Growing markets are rife with opportunity and should be a key part of your targeting when developing your marketing strategy.
As you look at each potential target segment you need to weigh up if it’s a market in decline or one that’s primed to grow.
With a growing market there’s more customers and more revenue to go around even if there is more competition.
The laws of supply and demand mean that in a growing market each player can charge more for their offering especially if there’s an under supply.
Whereas when contrasted with declining markets, incumbents fight over the remaining customers further reducing the available profit.
Some completion is useful when selecting a growth market to target as it means that the initial marketing cost is essentially shared by all players as you communicate the value of the new category offering.
Take ride sharing platforms Uber and Lyft.
They both benefited from each other’s marketing showing the usefulness of a ride sharing company for riders and for drivers.
This convinced customers and drivers to use the platforms and then after that it was about convincing those customers to use one or other particular ride share platform.
When this was a growth market both companies benefitted from the shared costs of positioning ride sharing as viable option in customers minds.
Whilst also then benefitting from an undersupply for the desire within the market, therefore maximising profits.
This could be contrasted against taxi companies who were left to fight over those who weren’t able to or interested in using rise shares.
Driving fare costs down and reducing the profit available to drivers and taxi companies who paid premiums for permits or paperwork to drive taxis in their different jurisdictions.
With your marketing strategy are you targeting segments that are in decline or segments that are projected to grow?
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