Market penetration match customer type to revenue goals

Market Penetration - Match Customer Type to Revenue Goals

Market penetration refers to the process of gaining market share by introducing your product to customers. To determine the type of customers you should be targeting it is important that you analyze your market in terms of the potential for market penetration.

Market Penetration, Market-Penetration

Market penetration refers to the process of gaining market share by introducing your product to customers. When you are planning your business strategy it is important to consider market penetration issues in terms of your revenue goals. If you need to generate a certain level of revenue, then a market penetration analysis will help you determine the type and number of customers you need to achieve your target.

Market Penetration Analysis

First you need to determine your revenue goal for the next twelve months. Then you need to figure out how much of that revenue will be generated per client.

Let's look at an example:

Say you wanted to do $120k in revenue for your company within the next 12 months. In terms of market penetration you have to determine whether that is going to be earned from six clients at $20k each, 12 clients at $10k each, or 20 clients at $6k each?

Market penetration analysis forces you to consider your average client size. This will help you determine your sweet spot customer

 

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