https://kanagawa.nl/what-is-a-growth-model-and-how-to-create-one-for-your-business/
Your startup offers an innovative product or service that is meant to make lives easier, help people achieve more and/ or provide solutions to complex problems. However, you will never get there if you don’t do your best to reach out to potential customers and convince them of your value proposition.
Realizing that growth isn’t just about hacking your way to the top of Google to drive all the traffic to your website, or reaching out to thousands of accounts a day on LinkedIn.
You need a solid, reliable model that will help you get there in a strategic way and realize growth by leveraging the ‘right’ marketing channels at the ‘right moment’.
In this article, we are going to talk about what a growth model is, why you need one and how you can create one for your business.
Simply put, a growth model is a strategy to maximize revenue and profit by focusing on acquiring new customers while retaining existing ones. You may even call it the North star of your growth efforts.
It can also be explained as the process of building a sustainable customer base that generates repeat revenue over time.
You can implement this by looking at what others have done before you who had similar goals and values or you can create one from scratch but adapt it along the way as needed for your specific business needs.
But in essence, the growth model consists of two elements – the marketing channel you choose will determine how you get your product/ service in front of potential customers, while the elements of your product/ service are what will convince them to buy from you. These two components work together to drive growth for your company.
But more importantly, a growth model is a process that makes your efforts towards growth measurable at each step of the marketing funnel. It involves the viewing of a dashboard that includes the most relevant metrics and how to connect each step in the customer’s buying journey, to lead them across the sales funnel until you secure a sale that gets added to the business revenue.
A business lives and dies by its ability to grow, so having an effective growth strategy should be at the center of your business plan.
A growth model helps you understand how your customers will use your product or service, and what marketing channels you should focus on in order to drive adoption and sales.
Growth models lay down the framework of your strategy to ensure your startup’s growth. If a business model is the reason why customers buy your product or service, then a growth model explains how your company will attain new customers and scale.
This is because it loops in your stakeholders, marketing team, sales department, customer success managers, and even those looking into finances. It also helps you establish your ability to leverage your team’s strengths to create a concrete bottom line.
The purpose of a growth model is to enable you to understand where you are heading and what it takes to get there. A strong growth model consists of a few parts: