There are multiple business strategy examples you can learn to model your business after. Here are some of the top ones.
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.
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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
- 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 rewards 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.
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 cook time and temperature are automatically set in the oven. When the meal is complete, the customer is notified via the Tovala app.
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.
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.