6 business growth strategies for your small business
In today’s competitive environment growing a business is difficult, but it’s possible with the right strategy.
Business growth strategies provide a structured and proactive approach to growth. Businesses that fail to plan for growth risk stagnation and decline. An effective growth strategy helps companies capitalize on opportunities and stay ahead of competitors.
Business growth strategies are like levers you can pull to scale your business. So, what growth strategies should you focus on?
This article will cover:
- Why you need a business growth strategy
- Six common business growth strategies
- How to apply the business growth strategies
What is a business growth strategy?
A business growth strategy is a plan that a company creates to achieve long-term success. The goal of a business growth strategy is often one of the following:
- Market penetration
- Product development
- Customer retention
- Strategic partnerships
- Employee satisfaction
- Customer acquisition
Let’s take a look at these six growth strategies to help you scale your business.
Market penetration focuses on increasing a company's market share. This can happen within its existing market or customer base.
Market penetration does not involve new products or markets. Instead, it seeks to maximize sales and revenue from the company's existing offerings.
A market penetration strategy will include short-term and long-term measures. Let’s look at a few examples:
- Lowering prices through flash sales and limited-time offers to attract first-time customers.
- Hyper-focusing marketing campaigns on specific niches of customers.
- Making products more accessible by expanding distribution channels
- Partnering with sellers with access to a wider, untouched audience.
- Personalized services with existing customers to build relationships and trust.
Have your products reached their full potential within their market? If not, then, market penetration may be a good strategy.
Product development involves creating new or improved products. Product development is important to keep customers happy and to stay ahead of the competition.
Two ways to drive growth through product development include:
- Expanding a company's product offerings
- Improving existing products
When building a product development strategy, your customers are the first place you should go for ideas. Then, you can identify if their ideas align with your company’s business strategy and goals.
Customers become raving fans when they feel heard through your actions, and when you have a great product.
Customer retention focuses on maintaining and nurturing existing customers. It's bad business to focus only on customer acquisition. Some studies suggest it costs five to seven times as much to acquire new customers than it does to retain existing ones. Customer retention aims to maximize the value of the current customer base.
Let’s look at some key elements of a customer retention strategy:
- Product development: Product development is a business growth strategy in itself, but it's also part of customer retention. You need awesome products if you want to keep your customers.
- Customer service: Customer service plays the most important part in customer retention. Customer service is assistance given to someone during or after selling a product or service.
- Customer experience: Customer experience includes customer service and interactions with a brand’s website, social media accounts, or app.
- Personalization: Personalization involves tailoring the buyer’s journey to help address their pain points and needs. Doing this can enhance your customers' connection with your brand.
- Feedback Utilization: Actively listen to customer feedback. Show your care by making changes to improve customers’ experience with your product or service.
A strategic partnership is an arrangement between two or more businesses. The goal is to achieve mutual benefits they may not attain alone. These partnerships use each party's strengths, resources, and expertise to pursue common goals. Unlike a partnership or multi-member LLC, strategic partners remain separate.
Strategic partnerships can come in many forms, such as:
- Marketing partnerships
- Supply partnerships
- Financial partnerships
- Technology partnerships
- Integration partnerships
Employee satisfaction and retention play a direct role in growth. Do you have high turnover in a customer-facing segment of your business? Your customers will notice. Staff that “quiet quits” will never reach their full potential. As a result, your organization will suffer.
Let’s look at the top reasons employees quit.
- Poor compensation
- Unmanageable workload
- Insufficient benefits
- Lack of manager support
- Poor or lacking company culture
- Unfair treatment
- Unclear goals and poor communication
- No work-life balance
- Unreasonable deadlines
- Limited career growth opportunity
Need an employee satisfaction strategy? We shared six employee retention strategies in a recent article.
Here’s a quick refresher.
- Onboarding: The more you invest in a new hire, the more you get from them. Employees need time to learn new processes and meet their teammates.
- Competitive wages: You want to offer wages that employees feel are worthy of their time and efforts.
- Employee experience: Employee experience includes all aspects of an employee's interactions with their employer. From their recruitment and onboarding process to daily work activities and career development.
- Employee recognition: Employees who feel the love stay longer and work harder. Hearing a “thank you” or “you’re doing a great job” goes a long way.
- Structured feedback: Your business should have a feedback system that provides slightly more praise than tough love. Employees should expect honest feedback and a fair rating system to measure their performance.
Customer acquisition refers to the process of attracting new customers. Its strategies and activities aim to convert potential leads into customers.
With a customer acquisition strategy, you can build a repeatable way of attracting business. You can track costs and eliminate wasteful spending. What gets measured gets managed, and what gets managed gets improved.
Marketing is heavily involved in customer acquisition, but it is a strategy that requires all hands on deck.
Grow your business one strategy at a time
If you want to unlock business growth, you need a strategy. We just shared six strategies you can implement in your business. For the best results, carefully consider which one you need most. Then, implement each strategy one by one. Our next article will discuss how to go through this process.
Lastly, does your business have a tax management strategy? The yearly stress and confusion make them easy to ignore. This can end up costing you money and time. See how ComplYant can help you manage your small business taxes.