Running a stagnant business for a prolonged period of time shall not be feasible for anyone. In fact, in case the growth of a company slows down or declines, the firm can eventually go bankrupt. Hence, Steven Rindner to make sure of the longevity of a company, having proper growth strategies in place is extremely important. A growth strategy can simply be described as a plan of action that allows a firm to achieve a higher level of market share than they currently have. Contrary to popular belief, the growth strategies followed by a firm are not necessarily focused on short-term earnings, but can also be meant for the long-term.
Business growth strategies are some of the vital sets of strategies that are needed to be developed to facilitate and maintain the growth of a firm. As per Steven Rindner, these strategies must be aligned with the aspirations of a company, its values, vision and mission, in particular in order to be optimally effective. Growth strategies typically start off by identifying and accessing opportunities within the relevant market of a company. They usually go beyond the typical business and marketing plans that are meant to detail how a firm can meet its particular business targets. Growth strategies keep a company working towards goals that go beyond what is happening in the market today, and compel it to be focused on the long-term picture.
Here are some of the major types of business growth strategies followed by modern companies, according to Steven Rindner:
- Market penetration strategy: A company following such a strategy shall direct its resources to the profitable growth of existing products in the market. Market penetration strategy is focused on increasing sales from current customers by encouraging them to use more, magnetizing patrons towards existing company products from the competitors’, as well as converting non-users of a product into users. Firms usually try to boost their market share for present products through methods like sales promotion, as well as effective customer support and after sales service etc.
- Market development strategy: Such a strategy involves introducing the present offerings of a company in a new geographical area. The marketing efforts are made on existing products, while adding different channels of distribution or by changing the current content of the advertising.
- Product development strategy: This strategy includes the growth in the market with the help of considerable modifications of existing products, as well as of the creation of new but related offerings that can be marketed to current customers through established channels
In addition to the strategies mentioned above, horizontal integration strategy has also become quite popular in recent years. This strategy is applicable when two or more companies dealing in similar lines of activity come together to give a boost to their overall growth prospects. The combination of two or more business units typically results in greater effectiveness, productivity and efficiency.