explain to others. It covers all the stages needed to create and implement any type of marketing plan. It also incorporates several traditional marketing techniques that have been tried and tested for many years that will assist in achieving a SMEs strategy.
While the SOSTAC ® framework could lead to long-form planning documents that may be difficult to communicate, it is essential to summarise them for users within a company to encourage action.
Finally, I leave you with a quote from M.K. Ghandi: “A Customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption on our work. He is the purpose of it. He is not an outsider on our business. He is a part of it. We are not doing him a favour by serving him. He is doing us a favour by giving us an opportunity to do so.”
