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Market development is the name given to a growth strategy where the business seeks
to sell its existing products into new markets.
New geographical markets; for example exporting the product to a new country
New product dimensions or packaging: for example
New distribution channels (e.g. moving from selling via retail to selling using e-
commerce and mail order)
Different pricing policies to attract different customers or create new market
segments
The seller may do this by promoting the product in a new geographical area. It may also
try to present it in different media. For example, if the product currently sells to young
people, it may try placing adverts in publications that older consumers read.In other
words, it is a strategic step a company takes to exploit an existing market further. It
takes this step rather than trying to look for a new market.
In an effort to boost sales, the company pitches its product to a new segment of
consumers.
Market development also includes trying to get current customers to spend more.
BusinessDictionary.com has the following definition of the term: “The expansion of the
total market for a product or company by (1) entering new segments of the market, (2)
converting non-users into users, or (3) increasing usage per user.
However, they can also boost sales by getting consumers to use their products in new
ways, i.e., new uses.
“In high tech, where discontinuous innovation is the norm, a successful market
development strategy requires crossing the chasm between the early market and the
mainstream.”
A two-step process
According to an Economic Times article, market development is a two-step process.
The aim is to boost sales by tapping into a new segment or a market the company has
not yet exploited.
As soon as it has chosen a segment, the company then creates a promotional strategy.
In other words, it finds ways of attracting those consumers.
“May have to take the support of both audio and visual media to push the product
deeper into the market.”
Pricing
The marketing team will also have to price the product competitively, especially if rivals
have similar strategies.
MARKET DEVELOPMENT