Marketing is all about Growth, and growth is about increasing Penetration

We are nearing the end in my series dispelling marketing myths by looking at what the focus on your business marketing should be.

Throughout this series, I have identified a number of marketing myths, using data primarily from Byron Sharp’s publications and recent Asian research to show why these myths are false. This post will present an alternate paradigm to grow your business.

Up until now, we’ve presented a lot of brand growth as a series of myth busting “don’ts”:

  • don’t build a strategy chiefly around customer loyalty,
  • don’t focus on heavy buyers,
  • don’t aim for differentiation,

But what should you do to grow your brand?  The key to brand success is growing penetration.

In an earlier post we talked about penetration, but I have yet to prove the case that increasing penetration increases share. Today I’ll attempt to do just that,

Lets take an example that Byron  Sharp presents that of toothpaste in Brazil.

The brand under discussion had this performance before embalking on a focus on growing penetration

toothpaste penetration brazil 1

Here’s the result several years later after the significant growth of penetration, how.. we’ll cover later.

toothpaste penetration brazil 2

The key driver of the increased market share- from 6.3% share to 14.1% share clearly was an increase in household penetration.  Only with the increased penetration was there an increase in average purchase… and this is aligned with previous research across other categories and countries.

Here is the similar conclusion from Bain’s research on Chinese consumers in two categories; shampoo and juice

China incr pene incr share Shampoo

china incr in penetration equals increase in share fruit juice

Whilst there is not a clear 100% link, the trajectory of the relationship is clearly established.  Decrease penetration and decrease share, increase penetration and increase share.

From now on we’ll look at HOW we can increase penetration.