The current global economic climate set the rhythm of business closures, takeovers and acquisitions. Competition is fiercer than ever combined with the fact that 70% of small businesses will fail within the first five years of operation.
Notwithstanding, most businesses are still striving and growing in any economic climate. These businesses have created full proof strategies for business success, and marketing is always the essential part of business growth. Marketing is everything for any business, with proper planning, execution and monitoring tailored to the company's goals, growth comes without breaking a sweat.
There are many ways of growing a business, most of which can be quite complicated and expensive for small business owners. To keep it simple, there are three major ways of growing a business.
1. Generate more customers/clients
2. Increase the number of purchases of each customer/clients
3. Increase in the value of each customer/client
(1) The ways of generating prospects are many, print, media, word-of-mouth, social media, e-mail marketing, etc. The effectiveness of each one depends on how many marketing pillars a company uses. The aim of generating more prospects should be converting them to actual customers because what is the point of letting people know about your business without capturing their need to purchase? Sure feels like inviting everyone to dinner without entertainment. Simply by integrating a company's USP into all marketing attempts, would help increase the conversion rate of prospects to customers.
(2) By increasing the number of each customer purchase is a sales strategy most businesses have found success in, most especially in the food and retail industry. In retail, it is called "Link Selling", whereby, a customer decides to buy one item (i.e a top), but other products are introduced to the customer that goes in hand with the initial purchase. The food industry are experts at this, gone are the days where you step into McDonald's for a burger, but now, you are encouraged to buy a meal that consist of fries and a drink instead.
(3) The third way, which i consider the most important is the increase in the value of each customer. Business owners need to see their customers as Lifetime customers. Analysing products/services being offered your clients is a way of measuring the value of each customer.
Implementing each method all depends on the business goal. The important thing to consider is your approach to each method. For example; A shoe retailer decides to grow his business by 10%. If he has 300 prospects with a closing rate of 30% which equals 90 customers and the average purchase price of each customer is £200 giving you £18,000 gross sales.
So, if he decides to increase just the average spend of each customer by 10% without doing nothing to the other areas the result would be;
Total number of prospects= 300
Closing rate= 30%
= 90 Customers
Total Number of Customers = 90
Average customer spends= £220
What happens when you apply 10% to all three areas? Only one answer; BUSINESS GROWTH!!