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7 Essential Elements to Small Business Growth

Business plans are great, useful even, but the planning process and a growth oriented plan of action is where it’s at for the small business.

A growth strategy planning approach forces you to focus on customer based strategy, high priority objectives and measurement of the things that actually impact your ability to reach your growth goals.

Every business that has growth in mind should make quarterly planning the practical and useful vehicle that it is.

The following seven elements and associated questions make up the foundation for brainstorming, questioning and organizing your growth planning strategy sessions.

growth strategy planning poster

Divide a white board into seven segments and pass out post it note pads to all participants involved. Then, just start asking questions. Let everyone vote with their ideas in private then start posting and discussing the thoughts as a group.

1) Ideal customer (IC) – How would someone spot our ideal customer? What do they look like, what do they think, where do they live, work and play? How do we locate them? What is their pain? Is there a behavior that signals they are ideal? What triggers their desire to solve their problem? What do they get when they hire us?

The goal of this phase of planning is to complete a picture of the ideal customer – one that values your unique approach. Look to your most profitable clients that also tend to refer business for clues.

2) Value proposition (VP) – Why do people buy from us rather than our competitors? This is a hard one for some companies to nail and you might have much better luck spending some time asking your customers why they buy from you, stay with you and refer you. Listen very carefully to the stories the tell for clues to your value proposition. There are a handful of proven value propositions, but the key is for you to find and commit to something that clearly differentiates.

3) Strategy Hourglass (SH) – Where are our gaps in customer engagement? I believe that process of growing a customer centric business lies in developing a mindset that focuses on the act of logically moving customers and prospects through seven stages of engagement – know, like, trust, try, buy, repeat and refer. The Marketing Hourglass is a tool I’ve used with hundreds of business owners to help create a focus on customer engagement.

4) Primary objectives (PO) – What are our 2-3 highest priority objectives for growth? One of the things the derails growth most often is too many goals and objectives. Most business can only focus on a couple of initiatives at any give time. You must identify and commit to no more than three priorities and then go to work on creating the projects and tasks needed to pull these off. And, you must say no to the idea of the week that shows up to knock you off course.

5) Revenue streams (RS) – How can we create more streams of revenue? There are only three ways to grow: add more customers, increase the average transaction size, increase the number of purchase per customer. It’s actually easier to sell more to existing customer than add new customers. What services or products could you add? What packaging, pricing or promotion could you realign? What new markets or segments could you enter?

6) Strategic relationships (SR) – What relationships do we need to develop? This is probably one of the greatest untapped opportunities for growth. What marketing partners could be motivated to promote and co-market your business? What joint ventures would allow you to tackle new work? What vendors or suppliers could help you grow? What competitors could become cooperative partners for new venture, markets or work?

7) Key indicators (KI) – What metrics impact our growth most? Most businesses can tell you how much revenue they did last month and how much money they have in the bank. By tracking things like % or leads converted, % or business via referral, cost to acquire a new customer and % of customers likely to refer you can take control of the things that actually impact your growth in near real-time. Here are 7 key indicators that I believe should be part of the picture.

When asked to come into a business and evaluate it for growth or help develop a marketing plan – this is where I start because this is where all the answers reside.

Marketing Without Strategy is the Noise Before Failure

The Art of War

Image: kainet via Flickr

Anyone that’s heard me speak or read my books knows that I believe marketing strategy is far more important to the small business than marketing tactics.

Any yet, the tactical idea of the week gets most of the mind share of the business owner.

Strategy and tactics must go hand in hand in order for a business to achieve a measure of true momentum, but an effective strategy must be in place before any set of tactics make sense.

This Sun Tzu quote, borrowed from the Art of War and adapted for the title of this post, pretty much sums up my feeling on the subject – “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.”

The reason strategy gets mostly lip service when it comes to marketing planning is because most people misunderstand what a marketing strategy really is.

So, let me start with what it’s not. Strategy is not a wish list, set of goals, mission statement, or litany of objectives.

How not what

A marketing strategy is a clear explanation of how you’re going to get there, not where or what there is. An effective marketing strategy is a concise explanation of your stated plan of execution to reach your objectives

To become the market leader is not a strategy – it’s an objective. To serve our customers with honor and dignity is not a strategy – it’s mission. To double the number of new customers is not a strategy – it’s a goal.

Goals and missions and objectives are nice, but how you plan to achieve them – otherwise known as strategy paired with a logical set of tactics – is the surest route to victory.

To become a market leader you may find that an effective strategy is to carve out one very narrow market niche and dominate it. To serve your customers with honor and dignity you may find that an effective marketing strategy starts somewhere in your hiring process. To double the number of new customers you may find that an effective marketing strategy is to build a formal network of strategic referral partners.

Now each of these strategies will have a corresponding list of tactics and action steps, but the action plans and campaigns will all have your stated strategy as a filter for decision making and planning.

After working with thousands of small business owners I’ve developed a bit of a 3-step process for developing a marketing strategy. I must warn you though that market conditions, competitive environments and trending opportunities all play wild card roles in the process.

A company considering a marketing strategy in a mature market with entrenched players will have a much different view of things than a company trying to bring a new technology to a market with no proven purchase habit.

I wrote a post titled 5 Attributes of a Sure Fire Start-up that might shed more light on the start-up view.

When developing a marketing strategy for your business the following steps come into play.

Who matters

For any strategy and corresponding set of tactics to work they must appeal to someone. The first element, and in some cases the primary element, is who. Develop your marketing strategy around a narrowly defined ideal client above all. This post titled How to Discover and Attract More of Your Ideal Client goes deeply into this process.

As stated before this step alone may actually prove to be your strategy – to get good at serving a niche market.

Using your ideal client profile as the basis of your strategy also allows you to think very personally about how you serve them and how you use your tactics to attract them. Without this concentration on an ideal segment your marketing strategy will often lack focus.

Be different

After developing a profile of an ideal client it’s time to find a way to appeal to this group. In my experience the only sure way to do this is discovering or creating an approach, product, or service that clearly differentiates you from the rest of the market.

The market needs a way to compare and differ and if you don’t give them one they’ll default to price comparison.

You need to dig in and find that way of doing things that your customers truly value, what’s going on your industry that frustrates people or how to turn the way people have always done it into an opportunity for innovation. This post titled 5 Questions You Should Ask Every Customer unveils the best way to discover what your customers really value.

In some cases you may be doing something truly unique, you just aren’t communicating as your core marketing message.

If you don’t take this step seriously everything else you do in terms of marketing will be far less effective. That’s how serious being different is.

Connect the dots

The final step in the marketing strategy game is to take what we’ve done previously – defining an ideal client and creating a core differentiator – and turning it into your stated strategy.

When I created Duct Tape Marketing my stated strategy was to create a recognizable small business marketing brand by turning marketing for small business into a system and product. This strategy contained a narrowly defined ideal client and a clear point of differentiation.

Our mission was to radically change the way small business owners think about marketing and our “marketing as system” strategy became how we would do that.

Like most effective strategy the gap in current offerings and positioning was what offered the clear opportunity. Connecting your strategy will also include careful study of the competitive environment and that of other unrelated industries in order to fill a need with your innovation or differentiation.

Let me return once again to Sun Tzu and The Art of War – “All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.

Now, before you determine whether Facebook is better for your business than LinkedIn or if direct mail is still an effective way to generate leads, start at the point where you will ultimately create the greatest possible impact – strategy!

The Picture Perfect Ideal Customer

When it comes to attracting your ideal customer you should be able create a picture in your mind as you describe them. Using images of a real life customers can prove an effective way to help everyone in your organization narrowly focus on and communicate in ways that more directly appeal to your specific ideal customer.

A detailed profile, one that includes photos and stories of real customers, should be part of your marketing action plan documents. You may never share this type of document publicly, but it can be one of the most important internal training documents you ever create.

In order to create your profile you need to understand as much about your ideal customer as possible. Remember the key phrase here is ideal. I suggest looking long and hard at the characteristics of your most profitable customers that also refer business to you, that’s the model of an ideal customer.

Once you dig deep and profile the common characteristics you should also start asking yourself some questions about these folks.

    Here are some starters.

  • What brings them joy?
  • What are they worried about?
  • What challenges do they face?
  • What do they hope to gain from us?
  • What goals are they striving to attain?
  • What experience thrills them?
  • Where do they get their information?
  • Who do they trust most?

The answers to the types of questions above are not always available, but pondering them in relationship to your ideal customer may allow you to more fully address their wants and needs in every interaction and communication.

Complete the profile, add a real photo, and hang it up in your office for all to see. Simply hanging photos of your customers around the office, may be the reminder that everyone in the office needs to connect with what your business is really about, what their work is really about, and who really pays everyone’s salary.

Are You Waffling?

Politicians are often accused of waffling between stances on issues in an attempt to broaden or redirect their appeal.

Well, I’ve run across a small business or two plenty guilty of the same.

In an attempt to broaden their market appeal they craft target market descriptions that leave room for just about anyone who pledges to pay the bill, eventually. Or, equally offending, it take 10-15 minutes to explain how they are different, you know, in a way that won’t turn any potential customers off.

Here’s the secret to success in good times and bad – stop waffling. Take a stand and make a marketing strategy commitment you can stick with.

Define your target market as narrowly as is humanly possible. Start by looking long and hard and what your profitable customers, the ones that already refer business to you, look like, think like, live like, value and fear. Now, eliminate all the jerks, cause you don’t have to work with them. Shake and not stir . . .

And now for a challenge: I dare you to write a paragraph and add it to every element of your marketing materials, including your website. Start your paragraph something like this – Here’s who has achieved the greatest success with our [product, system, process, tool, etc] – and then proceed to paint a detailed description of your new found narrowly defined ideal customer.

If you’ve done it right you will have to resist the urge to throw-up out of fear and anyone who reads it can either say, Yes, you are talking about me, you must know me – or, No, not for me. Either way your business just got better.

So now your job is to put everything behind attracting that ideal customer. Might I suggest some fresh strawberries and a hint of powdered sugar.