Category: Marketing Strategy

Poached Jobs

Market development: use existing products to capture new markets

Together, the hospitality industry, restaurants, and hotels account for 14 million jobs across the U.S., but the industry has a crushing 65 percent job-turnover rate. That means that, in a single year, there will be 8 million job openings in the industry. Most restaurant and hotel managers post jobs on Craigslist.com and have a terrible time sorting through hundreds of applicants who lack necessary qualifications or experience.

Poached Jobs is a young company that addresses this problem by providing an industry-based dedicated jobs platform that allows managers to find qualified applicants and manage the hiring process.

The company has chosen a market development strategy that’s based on geography. When Poached enters a new market, it wants to own that market and become the hiring solution for every restaurant and hotel in the region. The company used its initial markets, Seattle and Portland, to refine a market-entry strategy for its product and then took on larger markets such as San Francisco and Chicago. With each subsequent market the company incorporated new approaches that sped the adoption process. In late 2014, Poached entered the enormous New York City market. Most of 2015 was spent focusing on growth and success in that single market in order to build credibility that would enable it to move into other geographic regions.

The market development strategy allows a small company like Poached to stage its growth, perfect its existing product, and capture new markets one at a time.

What you’ll learn to do: give some examples of corporate strategies

It can be challenging to get a handle on an abstract concept like “corporate strategy” unless you can see what it means in the context of a real business. The goal of this section is to deepen your understanding of corporate strategies—particularly the ones described by the strategic growth matrix—by doing just that.

Learning Activities

The learning activities for this section include the following:

• Reading: Market Penetration Example
• Reading: Market Development Example
• Reading: Product Development Example
• Reading: Diversification Example
• Self Check: Examples of Corporate Strategies

The last strategic framework that we will consider is the strategic opportunity matrix (sometimes called the Ansoff matrix, named after its creator, Igor Ansoff). Whereas the SWOT analysis can help organizations identify new market and new product opportunities (it’s the “O” in SWOT), the strategic opportunity matrix focuses on different growth strategies for markets and products. The matrix examines the following:

1. New vs. existing markets
2. New vs. existing products

As the diagram shows, each quadrant represents a different growth strategy:

1. Market penetration: focus on current products and current markets with the goal of increasing market share
2. Market development: use existing products to capture new markets
3. Product development: create new products that can be sold in existing markets
4. Diversification: create completely new opportunities by developing new products that will be introduced in new markets

Each strategy entails a different level of risk. Market penetration has the lowest risk since it emphasizes known markets and existing products. Diversification has the highest risk because it involves the development of new products and taking them to new markets. The company must consider whether it can achieve the desired returns without risking a move into new markets or introducing new products. Often, though, higher risk leads to a higher return.

Which strategy should the company pursue? The answer can be informed by a SWOT analysis, which takes into account the strengths and weakness of a company’s existing products, as well as the opportunities and threats in the competitive market.

Check Your Understanding

Answer the question(s) below to see how well you understand the topics covered in this outcome. This short quiz does not count toward your grade in the class, and you can retake it an unlimited number of times.