There are lots of reasons why you’d want to develop more revenue streams for your small business. Diversification and because your customers are asking for more services and products is just the beginning. But you don’t want to do everything, so choose your revenue streams is super important.
Things you need to consider in order more revenue streams: 1) Your core competencies 2) Adjacencies to those competencies 3) Your existing customers 4) New customers 5) Standard types of alternative revenue streams
How to decide what your core competency is? This is your bread & butter! Your competitive advantage, what you are known for! This is something that you should be better than everyone at. And it is probably the reason why you went into business.
Now you have to figure out what a logical adjacency might be. These are new revenue streams that are strategically aligned to your core competency and that steer what you offer in a defined direction. Some different ways to pivot when you do adjacencies is if they are a new product or service for your existing customers or if you are doing the same product or service for a new target market. Both are a natural step in growing your revenue streams strategically.
Strategies that are for developing revenue streams that focus on the existing customer include increasing the average sale from a customer, increasing the frequency that people use your business, offering something new that they also need, or developing more effective retention strategies. Keeping a customer is worth even more than finding a new one!
There are lots of different ideas of revenue streams to consider. New products, services, intellectual property, events, memberships, intermediaries, programs, residual income, the sharing economy, government contracts and grants, or even crowdfunding. You can do one or more of them, blend them, have fun! Watch the video to hear more about all of this.