The 2016 Presidential Election has offered surprises and intrigue. It has also offered excellent examples of strategy at work. These lessons are most applicable to business, too. These are 7 important business strategy lessons from the election:
- Lead with a Simple and Direct Message: Trump has a very simple and direct tagline, “Make America Great, Again.” It is also a message that allows people to make it mean what they want it to mean. The other candidates do not have such a simple and direct message. Leading companies, doing this. Wal-Mart is about “Save Money. Live Better.” Nike is “Just Do It.” These are great examples of what the business stands for. Develop a simple and direct message!
- Plant Seeds Today for Tomorrow: The GOP seems to have many issues related to its splintering. However, its initial large number of candidates will allow these candidates to also become forces for the future, either in presidential races or senatorial races. Would Ben Carson have ever been considered for the US Senate before his surprising early results in the election? No. The GOP seems be doing a better job now of planting seeds for the future and showcased a set of candidates with more ethnic diversity that the Democrats. What a surprise! The challenge between Sanders and Clinton will give rise, I think, to an eminent splintering in the Democratic Party, with a strong pull from the left. It will help Elizabeth Warren, should she run, but the future of the Democratic party includes polarization, like that being seen by the GOP. For Firms, planting seeds for the future is so often missed. Kodak, Blockbuster, Dell, and Motorola – the list goes on and on. In each case, the firms did not plant for the future and were left without a strong product in the future. Plant your seeds now!
- Get Closer to Minorities: They are a major force in the election and may indeed be the deciding factor. Minorities are a major source of population and economic group. Businesses have long seen the impact and attempted to gain traction in these markets, but often approach the minority groups as a secondary market. However, the goals, aspirations, and even to some extent values of minorities groups can vary. Being Hispanic, I can testify that Cubans, Mexicans, Puerto Ricans share many things, but indeed political views and even product preferences do vary widely. Goya is a great example of a food brand that has transcended the Hispanic (and now non-Hispanic) market. It runs ads that show Hispanic families enjoying richer lives. It got close to Hispanic customers and showed a powerful message, attractive to both aspiring and economically successful people. For firms, it is important to really get close to your minority markets. They are the source of growth! Be the leader early with these groups and win their approval. It will bring you great success.
- Disruptors Can Play by Different Rules: The 2016 election is dominated by how Trump has challenged the GOP status quo and how Sanders has shaken-up the Democrats, challenging the previously anointed candidate. In each case, as outsiders they disrupt. Disruptors can play by different rules. When disruptors lose in final outcome, they might still win. Sanders is exceeding expectations an might still lose to Clinton, but a marginal win in Michigan is a HUGE win for him and a marginal win in Iowa looks like a loss for Clinton. Carson is being slated for a US Senate seat; he has won even if he is out of the presidential election. Bush learned that hard way that attacking disruptors can be hard and result in negative backlashes. Clinton is learning that attacking Bernie is hard, too. In business, disruptors are successful mostly because they bring better, cheaper, or much needed service to consumers. In this way, consumers become advocates for disruptors in the case of Uber, years of Amazon collecting no sales tax, and even Yelp and Tripadvisor that have brought a voice to consumers. So, recognize disruptors and get ahead of their strategies. It requires innovation!
- Brands Matter and Perceived Quality Matters: Trump’s success in business and on TV is clearly helping him in politics. He positions his properties, himself, and his politics as that of success. Sure, he has blemishes and challenges, but the track record and focus on quality has really allowed him to cover weaknesses. Look at your industry and firm, what does your brand say about quality? Move to a position of quality and success. It works in almost every market and allows firms to command higher price points. I think about it every time I am at Whole Foods and I see coffee and alcohol that is much more highly priced than in Jewel or Kroger. Whole Foods does it on branding and a focus on quality (or the perception of it).
- Emotions are More Powerful than Logic: Aristotle gave us Logos, Ethos, and Pathos as principles of rhetoric. Trump, has certainly, mastered the use of fear (a emotion and pathos) in the election. Bernie is masterfully using ethos to say trade agreements are not right or fair. Clinton is using logos to say she is most experienced and most qualified. In almost all situations, Pathos and Ethos trump (no pun intended) Logos. For business, focus on the emotions and ethics that you want associated with your brand and product.
- Authenticity is Rare and Valuable: Trump, Carson, Sanders, Christie, and even Cruz have exhibited various degrees of authenticity. They don’t mind showing a bold side, even if it is not mainstream. Clinton, Bush, and Rubio have all been very calculated to say what is expected. I feel each has struggled to demonstrate an authenticity and that hurts when you are trying to win on emotions. For firms, it is important to be honest and authentic. People love a story. Who makes your product? Where do the raw materials come from? I get a catalog for gift fruit and nuts each year that shows pictures of the workers in the orchards and kitchen. It is a great example of being honest and transparent about how the product is sourced and made. We need more of that in business and politics.
About Russell Walker, Ph.D.
Professor Russell Walker helps companies develop strategies to manage risk and harness value through analytics and Big Data. He is Clinical Associate Professor of Managerial Economics and Decision Sciences at the Kellogg School of Management of Northwestern University. He has advised various governmental leaders on Latino matters, including US Senators.
His most recent book, From Big Data to Big Profits: Success with Data and Analytics is published by Oxford University Press (2015), which explores how firms can best monetize Big Data. He is the author of the text Winning with Risk Management (World Scientific Publishing, 2013), which examines the principles and practice of risk management through business case studies.
You can find him at @RussWalker1492 and russellwalkerphd.com
Analytics, Authenticity, Brand, Business Strategy, Democrats, Disruptors, Economic Sciences, Elections, GOP, Growth, Hispanic, Hispanic Population, Latinos, Minorities, Politics, President, Republicans, Risk, Strategy, Trump