My Favorite Growth Strategy – Market Expansion

In my post on Growing Revenue through Membership Packaging,
Wednesday, October 5th, we looked at product line extenuation as a strategy for growth.

Today, I want to discuss one of my favorite growth strategies, Market Expansion.
I was reminded of this strategy in the last issue of Associations Now in the article Picking Markets That Matter by Noel Capon.

Capon warned that there are two mistakes organizations can make. One is overstretching to new markets and the other is remaining static and not moving fast enough.

He gave two corporate examples of organizations that successfully looked beyond their existing markets to grow. One is “GOJO’s launch of Purell as a first-in-its-category consumer product for keeping hands clean.” This launch moved it outside its traditional healthcare and food-service markets and “put it on unfamiliar ground.” But today, Purell is a very successful consume brand.

The second example is Progressive Insurance which launched a discount pricing strategy tied to an analysis of customer’s credit ratings. This allowed it to “acquire and retain a new population of medium- and low-risk customers.”

This market expansion strategy “drove Progressive’s growth from the 13th-largest to the third-largest player in the U.S. car insurance market.”

I have also seen the strategy of reaching out to new markets used with great success in the association marketplace. Sometimes, a market expansion strategy will require some modifications to member benefits and services.

Here are some examples of market expansion:

• Professional engineering associations reaching out to operators
• US associations expanding internationally with electronic membership
• High visibility cause driven-associations reaching out to consumers as donors
• College based associations reaching out to AP high school teachers

Here are some tips to help you get started with a market expansion strategy to adjacent or hot new markets.

• Use secondary research to begin scanning new markets to see if who would benefit from your association’s insights;
• Initiate primary research with executive interviews, focus groups, and surveys to identify unmet needs;
• Match your existing members and customers against commercial databases with data analytics to identify individuals from new markets who are already joining and using your services;
• Add live test quantities of commercially available mailing lists and databases in new markets to your ongoing marketing activities to measure potential response in these segments.

What new markets should you explore to expand the growth of your organization?