Market Penetration Strategy Is Most

¶ … market penetration strategy is most effective in a growth market because it essentially sacrifices short-term income in favor of gaining market share. This strategy is focused on building market share, in particular during the growth phase of a market (BusinessPlans.org, n.d.). The objective of the market penetration strategy is long-term dominance of the industry. This requires the firm to build up market share as quickly as possible. In order to do this, the company will keep prices low. This sacrifices profit in the short-term but allows the firm to penetrate the market. Once the market position is established, the firm can adopt a different strategy to earn profits.

I would defend that statement. Elements of that statement are correct, in that a poorly conceived strategy makes implementation irrelevant. It is not recommended that a company move to the implementation phase until the strategy has been fine-tuned and the company believes that it has a unique selling proposition (BNet, 2010). I would argue, however, that the reverse is also true. If the implementation is going to be flawed, then the conception of the strategy is irrelevant. A great strategy on paper is still only on paper. The difference between the two positions is that a great strategy that is not implemented perfectly may still give good outcomes. Thus, while implementation is important, the strategy is more important, as the original statement states.

3. All of the product options are not necessary. Indeed, many of the products currently on the market will fail and disappear. This many choices is a good thing for the consumer however. The consumer has the ability to choose whatever product he or she wants, which is superior to having less choice. Consumers benefit from specialization as they are able to find the product they need at the price point in the league. Increased consumer choice also drives innovation among companies as they seek to specialize. The choice is part of a feedback loop whereby consumers expect choice, which drives innovation and competition (AMD, 2009). Without this choice, innovation and competition is stifled, which hurts consumers. While standardization may eventually win out in a market, it is only by virtue of having so many choices that the ideal standard can be determined.

4. It is important to build a strong brand because the brand is the one source of sustainable competitive advantage that can be derived from marketing (Yap, 2006). The brand contains within it all of the past marketing that the company has done. The brand alone can sell the product, more than a sales pitch. As a result, the brand is the most important component of the marketing campaign.