by Mai Fenton, CMO of Superscript
So you’ve started your business, and you naturally have big ambitions for it. It’s estimated that 20% of businesses fail after their first year, so clearly growing a business past its earliest stages is no easy task. As the business owner, the growth strategy ultimately sits with you. The plan you put in place will depend on your business model, industry and the business life stage. Remember, a growth strategy that works well for one business won’t necessarily replicate that success for another.
With that in mind, there are two key areas you should look at if you want to grow – growing your customer base and diversifying your distribution channels. Here are some thoughts about how you might do both – if none of these are right for you, don’t worry!
There are plenty more ways to grow, and you can find additional strategies and advice about growing a business in Superscript’s Big Guide to Entrepreneurship.
1. Build visibility.
This is largely a marketing-driven strategy, and so it’s focused on customer growth. It is an approach that should really be an ongoing process for every growing business, but is particularly popular among early stage businesses as they try to spread the word amongst their target audience and grow their reputation. At the start of your lifecycle, there will be many potential customers who aren’t aware of you because you’re not on the channels where they spend their time. This strategy involves building up brand awareness in channels where your brand has low visibility and a significant potential customer-base.
It could mean investing in traditional marketing channels such as PR, events or out-of-home advertising like billboards. Or, if your customers are mainly online, it could mean focusing on an SEO content strategy to ensure you come top of Google search rankings for your services. Depending on the kind of budget you have to work with, you could also look to accelerate growth through paid online advertising. The key here is to focus your resources on where your customers are.
2. Move into new markets.
This strategy is about getting in front of a new audience by expanding where your product or service is offered. Meaning the opportunity for customer growth lies in a new market. This is usually a strategy for businesses who have already established themselves and built a reputation in their local market. This could mean moving from a local scope to national scope, or from national to international. The trick here is to be able to engage with those customers in the right way once you’re there. One way to do this is to hire local employees and specialists who understand that market, or look into appropriate marketing strategies that appeal to the new audience.
3. Build your distribution channels.
For early stage businesses, this is a path they often go down if they are looking for more avenues where they can sell their product. The idea is simple: the more distribution channels you have, the more products you can sell. Think about it as if you’ve just started an online retail brand. You have a website but you’re not getting enough traffic to sell enough units. Setting up a shop on Etsy, Ebay or Amazon might be a solution to increase your sales as they have lots of traffic. By selling through these websites, you would have grown a distribution channel.
Similarly, if you are a B2B business, you might consider partnerships with brands in your space that align with yours and grow sales by accessing each other’s customer base. It is important when you look to build your distribution channels to do a cost/benefit analysis to ensure they aren’t too expensive so they offset any sales you make, and make sure they reach a large chunk of your target audience. They have to be worth your while.
4. Expand your product offerings.
The final strategy is another product/service-led one, but this time for more established businesses. It involves expanding your offerings beyond your current capabilities. This may be a good option for you if the size of your market is small or saturated, and there is little opportunity for growth beyond the customers you already have. What new products or services can you create based on your original idea? Can you upgrade what’s existing? It’s usually best to execute this strategy once you’ve built a good reputation and perfected what you’ve already got. That will give you the legitimacy and authority you need to engage seriously with your target audience on new offerings. An added benefit is that it gives your customers freshness and keeps your business top of their minds. An example of a company that has done this incredibly effectively is Amazon – originally starting out as an online bookstore, it diversified its offerings into areas like SaaS cloud management and groceries!
If you’re feeling confident and you’ve got a good team behind you, you could tackle some if not all of these strategies. However, you will need a good understanding of the market in which you operate so that you can tailor your strategy according to the opportunities that you have identified. Additionally, use customer feedback to inform your decisions. Happy customers will be loyal to your brand and buy more products/services if you’ve listened to their requests.
Mai Fenton is Chief Marketing Officer for Superscript. Mai has extensive experience of scaling brands and driving growth across businesses from start-ups through to multi-million pound enterprises, with a diverse background which spans consumer goods, lifestyle, retail, ecommerce and tech. For Superscript, she has overall responsibility for growth marketing and brand building.