Market Strategies
The company market is the total sales volume achieved by a business in a certain period of time.An approach to the market through strategies and specific actions needs to be referring to an analysis of the demand that can be:
- Homogeneous demand – all the consumers have identical behaviors, requesting for identical products.
- Segmented demand – the consumers are divided into groups that differ by market behavior and products. There is an homogeneous demand inside the groups.
- Scattered demand – the consumers have very different individual behaviors, each of them requesting distinct, customized products.
Market strategies are guiding lines concerning the market approach by the company on a medium and long term.
The strategies are introduced by the company taking into account several criteria:
- Depending on the demand features:
- Undifferentiated strategy – applied for a homogeneous demand, when the market segments have a similar behavior. In this case, the company approaches all the customers with the same products and marketing activities. This is a rather seldom strategy nowadays, characteristic to the general consume products that have little differentiation options.
- Differentiated strategy – the company approaches the various market segments with products and marketing activities that are specific to each segment because the demand is scattered. In this case, the company wants a better reach of the different market segments and tries to satisfy each of them.
- Concentrated strategy – when the demand is segmented, the company focuses on only one market segment or a small number of market segments.
- Customized strategy – very practical for a scattered demand, each individual forming the demand is approached with specific, customized products and marketing activities.
- Depending on the demand requirements:
- High requirements strategy – applied on the market segments with a high purchasing power. In this case, the company launches exceptionally qualitative products, sold usually at high prices.
- Average requirements strategy – the company approaches the market with products of an average quality, destined for a demand with an average purchasing power.
- Low requirements strategy – low quality products for low purchasing power market. This is also a strategy usual for a low market competition situation, where the providers are not interested in satisfying the demand at high standards.
- Competitive market strategies are related to the competitors on the actual or potential markets. These strategies can be arranged in a bi-dimensional matrix, also known as the “Product/market matrix” or “Ansoff matrix”. The two dimensions take into account the company products (available or new) and the markets (actual or new).
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Markets
Available products
New products
Actual markets
Market penetration strategy
Product development strategy
New markets
Market development strategy
Diversification strategy
The market development strategy focuses on reaching to new consumer segment for the actual products. Geographical expansion or a broadening of the target market can attain the desired objective.
Product development strategy comprises the design of new products that will be offered to the available market segments, where they will be adopted much easier.
Diversification strategy consists in the introduction of new products on new market segments that have not been attended to. This is a brave strategy and very risky because the consumers don not have sufficient information neither about the product or the manufacturer. Therefor, aggressive promotional actions are required.
- Geographical strategies.
- Local market strategies
- Regional market strategies
- National market strategies
- International market strategies.