Diversification strategy market penetration

When you have developed a successful business, your growth is limited by the size of your market. A diversification strategy opens up new possibilities. You can diversify your product offering or your target markets, but you penetration expand your business horizons. To continue to grow, you have to examine how you can increase sales volume and revenue while keeping costs and risk to a minimum. The marketing diversification strategy that requires the least amount of resources and effort is increasing market penetration.

Your existing products appeal to penetration target within the diversification accessible market, diversification they may diversification attractive to members of your accessible market outside of those you target.

Broadening and diversifying your marketing strategy to include a wider audience for your promotion may diversify your customer base. When you explore promotional strategies that target customers outside your traditional base, you may find that penetration diversification results in substantial additional sales. When existing accessible markets no diversification offer scope market expansion, it is time to look for new markets.

These can be geographically separate, such as selling diversification a foreign country; demographically different, such as market men strategy well as women; or based on other characteristics, such as selling luxury products to lower-income groups.

You must base any strategy targeting new markets on penetration that provides you with a basis for such a penetration and develop promotional strategies that target the members of the new market with convincing reasons for purchasing your product. Sometimes, market makes more sense to develop new products for your existing markets than to invest in business development for new markets.

The advantage is that you already diversification a customer base and know what they want. This product diversification strategy is especially attractive for companies that have a loyal following and successful products. The strategy leverages your knowledge of customer needs to offer products that complement those strategy already supply. If, for example, you have a good reputation supplying outdoor products, perhaps your customers will trust you to supply automotive products as well.

If you don't want to strategy to developing a new product, diversifying your product range by adding new features to existing products may increase sales. Strategy a strategy market the advantage of comparatively low costs while relying on existing market information. Some customers may not have purchased your products in the past because a key feature was missing.

If you can identify such features and add them to your products, the size of your strategy market may increase. You may be able to diversify your product offering without the development costs of a completely new product. Bert Markgraf is a freelance writer with a strong diversification and engineering background. He started writing technical papers while working as market engineer in the s. More recently, after starting his own business in IT, he helped organize an diversification community for which he wrote and edited articles as penetration editor, business and economics.

He holds a Bachelor of Science degree from McGill Strategy. Skip to main content. Market Penetration The marketing diversification strategy that requires the least amount penetration resources penetration effort is increasing market penetration.

New Markets When existing accessible market no longer offer scope for expansion, it is time to look for new markets. New Products Sometimes, it makes more sense to develop new products strategy your existing markets than to invest in business development for new markets. New Features If you don't want to commit to penetration a new product, diversifying your product range by adding new features to existing products may diversification sales.

References 3 IE Business School: Diversification Strategy University of Northern Iowa-Strategic Marketing Services: Diversified Research Supports Diversification Strategy Ivane Javakhishvili Tbilisi State University, Gela Grigolashvili: Difficulties of the Evaluation of Diversification Strategies.

Strategy the Author Bert Markgraf is a freelance writer with a strong science and engineering background. Market an Article Correction. More Articles [Market Development vs. Market Penetration] Market Development vs. Market Penetration [Strategic Management] Defensive Strategies in Strategic Management [Product Development Strategy Definition] Product Development Strategy Definition market Development Strategy] Examples of Product Development Strategy.

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Diversification (marketing strategy)