In the FourWeekMBA growth matrix, you can apply growth for existing customers by tackling the same problems (gain mode). Or by tackling existing problems, for new customers (expand mode). Or by tackling new problems for existing customers (extend mode). Or perhaps by tackling whole new problems for new customers (reinvent mode).
Gain: solve existing problems better to make existing customers happier
In the gain section, you can apply growth strategies focused on your current customer base.
By better defining their problems you can craft an even better value proposition within your product and service.
Thus expand the business by applying higher prices (as a consequence of a better offering) or by offering more for less.
Here you grow by moving within your established business model.
Growth via price increase or expanded offering
Improved product features
Refine the most used features your current customer base has been using more frequently.
New product features
Add essential features that your customers have been asking.
Offer bundles or expand the offering if your customers value it the most in a bundle (for instance, by providing more features, they will pay less, yet more than the basic package).
Or perhaps unbundle the offering if your customers want one feature or a set of features within your product (avoid the lock-in effect).
This way, you can grow by simplifying the product and making it more powerful for your existing customer base.
In this case, growth might come as a result of reduced complexity for both your organization and the customer’s understanding of your product.
In all the cases above, combining frameworks like jobs to be done with demand generation is critical.
In other words, you want to improve the product’s utility while also working on the perceived value for users/customers.
For instance, take the case of a digital product like an eBook.
Not only you might want to expand it with new content, but you might also want to make its formatting more compelling.
As another example, take an e-commerce company that not only increases the availability and variety of products.
But it also works on the UX to make it easier for users to find relevant things by adding high-quality product pictures, which, right on, make the same product perceived as higher quality.
Help your customers find a better use case for your product.
In short, help them understand how they can use it at best to reduce churn (develop case studies or perhaps training programs for them).
Personalization and customizations
Provide the ability to customize the product or service so your existing customers can add more on top of your product.
Change the revenue model, or expand it
You can experiment from a one-off transaction to subscription-based service.
Think of how you can make your product recurring. Or perhaps, from subscription-based, add a component of consumption.
Make it repeatable
Think of ways to add more options within your product with prompts or incentives (programs like Amazon Prime help Amazon incentivize repeat transactions on the platform, the same thing applies to Sam’s Club).
Offer additional services
What recurring problems are your customers facing that they would rather use you to solve rather than solve those by themselves?
Those are all potential additional services that can be offered on top of your current offering.
Acquire existing products that you can integrate into your offering to make your core offering more valuable to existing customers.
Expand: solve existing problems 2x better to gain new customers
In this case, you grow by developing 2x better solutions to problems for your existing customer base, yet also for a new customer base.
As a result, you will charge more to your existing customer base or gain new customers.
The strategies you can use here are similar to those above.
With the difference that in a 2x growth in the problem to be solved, you can be more proactive.
Here you cautiously explore beyond your business model‘s boundaries.
Growth via expanded customer base
Partnerships and joint ventures
You can partner up with other companies in the same space which do not overlap with your product or service and come together to expand your market (see Shopify-Pinterest partnership).
Develop a new product for an end-to-end experience
You can also invest in R&D to develop a new product on top of your existing product.
As you know, that might make your core product more valuable to existing customers yet open up opportunities in adjacent markets to acquire new customers.
Buy a company offering a product in an adjacent space where your customers will be extremely interested in the future, or that will help you make a successful transition toward future market developments (see acquisitions like Google for Android and YouTube, or Facebook acquiring products like WhatsApp or Instagram).
Extend: solve new, more valuable problems to make existing customers more loyal
In this scenario, you can tackle problems that might be valued more by your existing customers.
In this case, growth happens as a side effect of having a better understanding of your customer journey, thus forcing your company to be able to cover more space in the same niche.
Here you strengthen your core business model by better understanding your customer base and keeping an eye on future market developments.
Growth via extended customer journey
Design an end-to-end experience
In this case, if you dominate ready your market niche, you can start developing an end-to-end experience.
You can help your existing customer base solve and tackle a set of new problems they are experiencing as part of the evolution of the market.
Reinvent: solve new problems for new customers
The company will try to grow in this growth profile by exploring a whole new space.
This is the riskiest of the growth profiles. An unsuccessful growth strategy might result in the corrosion of your core business model.
Growth by market reinvention
Be ready to cannibalize your core product
Be ready to come up with a solution that has the potential to cannibalize your core offering in the short term but also to expand your market exponentially, opening the space for way more customers.
Redefine value in a whole new way
Start by analyzing problems from first principles to come up with something that is a breakthrough that might open up a blue ocean.
- FourWeekMBA Growth Matrix Overview:
- The FourWeekMBA growth matrix outlines four different growth strategies: Gain, Expand, Extend, and Reinvent.
- These strategies help businesses decide how to grow by targeting existing or new customers and problems.
- Gain Strategy – Improve for Existing Customers:
- Focuses on improving existing products or services to make existing customers happier.
- Enhance value proposition, improve product features, add new features, better packaging, and refine communication/product fit.
- Explore personalization, pricing strategies, and additional services.
- Make the product more repeatable and offer extra services to solve customer problems.
- Expand Strategy – Solve Existing Problems Better for New Customers:
- Develop solutions that are 2x better for existing and new customers.
- Apply strategies similar to Gain mode but with more proactive problem-solving.
- Consider partnerships, joint ventures, and end-to-end experiences to reach a wider customer base.
- Extend Strategy – Solve More Valuable Problems for Existing Customers:
- Tackle problems valued more by existing customers to enhance loyalty.
- Design an end-to-end customer experience, redefine value, and understand the customer journey better.
- Reinvent Strategy – Solve New Problems for New Customers:
- Venture into a completely new space with innovative solutions.
- Embrace risk by exploring new markets and reinventing the value proposition.
- Be prepared to cannibalize core offerings and redefine value in a breakthrough way.
- Examples of Growth Strategies:
- Gain: Improve current products’ features, communication, and offerings.
- Expand: Partner with non-overlapping companies, develop new products, or acquire adjacent businesses.
- Extend: Redefine value for existing customers by solving new problems.
- Reinvent: Be ready to cannibalize core offerings to explore entirely new markets.
- Alignment with Customer Needs:
- The Value Proposition Canvas ensures products or services cater to customer values and needs.
- Combining frameworks like jobs to be done with demand generation enhances product utility and perceived value.
- Risk and Exploration in Growth:
- Different growth strategies entail varying levels of risk and potential market expansion.
- The Reinvent strategy is the riskiest, involving the exploration of entirely new spaces and solutions.
|When to Apply
|Advantages of Following It
|Drawbacks of Not Following It
|Focuses on improving existing products or services to make existing customers happier.
|When aiming to enhance satisfaction for existing customers.
|1. Enhanced customer satisfaction and loyalty. 2. Increased product value and competitiveness.
|1. Risk of stagnation and losing customers due to unmet needs. 2. Potential for competitors to outperform.
|Develop solutions that are significantly better for existing and new customers.
|When targeting both existing and new customer segments.
|1. Potential for capturing a broader market share. 2. Competitive edge with superior solutions.
|1. Missed opportunities to cater to diverse customer needs. 2. Risk of underperforming compared to competitors.
|Focuses on solving problems that are highly valued by existing customers, enhancing loyalty.
|When looking to deepen relationships with existing customers.
|1. Increased customer loyalty and retention. 2. Enhanced customer understanding and satisfaction.
|1. Potential for losing customers to competitors who address valued problems. 2. Limited growth potential.
|Ventures into entirely new markets with innovative solutions, embracing risk and redefining value propositions.
|When seeking breakthrough innovation and entering new markets.
|1. Potential for pioneering new markets and capturing early adopters. 2. Innovation-driven competitiveness.
|1. Risk of cannibalizing core offerings and market entry challenges. 2. Uncertainty and high-risk nature of innovation.
Related Growth Concepts
Growth Mindset vs. Fixed Mindset
Sales vs. Marketing
Sales Funnels vs. Flywheels
Zero to One
Digital Marketing Channels
Customer Experience Map
BANT Sales Process
MEDDIC Sales Process
Palantir Acquire, Expand, Scale Framework
Unique Selling Proposition
Read: product development frameworks here.
Read Next: SWOT Analysis, Personal SWOT Analysis, TOWS Matrix, PESTEL Analysis, Porter’s Five Forces, TOWS Matrix, SOAR Analysis.
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