Only 0.036% companies ever reach annual sales of $1 billion, according to an article by business magazine, Inc.com. Most businesses that last more than a year have good products and serve a market well. They fail to grow simply because they do not aggressively implement growth strategies.
New market development has long been used as a powerful growth strategy. It is a four-pronged strategy that has proved effective for businesses looking at growing fast.
ADDRESSING A NEW MARKET SEGMENT WITHIN THE SAME GEOGRAPHY
A business can scale down its offering to lower its pricing structure to address a new market within the geography it already has a presence in. This strategy is effective if users already know your brand. For instance, software companies catering to businesses begin offering a home version of their program, priced significant lower, to address a different market segment.
REACHING OUT TO CUSTOMERS THROUGH NEW CHANNELS
Companies with a local presence can expand their reach to more customers by adopting new distribution channels. Increased penetration of the internet has made this easier. Maintaining an online store can be challenging and your company would need to develop the skills to respond to online orders and fulfill them without delay. New procedures may need to be incorporated to process online orders. Companies are increasingly using mobile apps to streamline such processes, says an article in the Huffington Post.
EXPANDING TO NEW MARKETS
This involves expanding your offering to more regions across the US. The greatest challenge in this strategy is setting up logistics across a wider region. This challenge can be overcome with the use of technology. For instance, Interconnect is a dispatch management software that connects businesses in different geographies, such that new business can be received from partners in other regions. Moreover, this helps ensure customer satisfaction across remote locations.
NEW PRODUCT PACKAGING
A company can repackage its offering to cater to a wider range of customers. For instance, a packaging that is bright and colorful with bolder fonts can be used to address younger customers, while the same product can have a more sober packaging to appeal to older clientele.
The implementation of growth strategies is often influenced by a company’s financial situation and ability to improvise. The good news is that technological advancements have made it easier and more cost effective to execute aggressive growth strategies. The internet has made it easier and cheaper to reach out to wider geographies and software has made it simpler and more cost effective to establish logistics partnerships.