Do you know how the top businesses in the world continue to be successful? The answer lies deep within their growth strategies. Every successful business employs growth strategies that fit with its business goal and morals. It also complements their workforce and abides with government rules and regulations.
When every factor is perfectly placed, a growth strategy can reap benefits for any business. There are many such business growth strategies available at your disposal. Below is a list of 4 growth strategies you should use for your business:
1. Market Expansion:
Often businesses deal with their products successfully in a specific market. To improve, using the Market expansion growth strategy, a business can tap into previously unexplored markets where they can sell their existing products.
These markets necessarily don't have to be domestic. A business can tap into international markets as well. Finding new customers helps a business improve its sales and profits, thereby increasing brand authority.
2. Market Penetration:
Market penetration allows you to plan how your business can grow in an existing market with competitors selling similar products. This is the least risky strategy as compared to the others.
Here, you will fight to steal as much market share as possible. But this strategy needs a lot of work and will involve pricing, product positioning, and marketing. There is a way you can calculate market penetration rate to understand how much of a product you are selling as compared to the total estimated market for that product.
Market penetration rate = ("Number of customers" must be divided by "Target market size") * 100
3. Product Development:
What do your customers want? Is your product/s adding value in your customer's life? These are the questions you need to answer. Listen to your customers and their needs. If your product is partially fulfilling it, then you can get it improved. If not, then you can create a new product with high value for your customers as they are willing to pay for it.
For a business to be successful using this strategy, adequate research, an understanding of customer wants, and needs are important.
4. Growth via Diversification:
Also considered as the riskiest growth strategy in the Ansoff Matrix, growth via diversification can take place when a business enters a new market with a new product. You can reduce the risk by related diversification.
E.g. A car company can start working on stereo systems for vehicles or a leather shoe producer can start selling leather wallets in a new market.
Another way of diversification is by selling a new product that has no synergy with your business. The plus point here is that if successful, it will open a new revenue stream for the business.
Some More Growth Strategies:
1. Mergers and Acquisitions:
When your market share cannot grow, or the profit level is almost saturated, you can resort to acquiring smaller competitors who are either growing or weak. Doing this gets you more customers and a higher market share.
Although if you are part of a highly competitive market and it is getting difficult for you to grow alone, you can merge with another business. This integration will create a higher power that can run the market.
2. Alternative channels for distribution:
There are various channels of distribution available in the market, like wholesalers & retailers. Normally a business takes help from either wholesalers or retailers. If you can see a better impact using both, then do take help from both channels.
You can also sell online and also directly. Doing so opens more opportunities for you to gain customers and increase sales. It's, however, a better choice to communicate with each channel to not hurt their feelings and lose business. Streamlining your channels of distribution directly improves your product reach and sales.
3. Price increase and deduction:
You cannot sell one product at one rate forever. It is not profitable and realistic to do so. Hence periodically, a price increase for each product is understood by customers. They too know that each year, costs are increasing, and hence it is natural to witness a price increase.
On the other hand, you can strategically reduce the pricing of certain products. Doing this might increase the sales for that product and bring you new customers. Later, you can sell them some profitable items and increase your profits.
4. Brand/Product USP:
Lastly, Brand USP is one of the most important growth strategies. Does your product have a certain feature, quality, benefit, that is more advanced than any other similar product in the market? If there is something that sets you apart from the competition and matters to your customers, that means they will be ready to pay for that product easily.
Hence you must communicate this product's USP to the customer very clearly. This is important as once the public knows about this, your product is what will remain in their minds. Sales and profit will witness a huge rise.
Conclusion
These are some of the best growth strategies that are important for a business. They help to survive, improve market share + customer base, gain profits, and do this continuously.
Need help executing these strategies for your business? With over 10 years of experience in growth-focused marketing, Amura is a growth marketing agency with 250+ clients across diverse industries. Get in touch with us!