This step is designed to help you make the most of your opportunity. It assumes you already have some momentum with your first product or service, and gives you recommendations on how to parlay that momentum and expand into an even bigger opportunity.
THE TWO STRATEGIES WE EMPHASIZE ARE:
- Expand What You Offer
- Enter a New Niche
One path may be more appropriate for you than the other. Or you might pursue both growth opportunities. Just be sure you’re building on a solid foundation of something that’s already working – as you venture into any new lines or niches, you’ll need that strength to fall back on. The reason is that when you go into a new niche and/or expand your offerings, you’re essentially putting yourself back into startup mode. This time around, though, you have momentum, more resources, more wisdom, know your brand better and can stick to it, and can avoid wasteful mistakes.
Expand What You Offer
Once you’re on your way with your initial product or service, you can expand by adding complementary offerings to your current ones.
Be sure you have crisp and credible answers to the following questions before you decide which products or services to add:
What can I introduce to leverage my existing customer base?
Your current customers are the least expensive (most profitable) to “cross sell.”
What can I introduce to leverage my existing business resources?
It may be easier to expand your offering if you can figure out something that takes advantage of current facilities, Web site, salespeople, etc.
What can I introduce that’s a “natural” addition based on what I already provide?
Are there things that clearly go well with what you’re already offering?
What can I introduce that requires the least capital investment or financial risk?
Avoid big capital outlays if possible – this is all about making more money, not getting deeper into a financial hole!
How do I get early feedback so I know whether or not it’s working?
Swarm the first customers to learn whether your new offering is being embraced the way you hoped it would.
Enter a New Niche
When you feel you really have command of your current market niche, you may want to look for new opportunities in markets you’re currently not addressing.
The following are ways to consider new niches:
This involves expanding your marketing/sales effort through new delivery methods such as moving from a Main Street brick-and-mortar business to having an eBay store as well, or adding mail-order catalogues.
This gets you in front of new customers by expanding to a new geographic area. Perhaps it’s a transition from local to regional, regional to national, or these days, national to global.
Customers you currently cater to might be supplemented by an altogether different type of customer such as a younger one, a wealthier one, women vs. men, etc. You can also delineate different customer niches by behavioral and psychographic classification. For example, you may want to reach people who like hip-hop, or people who have long commutes to work, etc.
A word to the wise: It’s usually not a great idea to go after multiple new niches at once. Sticking to our advice about building on strength, we encourage you to choose one niche at a time, getting your legs firmly under you with each effort, before expanding yet again.