The one by Paul Bailey
Focus through constraints
Friends,
I hope that all is well with you and yours, and that this e-mail finds you on a boat with shoddy connection, in the tropics, three months after I sent it.
In today’s newsletter, guest writer and brand strategists par excellence Paul Bailey discusses the benefits of using constraints and inverting the common approach to brand. For premium subscribers, also the practical tools you need to ensure a work (whether your own or that by an agency) properly done.
Now accepting keynotes for 24Q4-25Q2
Every year for the last decade or so, I have created three main presentation decks. For 2025, however, I have (for the first time) added a fourth due to popular demand. They are:
What to Do When You Don’t Know What to Do: How to turn change into a competitive advantage. (Based on the new book by the same name.)
Leadership in Times of Uncertainty: How to steer an organization through a sea of change. (Executive audiences only.)
Resilient Retail: How to survive and thrive in the modern marketplace. (Based on the 2025 follow-up to the highly praised 2022 white paper The Gravity of e-Commerce.)
AI Beyond the Hype: How to understand the narratives, risks, opportunities, and best uses of a new technology.
If you want to book me for your event, corporate speaking slot, or workshop, merely send me an email. To make sure I am available, please do so at your earliest convenience; my availability is limited and the schedule tends to fill up fast. More information may be found here.
A couple of updates before we go-go
It is interesting to follow earnings weeks, particularly when it comes to Wall Street vs Main Street. In short, the firms that have multiple revenue streams (in line with what I have argued for years) do very well; the ones that rely on just the one, notsomuch.
Despite the easily proven benefits of strategically coherent diversification, the d-word is nonetheless habitually interpreted as a negative. I imagine that there are two primary reasons:
Investors want their companies do be focused, partly because startups can spend a lot of time running really fast without actually getting anywhere, but mainly because it makes companies easier to value.
Diversification is often taken to mean pivoting, which turn tends to translate to putting significant amounts of time and resources into endeavors that the firm has little understanding of (unlike its new competitors).
Both points are, however, neither here nor there. Investors and financiers are themselves diversified, which means that they do not need all of their companies to do well; they only need a couple to do very well. Their view, although it dominates the discourse (no doubt because it is their narrative), is thus not only highly skewed but also potentially lethal to the individual firm. Pivoting, meanwhile, is (as a rule) strategically inane.
Warren Buffet once (in)famously said that diversification is protection against ignorance. In a way, it is; we are all ignorant about the future. And protection can, I would argue, therefore be rather useful.
Moving on.
JP’s note: as we today begin the 2024 guest post series, Paul Bailey is the first one out. Paul and I have known each other for about half a decade now; as one might expect, with me being me and him being the strategy director at Halo (a brand-first agency in the UK that, with bold strategy and commercial creativity, improve audience experience and business performance through brand), most of our conversations revolve around strategy. As it concerns brand, Paul is among the best that there is.
As usual, the first part of the contribution - which is free for all - will cover a topic in general terms. The second part - which is exclusive to premium subscribers - will cover practical takeaways and how-to advice.
Constraints that bring focus
I wanted to open this by highlighting JP’s work on adaptive strategy. For me, the work he and his upcoming-book co-author Steve McCrone are doing with adaptive strategy, is really going to shake up the world of strategy. And it’s about time. For too long strategy has looked to define and follow a fixed path, and then claim cause and effect. We need to find ways to work in some flexibility.
What I’m talking about today is one way I see we might be able to shift our thinking as strategists; away from a linear process and opening ourselves up to a wider way of thinking. I’m going to talk about setting constraints, and how then working within these constraints can provide us with a focus that offers flexibility whilst encouraging forward motion.
In a conversation I had with JP a couple of years ago, we discussed how rather than being seen as a negative, applying constraints can be a positive way of bringing you focus. Setting constraints can give us a framework within which to work, whilst also encouraging flexibility within that set space. Consider it like this: when defining your strategy (whether that is brand or business strategy), instead of rigidly defining exactly what you must do and the steps you must take, there is huge benefit in first defining what you mustn’t do. Then, once what you don’t want is set, anything that sits inside those constraints should be considered good for the brand or business.
Starting with the audience
Customers, consumers, clients – whatever we call the people who buy your product or service, no business would be around for long without them. The way in which you identify your audience has two main approaches:
reach as many people as possible.
segment your audience and target those most likely convert to sales.
Each method has issues. Reach as many people as possible and there’s a degree of ‘wastage’ – speaking to people who will never, ever convert to a sale is generally a waste of time. (Of course, there is the idea of building ‘brand fame’ outside of your audience, but let’s ignore that for now.) On the other hand, segmenting and targeting risks missing potential sales; if you’re not careful, you may miss out on some people not included in your target segments who could convert to a sale.
Reach too many people and you’re wasting money. Reach too few people and you’re wasting opportunities.
There is another way to consider your audience, and that’s to think about those people who either you have no interest in reaching or who would have no interest in your brand. Patrick Hanlon, author of bestselling book Primalbranding, refers to these people as your ‘Outsiders’. If we consider a brand as a vehicle through which you can align an organisation and people, the people who you want to align with are ‘insiders’ of the brand. So, if you have insiders, you must also have outsiders.
Relating to your audience, it can be helpful (and often easier) to define who those people are that you don’t want to reach – those who are your ‘outsiders’. Depending on your industry or offering, these people might be outsiders because they simply can’t afford what you offer (e.g., if you’re Bugatti, don’t bother targeting me with your advertising), or they have a preference that goes counter to your offering (e.g., if you’re a meat producer, vegetarians would be a waste of time and money). It might even be that them being associated with you would be detrimental to your brand (e.g., think of Burberry and UK football hooligans). There are many valid reasons why either you or they would want them to be considered ‘outsiders’ of your brand, both practical and emotional.
Identify those you want ‘outside’ your brand, then everyone else becomes your target audience.
Your outsiders become your constraints; they create the framework within which everyone else is your audience. This approach may seem counter-intuitive, but it is being employed by organisations to great effect. In 2021, PHD Denmark and Audi heralded a success in narrowing in on most likely buyers while creating an "exclusion list" of least likely buyers based on media consumption habits and demographic characteristics. With equal spend across differing targeting approaches, 70% of conversions came from the audience and contextual exclusion strategies. Frederik Meincke, PHD Denmark’s digital innovations director commented: “This was somewhat of a surprise to us, and it shows the power of taking a different approach to targeting by specifying what you don’t want instead of specifying what you do want.”
The point is that, sometimes, it’s easier to identify who you don’t want than who you do want.
It is important to note here that your ‘outsider’ audience is not an external audience-facing bit of information. Like a lot of brand strategy, it is intended to inform how you approach working on and with the brand. Whether they are likely to become customers or not, people don’t take kindly to being ignored or rejected. Ensure your ‘outsider’ audience is known and understood internally, but not externally to your business or organisation.
How about your brand?
Many, many hours, days and weeks are spent by brand strategists defining what a brand should stand for. What is the purpose of this brand? Why does this brand exist? And this is important work – without clarity such as this brands can be rudderless, and the associated business or organisation lack focus. But sometimes, much like your ‘outsider’ audience, it is helpful to first work to define what a brand stands against.
Whether it’s to aid clarity of thought in the creation of a brand’s reason to exist, or whether it’s simply to be used to build the framework of what a brand should be against, the process is always valuable. Here at Halo, we often go through this process as part of defining a brand platform for our clients. It might be answering questions such as what this brand is against (is there a behaviour commonly seen across the category that they can take a position against). Or maybe we look at who this brand is against (this is a commonly taken challenger brand strategy when there are one or two category leaders; in fact, sometimes going against a key competitor is actually a way of aligning yourself next to that competitor in people’s minds e.g., think Burger King and McDonalds).
What we are doing here is very similar to the ‘outsider’ audience strategy. We are looking to define that which sits ‘outside’ of our brand – whether that is behaviours or competitors – with the knowledge that anything that’s the opposite to that which is ‘outside’ our brand, is ‘inside’ it.
Define yourself by identifying what you’re against.
An evolving brand
What this does is two-fold: it gives you a degree of focus, but it also gives you a degree of flexibility. It gives you the space and time within which to grow your brand.
Brand strategy should not be about locking down exactly what a brand is. It should not be seeking to tie a brand down to a prescribed step-by-step guide to the upcoming years. Brand strategy should be about setting the frameworks and constraints within which the brand will be able to grow.
A brand is an evolutionary construct. Because a brand is in part shaped by the context within which it exists (competitors, comparators, audience, market), the strategy for the brand should always be open to a degree of flexibility. The more flex you can build into your strategy, the less chance there is of it breaking. I think the reason so many brands feel the need to ‘rebrand’ every few years is that they have locked down what the brand means too tightly. Loosen the grip and let your brand flourish.
A brand is always evolving. What we must do as brand strategists is define what we don’t want the brand to evolve into, and who we don’t want to be ‘inside’ the brand. Then we have defined the constraints that can bring us focus, whilst giving us flexibility and enabling growth.
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