When change is so rapid today, with each week radically different from the next, how can a one-year – or, worse, three-year – planning cycle be relevant? Good news, says Colin Lewis: there is a way.
Many retail media network bosses are facing a challenge: for leaders, the last few years have been in ‘startup’ or ‘scaleup’ mode. Now, a few years in, the retailers’ senior management should (hopefully) be seeing serious revenues and are being asked for more. I know of one (non-UK) retailer who scaled to $300m revenues in a few years and is being asked to double turnover in three years.
But, against a backdrop of wars, fuel and food price inflation, tariffs and all the other macroenvironmental shifts, how can we possibly develop a three-year strategy?
The problem with strategy
What is strategy? It is one of the most overused and least understood terms in business. Everyone talks about it. Far fewer can define it or make it useful when the ground is moving underneath them.
That matters for retail media network leaders right now.
Most strategy frameworks are built on one dominant idea: that strategy exists to create sustainable competitive advantage. They also assume change can be ignored or neutralised by a single “correct” strategy.
What is strategy?
When Richard Rumelt’s Good Strategy/Bad Strategy was published in 2011, it struck a chord by exposing bad strategy as a mishmash of slogans and empty aspirations.
Rumelt argues that effective strategy is a focused response to a clearly defined challenge. “Strategy is designing a way to deal with a challenge.”
In other words, strategy is a coherent set of analyses, concepts, policies and actions that respond to it.
Rumelt also identifies several reasons why strategy is hard to deliver:
- The terms “strategy” and “tactics” are often used interchangeably.
- Resource plans that are not aligned with strategy or business objectives.
Furthermore, Rumelt clearly identifies what makes a bad strategy—many examples of which will be familiar to readers:
- A list of high-sounding sentiments or a laundry list of desirable outcomes.
- Confusing a list of objectives or goals with strategy.
- Plans to “spend more to get better” or vague terms such as “desire”, “drive” or “determination”.
Rumelt’s approach to strategy is both easy to understand and simple to follow. I encourage you to read the book and explore his ideas.
Adaptive Strategy: the ‘strategy in praxis’ view
Strategist JP Castlin argues more subtly that “strategy in practice is nothing much more than a continuous, coherent management of constraints to achieve success.”
Castlin also points out that change is not a contrast but a constant: it is the fundamental state of the world all the time. Change can be rapid or slow; it can be resisted or encouraged, but something always changes.
What to do? Castlin points out that we need an “Adaptive Strategy”.
- Adaptive strategy means recognising that the only genuinely sustainable competitive advantage in a changing environment is the ability to continually adapt.
- Adaptive Strategy does not mean reinventing the business repeatedly or running fast constantly. An endless series of pivots from one thing to another is a waste of time and assets.
Adaptive Strategy means the route to achieving the goal – the plan itself – must be fluid.
According to Castline, “Adaptive strategy is the first strategic management school of thought to be built on actual science. It takes its name from the single sustainable competitive advantage that exists: the ability to adapt to perpetual change. It is not about perpetual reinvention, but adding a responsive capacity that enables a become a whole stronger than the sum of its parts.”
Adaptive Strategy in action
Let’s look at a use case of how an RMN leader might plan to double turnover using this adaptive lens.
Imagine our $300m retailer. To reach $600m, they decide the opportunity is to move into off-site advertising and in-store digitisation. In a traditional three-year plan, they would spend months choosing a tech stack, integrating it, and then launching.
An adaptive leader does the opposite. They run a series of safe-to-fail experiments.
- In the first six months, they identify a constraint: brands are hesitant to move budget off-site because they do not trust the attribution. The guiding policy is to prove attribution through small, data-led trials. They run experiments with different partners. One fails. One is mediocre. The third shows a clear path.
- By Year 2, they move into the physical store. Instead of a national rollout of expensive screens, they test digital end-caps in 50 high-traffic locations. They find a partner with expertise in GDPR-approved screen measurement and double down on that in-store media offering.
- By Year 3, they are looking at agentic commerce and how AI assistants interact with their inventory. Because they have built an adaptive organisation, their tech team already has the APIs needed to feed the bots. They are not worried about the impact, because they have built the capability to adapt when the hype cycle is over.
Adaptive Strategy core principles for RMN leadership teams
The route to achieving your goals – the plan itself – must be fluid. If you are leading an RMN and trying to double your turnover, stop looking for the “one correct strategy.”
- Forget sustainable advantage: Scrap the pursuit of a fixed position and instead pursue transient competitive advantages that can be found and exploited.
- Continually Adapt: Recognise that the ability to change is the only thing that will keep you relevant.
- Responsiveness over speed: Add a responsive capacity that allows you to enhance what you already know works. If you don’t know what works, use adaptive strategy to find out.
- Avoid ‘move fast and break things’: Adaptive strategy is not about running fast constantly, but about creating the ability to run fast when necessary.
- Safe-to-Fail: Build experimentation into the business through coherent, parallel experiments.
