Context is crucial when using SoS for strategy

Unlike in Sweden, in France two friends who meet up on a terrace will sit next to each other, instead of opposite one another. It allows them to observe their surroundings, and chat for hours about what they see as it constantly changes. It keeps the conversation flowing, but also easy to foresee things happening. The use of Share of Search as part of tracking what will happen in your business we have covered. Others don’t agree with that view and international strategy expert JP Castlin shares on how he sees it as a tool to explain the past, but still use it to select which strategy method to choose.

“In strategy, Share of Market is often used as a starting point in diagnostics, a goal in objective setting, or both. Occasionally, Share of Voice is used as a supporting metric to garner information about spend relative to competitors, not least as increasing said spend can lead to market share growth”, starts JP. “The problem is that many companies struggle with obtaining the information needed for market share calculations – and media agency compensation for Share of Voice data is often prohibitively high. Share of Search provides a very good alternative.”

Besides Share of Search’ proven correlations to metrics such as Search of Market and Share of Voice, within different industries ranging from automobile and funds to FMCG and manufacturing, it is also a standard across the world, almost in real time and can be obtained relatively easily. Observing the trends can also indicate where your business is going, which could be interesting for CFO’s who see it then as a leading indicator.

Despite all this, Share of Search isn’t a simple turn key solution for strategy and should be used with some solid thought. Merely selecting which competitors you would need to compare yourself with can already provide very different results, which in turn will have a tremendous impact on building the strategy and looking at potential outcomes.

“As with everything, context ultimately defines use. For strategy, Share of Search is a lag indicator that demonstrates effectiveness relative to market share targets and, at least indirectly, growth”, JP continues. “Analyzing the outcome helps with evaluation, though it should not necessarily be extrapolated for projections.”

The context is then also the first pointer JP hints for marketers wanting to use Share of Search as part of their marketing strategy.

1. Know the context:
   Firstly you must know what you want to build the strategy for. Is it the general company strategy, or a particular part of it such as product development, manufacturing, or your social media approach? Is that taking place in an “entrenched” market like the metal industry or in a highly volatile one such as fintech? These things will define what searches will be set up as “Share of”, but are also important for the next steps in understanding the system of what you want to build the strategy for.

2. Understand the dynamics
   Once you have identified clearly what context you want to use Share of Search for, the next step is to understand what different actions lead to the trends in Share of Search. How do the dynamics of your particular market work? In practice this means taking your past marketing activity plan, but also those of your competitors from what you gathered in media or advertising and putting it next to the Share of Search trends. Add to that general trends that were happening at that time. Getting this overview, together with the general context will help identify what strategy approach to take.

3. Deliberate vs emergent strategy
   Looking at this marketing activity overview will give you a first idea on what drove changes in Share of Search, but they are mainly hypotheses at start.
   ““There are instances where the market is what I call entrenched; barriers to entry are high, technological developments are slow and, by and large, events are largely predictable. This allows strategists to lean heavily on deliberate strategic planning”, says JP, “but many markets are far from as mature. The more exposed a market is, the more one tends to rely on emergent strategy and rapid strategic iteration.”

The difference between the two is the approach.
With a deliberate strategy you can make a plan with different steps as you know what will be coming and can predict the outcome of each action you take. So by looking at what increased the search, we can try to repeat more of the same.  This is the more classical strategy plan as we know it, but will only be really happening in a very small percentage of cases.
JP says that looking at reality though, most companies will have to use an emergent strategy, where you build several different hypotheses and create different scenarios which you test moving forward and adapt as you go. This isn’t to be confused with just throwing a bunch of stuff out there and see what sticks. There is always a clear goal towards which you’re working and the scenarios will always be built in function of that. Based on the outcome you will then continue to build new scenarios and work your way forward. Share of Search can then also be used for tracking the results. Given the search is set up in the same way as the start, of course.

According to JP Castlin, Share of Search will therefore not really help you predict outcomes, but can definitely help you understand the efficacy of your approach, your share growth curve and how to create coherent strategic hypotheses going forward.

“JP’s approach on how to use Share of Search is an excellent way to start your strategy work and track it,” says Fred Pirenne, CSO at MyTelescope, “The most important is to know the starting point. We believe that given the right conditions you can also use the trends to outline where it will be going, depending on how far ahead you want to look. As JP always says: it’s all about the context.”

If you want to know more about strategy at a scientific frontier or need help managing organizational complexity, you can contact JP Castlin via his website: www.jpcastlin.com

Should you want to know more about Share of Search, or just get your Share of Search in an easy way, test it using our tool.