MARKET PENETRATION TACTICS

7. Create barriers to entry

When it comes to adopting strategic options, it is crucial to leverage your business’s strengths in a correct and just manner. For example, by minimizing your variable costs, you can boost your sales and establish a barrier to entry for others. This is why many firms with superior technology and distinct processes are able to reduce variable costs and earn better gross margins per item sold. With a substantial share in the market and an efficient marketing process, your business could create a barrier to entry to prevent competitors from coming into your industry.

8. Be unique and think differently

Although, the entire process of market penetration seems simple and monotonous, yet it’s a big challenge if you perceive it to be. To overcome the challenge, you need to be more unique and highly innovative in your approach. A repetitive selling strategy would yield unsatisfactory results and hinder your growth potential. So, it would be better to think different and modify your penetration tactics as and when required. By being more innovative and adding value to your products you enhance your success chances.

Some actions you could consider to be unique are:

Educate your customers – This is important as many times people are unaware of the quality of the product and how it could be of use to them.

Make purchasing easier – Many successful businesses lend a credit facility to their customers and thus increase the customers’ ability to buy.

Widen the distribution network – Making your product available at more locations and better delivery and service options can also significantly boost your sales figures.

Generate referrals – If you can encourage your customers to give referrals, it would certainly affect your chances of sales. For example, you can offer gift coupons or reward points to those customers whose referrals do actually get converted.

Changing product designs – By making the product in a more user-friendly manner, your chances of sales conversion significantly get a lift. For example, you could make a lengthy novel a paperback one instead of a hard-bound one.

9. Diversification

The product penetration tactic of diversification entails manufacturing new products for new markets. The strategy of diversification is usually followed whenever, there is saturation in the current market or when environmental changes such as societal, economic, technological or regulatory make it very hard to generate new sales in those markets. This strategy is most commonly followed by those businesses in the health sector, such as hospitals. Hospitals have now diversified their services in the form of long-term care facilities, reimbursement, network referrals, and utilization. Those firms that have diversified on opportunities of their strengths have been able to gain the most.

10. Strategic Alliances

For some organizations, it is difficult due to one or more reasons to enter new markets. To solve such an issue, many of these organizations enter into a kind of strategic alliances with one another to operate in a particular market. Although strategic alliances can be formed into many forms, the more common one is the joint venture business, in which each partner business holds an equity position.