When your revenue has hit a plateau and you’re feeling stuck, think laterally in order to break through and unlock new revenue growth. Tinkering around the edges with slight adjustments to what you’re already doing rarely produces the kind of results you’re seeking.
When facing flatlined revenue, adhering to industry best practices, looking to more successful competitors, or following the media’s hype is typically not going to be your path to breakthrough results. You need to rethink your marketing to cut through all the noise.
If what you’re currently doing is not the right fit for your audience, or if your audience is not the right fit for your business, it’s time to make a change. Be bold. Reinvent your marketing program.
In my new book, Rethink Your Marketing, I outline strategies to get unstuck and unleash revenue growth. Here are three strategies that can help you identify untapped opportunities for growth.
Rethink your audience
The first place to look is your audience. After all, these are the people who you want to find your offerings so valuable that they are willing to pay you instead of your competitors.
Over time, your company can slowly become disconnected from its target audience. This is a natural process that occurs as the company gets larger, processes ossify, and the firm falls back on the status quo to survive. Many companies simply identify their largest (or easiest to acquire and manage) customers as their “ideal” target audience. This is a reactive approach to thinking about audiences.
This was the case with my first job in the United States after returning from four years at Panasonic in Tokyo. After arriving back in the U.S., I joined a Japanese translation agency.
At my new employer, I noticed that the phones were ringing off the hook. Normally a good thing, right? What I soon realized, however, was that the vast majority of the calls were for small projects for an endless array of industries. The avalanche of small orders was dragging the company down and preventing revenue growth. There was so much clutter with small projects that, although everyone was “busy,” there was no strategy in place to intentionally drive growth.
That is when things got interesting.
Our team decided the agency should focus exclusively on the software industry, which typically generated projects in the $100,000 to $300,000 price range. In addition, software companies released new upgrades continuously, providing an ongoing revenue stream.
Implementing the change meant making software localization our core business, instituting a minimum fee, and firing half of the agency’s existing clients.
Despite jettisoning 50 percent of the client roster, the company’s revenue skyrocketed. With the change in target audience, we were able to focus all of the company’s resources on driving revenue growth. There was no more wasting time on small or unprofitable business. And the more software accounts we won, the easier it became to attract additional software accounts.
Within two years from the change, the new model enabled the company to increase its annual revenue by 250 percent. A larger company in the industry then swooped in and acquired our fast-growing agency at a multiple of annual sales.
Rethink your marketing mix
Another way to rethink your marketing is to make bold changes to your marketing mix. Many marketing teams tend to stick to the same overall marketing program from year to year, while making slight adjustments as they go. To create outsized growth, though, you often need to make radical changes by ditching the worst-performing 20 percent of your mix and adding significant experimentation in its place.
As a child, Tom Dickson was addicted to innovation. He rigged his doorbell to open the front gate. He configured go-karts with engines that traveled faster than 80 miles per hour.
So, it was no surprise that George Wright, the new Marketing Director at Blendtec, an unknown blender manufacturing company that Dickson founded, stumbled upon Dickson in the factory working on a blender one day. What took Wright by surprise was the sawdust and wood shavings on the floor next to Dickson’s workbench. Wright walked into the company’s founder testing changes to a blender by grinding up a 2×2. Apparently, this was not an uncommon sight in the factory.
Taking in the scene, Wright realized the powerful visual in front of him and decided to turn it into a video series called “Will It Blend?” The online videos featured Dickson – clad in a scientist’s white lab coat – conducting tests of everyday objects to confirm if they could be ground up using a Blendtec kitchen blender. The initial five videos cost $50, including the cost of the lab coat, the website domain, and the blending targets – a garden rake, a rotisserie chicken, and a Big Mac Extra Value Meal.
Within five days of posting the initial “Will It Blend?” videos, the series attracted over six million views. As the video series continued, Dickson blended an iPhone, iPad, Rubik’s Cube, Wii remote, tire repair kit, and many other items. In total, the videos have been viewed over 100 million times. Within a year and a half of posting the videos, consumer sales increased 700 percent.
Rethink your revenue model
One other area to examine when looking to drive growth is your revenue model – the structure by which you make money. There was a time when Adobe, developer of the popular Adobe Creative Cloud, Marketing Cloud, and now the Experience Cloud, sold products as one-off sales, with periodic upgrades. At the time, pricing for its Creative Suite could be as high as $2,600, depending on the version. The process had worked well for a long time, helping the company grow to billions in annual revenue.
But Adobe saw the writing on the wall. The world was becoming digital, and Adobe needed to evolve to meet the future needs and expectations of its always-online customers by moving to a cloud-based product model with a monthly subscription revenue model. At the time, many customers revolted. Approximately 50,000 signed a Change.org petition to demand that the company revert back to the old model.
Adobe persisted, though, understanding that to unleash revenue growth bold action would be required, even in the face of opposition. Today, Adobe is fully committed to the monthly recurring revenue model, which is fueling the current strength of its business.
In Adobe’s latest full fiscal year, the company earned close to $5.9 billion, up by roughly 46 percent over the previous three years. Approximately 80 percent of the revenue came from subscriptions and other recurring revenue sources.
When you are looking to achieve growth, tinkering around the edges with slight adjustments to what you’re already doing rarely works. Simply “working harder” rarely works. Copying more successful competitors rarely works.
Instead, look at your marketing with a fresh pair of eyes, jettison the bottom 20 percent of your marketing mix and start thinking laterally towards bolder, more ambitious changes. If you want radical growth, start taking radical steps to get there.