When it comes to growing your business, we often jump to thinking about expanding into new markets. This can be a very good – and necessary strategy when the time is right. But, it’s important to also remember the challenges involved in expanding into new markets.
For one, a new market may be totally unfamiliar with you company or your products. They may not even be familiar with the problem that your company is providing a solution for, or that they have a problem at all. So, not only are you tasked with making a fresh introduction from scratch to this new market, you also might be stuck convincing people first that a problem even exists before you even can give them the reasons why your solution is the best.
Another potential disadvantage of expanding into a new market is that it might cause you to spread yourself too thin and neglect some of your existing customers. If you gain one new customer from a new market while you simultaneously lose a customer from an existing market, that’s a net loss for your company since customer acquisition generally costs more than maintaining existing customers.
Alternatively, before expanding into new markets, consider growing by shrinking. Not shrinking the size of your business or your operations, but shrinking your focus. Perhaps more accurately, expanding by narrowing.
When businesses look to expand, they often overlook their start by turning their eyes outward instead of looking at the market that is right in front of them. Before undergoing the time and expense of expanding into an entirely new market, consider the following three points:
Increase Market Share
Is it possible to increase penetration into the market where your efforts are already focused? Try to examine where you are falling short within that market and how you can serve this market better. Are there additional products or services you can sell to the audience you are already targeting?
It’s sometimes possible that the best way to increase your success in a particular market, is to narrow the definition of what that market is. By further segmenting, you can target your audience more specifically, and therefore speak to them more effectively. This can allow for much larger growth within a niche group than you would have otherwise had when taking a broader focus.
Your existing business can sometimes be the best source for new business. Take a deep dive into examining how satisfied your customers are in their interactions with your company and find out if there is any room for improvement. Repeat business that you are missing out on is just as important if not more important than acquiring totally new customers. The other way that increasing customer satisfaction can help growth is by turning your existing customers into brand ambassadors. The more pleased and excited your customers are with your products and services, the more likely they will be to want to share those positive experiences on social media, thus bringing other people within their networks into your company’s fold.
Expanding into new markets is going to be an important part of any business’s growth strategy. But before taking that step, make sure to take a closer look at what is going on with your existing markets. By re-doubling efforts on a group of people that is already aware of your company’s existence and the positive things about you, you can make new marketing dollars go that much farther.
Have questions about how to apply this to your marketing strategy? Contact us today!