Every successful business once started off as a startup. So when an entrepreneur or businessman is thinking of moulding a company of his own, he has to take into account a lot of factors including revenue growth so as to become successful. There is no magic pill which would instantly resurrect a startup into a successful business overnight. To become successful the owner, his advisors and other co-workers has to work in sync and make sure that they make the best out of the current market trends while making fruitful use of their valuable time.
In doing so, in the long run these startup businesses would manage to grasp a lot of attention from a number of clients. Initially to make their presence felt, all startup businesses are bound to incur some loss, but gradually after serving a few clients these companies instills trust among their clients which helps to create visibility as well as exposure from other clients. At this very moment, most companies face a dilemma. Whether to emphasize on customer count or on generating revenue.
Customer count and revenue growth paradox
Customer count and revenue growth are the two basic pillars which helps any startup business to blossom in the years to come. But these two factors may or may not go hand in hand. To gain exposure and attract a number of customers, new companies have to launch their products or services at a relatively cheaper price than their immediate competitors, which helps them to increase their customer base even though it compromises with the revenue inflow.
Customer count can only be increased majorly by three factors, cost effective services, good quality and great reputation in the existing market. For startups, cost effectiveness and unparallel quality are the only means to prove themselves and set a standard. In this way they gradually build a reputation and also attract a number of new clients which helps them to expand their business considerably.
After gaining a few customers a startup can also aim at increasing their revenue by charging more to the client. In this way they can invest the income to grow their infrastructure and to attract new talents into their business. But generally when a startup business emphasizes on revenue, they charge a hefty amount and state enhanced quality as the reason behind their raise in billing amount. Hence it deviates many clients from using the startup business’s services, which causes their customer base to shrink.
Most suitable approach
In order to emerge successful all startups businesses should maintain a delicate balance between customer count and revenue generation. But the emphasis should be slightly towards the growth of customer count. Increasing customer base is considered similar to a chain reaction and it is the best approach to publicize a startup. As a business increases its customer count, they tend to create dependency, and instills trust and faith which helps these startups to cultivate a decent, faithful following. When they realize that their customer base is strong enough, they can steadily increase their billing which in the long run can help them ascend their profit. But they should make sure that during this process the quality of their product or services should not be hampered. Huge increase in revenue is not a overnight process and would take decent time and toil from everyone associated with the startup business.
To sum it up in a few words, increasing customer count is much more important that focusing on revenue collection. Rome wasn’t built in a day, so a start up business too can’t expect to amass a fortune within a short time. The best bet is to shift the focus of the startup business towards increasing the customers. This would help them to create visibility in the market and if their quality exceeds the current market standards, then it can even catapult their popularity on a global scale. After a few years, when the startup has got a foothold and is capable of flaunting a decent customer following, then they should turn towards increasing revenue. There are a number of startups that had started their journey using this very policy and now they are part of the Fortune 500 group. So the core value of the startups should be to keep the motive of revenue growth aside and focus on the quality of their product or services. As customers become aware of a brand through its services, the startups should make sure that the quality is not compromised by any means.