Did you know that only half of businesses make it past 5 years and only one-third survive more than 10? These stats mean that most large corporations don’t have the one thing that could help them achieve sustainability - an effective growth strategy.
A growth strategy is completely different from your yearly business plan. It can be tough to develop it if you don’t know what it is, its importance and the key steps to creating it. Here’s what you need to know:
Growth strategy: what is it and why is it important?
A growth strategy focuses on how your business will evolve to address the challenges of not just today but also the future. It offers your corporation a clear purpose and direction and addresses issues regarding your long-term plans. It begins by discovering and evaluating opportunities in your market.
A growth strategy is crucial because it allows your business to keep working towards its goals and keeps both you and your employees focused, pushing you to move from short-term to long-term thinking.
How to create an effective growth strategy
1. Determine a value proposition and product development
One surefire way to help your business maintain long-term growth is by determining what differentiates it from the crowd. Find out why customers love your offerings and identify what makes you unique and trustworthy. You can then use these findings to convince other potential customers to do business with you.
In addition to this, product development might be the next step for your business. It’s crucial that you expand your market and even find new ones, otherwise the profit will likely stay the same. New applications or changes in a product will benefit your business growth strategy.
2. Find out who your ideal customer is
Why did you get into the business? The answer is simple: to address a problem for a specific audience. But are you still achieving this? Find out who that audience is and whether it’s really your ideal customer. If not, you need to do thorough research on your target audience, so you can discover your ideal customer and go back to solving their problems as you reorganize the business to foster growth. Even as a larger corporation, still need to evolve if you want this strategy to.
3. Identify your key indicators
You must be in a position to measure change. Otherwise, how will you know whether your growth strategy is delivering the desired results? Make sure that you’re tracking all the success that you get, even the smallest details. It’s important that nothing goes unnoticed; find out which key indicators impact your business growth and put time, effort and money into those areas.
4. Evaluate your revenue streams
How do you currently make money? Are there other ways of making money you can add to your business to make it more profitable? Are these potential revenue streams sustainable in the long-term? Keep in mind that an idea or product may sound great but might not have the potential to generate revenue long-term.
Depending on the type of your business and market, you can make money by selling a subscription, billing on a per-use basis, relying on advertising only and providing different pricing levels to meet the needs of different customers. Pay special attention to the marketing strategy that you use - it’s often a good idea to partner with SEO experts who will cover this part for you.
5. Measure yourself against the competition
Your business doesn’t exist in the market alone and some competitors might have better growth strategies than you. As a result, it’s important to constantly check how your strategy measures up to those of your competition. You also need to benchmark your offerings against similar products and/or services at peer companies.
Pay attention to your competitors’ growth strategies. Highlight the moves they’re making in the market and weigh them against your own. How are they marketing their products differently? What unique variables are they seeing? Be sure to ask tough questions and actively look for unique ways to sharpen your strategy.
If you’re starting a podcast, for instance, you should listen to several leading shows in your niche and identify what they’re doing differently. Familiarize yourself with their mode of operation and think about ways to give your podcast an edge over the competition.
6. Pay more attention to your strengths
Paying more attention to your strong points rather than finding ways to improve your weak points may sometimes be all you need to do to develop growth strategies that deliver remarkable results immediately. Adjust the playing ground to align with your areas of strength and invest more time and effort in them to help your business sustain steady growth.
7. Hire the right people
Human capital is an important part of an effective growth strategy. You need the right team to successfully develop and implement strategies, so it’s crucial to invest in hiring and retaining the best talent that can surpass your expectations when it comes to performance. They must have the necessary qualifications, substantial industry experience and have previously held strategy positions or served in a strategy team. They must also have the right characters and values that align with your business’s culture.
If your team can’t invest time in this task, you can outsource your HR services to a Professional Employer Organization (PEO). Global PEOs are especially useful if your growth strategy has global expansion on its agenda. If you’re expanding in Germany, for instance, you can partner with a German PEO, to recruit, hire and manage your talented German workforce without having to set up a legal entity.
Building a growth strategy that works immediately is a tough task, as you can’t copy and paste what seems to be working for another business. Instead, you need to customize your strategy and make it flexible for your corporation so that it can cover any possible contingencies.