What Is Business Growth And Why It Is Important

SEO provides customers with the perfect answers to their questions at each stage of the funnel at precisely the right moment. This is just one example of digital customer experience that you can improve through SEO. As a result, you’ll Six Reasons Why Organic Growth is So Important drive higher customer loyalty and greater LTV. As a company leader, your top two concerns are reducing risk and accelerating business growth. But, there’s more than one type of growth to consider — organic growth and inorganic.

For the firms in this Index, both organic and acquisitive growth are positively correlated with shareholder value creation. What matters is having an effective growth strategy and not overpaying – not just for acquisitions but also for value-destroying organic growth. As the Index demonstrates, mere presence in developing and emerging markets is no guarantee of growth. In order to prosper, firms need to develop a competitive strategy. And because emerging markets are so different in terms of social and cultural norms, distribution systems and spending power, firms need to be highly adaptive in order to win.

Three Primary Strategies For Organic Growth

Nelson controlled the release of funds, monitored the initiatives, and decided whether they had achieved their milestones. If a business unit tried to hit its financial targets by reducing its investments in growth ventures, he reprimanded its leaders. Both Medtronic and Alere have exemplary systems for funding and governing growth initiatives. As executive vice president and then as vice chairman of Medtronic, Glen Nelson was responsible for the company’s growth initiatives from 1986 to 2002. He oversaw the launch of what he describes as 30 “new to the world” initiatives.

• The CEO should spend meaningful time with the team and with potential customers.
• Read our article about how to improve CLV for stronger business results.
• Also, because everything is measurable, you can quickly determine whether or not your organic growth tactics are working.
• Consider which growth archetype best reflects your company’s situation and strategy.
• Another important characteristic of your website is search engine optimization .
• Growing a startup is challenging, but also extremely rewarding.

Optimization of a business focuses on continuing to improve a business’s processes to reduce costs and set appropriate pricing strategies for products or services. Such a growth agenda is inherently integrative, crossing multiple functions and involving the entire management team. It often requires alignment and integration of disparate views of the top management team. No single executive or function is likely to have the perspective required to integrate all the elements. It can require cross-team and cross-functional deliberation and collaboration. These distinctive practices of growth overperformers suggest where potential gaps may exist across the activity and capability areas that underlie organic growth. They also point to potential ways in which companies can improve growth readiness in each of the 10 activity/capability areas.

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Some management teams may be at risk for taking these areas for granted. You can look at channels and methods to improve your marketing effectiveness. This can be accomplished by promoting and advertising your products in a different way or using new methods to reach your target customers. If you aren’t using social media, you’re missing out on prime opportunities to reach a large number of customers, both existing and new. Strengthening your company by using its own energy and resources can be an attractive option for growth in today’s volatile economic environment. Businesses that pursue organic growth — from within rather than through merger or acquisition — soon discover it requires time and planning. It must be done strategically while keeping the business’s core values top of mind.

• A unique image allows your firm to develop a distinct brand voice that highlights the value clients can get only from your company.
• EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity.
• No question, marketing strategies that only rely on organic growth are much riskier (compared to organic + paid) because everything is focused on long-term – making it difficult to capitalize on new opportunities quickly.
• In fact, the reason company B purchased its competitor is because company B’s sales were declining by 5%.
• Comparable store sales is a retail store’s revenue in the most recent accounting period relative to the revenue from a similar period in the past.
• So, if you’re struggling to grow your business, first consider whether you’re setting the bar too low.

A well-rounded company will likely adopt or practice all of the strategies at some point. Generally, only the top-tier level companies opt to utilize more than one strategy at once. They are companies that typically have more resources at their disposal. Done right, it’s a way to create sustainable long-term growth, lower your costs, improve your economies of scale and unlock new efficiencies. Another effective way of building mutually-beneficial relationships is by attending industry events. Such events can help you meet potential new business partners and stay updated on the state of your industry.

Step #5: Start A Podcast For Natural Business Growth

In our experience, most high traffic websites have a handful of high-performing pages that are responsible for most of the traffic – it’s not unusual to see 5% of the content responsible for more than 50% of the traffic. Ranking high in Google or any other search engine is a lot more difficult today then it was 5 or 10 years ago. This is why it’s essential to do your market research and identify where there are gaps in the market – which topics and keywords are underrepresented.

It includes things such as taking loans and entering into mergers and acquisitions. Inorganic growth almost always relies on securing outside capital or resources but may enable more rapid expansion. Organic growth, on the other hand, relies on intrinsic resources and skills to fuel a slower, more natural growth. In simple words, organic growth refers to the growth of a company through internal processes, relying on its own resources. This method yields tangible results, while keeping employees focused on marketing, sales, customer service and innovation. When you are starting drive organic business growth, it’s tough to successfully compete and rank for informational keywords in your niche right away. Conversely, organic growth comes through natural customer acquisition, typically via content marketing, social media, or word of mouth.

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It has fewer competitors because people use long-tail keywords that are related to a service or a product they want to buy. So long as you publish compelling content, your readers will share it with their friends on social media. Social shares do not have a direct impact on your rankings, but they give you the exposure you need right now and establish you as an authority.

Since organic growth occurs in a relatively tighter-knit organization, management knows the company strategies and operations more intimately than an organization that has recently undergone https://accountingcoaching.online/ a merger or acquisition. This means the company is typically able to adapt to changes in the marketplace more quickly. In general, growth is considered either organic or inorganic.

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These are seven organic growth business strategies that you should consider adopting. By implementing these strategies, you will help to drive the organic growth of your business over time. A common mistake made by many firms is to think that delivering growth is principally a question of participating in the right ‘growth’ markets.

• I’m all about that slow, sustainable organic business growth because it works.
• Apple – Apple recently spent $200 million to acquire Turi, a machine learning company.
• This can include implementing automation software that makes processes more efficient or ensuring warehouses are large enough to store the stock that will be required as a company expands.
• By scheduling your posts for these times when your followers are most active, you can boost the chances of your content being seen by a wider audience on Instagram.
• Another fantastic option for CTAs is to direct users to content first, to build trust, rather than blitzing a sale.
• With the right mix of hashtags, you can enhance your account’s organic visibility and form connections with your target audience on social media, too.

Organic growth allows for business owners to maintain control of their company whereas a merger or acquisition would dilute or strip away their control. On the other hand, organic growth takes longer, as it is a slower process to acquire new customers and expand business with existing customers. A combination of both organic and inorganic growth is ideal for a company, as it diversifies the revenue base without relying solely on current operations to grow market share. The world continues to get smaller, and technology is making it ever easier for entrepreneurial companies to incorporate international expansion as a key strategy for organic growth. If international expansion is on your radar, it’s important to do your homework and plan ahead.

In the end, mergers or acquisitions rely on the buy-in of both parties for a successful implementation. If cultures are too different or operations don’t adapt to manage the influx of employees, resources, or sales, then the merger or acquisition will likely become unsuccessful. By combining your company’s forces with those resources of another company, you are gaining the knowledge and expertise of their key players. This increased knowledge and experience means you have a stronger roundtable in making strategic decisions moving forward. Every company loves to see growth – it’s a signifier of potential success and that things are “working” within the organization.

When you go all in on digital, you tap into the behavioral zeitgeist we’re now seeing among individuals and companies. And when you track metrics, you can optimize for continually better results. One of the big reasons is that it exactly mirrors the way your audience is thinking at the precise moment they are most receptive to your message. If you want to be a customer-focused organization, using SEO as the foundation underlying all of your marketing is a good place to start. Organic growth is the process of expanding your business through your own strategic efforts, resources, capabilities, expertise, marketing, content, relationships, etc.

If your primary goal is long-term organic growth, consider an organizational change. But if your priority is short-term business growth, concentrating on encouraging and supporting the work of informal multi-functional teams will have a greater impact. Achieving and sustaining a high annual growth rate requires you to think differently than you may have previously.

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Adjust compensation schemes that make it difficult to recruit new types of people. Fully staff the venture only when the strategy, business model, and value proposition are clear. Assign your best, most experienced general managers to lead growth initiatives. They have the internal networks required to access the larger organization’s capabilities, and they understand its values and culture. These actions will help company leaders nurture internal start-ups and teach their core businesses how to deliver both earnings and growth. By answering these simple questions, you can better choose the right channels to build your personal brand.

One important circumstance in which this can happen is when a business owned by a ‘distant’ parent finds itself in the arms of a more ‘loving’ one who is better able to realise its untapped potential. The conventional wisdom is that driving growth depends on a lot of ‘blue sky’ thinking and exploitation of ‘white space’ and ‘blue ocean’ opportunities.