3 ways to grow a business
The American marketer, Jay Abraham, said that there are only 3 ways to grow a business:
- Increase the number of clients that you have.
- Increase the average transaction amount per client.
- Increase the frequency of client transactions.
Overwhelmingly business leaders tend to default their attention towards client acquisition (#1 on the list) strategies first.
Money gets assigned to PPC campaigns; disruptive marketing ideas get generated, the marketing team goes on the hunt for new leads.
This strategy may be the best one for a lot of young companies who need to fill a prospective sales funnel, but for other more established companies - significantly less focus is traditionally given to generating good ideas around increasing transaction amounts (basket size) and frequency of client engagement (repeats).
Innovation
Once you have established trust with a client, they will buy more from you if you innovate the value that you are offering and help develop your client through the value journey that you have designed for them.
Optimisation
Optimisation efforts need to be directed towards constantly improving the quality of your offering and process, while at the same time keeping costs in check. Do this well and your loyal clients will be inspired to frequently do business with you.
Innovation and process optimisation are probably the best ways you would achieve the 2nd and 3rd points on the list, and what is useful about this simple 3 step guide is that it's fairly easy to measure whether or not your innovation and optimisation tactics are having the desired effect or not.
If you have a clear view of the transactional behaviour of your clients, you'll be able to measure the success, or failure, of the initiatives that you choose to invest in based on your performance in each area.
What weighing you give to each of these three areas depends on the market status of your business and your long-term strategy, but a unique combination of focus on all three is a very useful lens to try on.