Market development is a strategic step made by a company to develop the existing market rather than looking for a new market.
The company searches for new buyers to sell the product to a different segment of consumers to increase sales.
Market Development is a 2-step process to get the untapped market. It starts with market research where a company does a segmentation analysis. It is a try to use the existing product or service to attract new customers.
The goal is to expand the reach a different segment or unexplored market.
Once the company decides which segment to choose, the next step of market development involves creating a promotional strategy to enter into the market. For that, companies may have to take the support of both audio and visual media to push the product deeper into the market.
On the demand side, income can play a significant role. As income rises, people will buy more of some goods or even begin to purchase higher quality – or more expensive – goods. The price of related goods can also alter demand.
If the price of one cereal increases, For example, demand will likely switch to a similar cereal – which would be considered a substitute good? If the goods are considered to be complimentary – or are typically used together – a decrease in the price of one of the goods will increase the demand for another.
Examples of complementary goods are cars and gasoline, where the price of gasoline depends partly on the number of cars. Personal tastes and expectations of the future also influence individual demands as does the number of buyers (an increase in buyers vying for a specific number of goods will increase the demand and likely increase the overall purchase price).
So when the incomes of the customers rise, the company needs to work harder to develop their market. They need to make different strategies, promotions, need to launch new products or need to develop the existing products. as because when income rises, people seem to switch their choices to better products. So in this case, it becomes harder to gain the same customers with those same products. So companies need to develop their markets as well with the income of the customers. After doing this, they can gain more customers or customers won’t switch their brand or company.
This is why market develops is necessary with income rising.
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