Organic growth is a good strategic choice for new businesses or small businesses entering a new market with insufficient inventory. The more organic growth you achieve, the lower your marketing costs, and the more you invest in further developing your brand, developing new products, and meeting customer needs. Growth can be achieved through practices such as adding new locations, investing in customer acquisition, or expanding product lines. The business growth strategy also includes diversification, where a small company sells new products to new markets.
Small businesses can also use a market expansion strategy if they find new uses for their product. For example, companies offering relatively versatile products (such as home cleaning companies or office supply stores) may benefit from adopting this market penetration strategy. Periodic packaging changes and product modifications or upgrades can also help you enter new markets.
If your small business has growing consumer demand that it cannot meet, expanding your product or service may be the best strategy for growth marketing. To gain market penetration, you will want to drive customers away from competitors and redirect them into your business. The goal is to stimulate brand loyalty and customer loyalty, perhaps by increasing brand awareness through a marketing strategy, implementing broader product / brand promotion, or applying more competitive pricing. Common techniques include lowering prices or using techniques such as direct marketing to raise consumer awareness of your offerings.
The strategy assumes that market growth can be achieved by making major modifications to existing products or creating new products that can be sold to existing customers through established channels. Diversification-This strategy creates new opportunities for the company by creating new products and new markets. Using one of the above-mentioned product development strategies usually leads to new potential customers, sales to existing customers, and natural growth in market share. If a company believes that its advantage lies in the product and believes that its product will attract new customers, then the company may wish to adopt a market development strategy.
In other words, a market development strategy helps growth-stage companies identify and develop new opportunities to sell their current product line in previously unexplored markets. While market penetration is the least-risk growth strategy, market development comes second because, unlike product development and diversification, these two strategies do not involve the extremely risky nature of developing and selling a new product. A company pursuing a market penetration strategy is focusing its resources on the profitable growth of existing products in current markets.
Marketing Penetration – This growth strategy leverages current products and markets with the goal of increasing market share. Looking at the image above, we can see that a market development strategy is a business growth strategy that involves adding existing products to new markets. Examples of strategic growth strategies range from new product launches for a product line to marketing strategy updates targeting a specific new market audience.
Internal growth is not about investing in the expansion of production and business development, but in a more targeted use of resources. Internal development can take the form of investment in new products, services, customer bases or geographic markets, including international expansion. Diversification strategies are used to expand business operations by adding markets, products, services, or production steps to existing businesses. Diversification adds a growth strategy to the business portfolio, which is pursued when the company’s growth goals are very high and cannot be achieved in existing products/markets.
A merger strategy is applied when there are adequate growth opportunities in the firm’s current market space. Concentration implies expansion within the existing line of business. The expansion strategy of the merger includes maintaining its current position and expanding the product into the current market space in order to achieve growth goals.
These strategies include product development, market development, diversification and market penetration. Well-implemented growth and business expansion strategies will allow your business to gain a large market share. Even if it means a short-term financial hit, they can put you ahead of the competition and keep you there in the long run. Finally, by building a solid business development strategy, you can breathe new life into your business in any market.
Ideal market development strategy methods will look different for every business, so you should think about this type of strategy in a way that best suits your business and the type of product or service. To increase your user base and activation rate for your products, your business must be methodical and adapt the strategies you read about to suit your unique product, problem, and target audience. If your business is looking to expand, a market growth strategy will allow you to chart an expansion path based on your industry, target market, and finances.
The company will use the development of the market to enter different market segments to gain more popularity and more customers buying their products; this is how most companies make the most. It’s not always good to stay in a market segment, especially if you want growth and profits.
Market development is a popular strategy for urban businesses as many markets abound and are easily accessible in urban centers. Market penetration tactics are usually applied to an existing customer base that is already associated with your product. The overall goal is to attract new customers in the same market and increase the speed at which existing customers shop from your business. This usually results in a very fruitful and consistent customer experience for both parties and can be a great strategy for long-term growth.
This can be a fairly simple strategy since you already know your market and you have loyal customers, so it can be as simple as selling them an additional product to what they are already buying from you, for example, often much cheaper if current customers are happy. instead of creating a new marketing strategy targeting a different clientele. When small businesses adopt a product expansion strategy, also known as product development, they continue to sell in the existing market. New distribution channels are among the top 10 business growth strategies because they drive revenue growth without changing the product.
For more examples of market strategy beyond SaaS, we can look at sports brands like Adidas and Nike, which continue to expand their global reach and reach a new demographic with their existing footwear. A significant benefit of a product development growth strategy is that you can leverage existing customers instead of having to create a new market.