Expanding the Total Market

The leading firm normally gains the most when the total market expands. If people take more pictures, then as the market leader, Kodak stands to gain the most. If Kodak can persuade more people to take pictures, or to take pictures on more occasions, or to take more pictures on each occasion, it will benefit greatly. Generally, the market leader should look for new users, new uses and more usage ofits products.

NEW USERS. Every product class can attract buyers who are still unaware of the product, or who are resisting it because of its price or its lack of certain features. A seller can usually find new users in many places. For example, L'Orfial might find new fragrance users in its current markets by convincing women who do nor use expensive fragrance to try it. Or it might find users in new demographic segments; for instance, men's fragrances are currently a small but fast-growing market. Or it might expand into new geographic segments, perhaps by selling its fragrances to the new wealthy in eastern Europe.

Johnson's Baby Shampoo provides a classic example of developing new users. When the baby boom had passed and the birth rate slowed down, the company grew concerned about future sales growth, J & J's marketers noticed that other

Figure 12.4

Market leader strategies family members sometimes used the baby shampoo for their own hair. Management developed an advertising campaign aimed at adults. In a short time, Johnson's Baby Shampoo became a leading brand in the total shampoo market.

NEW USES. The marketer can expand markets by discovering and promoting new uses for the product. DuPont's nylon is an example of new-use expansion. Every time nylon became a mature product, some new use appeared. Nylon was first used as a fibre for parachutes; then for women's stockings; later as a leading material in shirts and blouses; and still later in vehicle tyres, upholstery and earpetirig. Another example of new-use expansion is Arm & Hammer baking soda. Its sales had flattened after 125 years. Then the company discovered that consumers were using baking soda as a refrigerator deodorizer. It launched a heavy advertising and publicity campaign focusing on this use and persiuided consumers to place an open box of baking soda in their refrigerators and to replace it every few months.

MORE USAGE. A third market expansion strategy is to persuade people to use the product more often or to use more per occasion. Campbell encoxirages people to consume more of its soup by running ads using it as an ingredient in recipes in women's magazines. P & G advises users that its Head & Shoulders shampoo is more effective with two applications instead of one per hair wash.

The Michelin Tyre Company found a creative way to increase usage per occasion. It wanted French car owners to drive more miles per year, resulting in more tyre replacement. Michelin began rating French restaurants on a three-star system and publishing them in its Red Guides. It reported that many of the best restaurants were in the south of France, leading many Parisians to take weekend drives south. Michelin also publishes its Green Guide containing maps and graded sights to encourage additional travel.

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  • Temesgen Girma
    How can market leader expand the total marketmarketing management?
    2 years ago

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