There are only 4 ways to grow your business. Not 100, not 1,000 — just 4. You might be thinking that can’t be right, but I assure you it is. Once you understand these 4 ways, you will have clarity about what you need to do to expand your business.
Some people will argue that there are way more than 4 ways to grow a company, but the reality is that all subsets of growth fall into 1 of these 4 growth categories. Let’s get into it.
The 4 Ways
- Acquire New Customers
What is the single hardest thing you do in business? Get new customers, of course. This is by far the most difficult and expensive way to grow. I’ve coached a ton of people, and I’ve learned that regardless of what the underlying problem is, entrepreneurs ALWAYS want more leads in order to make more sales.
I feel the same way, but unless your goal is to be super small and struggle forever at your business, then you can’t focus solely on this one area of growth. After all, there are 3 other ways to grow your business.
- Build Trust With The Customers You’ve Got
The most difficult sale to make is the first sale to a new customer. That is the bad news. The good news, though, is that once you’ve made the first sale and delivered value (sometimes even before you deliver value via a 1-time offer or order bump), the customer will cheerfully buy other products or services from you. Why is that?
The answer is simple: Once you’ve built trust and helped them, it is much easier for the customer to continue down the path with you than to find a new provider. So, once you deliver results and show them the path, many customers will ascend to higher levels of service. Most consumers live in a state of fear, so if you can deliver, they will entrust you with more money.
- Encourage Repeat Buyers
Next, you can increase sales by increasing the number of purchases your customer makes in a given period of time. For example, at Newsletter Pro, our customers buy once per month. What if we could get the average customer to make a purchase 1.3 times per month? Sales would shoot through the roof.
In dentistry, they want patients to come back twice a year, but what if they had to come in 3 times per year? (That’s the number of times I personally go to the dentist. I like a clean, fresh, plaque-free mouth.) There would be a 50% bump in sales. Getting customers who are happy to buy from you again and again is a must for long-term profit.
- Retain Customers
I talk about this all the time, but if you work hard to get a new customer, spend the time to give them a good customer experience, and encourage them to participate in higher levels of service, then why would you then forget to implement campaigns to retain them? Retention is the key to long-term success.
Getting new customers is too hard and too expensive for 99% of businesses to not care about retaining a customer once they’re in the doors. In fact, retention is often the difference between single-digit growth and triple-digit growth. Of course, sometimes a company is so hot that they don’t have to focus on retention and customer experience, but that success is always short-lived.
Change The Way You Think About Growth
Small companies think that business is all about acquiring new customers, and because of that, they stay small. You need to change the way you think about growth. There is a lot of clutter out there.
If you were to score your effectiveness in each of the above areas with a 0-, 1-, or 2-point score, with 0 meaning you do just the basics, little, or even nothing in the area; 1 meaning you do okay in the area but could use some help; and 2 meaning you crush that area, how would you rate?
That isn’t a rhetorical question. Seriously, pause for a second, reexamine the following 4 areas, and give yourself a score:
- Acquiring New Customers
- Building Trust With Current Customers
- Encouraging Repeat Buyers
- Retaining Customers
How do you feel you did? Did you score 0 points in any of the categories? Did you get a 4 and you’re middle of the road? Did you excel with 7 or 8?
Now that you know the 4 ways to grow a business and have scored yourself in each area in terms of effectiveness, you’ve got the start of a road map for growing your business.
In terms of putting these systems in place, retention is the easiest problem to solve, followed by building trust with customers, encouraging repeat buyers, and finally, the most difficult: acquiring new customers.
I’m a huge believer that the masses are always wrong. I realized early on in my entrepreneurial life that focusing all my efforts on new customers was a horrible idea because I was struggling to get them at my old dry-cleaning company.
I dug into all the data one weekend after spending a month knocking on doors and signing up new customers. I found that I brought in virtually the same amount of revenue at the end of the month as I did at the start of the month. I quickly realized that if 30 more people had used my service that month, we would have seen good growth.
Since I had to go knock on doors to get customers, I made it my mission to figure out how to keep as many of them as possible. Ultimately, I figured out how to increase retention and then stumbled on the other growth levers.
Growth doesn’t have to be complicated, but if you want to achieve massive success and make millions in sales, then you’re way more likely to get there with your own ideas and ingenuity.