Innovation

Lessons 2014: Smart Strategy

Picking the right time, place and market for your company is rarely easy. A look at some of 2014's biggest business strategy moments, and what you can learn from them.

Written by Canadian Business Staff

As you gear up to take on the challenges and opportunities of the new year, it’s worth taking a moment to reflect on what happened in the last one. Good strategy can boost your bottom line and leave you poised to exploit emerging opportunities, but badly-conceived moves can cost you customers’ good will and patronage.

Last year, a number of major brands made some spectacularly well- and ill-conceived decisions that garnered significant public attention. Here are a few lessons in strategy from 2014.

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APPLE UNVEILS ITS SMARTWATCH

You don’t have to do it first, just better

Photo: Justin Sullivan/Getty Images News

When Apple unveiled its smartwatch in September, nearly a year had passed since competitors like Samsung and Sony released their own timepieces. Apple spent the two years bolstering the team that would develop its wristwatch—which goes on sale in 2015—including managers, members of its marketing group, software and hardware engineers who worked on the iPhone and iPod, and engineers who developed Nike’s FuelBand. This is because Apple isn’t just taking competitive aim at other smartwatches but luxury timepieces as well. When Apple wants something, it wants the whole thing.

MORE APPLE WATCH: Why Apple’s Disruptions are Good for Business »

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FACEBOOK APOLOGIZES

Your customers are not a science experiment

Photo: Nicholas Asfouri/AFP/Getty

In June, the big brains at Facebook triumphantly revealed they had performed a little test on some users’ newsfeeds. In a bid to learn more about human emotions, engineers tweaked the newsfeed algorithms of some 700,000 users to serve up predominantly cheerful or melancholic updates to see if it had an impact on their behaviour. Surprised by the backlash, chief operating officer Sheryl Sandberg offered this non-apology: “This was part of ongoing research companies do to test different products….We never meant to upset you.” In fact, they only intended to upset half of the group.

MORE FACEBOOK: Is Facebook Still Worth Your Time? »

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KEURIG FIGHTS BACK

Don’t lock out your customers

Photo: Bryan Bedder/Getty Images Entertainment

A revolution has been brewing in the kitchens of the nation: One in five Canadian counters now features a single-cup coffee system, according to NPD Group. The majority are made by Keurig Green Mountain and use its K-Cup coffee pods. This year, the company introduced the Keurig 2.0 system—a new proprietary line of brewers built to reject so-called “off-brand” K-Cups. Some Keurig 2.0 owners, baffled by the labelling, wound up buying the wrong coffee pods; others simply found their stockpile of K-cups obsolete. Keurig faced the unique rage of the enthusiast betrayed. (They also created an opening in Canada for Nespresso, the dominant single-serve brand everywhere except in North America.) Lock out your competitors and you might inadvertently shut out customers, too.

MORE KEURIG: When Keurig fights “coffee pirates,” who loses? Loyal consumers »

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SNAPCHAT HITS $10 BILLION

Sexts come and go, but equity is forever

Photo: Lionel Bonaventure/AFP/Getty

You might need to ask a tween to help explain this, but we’ll do our best. Snapchat, the mobile app that allows users to send disappearing photo messages to one another, was valued at more than US$10 billion this summer, as both Chinese e-commerce giant Alibaba and then Yahoo were rumoured to be looking to invest. None of this would have happened had Snapchat accepted Facebook’s reported US$3-billion offer for the company last year. It seems Snapchat, whose young, engaged users send more than 700 million photos a day, knows exactly what that audience is worth.

MORE SNAPCHAT: Why Are Jerks So Successful? »

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T.SWIFT SPLITS WITH SPOTIFY

Shake it off—if you can afford to

Photo: Jason Merritt/Getty Images Entertainment

In October, Taylor Swift broke up with Spotify, first refusing to release her new album, 1989, to the music-streaming service, then withdrawing her entire catalogue. Artists and labels complain companies like Spotify devalue their music (Swift’s label claims she has earned less than US$500,000 to date from streaming). Considering Swift has the fastest-selling album of the past 10 years—1989 sold 1.3 million copies in its first week—she’s in a unique position to stick to her principles. But even those sales are dwarfed by the 50 million users Spotify has worldwide. Swift might be repeating a mistake made by Blackberry, Kodak and Blockbuster—eschewing long-term innovation for short-term success.

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MARVEL GOES VERTICAL

If you’ve got a back catalogue, use it

Photo: Rick Rowell/Disney XD/Getty

If there was any lingering doubt about which comic book brand, Marvel or DC, is winning the war over movie screens, it was dispelled in October, when Marvel Studios president Kevin Feige took the stage at Hollywood’s El Capitan Theatre to announce a slate of nine—nine!—films to be released in the coming years. The comic book entertainment behemoth, now owned by Disney, is capitalizing on its deep catalogue of characters, including fan favourites (sequels to the Captain America, Thor, The Avengers and Guardians of the Galaxy franchises) and surprising new entrants, including a release centred on its Black Panther character in 2017 and Marvel’s first female-led blockbuster, Captain Marvel, the following year. The success of decades-old comic book concepts in the modern multiplex shows the best way to survive a shift in delivery platforms is to have strong intellectual property.

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MORE STRATEGY LESSONS:

This article is from the January 2015 issue of Canadian BusinessSubscribe now!

Originally appeared on PROFITguide.com