Market Expansion Strategies : A Study of Select Consumer Products

Abstract

Market expansion strategy is an important strategic option in Asian countries like India and newlineChina. But there are glaring gaps in research on market expansion strategy for consumer newlineproducts. There are hardly any studies which examine link between market expansion newlinestrategy and performance in a developing country like India. In this research an attempt has newlinebeen made to create a systematic understanding of (1) reasons for which a market expansion newlinestrategy is pursued or not pursued, (2) methods of market expansion and (3) relationship newlinebetween market expansion strategy and performance. newlineThe research focuses on select consumer products like two-wheelers, other consumer newlinedurables (televisions, refrigerators and water purifiers), non-durables like bath soaps, newlinewashing products (powders and bars) and oral care products (toothpastes and toothpowder) newlinebesides mobile telephone services. newlineExtensive literature survey has been carried out in areas related to market growth and newlineprimary demand. In this research a market expansion strategy has been conceptualized from newlinethe point of view of delivery of standard of living in developing economies. It aims at newlineincreasing primary demand for a product category by converting non-customers into newlinecustomers and/ or by increasing the usage rate of low quantity users of a given product newlinecategory. newlineSince there is no existing metric that can be used to capture a holistic view of the extent to newlinewhich a company practices market expansion strategy at a product category level a multiitem newlinemarket expansion scale has been developed. This 18 item scale (MAREX) has been newlinetested for its reliability and validity through a primary research. newlinePrimary data has been collected for 30 product categories (15 durables and 15 non-durables newlineincluding 3 mobile service companies) using depth interviews as well as a structured newlinequestionnaire. The questionnaire consists of three sections. First section consists of 12 Likert newlinev newlinescale type statements related to reasons for pursuing or not pursuing market expansion newlinestrategy.