Intensive Growth Strategy

It is a form of internal growth. Firms grow by expanding their scale of operation. It may be product expansion or market expansion. Firms concentrate on products and markets which have not yet reached their maturity stage.

Intensive growth or product/market expansion can be achieved in the following ways;

1. Increase sale of existing products through better promotional efforts or introduce new uses of existing products in the same Market The firm penetrates into the market to increase its market share. Sale of products like tea, coffee or bournvita vita is promoted in this manner. This strategy is suitable for firms with small market shares. It is called the strategy of market penetration. It increases sale of existing products in the existing markets to present and new customer. Growth is achieved by expanding market base of the company.

2. Increase sale of existing products to new customers in new market areas. Transport companies can grow by increasing transport services in national and international territories. Firms reduce the price of products to approach the middle and lower- income groups in new markets. It means selling existing products in unexplored markets. It is called the strategy of market development. It increased sales by entering into new markets with same products or products with minor modification.

3. Increase sales by introducing new products in the existing markets. Adding similar products to the existing line of products promotes growth in the existing markets. Firm selling soaps can also sell detergents to achieve higher growth targets. This is called the strategy of product development.

4. Increase sales by adding new products to the existing line of products, adding new markets to the existing markets, modification in the existing products to cater to new market segments. Change in color, size, shape or similar features increases sales in existing and new markets. This is called the strategy of product and market development.

Internal growth through products and markets is depicted as follows:



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