Market reach

Market reach
See also
Value drivers Areas of marketing Market dynamics Direct distribution Social network marketing strategy Marketing advantage Image of the company Marketing information system Analysis of customer

Market Reach is the approximate number of potential customers, which is possible to reach through an ad carrier or promotional campaign.

Market refers to a place, where forces of supply and demand meet and where buyers and sellers interact in order to exchange goods or services for monetary value or barter. Market also includes instruments that help determine the price of particular items or services, systems responsible for communicating offers and distribution tools.

Reach is defined as the number of potential customers that have been exposed to advertising or promotional message. Reach is often understood incorrectly, as the number of people that have actually seen the advertisement or promotional message. It shows the number of people that were exposed to the advertising channel, not the ones that have necessarily read or seen it. It describes the number of potential views. For example, if 1000 people drove by the billboard, 500 of them noticed it and just 200 read the promotional message, the reach number would be 1000, because it represents the maximum potential number of advertisement views. As a manager, it is greatly important to understand your company's market reach, because it gives an idea how much the enterprise can grow in the future and whom it can reach with its products or services.

Broadening market reach

Broadening market reach means taking actions, that will allow more customers to get access to company's products, or generally new products that were previously unavailable for certain market groups. It also means increasing company's or products' recognition on new markets or within new target groups. Companies decide to broaden their market reach in order to seek profit and business opportunities in new, not yet explored markets.

Ways of broadening market reach

There are number of ways of broadening market reach. For example:

• Entering foreign markets
• Investing in nationwide advertising campaign through social media channels
• Exploring new target groups

Mentioned above are examples of expanding company's market reach. Company only decides to take actions mentioned above, when expected outcomes are significantly bigger than incurred costs. Because expanding to new markets presents a set of threats to every company, the process has to be accompanied by deep analysis, e.g. SWOT analysis. Such analysis helps company to prevent failures, minimize risks and it also makes managers aware of different external and internal threats.

Examples of Market reach

• Advertising: Advertising can reach an extremely large audience, depending on the medium and the target audience. For example, a television commercial might reach millions of viewers, while an online ad might only reach a few hundred.
• Direct Mail: Direct mail campaigns can reach a large number of potential customers by mailing out brochures, postcards, flyers, and other materials to a targeted list of addresses.
• Social Media: Social media can be an effective way to reach a wide audience. With platforms like Facebook, Twitter, Instagram, and Snapchat, companies can create ads that appear in the feeds of users who meet certain criteria, such as age, location, gender, or interests.
• Events: Events such as trade shows, conferences, and seminars can also be used to reach potential customers. By attending these events, companies can make valuable connections and build relationships with potential customers.
• Word of Mouth: Word of mouth can be a powerful form of marketing, as people are more likely to trust the opinions of their friends and family. Companies can encourage customers to spread the word about their products and services by offering rewards or discounts.

Advantages of Market reach

Market reach is a measure of the number of potential customers that can be reached through an ad carrier or promotional campaign. There are several advantages of having a good market reach:

• It can increase brand awareness and help businesses reach new markets and potential customers.
• It enables businesses to better target their campaigns and increase the chances of success.
• It allows businesses to track their campaigns and measure the ROI of their efforts.
• It helps businesses to identify their target customers and create tailored messages to engage them.
• It can help businesses to build relationships with customers and establish trust in the brand.
• It can increase customer loyalty, as customers are more likely to return to a brand they know, trust, and have an established relationship with.

Limitations of Market reach

Market reach can be an effective tool for evaluating the success of a promotional campaign, however, there are several limitations to consider when using it. These include:

• Lack of granularity: Market reach does not provide granular information about potential customers, such as age, gender, location, interests, etc. This can make it difficult to assess the true potential of a campaign.
• Limited data sources: Market reach is typically based on unreliable or incomplete data sources, such as surveys or consumer reports. This can lead to inaccurate estimates of the target market.
• Inaccurate estimates: Market reach estimates can be inaccurate due to a variety of factors, such as sampling errors, incomplete data sources, and incorrect assumptions.
• Dependence on third-party services: Market reach can be heavily dependent on third-party services, such as research firms and advertising networks. These services can be expensive and may not be suitable for all businesses.
• Difficulty of measurement: Market reach can be difficult to measure, as it requires a comprehensive understanding of the target market and the ability to accurately predict consumer behavior. This can be a challenge for businesses with limited resources.

Other approaches related to Market reach

In addition to market reach, other approaches to assess a potential customer base include:

• Market Segmentation: This involves dividing the potential customer base into different segments based on demographic, geographic, psychographic, and behavioral characteristics. This helps identify the most lucrative customer segments to target in a promotional campaign.
• Market Penetration: This is the process of measuring the current market share, or the percentage of customers who are purchasing a specific product or service. It helps in understanding the potential for growth and reach within the existing customer base.
• Competitor Analysis: This involves assessing the strategies and tactics used by competitors to reach and engage customers. This helps in benchmarking and learning from the competition to craft better marketing strategies.
• Social Media Analysis: This involves analyzing the type of content shared on social media platforms, the influencers that are driving conversations, and the engagement of customers with the brand. This helps identify potential customers and craft better social media campaigns.

These approaches help to better understand the potential customer base, which can help in creating better strategies to reach and engage customers.

References

• Alejo R., (2010). Where does the money go? An analysis of the container metaphor in economics: The market and the economy "Journal of Pragmatics" V. 42, I. 4, 1137-1150.
• Arora A., Gambardella A., (2010). Chapter 15 - The Market for Technology. "Handbook of the Economics of Innovation", V. 1, 641-678.
• Guler I., Guillen M. F., (2017). Home Country Networks and Foreign Expansion: Evidence from the Venture Capital Industry. "Academy of Management Journal" V. 53, I. 2, 319-410.
• Jong J. P. J., Freel M., (2010). Absorptive capacity and the reach of collaboration in high technology small firms. "Research Policy", V. 39, I. 1, 47-54.
• Waltz E., (2018). With a free pass, CRISPR-edited plants reach market in record time. "Nature Biotechnology", V. 36, 6-7.

Author: Jan Kaptur