Types of Growth and Expansion Strategy | International Executive Consulting LLC

What is the development strategy?

A growth strategy is an action plan that allows you to achieve a higher level of market share than you currently have. Contrary to popular belief, growth strategies do not necessarily focus on short-term earnings; Growth strategies can also be long term.

As an action plan, your development strategy should include the following components:

• Goal: What do you want to achieve?

• People: How is each department affected by your goal?

• Product: Is your product positioned to help you achieving your goal?

• Strategy: How will you work towards your goal?

Types of development strategies:

You know you need a growth strategy, so... what should it be? There are four classic types of growth and expansion strategies that companies may use one or more of the following.

• Product Development Strategy: To increase your market share by developing new products to serve that market. These new products should either solve a new problem or add to an existing problem solved by your product.

• Market Growth Strategy: Increase your market share by developing new customer segments, expanding your user base, or expanding your current users' use of your product. This strategy is sales focused.

• Market Penetration Strategy: Increase your market share by bundling products, lowering prices, and advertising – basically everything you can do through marketing once your product is built. This strategy is often confused with a market development strategy, but the approaches differ in their emphasis on sales or marketing.

• Diversification Strategy: Increasing your market share by entering completely new markets. Instead of expanding into your existing market, you are launching into a new market with new products or services into the unknown. This strategy is often the riskiest but can have huge rewards if successful.

These strategies are big concepts. You may be reading them and thinking, "Okay, these are interesting, but how can we actually apply them to our business?" Do not worry. We're here to help!

One approach, we like to take is thinking of strategies in terms of customer lifecycle phases: acquisition, activation, advocacy and retention. By looking at your growth and expansion strategy through the lens of a lifecycle phase, you can focus on a specific strategy, such as "How can I implement a strategy to increase customer acquisition and achieve better market growth?"

For more information, visit International Executive Consulting LLC. We are one of the best growth and expansion strategy consulting companies in the United States.