What Is Market Development? Examples Of Market Development Strategies
Market Development is a series of approaches aimed at expanding the business niche. For example, when a company has a product that it wants to sell to a new sector of the population, it is necessary to implement a novel strategy to sell it more effectively.
Planning a Market Development strategy involves researching, analyzing the competition, keeping in mind the trends, and knowing the needs of the clients. This way you will offer your product in the market and consolidate your position as a strong competitor.
As a technique, market research serves to generate more successful decision-making, since it includes the collection of data and its interpretation, the result of which is the description of the characteristics of the buyer people.
If you have already done market research or a SWOT analysis (Strengths, Opportunities, Weaknesses, and Threats), as well as competitive analysis, you have come to the right place to consolidate your new offer.
Examples of Market Development Strategies
The Best 3 examples of strategies that will help you understand the presence of your company in a market
Amazon uses a strategy of changes in the distribution or positioning policy, the objective of which is to change the way of distribution to deliver a product or provide a service in the most efficient way and in the most opportune time for the client.
One of the best selling tools is digital platforms. One of the first to achieve this was Amazon when Jeff Bezos decided to replace the physical distribution of products and implemented a new sales channel through the internet. In this way, it became a logistics company that sells products and eliminates the need to use warehouses.
Amazon used data center technology as a positioning and distribution tool that the rest of the stores did not want to explore. Its services covered home delivery, which aroused the interest of those customers who seek to purchase products more easily and even at the door of their home.
Since then, Amazon has implemented a revolutionary way of buying and selling in the market with surprising results. In 2018, it presented an income closure of approximately $ 10 billion, which means a 300% profit compared to 2017.
The second example is based on the strategy of attracting new consumers and that is applied to new groups whose characteristics, such as demographics, differ from their regular customers.
You surely know the Starbucks company, and perhaps you will remember the commotion caused by its unicorn frappuccino product, distinguished by its explosion of color and sugar. At the start of its launch, the drink did not have the expected impact among the youth sector that wanted to win.
The flavor was not as expected, but even so, he decided to enter the North American market (in stores in the United States, Mexico, and Canada) with a new campaign backed by an attraction strategy.
After a market study, the most famous coffee shop understood that the sector of the population it wanted to reach had different interests than its usual market, so it decided to focus on young people creating a new trend that would make them feel unique and special to the consume a frappuccino that few could try. Thus, the drink was sold in some stores for a limited time, and what it gained was a place among youth preferences.
3. Club Med:
This strategy is about an additional geographical opening, which means planning an expansion taking into account the characteristics of the territory to offer a product, and, above all, a service.
As an example, we present the case of Club Med, a French company in the tourism sector, which for years had had an interest in expanding its market in Argentine territory. The objective was to add four 5-star hotels in Bariloche to their destinations, but there was a limitation: the lack of air connectivity, mainly for the European continent and the United States.
The question then was how to make an offer attractive enough to the clientele? The company wanted to fill a new tourist destination in South America when the best clients, until then, were the French and the Americans.
Thanks to a strategy of opening additional geographic markets, the decision was made to reform some of the existing hotels. In the end, the investment worked as foreseen by Luis Miguel Martín, director of Azora’s hotel assets portfolio:
“We focus on the true value of the asset by adding value and reforming it to reposition it in order to obtain higher investment returns. In sum, asset price and future vision are the two factors that weighed the most in our decision”.
Implementing a Market Development strategy is a task that involves a specialized process to achieve optimal results and, as you can see, they are possible to achieve. These are the Best Examples Strategies of Market Development