Product/Market Expansion Grid
The product/market expansion grid is a tool for identifying company growth opportunities through market penetration, market development, product development, or diversification.
Starbucks
Starbucks is an international coffee and coffeehouse chain based in Seattle, Washington, USA. Starbucks is the largest coffeehouse company in the world, with 16,120 stores in 49 countries, including around 11,000 in the United States, followed by nearly 1,000 in Canada and more than 800 in Japan. Starbucks sells drip brewed coffee, espresso-based hot drinks, other hot and cold drinks, snacks, and items such as mugs and coffee beans.
Market Penetration
Increasing sales of current products to current market segments without changing the product
Add more outlets in current market area
Improve in advertising, quality, selection, prices
Starbucks
Open new stores
(11,000 stores in USA)
More concentrate in advertising
Improve product quality
Offer variety of coffee
Market Development
Identifying and developing new market segments for current company product
Review new demographic markets
Review new geographic markets
Starbucks
New groups -> senior and ethic customers
Expand to another cities, international market
Product Development
Offering modified or new products to current market segments
Developing new products
Starbucks
Offer food during lunch and dinner
Jointed with PepsiCo for bottled Frappuccino drink
Jointed with Breyer’s for Starbucks ice cream
Starbucks on supermarket aisles
Diversification
Growth through starting up or acquiring business outside the company’s current products and markets
Start up new business
Buy new business
Starbucks
Two new restaurant concept – Café Starbuck and Circadia
Hear Music brand of compilation CDs
Starbucks experience in Casual clothing
The Marketing Process
KEY ELEMENTS
Analysing market opportunities
Select target markets
Develop the marketing mix
Manage the marketing effort
Evaluation
INTEGRATED MARKETING MIX
4 P’S
Product
Price
Place
Promotion
4 C’S
Customer solution
Customer cost
Convenience
Communication
Marketing Management and Analysis - Swot Analysis
