In today’s business world, the pressure to grow is persistent and unwavering. A company must continue to evolve to stay innovative, relevant and competitive.
In almost every individual’s mind, growth is the definition of success. Whether it be a decision-maker, an investor or a customer, growth is something everyone craves to be a part of.
In part, it can be explained as a psychological effect, but the reality is, if a company is not growing, it is declining. So, how can a business keep growing even in a bad economy?
As a famous American author, Ralph Waldo Emerson put it, “This time, like all times, is a very good one, if we but know what to do with it.”
The strategies I’m sharing with businesses today are Differentiate, Advertise, Branch Out, Build Trust and Leverage.
Strategy #1: Differentiate
With the pool of total buyers shrinking in most markets, it is critical that you find ways to differentiate yourself from your competitors.
The temptation will be to keep doing what you’ve always done. But what worked up until now will probably not work as well over the next six months.
You can differentiate by:
*Making your product better than your competitors’ products.
*Making your advertising better than your competitors’ ads.
*Making your fulfillment better than your competitors’ fulfillment.
*Making your customer service better than your competitors’ customer service.
You can take almost any aspect of your business and step it up a notch to set yourself apart.
What can you do to differentiate? How can you restructure your offers, products, and distribution models?
If your competitors are all making similar claims, can you make a unique claim that trumps theirs? Or can you improve upon their claims by adding a guarantee never before seen in your industry?
Benchmark what your competitors are doing; then one-up them.
Strategy #2: Advertise
Whenever the market contracts, the temptation for most business owners is to reduce advertising. Their logic is this: A dollar saved goes straight to the bottom line; let’s reduce or eliminate advertising because that will save a lot of money.
This fatal error has forced many owners out of business.
The correct action is counter-intuitive. You should not reduce your advertising and neither should you maintain it. In a bad economy, you should increase your advertising.
After all, unless you have a sales team generating business for you, how else are you going to attract new customers and clients?
What can you do today that will get your advertising message to more qualified prospects? Can you run print ads in targeted publications? Can you invest in a word-of-mouth advertising program? Can you run a Google Adwords campaign?
Ask yourself these questions and more. Find the answers. And act on them. But by no means should you cut your advertising. Unless, of course, you are genuinely interested in becoming another casualty of the economy.
Strategy #3: Branch Out
If you take the time to analyze your business, you will find that about 80% of the profit is generated from the sale of one product or service. It is the classic 80/20 Rule: 20% of inputs create 80% of outputs and vice versa.
Obviously, it makes good sense to “ride your winners” for all they’re worth. If it is possible to increase sales of your #1 product or service, by all means, do so.
On the other hand, a business built on a single leg may be vulnerable in times like these. How can you branch out, develop multiple profit streams, and create more stability?
*You can enter a new niche by creating a new product and using a pseudonym.
*You can offer a new related product and persuade your customers to buy it (also called an “upsell”).
*You can figure out how to build continuity revenue into your current business.
*You can take on a new client who makes money in a different market than your other clients.
*You can make money on “dead” leads by referring them out for a commission.
These are just a few ideas for how you might branch out and diversify to stabilize your income.
Strategy #4: Build Trust
BusinessWeek reporter Peter Coy writes, “One lesson of the crisis is that nothing matters more to the global financial system than trust — and it is a fragile commodity.”
Coy’s observation is important because trust is not only important to the global financial system… it is equally important to your customers.
Now, more than ever before, trust is an asset you can’t afford to be without.
Unfortunately, as losses mount, the temptation for many will be to run after get rich quick schemes. The more financially desperate people become, the more willing they will be to justify whatever it takes to make an easy buck.
Don’t fall into this trap.
The best course of action is to become your customers’ trusted advisor. Always keep their best interests in mind. And do only what will further their safety and well-being.
If you commit to preserving and building trust, you will be greatly rewarded. Maybe not this week or next week or even next month. Yet planting good seeds will produce a harvest in due time.
Strategy #5: Leverage
Finally, consider how you might use leverage to grow your business.
There are three primary forms of leverage available to entrepreneurs: automation, systems, and people.
*How can I automate tedious tasks? Is there a product I can buy or a programmer I can hire to automate these tasks?
*How can I create easy-to-follow systems to define and streamline key business processes?
*Who can I enlist to help me grow, expand, and develop my business?
It is important that you focus your efforts on strategies that are already working. Throwing leverage at something that’s not working is like throwing more wood on a bonfire that hasn’t been lit yet. There’s really no point.
That said, leverage properly applied can work miracles for almost any business. Determine how you can use leverage to get more results out of business processes that are already working well.
Take Stock, Then Take Action
As you think about the five strategies shared here, which one jumps out at you? Which one would give you the result if you applied it immediately?
Obviously, it would be difficult to try to implement every strategy all at once. So pick one, take action, and see it through. Then move on to the next best strategy for you.
In this way, you can systematically achieve business growth in spite of the poor economy.