A growth strategy is a set of principles companies use to increase their market share. A good growth strategy not only gives a company direction, it helps focus employees so that everyone in the business is united around the same goals.
Creating a coordinated and fitting growth strategy is, therefore, an important part of business. So what options are there and what do different strategies tell us about businesses and their goals?
Different growth strategies
Broadly speaking in B2B marketing, strategies for growth fall into two main types, Inorganic growth which usually involves partnering with another organisation to ‘get bigger’. Or Organic growth where companies work to increase market share by selling more. According to the business website Study, companies will invariably select from 4 strategic approaches in B2B marketing to grow their sales.
- Market penetration is increasing sales of current products or services to existing markets
- Market development is increasing sales into new markets using current products or services
- Product development is increasing sales by adding new products or services
- Diversification is entering new markets with new products or services
The Telegraph states that today, 60 percent of start-ups fail within 3 years and 20 percent fail within just 12 months. Of course, there are many factors that impact the viability of a new business, not least market forces, but one of the things that can make or break a new venture is choosing and expediting the right growth strategy.
What a growth strategy tells us
The path a company chooses will depend on the type of growth they want to achieve and this can tell us a lot about their long term goals and ambitions. For example, a business that wants to appeal to a broad swathe of customers may opt to diversify its product line, increasing the variety of services offered so they have something for everyone. Alternatively, a company that wants to earn itself a reputation as a specialist within its industry may focus on product development in the hope that they’ll create products that offer the consumer something different.
The growth strategy a company chooses tells both its customers and its rivals the direction in which it intends to go. Analysing the different directions that competitors have taken should give business owners an idea of their long term goals and could also inform a business’s own growth strategy.
How to develop a growth strategy
Almost all growth strategies rely on customer interaction and market research in one form or another. In order to develop new products, move into new areas and boost brand awareness, businesses need to understand their market base, communicate with their customers and listen to feedback.
The most effective way to carry out this research, and keep lines of communication open, is to invest in a telemarketing campaign. A fast and reliable way of gathering important information and boosting brand awareness, telemarketing can help you to achieve your long term growth goals.