A common objective of established businesses is to increase their market share. The reason for wishing to increase market share is to gain pricing power – to be able to increase the price – to boost sales revenue. And, to benefit from economies of scale – as a larger business with more customers – to lower the average cost of production.
In order to increase market share, the business should:
- Sell higher quantity of products; simply sell more products.
- Generate higher sales revenue by charging higher prices.
- In the growing market, the business should sell products faster than competitors.
- In the declining market, the business’s sales should fall at the slower pace than sales of competitors.
Typical ways to increase market share
An increase in market share can be achieved in a number of ways. Let’s take a look at the most typical ways how to increase market share:
- Increase promotion of the brand to boost sales.
- Increase promotion of the products to boost sales.
- Innovate and develop new products to sell higher quantities.
- Improve existing products to charge higher prices.
- Use more efficient channels of distribution to sell products faster.
- Establish loyalty programs to increase customer loyalty by repetitive purchases.
- Motivate and train employees to deliver better customer service.
- Register intellectual property rights such as trademarks, patents and copyrights to slow down the competition.
While increasing market share will not happen overnight, this business objective should be a part of the larger marketing strategy embodying the whole business rather than a wishful thinking of one single manager who hopes to beat competitors.
