Narrow your marketing focus and think inside the square

Posted on March 30, 2011 by Gary Chow | No Comments » | Trackback URL

This famous scene, from the Billy Crystal film, ‘City Slickers’, says a lot about the importance of ‘focus’ in business; that is, concentrating all your efforts and resources on being good at one main thing.

The dialogue is: “You know what the secret is? One thing, just one thing. You stick to that and everything don’t mean s—”

There’s a lesson there. Companies doing well are those that focus on what they do best. They don’t bother wasting time, money and energy on non-core products and loosely connected ventures.

The problem is, once a company starts doing well, in short time, the higher-ups start thinking ‘outside the square’, which is often a dangerous past-time. They figure ‘if we are so good in this market, why don’t we go chase after that market…?’

And before you can say ‘spreading yourself too thin’ they’re off and running on line extensions, diversifying into unknown territories, buying other companies in industries they have only the barest of knowledge about. In the process, they start weakening their core strength, diluting their brand and yielding market share to their main rivals. Their customers become confused: ‘what exactly do you stand for?’

We see this all the time. Wine companies making beer, ski equipment manufacturers making tennis racquets, insurance firms selling home loans. These diversification strategies usually end up yielding poor results, and in the meantime they suck up resources and waste money.

Now recently we had the Borders bookstore chain going into administration. You’d think – why? Don’t they have a competitive advantage that’s hard to combat – range? Well I’d suggest that ‘range’ is one of the reasons why the business went belly-up.

Book sellers would do better if they narrow their focus. Rather than try to be all things to all people, what would work better for the troubled retail book industry is to concentrate on specific areas. How about a bookstore specialising in technical books or children books or literary novels?

A good example of a small business that follows a focus strategy is Birdland Records in Sydney. When I lived in that city, it was a favourite haunt of mine. They stocked only jazz. You won’t find the latest Kylie Minogue nor would you find The Wiggles’ back catalogue. But if it’s Charlie Parker or Dexter Gordon you’re into, then Birdland is the only place to go.

Check out their website copy; its all about focusing on what they know best:

“We offer a huge range of jazz music cds from all around the world. We’ve probably got the most extensive range of jazz music cds, in the country, if not the southern hemisphere. “

Now you can’t tell me that would not appeal to a jazz aficionado!

To be honest, I haven’t a clue how well Birdland Records is doing financially, but seeing as it’s been around since 1991 and it occupies a high-rent CBD address, I’d say it must be doing pretty good. The owners are focusing on their market niche which is why they are thriving when record stores – big and small – have either disappeared or are going to the wall.

When you narrow your focus you put yourself forward as being a specialist, which by definition is someone more capable than a generalist. This is how the medical profession works, and it will work elsewhere.

Like the Jack Palance character in City Slickers, the secret is to find your ‘one big thing’. Once you’ve found it, work it hard and stick with it, and whatever you do, don’t think outside the square.