How do firms penetrate an existing market?

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Existing Markets

How do firms penetrate an existing market?

Cadburys have to improve their levels of market penetration and also make more sales customers.

Cadburys have improved their penetration which helps them to improve market share. It can increase in there market share which can create significant sales. Market penetration suggests a further penetration of existing markets with existing products. This will involve a strategy of increasing market share within existing segments and markets.

           Present Products                                   New Products                                                                                                                                                                        

Above is the Ansoff Matrix. It is an analytical tool helping in making decisions developed by Igor Ansoff.

  • Market development is a strategy requires the producer to develop raw market segments for products.
  • Product development is the process of researching market needs, creating products to meet the identified needs.
  • Diversification means going into new market with entirely new products.
  • Market penetration is increasing the % of sales in present markets by taking sales from competitors.

 

To improve their market penetration there are six district stages in the development process for new products are;

  • Ideas

All Cadbury products start from ideas. These ideas may come from the following sources:

Research and Development

-This is where product development and market research working together.

Mindstorming

-This is where it involves few people developing ideas from words and concepts.

Suggestion box

- Here Cadburys is working close to the customer and the sales forces understand their needs and requirements.

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Forced relationships

-At times one or more products can be joined together to form new product concepts.

Competitors

- Monitoring the actions of competitors may provide a rich source of new ideas.

Screening of ideas

 -Once Cadburys ideas have been generated. It is important to screen for the ideas likely to be successful. Considerations may include how well the product fits in with others in the product range the unique element of any idea that makes it competitive. They are likely to demand for the product and whether or not ...

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