What is Market Penetration?

Business & Management
, ,
#1

The market penetration strategy is the least risky since it leverages many of the firm’s existing resources and capabilities. In a growing market; simply maintaining market share will result in growth, and there may exist opportunities to increase market share if competitors reach capacity limits.
Limit: Once the market approaches saturation another strategy must be pursued if the firm is to continue to grow
image

#2

Market penetration is a measure of how many consumers use a product or service when compared with the overall potential demand for that product or service. Market penetration can also be used to develop strategies employed to increase a particular product or service’s market share.

In other words, market penetration is the percentage of customers that can be reached in a given period of time, at least once. This is also measured relative to a target group, which may theoretically be less than the entire economy.