7 Types of Business Development Strategies to Grow Your Business
Business development is the process of identifying, pursuing and acquiring new customers, markets, partnerships and opportunities for your business. It involves creating and implementing strategies that help you achieve your growth goals and objectives.
In this article, we will discuss seven types of business development strategies that you can use to grow your business and increase your revenue. These are:
– Market penetration
– Market development
– Product development
– Diversification
– Strategic alliances
– Mergers and acquisitions
– Licensing
Let’s look at each of these strategies in more detail and see how they can help you expand your business.
1. Market Penetration
Market penetration is the strategy of increasing your market share in your existing markets by selling more of your existing products or services to your current customers or by attracting new customers from your competitors. This strategy is suitable for businesses that have a strong product or service offering and a large potential customer base in their current markets.
Some of the ways to implement market penetration are:
– Offering discounts, promotions, loyalty programs or incentives to encourage repeat purchases or referrals from your existing customers.
– Improving your product or service quality, features, benefits or customer service to differentiate yourself from your competitors and increase customer satisfaction and retention.
– Increasing your marketing and advertising efforts to raise awareness and interest in your product or service among potential customers.
– Expanding your distribution channels or locations to reach more customers or to make your product or service more accessible or convenient.
2. Market Development
Market development is the strategy of entering new markets with your existing products or services. This strategy is suitable for businesses that have a proven product or service offering and a strong competitive advantage in their current markets, but want to explore new opportunities for growth in different geographic regions, customer segments, industries or niches.
Some of the ways to implement market development are:
– Conducting market research and analysis to identify and evaluate new markets that have a high demand for your product or service, low competition, favorable regulations, cultural compatibility and growth potential.
– Adapting your product or service to meet the needs, preferences, expectations and standards of the new markets. This may involve modifying your features, benefits, pricing, packaging, branding, language or delivery methods.
– Developing a marketing and sales strategy that targets the new markets and communicates your value proposition effectively. This may involve creating a unique selling proposition, positioning statement, marketing mix, sales channels and promotional activities for each market.
– Establishing partnerships or alliances with local distributors, agents, resellers or influencers who can help you access the new markets and build trust and credibility with the potential customers.
3. Product Development
Product development is the strategy of creating new products or services or improving existing ones to meet the changing needs, wants and expectations of your current or potential customers. This strategy is suitable for businesses that operate in dynamic, competitive and innovative markets where customer preferences and demands evolve rapidly.
Some of the ways to implement product development are:
– Conducting customer feedback surveys, interviews, focus groups or reviews to identify their pain points, problems, challenges, goals, desires and suggestions regarding your product or service.
– Conducting market research and analysis to identify new trends, technologies, opportunities and threats in your industry or niche that may affect your product or service performance or demand.
– Developing a product roadmap that outlines the vision, goals, objectives, features, benefits, timeline and budget for developing new products or services or enhancing existing ones.
– Implementing a product development process that involves ideation, prototyping, testing, validation, launch and evaluation of new products or services or improvements to existing ones.
4. Diversification
Diversification is the strategy of adding new products or services that are different from your existing ones to your portfolio. This strategy is suitable for businesses that want to reduce their dependence on a single product or service line or market segment and increase their revenue streams and profitability.
Some of the ways to implement diversification are:
– Conducting market research and analysis to identify new products or services that have a high demand in the market, low competition, synergy with your existing products or services, and alignment with your core competencies and values.
– Developing a business plan that outlines the vision, goals, objectives, market analysis, product description, marketing strategy, financial projections, and risk assessment for launching the new products or services.
– Acquiring or partnering with other businesses that offer complementary products or services that can enhance your value proposition, customer base, distribution network, or brand image.
5. Strategic Alliances
Strategic alliances are the strategy of forming cooperative relationships with other businesses that share common goals, interests, values, or customers with you. This strategy is suitable for businesses that want to leverage the resources, capabilities, expertise, or reputation of other businesses to achieve mutual benefits such as increased market share, revenue, efficiency, innovation, or customer satisfaction.
Some of the ways to implement strategic alliances are:
– Identifying potential partners that have complementary products or services, similar target markets, compatible cultures, and mutual trust and respect.
– Negotiating the terms and conditions of the alliance that specify the roles, responsibilities, expectations,
benefits, and risks of each partner.
– Establishing a governance structure that defines the decision-making process, communication channels, conflict resolution mechanisms, and performance evaluation criteria for the alliance.
– Implementing a collaboration system that facilitates the coordination, integration, and sharing of information, resources, and activities among the partners.
6. Mergers and Acquisitions
Mergers and acquisitions are the strategy of combining your business with another business through a purchase or a merger. This strategy is suitable for businesses that want to achieve rapid growth, market dominance, economies of scale, or diversification by acquiring or merging with other businesses that have valuable assets, customers, technologies, or brands.
Some of the ways to implement mergers and acquisitions are:
– Conducting due diligence and valuation to assess the financial performance, competitive position, strengths, weaknesses, opportunities, and threats of the target business and determine its worth and compatibility with your business.
– Negotiating the deal structure and price that reflect the value and risks of the transaction and satisfy the interests and expectations of both parties.
– Obtaining the approval and consent of the relevant stakeholders such as shareholders, board members, regulators, employees, customers, and suppliers.
– Integrating the operations, systems, processes, cultures, and people of the merged or acquired businesses to create a unified and cohesive entity.
7. Licensing
Licensing is the strategy of granting or obtaining the right to use your intellectual property such as patents, trademarks, designs, or know-how to or from another business for a fee or royalty. This strategy is suitable for businesses that have unique or innovative products or services that can be replicated or adapted by other businesses in different markets or industries.
Some of the ways to implement licensing are:
– Conducting market research and analysis to identify potential licensors or licensees that have a high demand for your intellectual property, low competition, favorable regulations, and growth potential.
– Developing a licensing agreement that outlines the scope, duration, terms, conditions, fees, royalties, and obligations of the licensor and licensee.
– Protecting your intellectual property rights by registering them with the appropriate authorities, enforcing them against infringement, and monitoring their use by the licensee.
– Providing support and assistance to the licensee such as training, technical guidance, quality control, or marketing assistance.
Business development is a vital process for any business that wants to grow and succeed in today’s competitive and dynamic market. By implementing one or more of these seven types of business development strategies, you can increase your customer base, revenue, profitability, innovation, and competitive advantage.
Types of Business Development Strategies and Their Impact on Global Demand
Business development is the process of implementing strategies and opportunities across an organization to promote growth and boost revenue. It involves pursuing opportunities to help a business grow, identifying new prospects, and converting more leads into customers. There are different types of business development strategies that businesses can adopt based on their goals, such as market expansion, brand projection, new client acquisition, general awareness, innovation, internationalization, or the use of digital technology. In this blog post, we will discuss two types of business development strategies and how they affect the global demand in the industry.
Market Expansion Strategy
A market expansion strategy is a type of business development strategy that aims to increase the sales of existing products or services to new markets or segments. This can be done by entering new geographic regions, targeting new customer groups, or offering new variations of existing products or services. For example, a company that sells coffee machines in the US may expand its market by selling them in Europe or Asia, or by targeting hotels, offices, or schools as potential customers.
A market expansion strategy can increase the global demand in the industry by reaching more customers who may have different needs, preferences, or purchasing power than the existing ones. It can also create a competitive advantage for the company by being the first or the best in a new market or segment. However, a market expansion strategy also involves some challenges and risks, such as adapting to different cultures, regulations, or customer behaviors, facing new competitors or substitutes, or investing in marketing, distribution, or production facilities.
Innovation Strategy
An innovation strategy is a type of business development strategy that aims to create new products or services that offer superior value to customers or solve their problems in a better way. This can be done by developing new technologies, processes, features, designs, or business models that differentiate the company from its competitors. For example, a company that sells online courses may innovate by creating interactive and personalized learning experiences for its students, or by offering certificates or credentials that are recognized by employers.
An innovation strategy can increase the global demand in the industry by attracting new customers who are looking for novel or improved solutions for their needs or wants. It can also increase customer loyalty and satisfaction by delivering higher quality or performance than existing products or services. However, an innovation strategy also involves some challenges and risks, such as investing in research and development, protecting intellectual property rights, overcoming customer resistance or inertia, or coping with changing customer expectations or needs.
Business development strategies are essential for any business that wants to grow and succeed in a competitive and dynamic environment. Different types of business development strategies have different impacts on the global demand in the industry. A market expansion strategy can increase the global demand by reaching more customers in new markets or segments. An innovation strategy can increase the global demand by creating new products or services that offer superior value to customers. Both strategies require careful planning and execution to overcome the potential challenges and risks involved.
References:
https://books.google.com/books?id=BxSgAgAAQBAJ
https://www.forbes.com/sites/scottpollack/2012/03/21/what-exactly-is-business-development/
– https://hingemarketing.com/blog/story/business-development-strategy-a-high-growth-approach
– https://blog.hubspot.com/sales/business-development
– https://www.educba.com/business-development-strategies/
– https://www.studysmarter.us/explanations/business-studies/business-development/
https://www.business2community.com/strategy/7-types-of-business-development-strategies-to-grow-your-business-02341461
https://www.investopedia.com/terms/b/business-development.asp
