Marketing development is a market development strategy employed by a company to increase its market, broaden its customer base, and ultimately sell more products, all three key factors to succeed in market penetration. The two most used marketing development approaches are attracting customers of competing firms and branching out to a heretofore unserved market segment.

The first step for a company to increase its market size is usually to discover the segments of the market that are currently being supplied. This scrutiny would not be complete without an evaluation of both the type of customers the company has and what said customers are purchasing. This data is used to create a cost efficient and encompassing market development strategy.

One facet of marketing development that is critical for market penetration is convincing current customers to buy new products and services that they are not already purchasing. This is a great place to start because these clients already know and use the company so a relationship that can be expanded has been established earlier. From there, the company can move on to identifying rival companies’ customers and offering ideas to allure them, like discounts and promotions.

People who are not buying a product or service from either your company or your competition are an untapped market segment. Marketing development can concentrate on drawing them to a company or product and sparking their interest in order to hopefully turn them into regular customers. Finally, a company that is only selling in one region or country, focusing on a specific demographic, can resort to market penetration to increase its market in new geographical areas and with new demographic targets in order to boost sales.

A small market share translates into low sales, lack of capital and reduced operation, all of which can spell the end for a company. There are many market development strategies that can be implemented by a team from within the actual company, or there is also the possibility to hire an outside consultant to guide and lead the process. In either case, it is important to allot a reasonable amount of capital on this effort, since it would be counterproductive to spend more money on research than what is expected to be make from market expansion. A strong market development strategy can significantly help a company to grow, and therefore it goes hand in hand with market penetration.