Market development is a strategy that is geared towards the growth of a business by simply expanding the existing market through new users.
If you read till the end, you will understand what market development is, why market development strategy is important for business growth, as well as the advantages and disadvantages.
Market development is simply targeting new markets.
Let’s take a look at a proper definition:
Definition
Business dictionary defined it has the expansion of the total market for a product or company by entering new segments of the market, converting non users into users, or increasing usage per user.
It is a process whereby a company tries to sell an existing product to a new set of customers.
For instance, if your product has been targeting men, when you aim to expand your market, you might consider targeting more women.
What is the marketing trend for 2023?
According to the HubSpot 2023 Marketing Strategy & Trends Report, influencer marketing’s strong ROI will continue to increase. According to the survey, almost one-quarter of marketers today utilize influencer marketing, which offers the second-highest ROI of any trend.
Objectives
The main objectives for considering expanding or developing an existing market is to:
• Target new customers with an already existing product
• Suggest new users for your existing product.
• Boost sales and increase revenue.
Model
Market development model is about the product category stage the product is in and how that category is.
The stages of the model displays how a customers’ buying behaviour can change depending on how the product category matures.
Read Also: Ansoff Matrix Explained: Practical Examples, Theory, & Strategy
Market development strategy
This involves adding already existing products to new markets.
It helps businesses identify and develop new opportunities to sell an existing product in previously unexplored markets.
Before you implement a market development strategy, you will need to answer the following questions
• Is the strategy profitable?
• Have we weighed all the risks?
• Have you researched your target customers extremely enough
• Will you need to introduce new products?
There are four strategies that can achieve all these:
1. New geographical market
This involves expanding outside your current region or selling to a new country or continent.
2. New product packaging
Your company might simply want to repackage a product to reach new customers.
E.g: re packaging a 20 liter container into a smaller container.
This can pose a threat, so you will need to review the costs involved in these changes to make sure it doesn’t alter a lot of things.
A great way to improve your packaging is to integrate your brand across it. Get custom packaging for your products with your brand logo and colors. This will not only amplify your branding but will also give your business a more professional and trustworthy image.
3. Different pricing
You can use this strategy by selling a cheaper product under a different sub brand.
4. New users for an existing product
If your product has been made to serve a particular purpose, the product can be transformed to serve another set of people, thereby reaching out to untapped and new customers.
Market development strategy advantages and disadvantages
A good strategy will fetch you good results but at the same time there are disadvantages attached to it.
The advantages of these strategies include:
• Reaching new customers
• Exploring untapped markets
• It leads to an increase in sales and revenue
• Increase in a companys’ profitability.
• Expanding the use of products.
Disadvantages:
The major disadvantage of these strategies is alienating your current customers.
Which expansion plan is the simplest?
Market Penetration
This is the least risky and probably most straightforward growth plan. It entails increasing sales of your current product in your current market.
What four sorts of market expansion strategies are there?
Market penetration. This strategy is to increase sales of existing items and services on existing markets, hence expanding your market share.
Market development.
Product development.
Diversification.
How might my sales be increased in 2023?
Lead With A Motivating Vision.
Concentrate On Content Relevance, SEO, And SEM.
Investigate New Mediums.
Beginning the year with limited-time offers.
Use the holidays to spark a conversation with your customers.
Incorporate a cause or objective into value propositions.
What trends will return in 2023?
Tailoring. At Valentino, big, slouchy blazers were all the rage, and even Chanel went for bright pink versions of its signature bouclé coats with a looser shape.
Mini dresses.
Lace.
Fringing.
Knee-high splits
Denim.
Ultrafeminine sheers
Grunge.
What do 2023 consumers want?
According to Euromonitor International’s Top 10 Global Consumer Trends 2023 study, global consumer trends for 2023 include responsible but emotional spending, the role of digitization in purchase processes, female equality expectations, and a disruptive Generation Z.
What is the growth strategy with the lowest risk?
Market Penetration
This is the least dangerous business growth strategy, but it also offers the least potential for expansion. This strategy comprises on selling more of your present product to your existing customer base (s).
