Your company’s planned projection and foothold in the market (one you’ve invested significant time and resources into) is suddenly disrupted by federal and state regulations and increasingly complex B to B/B to C partnerships. You realize the implication of this change is not only a loss of short-term profits—it will also result in lost market share to your fiercest competitor that you may never recover. And your executive leadership team is asking what your plan is to side-step this challenge and maintain your brand’s growth.
These are the moments when leaders realize they need a contingency strategy in place to better anticipate and respond to market forces. But is it possible to do so before you’re in crisis mode? We believe the answer is yes. And that’s why future scenario development should be an essential part of every brand’s yearly planning process.
And yet, increasingly in our current climate of disruption and shifting market dynamics, business leaders are being asked to do just that, to maximize the possibility of their brand’s success. Pivoting a product or brand can feel more daunting the larger your organization is—and, if you’re a cannabis company—can be an even greater challenge when considering the complexity of an ever evolving market full of regulatory changes and unknowns. Add to that the pressure of shareholder and executive team demands for topline growth now, and it’s easy to see why long-term planning takes a back seat to short-term sales figures.
The practice of future scenario planning includes tools to anticipate and prepare your brand for changing external forces that could affect its future. And unless you discover a crystal ball, you’ll need a structured framework to wrangle and better react to the forces that seek to determine your brand’s destiny.
The first step of the process involves taking a wide view of the forces shaping the category, the lives of your customers, and the climate in which you do business. A simple place to start is by leveraging the widely-used STEEP framework: considering Societal, Technological, Economic, Environmental, and Political forces. The goal at this stage of the process is to leave no stone unturned, considering every possible force that could create a ripple effect for your business.
At BrandJuice, we start this process by tapping into our vast trend database to examine emerging behaviors across categories because trends are generally leading indicators of where the market will go in the future.
Once you identify the macro forces that could impact your business, the next step is to create a list of hypothetical scenarios within each of those territories that could plausibly come true in the future. This can feel like a daunting process, but starting from close-in scenarios (those that have a greater number of indicators in the current market today) and then working your way towards events that feel on the edge of plausibility can give greater breadth and dimension to your thinking. Starting broad and then whittling the list down to a smaller number (say, 15-20 scenarios) can help focus the effort.
Once you have a narrowed list of hypothetical future scenarios, further elimination may be necessary to focus the efforts of your team. This simple 2×2 framework (Exhibit A), based on the intersection of probability to occur in the future, and potential impact on the brand, can be a helpful tool to facilitate team discussions. Assessing and plotting the scenarios on this framework helps identify the true “imperatives” for your business to contingency plan against—those with the highest likelihood to occur that could have the greatest potential impact on your brand should demand the most attention and resources.
Finally, an assessment of your brand’s preparedness in the most likely, highest impact scenarios will determine areas of potential threat so you can plan against them. Ask yourself, “if this scenario came true tomorrow, how much risk would there be for my brand’s viability?” Using a simple assessment tool of “high, medium, or low” can identify order of magnitude of the problem and direct the team on the biggest threats to mitigate.
Mitigation strategies can take many forms, and will be unique from company to company. They may involve other marketing initiatives, product innovation opportunities, or additional resource needs. Beginning to outline these, and putting a plan in place to mobilize against them as necessary, can help leadership feel clear about the path forward if the “worst case scenario” becomes reality.
While there’s no way to predict every possible scenario that could affect your business, anticipating and planning mitigation strategies can mean the difference between category leadership or fading relevance. Statistics show that future-prepared firms outperform the average business with a 200% higher growth rate and 33% higher profitability*.
Contact us to chat about how Futurefluence and scenario planning can help your brand be better prepared for an uncertain future.