Sales Strategy
Market Penetration: Proven Strategies to Increase Your Sales and Grow Your Business January 27, 2023 (0 comments)
New York, NY--Market penetration measures how much customers use a product or service compared to the total estimated market for that product or service. Knowledge of market penetration can be an excellent tool for retailers to make the most of their market presence.
Understanding the term
Market penetration is a measure of a company's success in a specific market compared to its competitors.
To understand this, the article takes the example of cell phones. If there are 300 million people in a country and 65 million their cell phones, the market penetration of cell phones would be approximately 22%. This means that 22% of the total market owns a cell phone. The remaining 78% of the population, 235 million people, are potential customers for cell phone makers.
So, when companies look at market penetration, they can use this number to gauge the potential for growth in that market. If the market penetration is low, there is a lot of room for new companies to come in and capture market share. However, if the market penetration is high, existing companies have the vast majority of the market share, leaving little room for new sales growth.
Market penetration strategies
The article lists some market penetration strategies that retailers can adopt to ensure they are headed in the right direction. The strategies are: change product pricing, create a new product, target new geographies, seek partnerships, and create promotional opportunities.
The article highlights that market penetration can have ill consequences if things go wrong, such as the company-wide image might be altered if a wrong message is shared with the public. These strategies also need you to align most departments in your company or organization, which might be an additional hurdle if you still haven't found your organizational flow.
Learn more about market penetration in the entire article.
[Photo by Rafael Guimarães]