In life, whether you decide to take baby steps or huge leaps of faith, you should always consider your goals and objectives. If you want to grow your business one of the most important decisions that you will have to make is to decide upon the perfect growth strategy for you and how you can implement it.
Here are the four key strategies you can use grow your business.
1. Market Penetration
This is the lowest risk and potentially easiest growth strategy. It involves growing the sales of your existing product in your existing market. The key objective here is to increase your sales and overall market share.
Your market share is the percent of unit and monetary sales your business holds within a certain market vs. all your competitors.
Ways to increase your market share:
- Lower your prices
- Bundle your products together so people buy more
- Find a new use for an existing product
- Increasing customer satisfaction and referrals
- Maintaining existing customers while acquiring new ones
- Increasing frequency with which products are purchased
- Increase amount of product purchased (buy on get one free)
It’s all about finding your competitive edge!
2. Market Expansion
Often called market development, market expansion is selling your existing products into a new market. Market expansion is perfect for your business if you find a new use for your product or service. This opens up new opportunities for growth and expansion.
Occasionally changing your packaging and modifying or upgrading your product can also help you penetrate new markets. However, it is very important to conduct an in-depth research of the new market to know what you’re getting your business into.
Market Expansion strategies
- Identify a new use for your product
- Adapt your product i.e. sugar free
- Innovate your product
- Repackage and potentially rename your product so it appeals to a different market
- Offer additional services to enhance products uses
3. Product Development
There are some successful entrepreneurs who’d rather maximise their skills within their existing market by developing and expanding their product line. This strategy goes well with the continuous development of the technology. You will have to tap into what your market is interested in, delve into the fads, and understand that while your business is growing, so is your market.
This can be a fairly simple strategy as you already know your market and have loyal customers, so it could be as simple as selling them a complementary product to the one they already purchase from you i.e. shampoo and conditioner, lawn mowing and grass care products, the more closely they are related the easier the transition will be.
This is the hardest and potentially the most risky, it involves developing new products to sell to new markets. However if you are successful it can help the longevity of your business as you will be protected from the ups and downs of a single market and product category.
This will require you understanding a whole new market and customer profile, so it is wise to undertake considerable research before undertaking this strategy.
Always remember that your business’s goals and objectives are the driving force of your operations. Your every decision will have to revolve around these two elements. When you decide on which of these strategies to use, always remember what your business is about and what you want it to turn out to be in the future.