Penetration

Penetration strategies for newer technology has become extremely challenging. In order to maintain a strong grip in the market, industries are locating and chasing newer paths. Industries engaging strategic consultants has become more prevalent as they feel strategic consultants are trained to sustain new revenue focusing on priorities.

Thus today new technology ideas are generated taking into consideration the needs of the market. As a strategist I find penetrating these technologies into the market, requires precise definition’s and focus.

I have observed industries re-trenching and re-educating consumers when they encounter a glitch when trying to push their new product into the market. I often find the reason for this glitch is because they have not set a clear connection to specific use. They fail to understand that most technologies are interpreted inside a constantly shifting perceptual frame buffeted by issues and crises of the day.

So whether an industry is inventing pyrotechnics or creating a new network of data analytic technology or a developing a cutting-edge oil and gas screen, a strategist will need to define the specification of their technology while keeping in mind the target market and how this technology will fill in the voids of their demand. In order to inject a new product into the market the strategist may have to build teams in an industry and be ready to break these teams into smaller sub groups who are trained to study the demand and subsequently trained to tweak this demand in order to bridge a wider consumer market.

I have also observed that the key to market penetration is the use of” language” which if used correctly allows one to comprehend and connote more positive outcomes. Educating the consumer is imperative in demonstrating the value of a new technology. Over the years I have also found that sometimes the main entrance may not be the best entry for some technology in emerging markets.

I once attended to a client who had developed an excellent fin-tech feature being an e-wallet integration system ( A) specifically targeting the foreign worker platform. They had created the product and were looking for funding for market penetration. I studied their penetration strategy and found some glaring faults. I also envisaged that this product will drown in the midst of global competitors.

As forecasted when the company (A) was interviewed by potential investors (B), my concerns materialized. This potential investors was actually look at starting their own e wallet system and was doing their research to comprehend the features of other competitors. B the potential investor who had the finances ready and had done their business development and marketing strategy concurrent to their product development created a much more superior e-wallet system and as predicted superseded company A into injecting this new feature it into the market.

They overcame the problem of the big established global players by striking a deal with them to buy over their feature once they successfully inject this new feature into the market. This product penetrated the market with not problems at all. Today they have sold their fin-tec for a huge profit and have moved on to create newer technology.

I went on to do a review on on why this technology failed when it had far superior features and operating ease. Every angle of study I did reflected the same outcome.

Client A should have developed their business development and marketing strategy concurrent or better still a few yards ahead before presenting their product to potential investors for funding. When they finally got the funding it was too late as their competitor had penetrated the market while A was just developing a marketing strategy. By the time A managed to get market entry their technology was outdated and e- wallet was already a thing. The whole business plan failed or rather their technology was outdated.

They failed in their main objective behind the market penetration strategy. They were not prepared to launch the product and to enter the market as swiftly as possible as soon as funding came through. This lead to their failure to capture a size able market share. Company A could have used a market penetration strategy that would not have affected the overall marketing strategy of their product. This would have brought growth opportunity and maximized their revenue generation. Company A failed in adopting the concepts of market penetration and to implement specific plans and tactics to challenge the competitors.

Had company A established a good business development team in the early days they would have been able to taken into consideration the relevant market development or expansion grid data to decide actually, which penetration tactic to have adopted?

On hind side I often pondered how I would have managed this product had it come to me from the beginning. Would I have used penetration strategy judiciously as overdoing it could lead to adverse results? For example, while advertising is a wonderful tool for increasing brand awareness I may have cautioned the use of it at an early stage as with technology, it is very easy for it to be overtaken. Because technology is fast moving I would have exercised extreme caution. If we are not secretive, swift and dynamic we risk the technology being copied or ousted by competitors. This would have been paramount in my penetration strategy. I would have a well-planned and thought-out strategy as an easy to counter promotional campaign can be ruined by competitors. I also pondered whether the company could have used the method of market penetration where they increased the usage of the product or service. This would may have lead to a better market penetration that could increase the sales figure.

Company A could have also created barriers to entry but in this case money remittance is an established million year old industry which means breaking into this industry will require some sharp edged marketing tools. However E-wallet has only been on the platform for the last 20 years or so. For this technology to take off they could have minimizing their variable cost by establishing a strategic alliance who could have worked with them in having a successful launch and this would have created a barrier for entry by smaller players. This card was used by Company B in ousting Company A. This is how most industries with superior technology and distinct processes gain strength and created a barrier to entry prevent copycat competitors from coming into their industry at an early stage.

Market entry in my view could be the trickiest. Market penetration strategy isn’t going to work for all. One plan does not fit all. Industries may have to use different strategies for more efficiency. It is not as easy as it sounds. For many reasons some industries may find it difficult to penetrate the market. I have seen this many times particularly within sector where there are big players. To overcome such instance many of these industries enter into strategic alliances with bigger players in the industries. Strategic alliances could have been linked into many forms. In this case they should have formed a joint venture business whereby each partner business holds an equity position.

Although it is clear that technology developing companies have enormous opportunities to create new markets, in today’s day and age their business development, customer education, product and market research is as important if not more important than the products itself as in the case of company A. Product development and market research are additional niches in successfully penetrating a market. With the right strategies it is may have been easier to achieve solid growth objectives.