Accelerating Growth: Strategies for Acquired Internet Companies
Anna Tarasidou[object Object] image

Anna Tarasidou

3 min read
Accelerating Growth: Strategies for Acquired Internet Companies image

After an acquisition, the marketing strategy often aligns with the type of acquisition made. In a minority buyout, the acquirer usually assumes a passive role, offering guidance to existing management and facilitating network introductions. On the other hand, in full or majority buyouts, the buyer typically adopts a more hands-on approach, actively engaging in day-to-day operations.

The primary aim might be to optimize the business for increased profitability, but frequently, acquisitions target scaling up operations, a task easier said than done.

Outlined below are several suggestions and tactics to aid buyers in growing their recently acquired online enterprises.

A significant starting point involves enhancing the company’s customer funnel. Conversion Rate Optimization (CRO) becomes pivotal—a practice focused on increasing the percentage of users performing desired actions on a website.

Boosting conversion rates encompasses various strategies like testing diverse calls-to-action or showcasing testimonials. This is usually accomplished using analytics tools and rigorous A/B testing.

Moreover, enhancing the business’ funnel might involve implementing additional tactics, such as initiating loyalty programs or referral systems to incentivize existing customers to advocate for the brand or spend more.

Another critical aspect is marketing, closely tied to the aforementioned strategies. While acquired businesses may already have established marketing approaches across different channels, there's always room for improvement.

Initially, the new owner should evaluate the existing marketing initiatives through market research and assess their overall effectiveness. Scrutinizing the attribution model becomes crucial to ensure optimal budget allocation. Subsequently, updating the marketing plan by enhancing specific channels, like search and social media marketing or leveraging partnerships with relevant brands or influencers, could prove beneficial.

Establishing a sales team, particularly for complex or B2B products, might also facilitate significant growth and revenue generation, if not already in place.

Expanding into new markets follows naturally after penetrating one market. However, venturing into new markets presents challenges concerning regulations, logistics (for physical products), market sentiment, and educating the market about the product.

Prior to tackling these complexities, owners must carefully select which markets to target next.

Tools like Google Keyword Planner and Similarweb can aid in competition analysis, but understanding the customer journey and local behaviors through direct interaction or behavior analysis is crucial.

Furthermore, the new management can introduce new products, services, or features, broadening the company's offerings to reach new customer segments, drive cross-selling, and create economies of scope.

New services enhance customer satisfaction, leading to increased customer retention, while additional features enable businesses to command higher prices and attract new users.

Improving existing products through added functionality can have similar effects, addressing customer pain points and prolonging customer lifetime value.

Raising prices, although tricky due to potential customer resistance, can contribute to earnings growth. Strategies like fee increments, targeting customers willing to pay more, or bundling products can help. Timing is critical in implementing such changes.

Conversely, reducing costs plays a significant role in business growth. For internet companies, renegotiating SaaS contracts or opting for cost-efficient providers can lead to substantial savings. More drastic measures involve outsourcing to remote low-cost labor markets.

A more radical step involves restructuring the business model itself. Altering strategies and optimizing sales funnels may unveil new revenue streams or higher margins, but could also risk alienating existing customers.

For instance, a business might choose to implement a paywall for content instead of relying solely on advertising, or introduce a subscription service for frequently purchased products in an eCommerce setting to enhance customer loyalty.

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