As a business owner, have you considered expanding your offering to stimulate growth?
Diversifying what you provide can open new revenue streams, increase customer loyalty, and give you a competitive edge. You could develop new products or services that complement your existing ones or even venture into related industries to cater to a broader audience.
Turn one-off sales into repeat business
Take a landscape design company, for instance. Instead of simply offering design services, you could introduce a maintenance service to help clients keep their gardens in top condition. This add-on not only provides an extra source of income but also gives customers more value and convenience. By fulfilling multiple needs, your business becomes more integrated into their routine, making it less likely that they’ll switch to a competitor.
Focus on the customer
Understanding your customers’ habits is key to this strategy. What do they currently buy? What related services or products might they need? By identifying these gaps, you can expand your business in ways that are both natural and beneficial to your existing client base.
For instance, a retailer that sells fitness equipment could also offer personal training sessions or wellness products. This cross-pollination of services can position your business as a one-stop shop, enhancing customer satisfaction and loyalty.
Richard Branson’s Fourplay
A famous example of diversification comes from Richard Branson, who implemented a “fourplay” strategy. Customers who signed up for three services were offered the fourth service for free. This not only provided a compelling incentive for customers to purchase more but also made them more invested in the Virgin brand, increasing customer retention and loyalty.
Growth by acquisition
This principle of expanding your offering can be a reason to make an acquisition. You’ve identified a company whose services would be valuable to your customers – and whose customers are likely to be interested in what you have. Putting the two businesses together could result in the sum of the parts being greater than the whole.
Incidentally, that scenario is exactly what we look for if we are selling your business. We want a buyer who can take what you do and add to it
The joy of sticky customers
Incorporating multiple offerings into your business can also make it more attractive to potential buyers if you’re thinking of selling. Investors are drawn to businesses with a diversified portfolio, as this often signals stability and long-term growth. Having “sticky” customers – those who rely on your brand for multiple products or services – further boosts the value of your business in the eyes of buyers.
Your next steps
In conclusion, expanding your product or service offering can strengthen customer loyalty, drive revenue growth, and make your business more competitive. By becoming more integral to your customers’ needs, you create lasting relationships and set your business up for long-term success. Whether through complementary services or innovative packages, diversification is a powerful strategy to explore. If you’re stuck on how to move forward, find a UKBA expert to help you.