Increase our penetration to the market by intensifying the organisations efforts to more of the market
Market penetration strategy refers to the firm intensifying its efforts to capture a larger share of the market by selling more of its product to its already existing customers (Ataman, 2003; Smith, Drumwright & Gentile, 2008; Myron, 2007; Kara, Kaynak & Kucukemiroglu, 2007).
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It is always the fast alternative that firms turn to in order to compete and therefore represents the first degree of freedom to grow. Before exploring any further alternatives, firms first try to answer the question whether the opportunity to grow share of the market for the products has been completely exhausted.
Unless the firm is looking for an exit strategy after probably realizing that its product has already past maturity in the product development lifecycle and there’s no way it can be done to revitalize its growth in the market, then this strategy always makes the first competitive option the firm can turn up to for growth (Craig & Douglus, 2006; Morgan & Rego, 2002).
After identifying the first desirable option for growth, the next step is to evaluate its suitability taking into consideration the identified firm characteristics. So what makes this strategy a favourite option given our identified firm characteristics, does it match what we have?
I would first start by stating that, this strategy very much matches what we have identified as far as our competitive environment is concerned. In our identified opportunities we identified the firm can pursue is that of probability of enhancing our market share.
We identified that there’s still lots of potential to improve on market share for the current products if only we were able to use the right marketing tactics. Even though one of our major strengths derived from the parent company is the strong marketing and advertising campaign, incidentally and probably what has been a major weakness for the company is the inability to use that advantage because of the bad marketing policies.
If only therefore the company is able to minimize this weakness and make use of its key strengths of its strong product brand, well established market and its global presence, it is very much possible to increase on the market share. In doing so we will still be weakening out the competitive threat the firm is currently facing.
The other factors that make this alternative also very much attractive are the various exciting opportunities for growth present. By exploiting other opportunities present such as venturing into home delivery, increasing access by expanding our operating hours to 24 hours it will also be very much possible to capture more of the market.
Diversify the organisation’s target market by identifying new markets for the existing product
Diversifying the target market by way of identifying new markets to the existing product is similar to the market development strategy as identified in the Ansolf’s product market expansion grid (Ansolf, 1957; Varadarajan, 2008).
This strategy makes up the second degree of freedom to growth regarding how firms react to competitive pressures or opportunities. Market development strategy refers to going a step further from the current existing market to look for new market opportunities for the existing product (Ataman, 2003; Sharpe & Staelin, 2003).
After fully utilising our first degree to growth by ensuring we get the maximum out of our current target market, it is time then to look for opportunities for growth elsewhere. Market development strategy is a perfect and easy alternative to expand on our market in order to enhance our market presence ()Atuahene-Gima & Murray, 2006).
According to the analysis done on our competitive environment, currently the firm’s clientele comprise only of students and youngsters of average age between 16 and 24 years of age. The main reason why this type of clientele has preferred our menus is the quickness of our meals and the value for money.
Using the same attributes however, we can still be able to capture a different kind of clientele not necessarily in the age bracket specified. One of the external factors that are coming out so clearly in our analysis is the direction of the global economic conditions.
Following the recent global financial meltdown, there has been an adjustment of customers eating habits with most preferring to eat at their home to save on their incomes (Worthington, 2006). This has as a result resulted in the decline of fast food sales.
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The situation is however turning back to normalcy and although in most countries the economy is not yet fully stable to recovery, it has definitely improved. This is a very great opportunity to build up on new target market for our product.
Since fast foods are regarded by many as cheaper and faster meals, it possible to create such kind of appeal to the working group slightly older than our current target group by using this two appeals; cost and urgent meals. Through this kind of strategy, the firm will not only be creating new business but also building future means of competing by creating new sources of profits.
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