Market Share vs. Market Growth

The economic downturn has changed the way business owners as well as consumers behave, so as a matter of course, companies will need to develop a plan that accommodates these challenges.

There are many speculations on what is going to happen economically in 2010. Most are very optimistic in their outlook, while others are still somewhat very conservative when predicting on how 2010 will unravel. Regardless of the economic prophecies, however, a majority of businesses will logically be planning for growth. The details of that growth can be planned effectively if you focus on the immediate opportunity of growing market share versus relying on market growth.

While your planning should integrate both, an approach that increases market share can facilitate expansion that is more tangible than market growth. Developing a plan that addresses market share permits you to evaluate the existing market and concretely implement plans that challenge the competition. When developing strategies to increase market share, you must have a good analysis of your competition. Outline their strengths and weaknesses in relation to their strategy but as well as in relation to their product or services. This analysis will provide you a landscape on how to construct a more effective approach on how you can compare your business or product to the competition.

Lastly, to optimize your activities in increasing market share, you can utilize a tool that evaluates your value chain. The value chain for your market is the series of people that actually experience your product from your company to the ultimate customer. For example, if you are a wholesaler, you may be selling to a buyer, retailer, and then the end-user. Once you establish your value chain, determine where in the chain your business is currently focusing on, and evaluate if this can be optimized or if a new marketing campaign that focuses on a different section of the chain. This exercise will help you to maximize your marketing efforts by targeting a specific segment within your market.