Company Growth Strategy: Steps For Business Growth & Expansion
Different Types of Business Growth
As a business owner, you have various options for expansion. Business expansion may be classified into the following categories:
1. Organic
Organic growth occurs when a corporation increases via its activities, using its internal resources. This is in contrast to seeking outside resources to help with the growth process.
Making production more efficient to create more in a shorter time frame is an example of organic growth, which leads to greater revenue.
Organic growth has the advantage of relying on self-sufficiency and avoiding debt.
Furthermore, the extra money generated by organic growth may be used to support more strategic expansion techniques in the future. That will be explained further down.
2. Strategic Planning
Strategic growth entails creating efforts that will aid your company or organization’s plan for short term gains long-term growth. Two examples of strategic expansion are coming up with a new, product or service or devising a market plan to attract a new audience.
Unlike spontaneous development, these programmes frequently need large resources and finance. Businesses frequently pursue an organic strategy first, hoping to create enough cash to engage in future strategic development projects.
3. Internal
Internal growth strategy aims to improve income by optimising internal business operations. This technique, like organic and growth strategies, focuses on organisations employing their internal resources. Internal growth strategy is all about making the most use of current resources.
Internal growth might be demonstrated by reducing unnecessary spending and running a leaner organisation by automating some of its activities rather than recruiting new personnel.
Internal growth can be more difficult since it requires small businesses to consider how existing processes can be improved and made more efficient rather than depending on external variables different growth strategies such as entering new markets to increase revenue and promote development.
4. Mergers, Partnerships, Acquisitions
While riskier than the other ways of expansion, mergers, partnerships, and acquisitions can result in significant profits.
There is power in numbers, and a well-executed merger, collaboration, or acquisition may help your company enter a new market, increase sales again, extend your client or customer base, get technological resources, or expand the products and services you offer.
5. Market expansion (market penetration)
A market penetration product expansion strategy (or market development product expansion,) is a business expansion approach in which you try to sell your already existing products or items into unexplored areas. This entails discovering new markets that might complement your present product range.
Market development is a popular growth approach, enabling you to expand beyond your existing market and current clients. As a consequence rapid growth, your market share will increase. This sort of segmentation market expansion may entail focusing on a different sector, demography, corporate department (for example, shifting from HR to finance), or geographical region.
Bain & Company evaluated 1,850 organisations’ growth-driving initiatives to understand how successful growth tools can companies achieve sustained, profitable growth. They discovered that organisations have the greatest lucrative growth when they expand one growth strategy into an adjacent target market.
Facebook is an apparent example of a company that has used market development as a corporate growth strategy.
They began as a product solely available to Harvard University students. They then grew to include Stanford, Columbia, and Yale. The platform was then made available to all Ivy League colleges and several Boston-area schools. Then they increased access to institutions across the United States and Canada.
You must first grasp the whole competition environment to enter a new market. Consider alternatives to direct rivals. Who in the space dominates consumer attention? Which companies have the most share of mind, and who has authority over important decision-making moments for potential customers?
Do you want to know where you stand in your current market or one you intend to enter? Request a free market share analysis of your search!
6. Market disruption
Market disruption is entering a well-established sector controlled by a few legacy businesses and doing things substantially differently than everyone else. There are several existing and potential customers of ways to disrupt a market, including:
Using an entirely new features different business strategy, as many DTC businesses have done; Using innovations, such as when Salesforce provided a wholly cloud-based CRM; and Providing much cheaper or higher-quality items.
Offering something completely different, such as Slack in place of regular email
Consider how Dollar Shave Club used a direct-to-consumer approach to disrupt the male razor industry. Unilever bought them for $1 billion five years later, indicating surrender.
7. Growth Through Diversification
Creating new items for existing customers or enhancing old ones may be a highly successful corporate product development and strategy. Product development exposes your brand to new audiences previously uninterested in it.
Semrush is an example of a business that began with a basic SEO and sponsored search platform.
Over time, the corporation added more functions and is now a full software package. Although the target audience remained constant, additional functionality attracted a larger percentage of that group.
Semrush, with a current market valuation of more than $2.7 billion, and most companies that found this company growth approach effective.
Components of a Successful Business Growth Strategy
So, how can you put a successful business expansion strategy into action? Let’s start with the most important parts common any business growth strategy.
Conduct market research
Start with market research, regardless of the growth techniques you choose. Research provides information about your present clients and prospective or new customers and businesses from undiscovered markets.
This stage identifies trends overcoming current, growth possibilities, and potential obstacles to entry that may restrict your performance in a new market.
Audience research allows you to get into new areas of your present market and new audience groups that might benefit from your products or services.
You’ll learn a lot about their shopping habits, product preferences, and the channels they favour. Use this information to inform your customer acquisition efforts and overall marketing strategy.
The competitive study exposes your position about rivals in your present market. It also finds market share leaders in new sectors, allowing you to examine their vulnerabilities and capitalise on possibilities.
Finally, keyword research may assist you in learning how your target audience thinks. It exposes what your current and future consumers look for as they progress through the customer journey.
You may utilise keyword research data to establish a content strategy, uncover subjects people care about, and craft the perfect experience for each client touchpoint.
Set Growth Goals
You may set precise and specific business growth strategies and targets after understanding your present market and where you want to develop (new or existing markets). Goals are essential to every development plan because they motivate the actions that lead to success.
All other growth strategies and objectives should be quantifiable, and quantitative objectives should be time-bound with deadlines.
You may monitor your progress and optimise your actions over time by creating defined goals. You can modify your plan to guarantee your development goals are met.
Determine Your Growth Strategy
After establishing your detailed growth strategy goals and objectives, pick which growth plan to attract new consumers business grow, and meet your objectives.
Will you pursue organic business growth strategies or pursue an acquisition strategy? Alternatively, you might mix numerous tactics to meet your objectives. Multiple corporate and growth strategies and plans are more difficult to implement. However, as we witnessed with Klarna, it is undoubtedly a strategy to maximise and grow your business outcomes.
Your plan or tactics will be determined by several criteria, including your budget, goals, opportunities, competitors, timetables, and predicted market share targets.
A company may need to rely on market disruption techniques if it is entering a competitive market. You may use strategic alliances same market, if you’re a huge store with a significant budget and require urgent short-term results.
However, you must engage in SEO and content marketing if you want long term success in-term organic development.
Make your execution strategy
Your execution plan comprises the finer points of your growth strategy. It is the steps you will take to make your growth strategy a reality. For example, to utilise acquisitions as a word of mouth growth strategy, identify the gaps you want to address in new examples of growth industry or the new target groups you want to reach.
Don’t be hazy about your execution strategy. Outline all of the elements of your development plan so that you and your team members understand what needs to be done, when it needs to be done, and how it will be accomplished.
All of this preparation generates responsibility and helps guarantee that you consistently meet your desired growth goals.
Track and Measure Success
Once you’ve defined and begun implementing your growth plan, measure the key indicators that show your progress towards attaining your objectives regularly.
The metrics you select should be strongly related to your overall growth goals rather than vanity metrics with little real-world influence on actual achievements.
For example, suppose you aim to raise revenue for a certain business line by 20% in two years through a regional expansion plan.
In that case, your social media following size isn’t the appropriate statistic to analyse. Rather, you could wish to measure location-specific analytics, as well as site traffic and conversion metrics from visitors generated from your newest areas.
Optimise business growth
The more you monitor and assess your growth efforts, the clearer it will become which components of your execution strategy provide results and which aren’t. If something is functioning well, expand on it.
If a strategy isn’t working, consider making changes. If it fails, consider pivoting.
Even if you make significant expenditures in any company growth tactics described above, your strategy must be flexible.
You may realise that some expansion strategies do not generate enough market traction. Perhaps a new geographical emphasis lacks product-market fit, but a different region may offer the necessary outcomes.
Alternatively, if you are an internet firm launching brick-and-mortar locations, accelerate the pace of your current and future challenges and store openings if you observe great results from your original set of stores.
Continuously optimise the actions of your business growth strategy, and you’ll come out ahead in the end.
How to Implement Market penetration Strategy
Here are some examples of successful market penetration techniques you might focus on and use at your organisation.
1. Modify your price.
Reduce or increase the price of one of your items.
2. Redesign your marketing.
Rethink your marketing strategy and roadmap.
3. Determine the need for and launch a new product.
Survey and analyse your consumers and target audience to determine the necessity for a new product (or feature). Then, make and market that thing.
4. Revise or modify your product (or a specific element of your product).
Update or change a product or feature better to address the needs of your consumers and buyer personas.
5. Expand into new markets and give franchise possibilities.
Determine new markets in which to extend and grow your firm. Consider this: In which new locations may we build stores or prospects? You might also start giving franchise options to other businesses to help your brick-and-mortar firm grow.
6. Find a company partner with whom to collaborate.
Partner with or combine specific resources with another company in a mutually advantageous fashion (for example, execute a co-marketing campaign).
7. Invest in a small firm or a rival in your field.
Consider purchasing a small firm or rival business in your field if you have the resources to increase your client base and offerings/capabilities. (This was done by HubSpot a while back.)
8. Provide a promotional programme to increase loyalty.
Allow consumers to join a loyalty programme that rewards them in exchange for their contact information (e.g., discounts, birthday presents, insider knowledge, etc.).
9. Create a new marketing campaign.
Create and implement a marketing campaign or project to promote your product line in an innovative and novel way your clients have never seen before. Analyse the success of your campaign so that you can refer to it in the future.
10. Increase sales rep activities.
Encourage sales reps to have more contact with qualified prospects (for example, emphasis on social selling and meeting prospects where they are).