Build your strategy around companies that have the same kind of value proposition, not companies that are in the same business.

There Are 9 Types of Businesses. Discovering Your Type Is Easier than You Think

Build your strategy around companies that have the same kind of value proposition, not companies that are in the same business.

Staff Writer

How did Netflix inspire commuter airline Surf Air? On the surface, these companies have little in common. But in many cases, similarities in the way companies go to market are more important than the products or services they sell and are more fundamental than the industries they are in.

One of us was recently working with a startup in cybersecurity and the company sales reps were lamenting their inability to distinguish their company from others. We suggested that they think about their company’s “Service Design Archetype“–the embodiment of their unique value proposition and the expression of strategy as your customer experiences it. We have identified nine Service Design Archetypes:

  1. The Aggregator pulls many suppliers together to one common platform and experience
  2. The Bargain combines low prices with a determination to also be a low-cost producer
  3. The Classic is top of the line, highly reliable in quality, and usually pricey
  4. The Old Shoe is the business equivalent of comfort food
  5. The Safe Choice operates in the broad middle of taste, price, and service. You won’t be wowed, but you won’t be disappointed, either
  6. The Solution puts things together or orchestrates the work of others into a single offering
  7. The Specialist is the rifle to other’s shotguns.
  8. The Trendsetter lives and thrives on the leading edge of its industry; confers its hip status on its customers
  9. The Utility offers a basic service to a broad public. It is sometimes public, and is often regulated.

Each of them is present in most industries. (An exception: the Utility.) Each can be highly successful. And they are as different as chalk and cheese. The critical, differentiating customer interactions for passengers on Singapore Airlines (a Classic) aren’t the same as those for RyanAir (a Bargain). Macy’s (a Safe Choice) shouldn’t try to out Amazon (an Aggregator).

Service design archetypes can be valuable in two ways. First, they can help you evaluate the choices you have about what offerings to make, what expectations to set, and what experiences you wish customers to have–and what offerings, expectations, and experiences are just “not us.”

Winning Your Way

Understanding archetypes helps you see how to embody your strategy at every point of interaction with customers and backstage. The essence of strategy is not to beat the other guy. It is to become the best possible you, so that you win where you want to. “We’re a Specialist,” you might say: “How do we make sure we’re the best in our specialty? How do we avoid getting distracted? How do we help customers who need services we don’t provide–and make sure they come back when they want something in our field?”

The second use of archetypes is to provide fresh sources of inspiration. Many of the most valuable insights in service design come not from direct competitors, but from companies of your type in entirely different industries. Surf Air offers a fly-all-you-want subscription for air transportation inspired in part by Netflix’s watch-all-you-want model for video rentals. Mark Holtoff, Senior Manager, Community, of Edmunds.com told us: “My big product is consumer-generated content. I look at Yelp, Trip Advisor, Amazon, and try to apply those things to the automotive experience.”

A Safe Choice

Very few companies will fit an archetype precisely, so don’t think of them as straitjackets. But one of them is your dominant mode. The cybersecurity client realized it was trying to be a Bargain, a Safe Choice, and a Trendsetter all at once. After research and discussion, the team decided that the “Safe Choice” archetype best expressed what they wanted to achieve.

Like them, you can use service design archetypes to improve your strategic and design thinking.

  • Recognize that one of these is the essence of your value proposition
  • Focus there. Make sure you express that essence at every touchpoint and whenever you set expectations for customers
  • Complement that essence where you can; pare away anything that conflicts with or contradicts it
  • Discuss this identity across the executive team; make sure it is shared and understood by everyone who has a budget to propose and manage; school frontline employees in what it means for how they interact with customers. An organization aligned to an archetype makes better decisions at all levels
  • And have fun with it.
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.

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