How to develop a business growth strategy
You do not have to be a multibillion-dollar worldwide brand to wrest market share from competitors. What you require is an unbreakable growth plan for your firm.
Naturally, progress entails danger. As a result, successful firms seldom rely on a single strategy. Rather than that, they win by leveraging a variety of growth tactics, like marketplace growth, disruptions, product enhancement, channel expansion, strategic alliances, acquisition, and organic growth.
Continue reading to discover seven of the most successful business and brand value accelerator techniques used by brands to outperform the competition.
What makes a business growth strategy effective?
Before we discuss particular development tactics, let us discuss some high-level concepts that contribute to the effectiveness of any business growth plan.
To begin, you must have a firm grip on your brand's image and DNA. Additionally, you must understand your advantages, positioning, and difference.
Growth occurs as a result of an unwavering emphasis on your key talents. Walmart is an excellent illustration of this. They've achieved stratospheric growth by offering the lowest pricing to clients.
Second, a thorough understanding of your audience is critical for any successful company growth plan. You must understand your consumers' pain spots and desires and exceed their expectations in meeting their demands. As a consequence, you'll increase client loyalty and recommendations via word-of-mouth (WOM).
Additionally, business growth marketing needs nimbleness. Without a doubt, you'll need to pivot in tiny ways, such as altering your marketing methods to reflect recent trends or customer behaviour. However, you may also need to make significant modifications to reach your development ambitions.
For instance, Shopify began by selling snowboarding equipment but quickly discovered its true strength was in developing eCommerce software. A willingness to adapt in minor and broad ways may considerably boost corporate success and also business growth.
Market development (market infiltration)
Market infiltration strategy (or market development strategy) is a method of expanding your firm by attempting to sell your existing items into unexplored areas. This entails discovering new markets for your present product line.
Marketing strategy is a popular technique among fba aggregators for expansion since it enables you to expand beyond your current clients. As a consequence, your market share will increase. This form of diversification may entail focusing on a new industry, demography, corporate department (e.g., moving from human resources to finance), or geographic region.
Bain & Company examined 1,850 organisations' growth strategies to identify how successful business growth achieve sustained, profitable development. According to the report, business growth is most lucrative when they enter a new target market.
Facebook is an apparent example of a firm that uses market development as a strategy for business growth. They began as a product that was solely available to Harvard University students. They grew from there to encompass Stanford, Columbia, and Yale. Following that, they made the platform available to all Ivy League colleges and a handful of Boston-area schools. The programme was then expanded to institutions around the United States and Canada. Facebook has subsequently extended beyond its initial emphasis on campuses to reach a wide variety of people.
Market disruption is entering an established industry, which is often controlled by a few legacy businesses and doing things entirely different from everyone else. There are several ways to disrupt a market, including the following:
- By adopting a whole new business strategy, as many DTC businesses have done. Consider how Dollar Shave Club's direct to consumer approach revolutionised the male razor industry. Unilever purchased them around five years later for $1 billion as a symbol of submission.
- Utilizing advances, such as when Salesforce introduced a completely cloud-based customer relationship management system
- Offering items that are considerably less expensive or of higher quality
- Introducing something novel, such as Slack as a replacement for regular email
Product diversification or growth
Developing new goods or enhancing old ones may be a highly successful approach for corporate growth. Product creation helps you to reach out to previously uninterested consumers.
Semrush is an example of a firm that began with a simple search engine optimization and sponsored search platform. The firm has steadily expanded features over the years, and the result is a very comprehensive software suite. Throughout, the intended audience has remained constant. SEMrush has benefited from this commercial development approach, with a current market valuation of more than $2.7 billion.
New channels of distribution are among the top ten business development methods because they increase revenue without requiring product adjustments. Allbirds, an eCommerce firm, gained sales by expanding its brick-and-mortar presence. While Allbirds began purely online, they now have 29 brick-and-mortar locations.
Occasionally, a single company's identification of a new distribution channel can spark an industry-wide tsunami of change. Consider Salesforce. They pioneered cloud-based, membership services in an industry driven by massive, costly, sophisticated business software that required an army of professional support representatives to operate. Salesforce continued to develop swiftly, and the company is now worth more than $21 billion. The software business has evolved, and the market is now entirely saturated with more SaaS services.
Strategic alliances with other companies can enable growth that would not be achievable otherwise. For instance, if you collaborate with a firm that provides a complimentary service or product to yours, you gain accessibility to their customers and vice versa. Additionally, you profit from recommendations from your strategic ally and the reputation associated with their brand.
A successful strategic relationship is between Lyft and Taco Bell. Lyft provided a Taco Bell delivery service to its clients, allowing passengers to make a mid-trip stop at a nearby Taco Bell ("Taco Mode") with a single tap within the Lyft app. The arrangement benefited both firms by providing free exposure and increasing Taco Bell's sales.
Additionally, strategic collaborations might be formed to develop a better or unique product. Returning to Taco Bell, cooperation with Doritos resulted in the Doritos Locos Taco.
To say it was a huge success would be an understatement. Doritos Locos Taco sales topped $1 billion within the first 18 months of the new product's debut.
The most apparent method of expansion is through acquisitions. Acquisitions are often a suitable business strategy only if you have a sizable income stream and/or debt capacity.
Acquisitions provide several significant advantages. They enable you to decrease competition through the acquisition of direct competitors. They provide you access to proprietary technologies that would need considerable time and money to create on your own. Additionally, they provide you with access to the purchased business's consumer base.
Rollups are one of the most effective and dependable business expansion tactics available. A rollup occurs when numerous smaller enterprises in the same market are acquired. The objective is to maximise cost reductions and efficiency by leveraging economies of scale.
Alera Group, a provider of employee benefits and human resource solutions, is one example of this, having grown to 1,700 people mostly through acquisitions.
Organic growth is by far the optimal strategy for business expansion. This enables you to accelerate expansion without relying on mergers and/or purchases. With regards to your marketing plan, this indicates that you are developing without the assistance of promotion, while once you stop spending, you stop developing.
Home products firms in a $29 billion industry moved from $0 to 3% market share in five years, largely through organic expansion. Organic search played a significant role in the firm's quick growth, with the startup receiving over 340,000 organic monthly visitors to its website.
Organic growth reduces client acquisition costs, increases the return on advertising expenditure, and establishes a smooth upward trend. The more organic growth you accomplish, the less money you will need to spend on marketing and the more money you will have to invest in further expanding your brand, creating new goods, and pleasing your consumers.