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Growth strategy


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Most companies have plans to grow their business and increase sales and profits. However, there are certain methods companies must use for implementing a growth strategy. Growth strategy is a long-term approach which are implemented by companies to expand their business depend on financial capabilities, competition level and SWOT analysis. The main Growth Strategies include as below:

Market Penetration

Market penetration strategy is used when we want to expand existing products within the same market. In other words, increasing marketing performance with current products or services in the market they are already operating in. One of the best solutions for doing this is incensement of market share by decreasing the prices or other methods.

Market Expansion

A market expansion growth strategy, often called market development, entails expanding into a new market using current products or services. There several reasons why a company may consider a market expansion strategy. First, the competition may be such that there is no room for growth within the current market. If a business does not find new markets for its products, it cannot increase sales or profits.

Product Expansion

A company may also expand its product line or add new features to increase its sales and profits. When companies employ a product expansion strategy, also known as product development, they continue selling within the existing market. A product expansion growth strategy often works well when technology starts to change. A company may also be forced to add new products as older ones become outmoded.

Diversification

A strategy based on Entering a new market with a new product or service which can be very risky, time consuming and costly strategy. Implementing this strategy depends highly on marketing research because a company will need to determine if consumers in the new market will potentially like the new products.

Acquisition

In acquisition strategy, a company purchases another company to expand its operations and market. A company may use this type of strategy to expand its product line and enter new markets. An acquisition growth strategy can be risky, but not as risky as a diversification strategy. One reason is that the products and market are already established. A company must know exactly what it wants to achieve when using an acquisition strategy, mainly because of the significant investment required to implement it.

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