When your business has reached the limits of capacity in your current market it could be time to expand. Small business expansion is the natural next step for a successful business but it’s also a different proposition.
Expanding your business is less about keeping costs down and revenue high, and more about investing in the right way and marketing to gain a foothold in new markets with different products.
Market Penetration
Market penetration is the process of breaking into new and existing markets as part of a growth strategy. There are several techniques to help your small business to increase its market share and compete with existing companies. These include advertising, bundling products into attractive packages, and lowering prices or offering discounts to beat the competition.
To break into a new market you need to persuade customers that your product or service is worthy of their time and money. Since no-one knows you, you need to give them an idea of what you’re about. The way to do this is to implement an effective marketing and advertising campaign, lower prices – though it may seem counterintuitive, and offer excellent short term deals.
If you don’t have a new product to help you break the market with a conventional product you need some creative strategies to make up for the lack of persuasion. You can lower your prices and offer excellent short term deals that competition can’t match, or you can bundle products together and offer a complimentary package. Do your market research and decide what is the best point of entry for your expanding business.
Professional Answering Services
If your small business deals with call handling then you will have to consider your capacity if you want to expand. Many small businesses have a core team of call handlers offering professional brand-specific services to customers often it’s a level of service they have come to expect and it’s a problem when looking to grow the business. How do you maintain the same level of service but handle more calls?
The answer is professional answering services that can supply your business with as many call handlers as needed for your expansion project. These call handlers are located in various parts of the world but they speak clearly and provide an excellent point of contact service for your customers. The call handlers will be fully trained on your brand’s credentials and will offer you the highest level of customer support as you grow your brand into new markets.
Market Development
Market development is the process of breaking into new markets with new products or diversifying existing ones so that your brand gains a reputation. Market development can be used to promote new products and services or launch them in a new geographical area. You might do this if your current market is saturated or you’re struggling to attract clients in your existing market.
Growing your business does not only mean creating new products and selling them in new markets, it also means maintaining your presence and reputation in a marketplace and extending it outwards. Big brands like Nike, Coca-Cola, and VW do this with large scale advertising and diversifying products continually. Smaller businesses don’t have the same resources but they can mimic the strategies.
Smaller businesses looking to expand using market development methods might consider their products and how they might be rebranded or diversified to appeal to a different target audience. For instance, a restaurant might decide to offer catering as well or take-out delivery. Market development is all about finding new opportunities for the products and services you are presently known for.
Alternative Channels
Alternative channels refer to the advertising and customer contact channels a small business uses predominately. Traditionally these channels were somewhat limited, especially for small businesses without the resources to advertise on television. Instead, they used newspaper adverts and billboards. With the Internet, more channels have opened up.
Today the top three marketing channels are email marketing, social media, and websites. These channels are especially important for small businesses who predominantly use them as effective budget-friendly ways to connect with target audiences. That said, it is common to find small businesses overusing one or more of these channels and neglecting common expectations – for a website, for instance.
If you want to expand your business you need to make use of all available channels in some way. Of course, there will be some channels that are more popular and effective for you, but diversifying the business also means bringing new customers onboard and they might have different preferences. They might expect a website, for instance, for basic information, if you don’t have one it might affect your reputation moving forward.
Product Expansion
When you expand your small business you need to think about some new approaches and strategies that work for bigger names in your industry and big players historically. You might be able to generate interest in a new product for instance, but what will you do when that interest starts to wane and you find yourself all out of ideas?
The first thing not to do is panic, many businesses and marketing departments have been in the same positions for decades and centuries. That’s good news, it means there are some tried and true strategies to help you develop new product lines and maintain the interest in your brand. Examples include Coca-Cola who introduced Cherry Coke in 1985 and Gillette who continually diversify their existing product.
What does this mean in practice? It means that if you have a product or service that is on the slide you need to look at fresh ways to re-engage your target audience. They may just have grown tired of your marketing efforts or bored of the products style. Try rebranding it or bringing a new style to it. You can then launch it with an entirely fresh marketing campaign.
Market Segmentation
Another excellent small business growth strategy is market segmentation which can make your business more efficient and grow it in a controlled and progressive manner. Market Segmentation is the process of dividing your target audience into demographic, geographic, psychographic, and behavioral segments and advertising to them based on specific criteria.
When you have your target audience segmented in this way you can communicate with them based on personalized criteria. Based on this information, you will know a customer’s specific preferences, the products they like to buy, when they shop, and their online behavior when they visit your site. A more personalized service from you means better customer retention and an enhanced reputation.
If you have issues segmenting your customer base or you aren’t getting the result you expect from. The segmentation strategies you might consider using a good Customer Relationship Manager (CRM). These digital tools will allow you to automatically segment your audience based on analytical data giving you better interpretation and more time to spend growing the business.
Partnerships
You don’t always have to grow your business on your own, there are several ways other companies and businesses can support you through effective partnerships. These partners might be able to provide you with investment, market-entry, or customer acquisition. You might also develop a more effective IT infrastructure by partnering with a Managed Service Provider (MSP).
The tendency is to go it alone when expanding your small business. This standing reason since it’s what you’ve done all along. But growing your business is a new challenge with new demands. You have to think big and implement new strategies that may involve investment and speculation. If you follow the strategies outlined on this list you’re sure to make a strong and effective start to your small business expansion.
