Online Business Growth Cycles

Your online business will go through periods of growth just like us, how we manage that, is what direction it takes and the rewards your online business will achieve.  The business growth cycle will reach each period with success & continue on into eternity should it follow some simple principles that will shape how each cycle progresses.

The online business growth cycle can be best looked at broken up into four periods. These being the start-up, launch, stabilisation and expansion.

4 stage business growth cycle


Starting a new online business requires a large amount of planning and research.

It’s important that you research your intended market, your competitors & initial costs. This first stage is pivotal in reaching your intended business growth targets.

A good way of identifying the potential  viability and capabilities is to perform a SWOT analysis, acronym for Strengths, Weaknesses, Opportunities and Threats. It’s at this point most online businesses fail.

Planning provides a map of the journey your online business will take in its most vulnerable cycle.

It’s quite easy to get overwhelmed with all the research, tools and advice available, however start-up is a high energy cycle and what’s required by you is the right focus for these objectives.


You have made the leap of faith & your  venture is up and running. All your marketing and advertising efforts are showing signs of good customer acquisition,  sales and rapid growth. This cycle can present new ventures with cash flow shortage so be sure to keep costs to a minimum.

Cutting costs from the get go will maximise your cash flow and keep the online business profitable. Move in the direction to take advantage of increased sales keeping in mind your bottom line.

Review your SWOT analysis regularly and work to reduce your weaknesses whilst ticking off your strengths. Over time opportunities may present themselves, so it’s important that you have strategies in place to take advantage.

These could be moving into new market segments, mergers, re-developing your website etc.

Threats can pose difficult situations upon your business. Ensure you continually record any threats against your business and have strategies, policies and/or procedures in place to avert them.


As the venture moves along it will benefit from a stabilisation cycle.  In your online business life cycle, the stabilisation period will occur when you have experienced rapid growth (could be over many years) but before it begins any decline. During his period you should seek to reduce redundant product and processes.

As a business owner there are two directions you can take from here.

The business can be kept hovering in this stabilisation cycle as you may have enjoyed year on year financial success through increased cash flow, positive net results and increasing ROI that you feel is sufficient enough that the pursuit for growth isn’t the be all and end all.

For you the business size is where you had visioned it to be.

Other business owner’s however may take this opportunity to take on acquisitions to complement there existing product line or services or promote business growth in other avenues


Learning to carefully protect your core culture as you absorb new online businesses is important and a focus on retaining the very best employees form the acquired business will enhance a positive outcome form the merger.

Acting to expand your online business in times where economies are in a trough can have you well placed once the economy turns around.

Growing your online business is a constant challenge. Other avenues of expansion could be;

Organic growth- A more common way to promote business growth is where you concentrate on providing an increased perceived value for your product or service. Strengthening relationships with your key customers and enhancing the value of your businesses products or services in imperative for business growth

Expanding into related markets- Applying your strengths into related markets by expanding your business operations. For example your target niche could be household cleaning however with that you can expand your operations to include commercial.

Remember there is only 3 ways to grow a business:

  1. Increase your customers
  2. Increase the amount your customers spend, or increasing the LVT (Life Time Value)
  3. Increasing the amount of times your customers return

Focusing on increasing the LVT of your customers provides you with the ability to increase your spend per customer acquisition.

Jason Upton