What is Market Development Strategy? And How to Create One

A business owner must make many decisions for the organization. Each will contribute to the success or failure of the company. One of the most crucial decisions you, as an entrepreneur, will make is developing and implementing strategies. This article will discuss market development strategies and how they can help your company.

In essence, whether you are a one-person show or have a team, you should always be evolving — seeking new clients, improving products or services, etc. The aforementioned equates to growth.

Experts agree, in business, there are only four main strategies for growth: diversification, market penetration, product development, and market development.

Today, most companies undertake market development strategies to either enter a new market segment or promote their existing products in the same category to a new target segment. However, some companies develop both strategies at the same time.

For the purposes of this article, we will only discuss the market development strategy.

What is Market Development Strategy?

What is a market development strategy? Market development is a marketing strategy that refers to and develops new markets for new or existing products.

It is a plan that helps business people to create and market their products or services. The strategy has two key elements: market penetration and market development.

Market Penetration

Market penetration refers to the percentage of people who can buy the product or service you offer.

Technically, the concept deals with people who can actually buy them. Also, in this strategy, customer service is heavily focused on customer satisfaction.

Market Development

The second element is market development, creating and developing a market for your product or service.

Basically, market development strategies help your company to define what it is and what kind of market it will enter. Also, it helps a business figure out where they are, what kind of market they either need or want to enter.

Market Strategy Development

Market strategy focus on what you have to offer — products and services. There are many ways to create and market your product.

One notorious way to market your product or service is by branding. That’s when companies hire brand new marketing consultants to market the product. Oftentimes, consultants provide blueprints on what to say, how to act, and even how to design the new product.

Another way is by market research. That’s when companies use surveys and focus groups on coming up with market penetration strategies.

Similarly, other companies use what is called an overall strategy. It can cover new product development, pricing, advertising, and distribution. It also analyses how to get the product into the market and where to market it.

Customer Centric

Most people are searching for products or services to fulfill a need or desire. When a business can satisfy those customers, they generally turn around and recommend the company to their friends and family. This generates new customers.

Today, the internet makes it so much easier for people with needs and wants to fulfill these desires. Thus, having a large customer base is critical to being successful.

Another part of the market penetration strategy is creating a new customer base. That is, when a company makes a new product or develops a new service, they do not immediately market them to existing customers. Instead, they opt to seek a new customer base.

Those are all factors your should consider when developing your own marketing strategy.

Products and Services

Conversely, promoting, and expanding your products is also one crucial activity of the market development strategy.

In this strategy, you are more focused on the product rather than the customer.

For instance, your company manufactures water purifiers, in such a case, your client’s needs will never change. They will always need clean water. Thus, your focus would be on what your product can do and how well it can perform.

If you want to expand your product lines outside of their traditional target markets, they must launch localized marketing campaigns in the desired locations.

Attracting Non-Buyers

One way to attract non-buyers is to provide free trials, advertising, and experimenting with pricing strategies. All of those can encourage prospects to become customers.

However, to continue steady growth, you must consider a higher reward strategy with a higher risk. With that, understanding your current buyers can be beneficial for this strategy.

Timing and Results

The market development strategy of a business needs to consider both the company’s immediate and future needs.

The market development does not happen in a day. It is an ongoing process that requires constant observation, research, adjustments, and re-adjustments.

As the principal of the company, you must monitor these strategies and update them as necessary and as the market conditions change. Market development is just part of the process of business development.

Also, it is crucial to set goals with time limits. That will help to stay on track.

Conclusion

Market development is essential for the success of any business. While it takes time and effort to develop a strong marketing strategy, it can dramatically impact your business’s success. Companies that fail to develop effective strategies are often at a disadvantage in their industry.

As more consumers become savvy to the benefits of doing business online, companies will be facing stiff competition from online companies who have more resources. It is vital that a business develop a marketing strategy if they wish to remain competitive.

A localized strategy that targets consumers in your region will help you achieve your goals and make your company even more accessible to consumers.

What are your thoughts?