What is market penetration?
Market penetration refers to the extent to which company sell its product to the buyers in a market. In this way the all the consumers who are buying a company's product are sometimes referred as penetrated market. Penetration is a concept similar to but not exactly same as market share. Market share refers to the sale of a company's product expressed as a percentage of the total sale of all the competing products in the market. Penetration is not concerned with the quantity sold but just the number of customers in the market buying a company's product.
A company can increase sale of an existing product in an existing market in one of two ways. One is to increase its market penetration. That is, sell its products to more customers in the market, Second is to increase the quantity sold per customer. That is to make the existing customer buy more of the product.
Market Penetration means:
1. In a large sense, the conquest of the market and deepening it's contacts, by gathering the necessary market information and training market with merchandise, prices, distribution, advertising and other means to promote exports.
2. The narrow sense, the extent to which a particular company uses market potential in a given area of movement of goods (for example, the share of sales in a market, in one year).
Efforts to penetrate the target markets concern: critical requests and extend to current needs, demographics, geographic location, seasonal cyclical trends.
Market penetration follows the steps: markets division, the number of customers,geographic covering, rational estimate of the market.
If any organisation facing problems of decreased sales compare to its gross sales in a year,then have to reform their existing strategies to boost up the sales.In these condtions marketing department of any organisation would designed new,creative promotional marketing techniques.Such as Adverising,selection of media,direct marketing or indirect marketing, through which they can attract customers and create such market wher demand for their products or services can increase.Finally boost up the sales and crate profits.