market penetration

Examples of market penetration in the following topics:

• Ansoff Opportunity Matrix

  • Marketing penetration - This growth strategy uses current products and current markets with the goal to increase market share.
  • Each strategy has a different level of risk, with market penetration having the lowest risk and diversification having the highest risk .
  • The penetration that brands and products have can be recorded by companies such as ACNielsen and TNS who offer panel measurement services to calculate this and other consumer measures.
  • In these cases, penetration is given as a percentage of a country's households who have bought that particular brand or product at least once within a defined period of time.
  • While market penetration may come with the lowest risk, at some point the company will reach market saturation with the current product and will have to switch to a new strategy, such as market development or product development.

• Marketing by Individuals and Firms

  • A marketing strategy is the combination of all of an organization's marketing goals into one comprehensive plan.
  • Market Penetration: This strategy aims to increase sales of an organization's current products through an aggressive marketing campaign.
  • Market penetration occurs when a company penetrates a market in which current or similar products already exist.
  • The market penetration strategy is the least risky since it leverages many of the firm's existing resources and capabilities.
  • A prominent example of market penetration was the emergence of Facebook in the social networking market.

• New Product Pricing

  • Penetration pricing is the pricing technique of setting a relatively low initial entry price, often lower than the eventual market price, to attract new customers.
  • Penetration pricing is most commonly associated with a marketing objective of increasing market share or sales volume, rather than to make profit in the short term.
  • The advantages of penetration pricing to the firm are as follows:
  • This can achieve high market penetration rates quickly.
  • To gain further market share, a seller must use other pricing tactics such as economy or penetration.

• Market Share

  • Market share is key metric that helps firms evaluate demand in their market and can be influenced by PR and marketing campaigns.
  • Market share is a key indicator of market competitiveness—that is, how well a firm is doing against its competitors.
  • Firms with market shares below a certain level may not be viable.
  • New brands not only require lower prices to penetrate the target market, but they typically require more investment as well.
  • Discuss how companies use market share as a key indicator and tool to increase market competitiveness

• Demand-Based Pricing

  • These include: price skimming, price discrimination, psychological pricing, bundle pricing, penetration pricing, and value-based pricing.
  • Pricing factors are manufacturing cost, market place, competition, market condition, and quality of the product.
  • Penetration pricing is the pricing technique of setting a relatively low initial entry price, often lower than the eventual market price, to attract new customers.
  • Penetration pricing is most commonly associated with a marketing objective of increasing market share or sales volume, rather than to make profit in the short term.
  • The main disadvantage with penetration pricing is that it establishes long term price expectations for the product as well as image preconceptions for the brand and company.

• Are Global Corporations Beneficial?

  • An MNC is a company that operates in two or more countries, leveraging the global environment to approach varying markets in attaining revenue generation.
  • MNC operations often attain economies of scale, through mass producing in external markets at substantially cheaper costs, or economies of scope, through horizontal expansion into new geographic markets.
  • High growth in the external environment is a strong opportunity for most incumbents in the market.
  • However, despite the general opportunities a global market provides, there are significant challenges MNCs face in penetrating these markets.
  • Discuss the benefits and challenges of global corporations from a marketing perspective

• Trends in Retailing

  • Current trends include channel marketing, cross promotional campaigns involving multiple products and companies, on and off line marketing campaigns, in-store and online campaigns, sales tool usage and interactive marketing.
  • Brands are shaped and marketed by customer input turned into actions by the companies who are smart enough to listen.
  • Independent marketing companies are focusing on the wealth of information gleaned from online commerce, using the information to penetrate target markets, establish new brands and to revitalize older brands.
  • The scope of a company's marketing mix has increased with the advent of many new technological tools and system platforms that are available.
  • This balance is easier to maintain with the use of technological marketing tools that are now available to retailers of all kind.

• Impact of the Product Life Cycle on Marketing Strategy

  • The stage of the life cycle of the product affects how it is marketed.
  • The product life cycle is a well-known framework in marketing.
  • The impact on the marketing mix and strategy is as follows:
  • Pricing may be low penetration to build market share rapidly or high skim pricing to recover development costs.
  • At this point, there is a downturn in the market.

• Product, Placement, Promotion, and Price

  • Product, placement, promotion and price are the four elements of the marketing mix.
  • The marketer must also consider product development strategies.
  • A marketer may use advertising, public relations, personal selling, direct marketing, and sales promotion to achieve these objectives.
  • The marketer should set a price that complements the other elements of the marketing mix.
  • Common pricing strategies include cost-plus pricing, skimming, penetration pricing, value-based pricing, and many more.

• Brand Loyalty

  • In marketing, brand loyalty refers to a consumer's commitment to repurchase or otherwise continue using a particular brand by repeatedly buying a product or service.
  • The American Marketing Association defines brand loyalty as: 1. ) "The situation in which a consumer generally buys the same manufacturer-originated product or service repeatedly over time rather than buying from multiple suppliers within the category" (sales promotion definition). 2. ) "The degree to which a consumer consistently purchases the same brand within a product class" (consumer behavior definition).
  • Thus, "brand penetration" or "brand share" reflects only a statistical chance that the majority of customers will buy that brand next time as part of a portfolio of brands.