New York native and nomad by choice— Emily is a marketing & PR pro, now the founder of the award-winning R Public Relations, New York.
Exponential expansion: It’s every small-business owner’s dream. Product or service expansion is a necessary step to grow and remain relevant. But to do so in a manner that doesn’t feel like taking one step forward and two steps back can be a real challenge.
When it comes to growth, the importance of careful planning and strategic decision making cannot be overstated. As business owners, the last thing we need is extra and unexpected work. From my experience at the helm of a PR firm, there are three important actions every small-business owner can take before embarking on expansion initiatives.
1. Get to know your current customers better than you know your best friend.
I’ve known my best friend since I was 4; she is a character, a hard worker and my inspiration. I try to create that same connection with all of my clients. The more you understand your current customer, the better you’ll be able to market to them.
That understanding will also trickle into the way you create products and services to meet their needs, and it will allow you to gain a competitive advantage by proactively predicting shifts and trends in your market. Trust me—all that time on the front end will be well worth it.
Using Market Research
Conducting market research and analysis with current clients is a crucial starting point for future growth. But growth doesn’t just entail expanding products or reaching new customers. It also offers the opportunity to reassess all of your current products, make tweaks where needed and, in some cases, eliminate some products.
Well-crafted customer research has been proven to be a key to the performance of top companies today. For example, according to Aberdeen Group, companies that develop a comprehensive suite of customer research strategies grow annual revenue by 48.2% year-over-year and achieve a 292% greater employee engagement rate. You can’t argue with numbers like that.
If you have the budget, you may want to consider outsourcing your customer research. You’ll get comprehensive and unbiased results while you continue regular business operations. But if that isn’t within range, there are a couple of free tools you can leverage.
I regularly check the demographic reports of my business’s social media accounts to see who interacts most with us. I also keep a detailed account of our past and current clients, including their industries, demographics and the services they request up-front. You can add other data points depending on your field of work.
This process has helped me identify my agency’s target audience—and their preferred services—more effectively. From this, I was able to create detailed buyer personas that represented my ideal customers, which in turn helped refine my messaging. Understanding your current customers’ motivations, pain points and desires can help you hone in on services that truly resonate with customers while cutting out the noise.
2. Dive deep into your market niche.
Before finalizing my offerings, I wanted to ensure I had a solid grasp of the market landscape and how potential customers would respond to my new service offerings. I also wanted to ensure that I was offering something my current customers would be interested in.
A simple demand analysis can help you scope out opportunities for your business—just make sure they’re in line with what your current customers want. You should have the majority of information you need from developing a business plan in your early days, but be sure to refresh numbers like income ranges, employment rates and pricing to align with current economic trends.
Ultimately, the goal of your basic demand analysis is to determine if there’s a market for your new products and services in your specific area. During this step, try to consider all types of research—from hard data to qualitative conversations with current customers.
3. Find your competitive edge.
Through all your customer and market research, you should have a good sense of where your business offerings fit into the landscape. There’s just one piece left: identifying your competitive edge. What makes your company unique? Why do your long-term customers stick around despite your competitors?
I’m a big believer in one-on-one connection, so I feel the best way to approach this final step of research is to schedule conversations with the most important stakeholders at my company. I chatted with senior leadership, longtime employees and our longest-standing clients to understand what they loved most about our services. This type of research is far more valuable than most people care to admit.
Conducting research both externally and internally has helped me mitigate many of the risks associated with expansion, and I continue to grow my team and business today. By taking research seriously, you can set a solid foundation for growth, strengthen your existing customer relationships and position your company for success.
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