Ready to Take Your Startup to the Next Level? You Definitely Need a Growth Strategy
We’ve all heard of that inspiring startup story, where the CEO started out in a run-down apartment with 20 roommates only to become a gazillionaire four or five years later. You can think of countless startup successes from YouTube and Facebook to more recent ones such as Instagram and Snapchat. We all say to ourselves, “Why didn’t I think of that?” To be fair, before the Facebooks or Snaps of the world, these were simply ideas which were probably bashed for being unrealistic—that is, until they took off.
Then, there are the stories of many promise-filled startups who crashed and burned. One such example is Sophia Amoruso, founder of Nasty Gal. In 2016, she was listed as one of Forbes’ richest, self-made women. In addition, she has a best-selling memoir about her experiences which is becoming a Netflix series. If that isn’t a success, then I don’t know what it is. Yet, it also proves a cautionary tale—Nasty Gal is currently filing for bankruptcy.
It grew too quickly.
Of course, you must grow your business to increase profits. Still, there are many caveats and complexities which come with growth. Nonetheless, with a growth strategy, the crash and burn can be avoided. This is why it is critical to create a thoughtful growth strategy before you ever plan to take your business to the next level. You want to make steps forward, but they must be cautious.
It’s Never Easy
Turning a startup into a big business comes with its own set of issues. The truth is, many small businesses stay small. But, if you want to venture outside of the box, you must transition from startup to a thriving large company. The question is how to maintain speedy growth over the long-term.
According to the SBA, only half of startups survive longer than five years. After that, only one-third survive 10 years. The only sustainable means for growth starts with a tangible growth strategy.
“The only sustainable means for growth starts with a tangible growth strategy.”
Explaining a Business Strategy
This is a road map where you lay out extremely specific details regarding your company objectives. Then, you must define your methods for achieving your goals. You can’t get to “destination unknown” without a map.
In terms of a business strategy, it is important to lay out both short-term and long-term goals—with an eye towards 5 or even 10 years into the future. Remember that question, “where do you want to be in 10 years?” How would you answer that?
Why is it important to pen a business strategy? Simply put, if it is out of sight, it is out of mind. With a documented business strategy, you can share it throughout your company. This way, you have a guide that leads all decisions and initiatives. It ensures your daily decisions fall in line with your plan.
Still, your business strategy does not necessarily need to be set in stone. It is always recommended that you revisit your strategy on a consistent basis to make any necessary modifications based on historical data, new information, recent technological innovations and market shifts. Plus, it must fall in line with the needs and wants of your target customer.
Write Your Business Strategy
Now that you are ready to document your detailed plans, it is important to follow these steps to ensure it is as comprehensive as possible.
1. Pen your value proposition. What sets your company apart from your competition? Why do customers utilize your products and services? What makes you different and credible? Use answers to these relevant questions to establish your value proposition. What is the unique benefit only you can provide?
2. Set up short-term and long-term goals. Try to include both general and specific goals such as:
- Increase R&D
- Grow organic site traffic by 25%
- Create five tailored landing pages
- Launch in a new market
- Create a mobile business app
- Increase sales by 20%
If it helps, consider a brainstorming session with your company’s executives.
3. Rank your goals by levels of priority. Some of your goals may be more realistic than others. Then, there are compounding goals that can be reached only after you have achieved the goal before it. Moreover, there are immediate goals that need to be reached as soon as possible. Prioritize your goals based on a numerical scale, such as 1-10. This doesn’t mean you can’t aim to reach several goals at once, but it helps to ease any confusion about which goals you can and should target first.
4. Identify your target customer. If you haven’t already done so, this is an imperative action for achieving any measure of business success. In today’s consumer-driven world, you can’t be all things to all people. Personalization and engagement are what drives sales. So, think about who you are serving. What problem are you helping to solve? Who is your ideal customer?
What problem are you helping to solve? Who is your ideal customer?
5. Explain how you plan to reach your goals. You must now come up with detailed strategies for reaching your objectives. This may require new marketing strategies, hiring new staff, implementing updated technologies or all of the above. Here are some examples:
Objective: Increase organic reach by 25%
- Conduct research into your target audience–what keywords are they searching for?
- What sites does your target audience frequent?
- What types of advertising will expand your reach and focus?
- Hire a digital marketing campaign manager
- Launch a digital marketing campaign, and optimize your sites for search engines.
Objective: Launch a mobile app
- Conduct research around successful apps in your industry
- Review policies for launching your app on the various app stores
- Set aside a budget for your app
- Hire an app developer
- Launch a marketing campaign to advertise your app
When you go through this step, you might find that some goals may not be as easily achievable as you once thought. As a result, you should review where they will now stand on your priorities list.
6. Look at your competition. Regardless of your industry, you probably have competition doing well with something your business finds challenging. This is where you can take a look at your competition to help gain more insight into your business strategy. Try to understand what your competitors are doing which makes them more successful. On the other hand, what are they doing wrong?
7. Set timelines. Now that you have your objectives and methods for meeting them, you want to set a timetable for reaching them by priority. For short-term goals, this can be a month-to-month strategy. For long-term goals, you might look at achieving them by a certain year.
8. Make your plan strategic. If you intend to use your growth strategy for securing investments, then you should utilize a strategic plan template. This will have to include an elevator pitch and an executive summary.
Growth strategies to consider
There are multiple options for expanding your business. You want to choose one that works best for you, with the least amount of risk. Of course, it is important to determine beforehand how much risk you are willing to absorb. Here are a few widely-used growth strategies to consider:
- Add new marketing campaigns. Are your current campaigns engaging and encouraging interaction from your target market? Do you have something that can go viral?
- Take on more clients. There isn’t any question that you can boost your profits by increasing your client load. You might even look into account-based marketing.
- Launch in new markets. This can include everything from opening a new storefront or launching an online business.
- Create new products. You can certainly diversify your product listing. If you sell cat collars, you might want to venture into cat clothing.
- Widen your service offerings. If you specialize in text messaging encryption, it wouldn’t be much of a stretch to offer phone call encryption and even conference call and VoIP encryption.
- Try acquisitions. You can focus on buying companies that are a facet of your distribution chain. If you manufacture tires, you might want to buy retail stores that already sell your product.
A growth strategy isn’t meant to be one-size-fits-all. A successful plan must be specific. In order to keep your target audience coming back, tailor your growth strategy to their wants and needs. And, always be willing to change course in response to market feedback.