The product/ market expansion grid

The product/market expansion grid is a device used to identify growth opportunities.

Depending on the product and the market, you will be able to implement 4 different strategies.

First, the market penetration is when you produce a product in order to enter a new market. The products already existed before, but you want to create your own brand. This helps your company improve sales. If you chose a market in a fast development state, then you will be able to get your slice of market shares.

Then you can do a market development. This happens when you identify new markets for your currently owned products. For example, you target a new customer, one that you traditionally don't have buying your products, or when you target a new geographical market, Asia or Africa for example.

After that, you can find the product development strategy. A product development is when you improve, change or create a new product and apply it to currently owned markets. This might put you in competition with strong players so be careful.

Finally, you may encounter the diversification strategy. The diversification happens when you are starting up a new business in a field that you never tackled before. You are not used to interact with the markets so that makes it sometimes difficult, yet promises growth opportunities and renews you customer base. The company must be careful not to overextend their brands positioning. The issue is that you might lose your customers in the process, if they don't understand your strategies.