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Top Six Steps to Achieving Profitable Growth

As marketers, we usually handle the demands for steady growth but what about aggressive growth. We recommend the following six steps for effectively driving growth rates greater than 20%.

1. Identify the greatest sources

Identify several sources that could have the greatest impact on profitability. The analysis should uncover how to reach and influence the most profitable segments.

Profitability is driven by:

The likelihood of converting prospects into incremental sales
The cost of generating those sales
The long term value of sales in terms of revenue
The long term cost of supporting that revenue

2. Plan for multiple ways to succeed

Develop a set of diverse action plans that have quantifiable impacts on customer behaviors, sales activity, revenue generation, and profit. Being fast is important but don’t prioritize speed over accuracy.

3. Define key metrics to identify the need for course correction
Don't wait until for the revenue numbers to start coming in to determine if the plan is working. Identify early indicators and watch them closely. If the indicators aren't being met, correct plans, shift tactics, address performance gaps, and/or eliminate ineffective strategies.

4. Start broad, small, and smart
Pursue a relatively broad range of growth strategies and then narrow the focus based on the best performances. Focus on generating revenue first and then refine profitability. The most feasible course is to launch on a small scale before expanding to a full-scale effort.

5. Act fast on leading indicators
It's important to act fast on the best leading indicators. While leading indicators are good, they're not perfect predictors of incremental sales, so be smart with the assessment. Eliminate initiatives that are clearly off track first, and then focus on the initiatives most likely to have a long-term sales impact.

6. Hedge against the unexpected
Based on bandwidth, chose a manageable amount of initiatives. Make sure the initiatives have a good blend of accuracy and speed, and then put 90% of your budget behind those strategies. Leave 10% for variations to hedge against current plans.