Market penetration strategy

In search of increase production sale, e increase participation that a company has in the different markets it operates, the various market penetration strategies. They can be defined as measures that a company can employ to address and lead sales above the competition.

These strategies Although they have a common purpose, they can be varied, such as:

• Encourage customers to purchase more of the productThis can be used with different techniques such as extending business hours.
• Increase the number of customers. A price adjustment, discounts, offers, etc... can attract competitive customers.
• Potentially attract customers through techniques such as free parking, which generates some benefit for both.

From a commercial point of view, these strategies can be used as a internal or external growth. For example, through the opening of new establishments that operate in the same commercial market, within the same format, a internal growth. In the same way, the external growth It is possible to carry out through the exploitation of the commercial formula, and the expansion through the external purchase of different companies that lead with the same commercial format.

These strategies can be considered as high riskor reduced risk. The strategies with lower risk they are used in the first place by companies, such as the exploitation of the market that can be controlled due to knowledge. These strategies can be combined with other riskier measures, such as the introduction in other markets, the internalization, and the diversification of different commercial formats within the same market.

Specific strategies for market penetration

With the purpose of increase market penetration, various specific strategies can be used, such as:

Greater promotion

Market penetration can be increased by further promotion. This can be done through a short-term promotion or an advertising campaign that promotes the brand and generates greater awareness. In general, they are strategies that have responses from competitors, where they take a similar action in search of recovering the lost market.

A price adjustment

Within market penetration strategies, the price adjustment (both increasing and decreasing them) is usually the most common. With this measure, the aim is to gain a higher sales volume as the prices are more attractive than the rest of the competition. In the case of being an adjustment with higher prices, there is the expectation of a higher profit per unit sold, which in turn increases the market penetration. However, according to the clientele, the latter measure may deter customers.

Increase distribution channels

The increase in distribution channels through which the company offers the products to the public, is usually a fairly effective strategy of market penetration. Providing in this way a greater facility to obtain the products.

Apply a product upgrade

Looking to create new interests, do improvements to products can create a higher profit. A new and improved look is a main factor for attract customers and increase market penetration.