Internal (organic) growth - marketing
Entering new markets
A business may decide to enter to try to achieve growth. However, this comes with a higher risk than developing new . This is because the business will not have dealt with these markets before, and entering the markets may be complex and expensive.
There are three ways a business can attempt to enter new markets:
- entering overseas markets
- amending its marketing mix (product, price, place and promotion)
- taking advantage of technology
Entering overseas markets
A business that operates in a might consider beginning to trade in other countries to try to achieve growth. Operating in this way could give the business access to a brand new market, which could prove extremely successful and increase profitability. However, developing new, unfamiliar markets can be complex and expensive.
Amending the marketing mix
Whenever a business enters a new market, it is vital for it to re-examine its marketing mix. This is particularly important when a business is considering entering an overseas market, because the business might not know or understand the new market.
For example, the price might need to be changed so that the product appeals to the new market. Alternatively, the new market might not know about the brand at all, in which case the marketing mix would need to be changed to encourage people to try it.
Taking advantage of new technology
Businesses may also take advantage of new technology to target new markets. For example, a business could use to enable customers to buy products even if they do not live near its store. New technology may also mean items are cheaper to produce, so a business might be able to lower prices and target a lower-income market.
The advantages and disadvantages of internal (organic) growth
An advantage of internal growth is that it is low risk:
- a business can maintain its own values without interference from
- higher production means the business can benefit from and lower average costs
A disadvantage of internal growth is that it is slower growth:
- there maybe be a long period between and return on investment
- growth may be limited and is dependent on the reliability of
