Whether you’re a small business owner looking for a way to secure a more stable stream of revenue or the CEO of a mid-size business trying to earn more profits for your shareholders, eventually all business decision makers are faced with the pressing option of growing the business. “Growing” is a general term usually referring to a collective of doing more work, hiring more people, and making more money—but how you go about achieving that growth can vary.
Pros and Cons
There’s no “right” or “wrong” way to grow your business—it’s possible to see meaningful results with almost any approach, and every approach has strengths and weaknesses. However, some businesses are naturally better suited for some strategies more than others, so think carefully about your brand, your target demographics, and your competition before finalizing a strategy. Once in place, you’ll need to pace your growth; even with the right strategy in place, growing too quickly or too slowly could interfere with your results.
5 Major Strategies
Take a look at these five business growth strategies and consider their pros and cons carefully before landing on one (or more) that suit your brand:
1.Pushing existing products
You already have products you’re selling to the market—and somewhat effectively, or you wouldn’t be considering growth at this stage. Your first option is to penetrate the market by pushing those products harder and opting for a larger market share, driving more sales and revenue. Within this strategy, there are several sub-strategies worth considering. For example, you could hire more talented sales reps to earn more new sales, increase your marketing budget to earn more conversions, or even consider poaching some customers from a close competitor. In any case, the biggest advantage here is that you won’t have to learn anything new; the downside is there’s generally an upper limit to your growth here. You can only compete so hard and sell to so many people before you tap your potential.
2.Expanding your audience
Your second option is to increase the number of people you consider “target customers”. For example, let’s say you’ve created a software platform designed especially to help marketers in the food industry better track and manage their advertising campaigns. You could create a new skin for that platform, and a new marketing campaign entirely to target marketers of a different industry, such as pharmaceuticals. With this strategy, you could effectively double your potential client base without doubling your current efforts, resulting in a net gain. It’s a valuable strategy because it can be used in conjunction with any other growth strategy. However, be mindful here—not all businesses can easily expand their audiences, especially if they serve a highly specialized niche.
3.Increasing your product line
Instead of reaching for a new target audience blindly, you could add more products and services to your existing lineup to drive more revenue. For example, if you’re marketing a popular game app, you could create a sequel game or introduce new in-game purchases to incentivize existing customers to spend more money (not to mention attract new customers who otherwise wouldn’t be interested in the game). The upside here is that you could create a separate line of revenue, doubling down on your current customers and seeking new ones in the process. The downside is somewhat obvious; it takes a lot of product research and initial effort to get those new products or services developed.
4.Diversifying your revenue streams.
Selling things isn’t the only way to make revenue. You could also restructure your website or physical location to make a separate stream of revenue—there are thousands of possibilities here. For example, if your business revolves around a blog or website, you could use affiliate links or paid advertising to cash in on some of your inbound traffic. If you already have a strong audience for your content, you could start selling “premium” content like eBooks or whitepapers for a few dollars per download to create an entirely new stream of income. And if you have a physical business, you could consider leasing a portion of your space to another tenant, effectively giving you a reliable sum of money every month. This may be hard to set up, but it’s reliable and consistent in the long run.
5.Acquiring or merging with another company
Of course, there’s also the brute-force method of company expansion, which is simply acquiring or merging with another company. There are options here too, however—you could merge with a competing company to instantly double your market share, or you could acquire a peripherally related business so you can offer your customers a new product. The biggest upside here is the amount of flexibility you have; you can Frankenstein together an entirely new company. The biggest downside is the amount of time and paperwork it takes to merge companies.
If you’re looking for a better way to build your business, you can start by better training and informing your employees—after all, they’re the ones who will be making your vision a reality. Sign up for a free demo of ProProfs Training Maker, and you’ll learn how it can help you create better training for your workers. With that in place, no matter what growth strategy you choose, you’ll have a better-informed and better-trained team to make it a reality.