In the 21st century, the corporate world has set new bars for itself, which has pushed every organization to extend their usual limits, go beyond their comfort zone, and compete with various businesses.
Every business has some common goals. No matter the type of the company and product, there are basic goals that establish the business. These goals include profit, survival, growth, etc. One of these most success-pointing indicators is growth.
Business growth is defined as an indicator for an organization in terms of expansion of any type like geographical expansion, product diversification, etc. But, there are numerous challenges that lie ahead of growing. In order to tackle these current and future complexities in the growth process, companies adopt a growth marketing strategy.
In simple words, growth marketing strategies involve identifying, evaluating, and assessing any hurdles in accomplishing the expansion or growth goals, such as introducing a new product or product line, acquiring new assets, capturing market share, etc.
These strategies range from pricing policies to transformation in marketing tactics. The process can occur and be applied in any field, leading to the organization’s growth. However, the ultimate aim of different growth marketing tactics is to enhance the overall revenue system. It keeps customers in the focus point and revolves their decisions around them.
Advantages Of Growth Marketing Strategy
Apart from overcoming the extremities of the market, there are many other benefits of incorporating these tactics. These advantages are highlighted in the following section.
Enhanced Decision Making
This type of marketing helps a marketer attain a complete satisfaction level with their decisions as there is more real-time analysis of an alternative. Unlike traditional marketing, people utilize online platforms to expand their business, which means that they have enough time to check whether the online presence is working for their business profitability.
Businesses can push their products through digital ads giving better flexibility to their decision-making process. There are fewer restrictions faced while shifting to the digital medium. Moreover, marketers can have better access and reach the target customers through growth marketing compared to traditional low-targeted traditional marketing.
Builds Brand Loyalty
This expansion technique helps influence customers and create a sense of belonging to the brand. It not only captures the existing customers, but also attracts new customers. The process understands the customer profiles, delivers a consistent message, and sets personal relations with the potential customers. Eventually, it improves the overall company reputation.
Boosts Revenue
The fundamental objective of these strategies is to minimize costs and boost the revenue system. Even if the former is not achieved, the emphasis is more on increasing the company’s revenues.
Improved Flexibility
As stated earlier, organizations can modify their strategy according to consumer and market responses. Apart from this, they can analyze their cash flow pattern and judge whether to drop the growth marketing strategy or continue with the same.
Integrates Different Teams
Successful execution of various strategic processes requires a unification of different teams. Various teams like the customer support team, analytics, production department, etc., should be coordinated to achieve maximization goals. Therefore, growth marketing brings all the key teams together.
Strategy For Combining New Markets With New Products
There is a popular expansion grid given by Ansoff to position a business’ growth strategy. The grids are categorized according to the products and the markets like existing/new products and existing/new markets.
When a company addresses existing markets with the same bundle of existing products, it is called market penetration. These low-risk tactics mean delivering goods at low prices to increase market share.
Similarly, when the existing market is tapped using new products, it is known as a product development strategy whereby new features to products are added, technological additions are involved, etc.
Contrary to these, when existing products are catered to new markets, it is called the market development phase. This plan involves unveiling different potential markets that were previously unidentified. Lastly, when new products are delivered to new markets, it is called a diversification strategy. It involves high risk as it gives a complete new dimension to the company.
Diversification
When a company enters new markets through the development & creation of new products with the aim of increasing profits is known as a diversification strategy of growth. The most crucial characteristic of this tactic is that it comes with high risk and high returns. If the diversification process fails, the company will face extreme downfall and vice versa.
Examples of this expansion goal can be a cosmetics brand catering to adult females with new categories of lipsticks or products. Another example can be a fast food restaurant entering the packaged food industry to capitalize on brand visibility.
There are majorly three types of diversification strategies, listed hereunder:
- Concentric diversification: It refers to introducing new products similar to the existing product line. Example – An ice cream parlor decides to introduce an exotic flavor to the existing flavors or when it only sells ice cream cones and introduces ice cream cups to the product line.
- Conglomerate diversification: When a company introduces a product completely different from the existing product line, it is called conglomerate diversification. Example: A smartwatch company introducing their own fitness brand selling sportswear, gear, etc.
- Horizontal diversification: This strategy involves selling somewhat similar products to the customers. For example, a chair manufacturer making tables or a plant seller launching different flowers and pots.
Advantages & Disadvantages Of Diversification Growth Strategy
There are various benefits of applying this tactic. Some of the most impactful merits are highlighted below.
- This strategy helps achieve agile profits as revenue is not only increased through existing products, but also through new products in new markets. Therefore, there is a high increment in sales and revenue.
- As a result of increasing revenue, this tactic helps attain great market share.
- Moreover, brands can identify new channels of revenue and communication. They can diversify their products through online channels as and when required.
- When the product offerings are diversified, the scale of changes or damage also reduces. The changes in the industry affect the business on a small scale.
Some of the most experienced disadvantages of this strategy are:
- It may lead to less focus and specialization in the core business offerings. It will also spread the emphasis to different products.
- Businesses entering into new product dimensions will need adequate knowledge for excelling; else will lead to cost increments.
- Many brands face the problem of consistency while diversifying their operations.
Companies usually adopt diversification strategies for three major reasons. These are for reducing and spreading market risk, protecting from extreme competition, and increasing profitability in a short period.
Ways To Apply Growth Marketing Strategies
There are many gateways through which a company can implement its growth strategy. The most common platforms or ways are described below.
Executing Content Marketing
As many people say that content is the king, and it is powerful enough to drive customers to a platform. It can move the target audience by engaging them in the information or content. If a business is established in the offline mode and has reached the boundaries of growth, content marketing is an ideal solution to kickstart its growth process.
Focus On Customer Relationship Management
Many businesses build a community around their brand offerings where loyal customers meet and create an atmosphere ideal for a business to grow. This community building can be attained through effective customer relationship practices. Organizations should involve and respect customers in order to get their loyalty in return.
Hitting Customer Pain Points
When a business fails, the most probable reason for the fall can be its poor addressing of customer needs. The same ideology goes for limited growth. When businesses do not innovate while addressing the pain points of the target audience, they will suffer losses or face stagnant growth. It is crucial to rank the business regularly using free tools like Hubspot’s free tools, etc.
Keywords & Visual Appeal
Brand visibility is a significant component essential for business growth. A company can upgrade its brand visibility and boost brand awareness through attractive visual appeal. Moreover, include keywords associated with your business to engage customers in your product array.
YouTube Ads
YouTube has emerged as the modern-day armor of digital competition. It has given businesses various reasons to join the platform’s community for wider and better reach. If a brand looks to expand its products’ visibility, placing ads on YouTube can garner massive attention. However, it will require proper resource allocation.
Using AIDA Model
When a business attempts to grow its business horizon through online platforms, it is important to analyze different metrics like Google Ads analysis, keywords metrics, and many other such factors to select the most appropriate growth marketing strategy.
Apart from this, an organization should also research and understand various alternatives using different techniques and tools. One of these tools to design objectives for a successful strategy is the AIDA model. It takes four factors or stages into account. These are the phases a buyer goes through while purchasing an item.
- Awareness – This stage is the first stage where the purchaser gets information about the product, service, or company through various sources like newspapers, television, social media, hoardings, events, etc. At this level, a marketer carries all the push strategies where they try to raise brand awareness from all the possible platforms.
- Interest – The interest phase occurs when the information attracts the customers and forces them to get more details about the company and its offerings.
- Decision – At this level, a consumer decides whether they have to buy the product or service or not. They research different competitors and consider various factors before making a favorable decision. Companies should understand and predict a customer’s actions in this stage and prepare in advance for this stage.
- Action – In the action stage, the customer finally purchases the product or service. This is the company’s ultimate aim, and once it is achieved, the growth strategy becomes successful.
Conclusion
Businesses majorly aim to earn more revenues and enhance their market position by growing regularly. Once a company records stagnant growth for a long time, it exposes loopholes to potential customers.
The guide above gives a detailed analysis of how a company can plan a successful growth marketing strategy and what are its benefits. However, growth is not the only driver of corporate success. Simultaneous cost-cutting is also a prerequisite for driving and channelizing this upgrade process. Companies should get in-depth data to choose the best growth marketing strategy in 2022 to capitalize on the market opportunities.
