I was at a board meeting when the CFO asked the CMO, "What's your strategy?" The CMO answered, "We're going to grow the market." The CFO stared. "That's not a strategy—that's a wish." He was right. Market-growth strategy is the plan. It's about expanding the total size of the market itself, not just your slice of it.
What Is Market-Growth Strategy?
A market-growth strategy aims to increase the overall size of a market category by bringing in new users, creating new use cases, or expanding consumption frequency. The key distinction: you're not fighting over existing demand—you're creating new demand.
This differs from market-penetration (getting existing customers to buy more) and market-development (selling to new segments). Market-growth makes the pie bigger for everyone, which sounds generous but is often the most profitable approach because it reduces competition for share.
The Market-Growth Expansion Matrix
Mechanism | Definition | Example |
New User Acquisition | Convert non-users into category users | Teaching non-gamers to play mobile games |
Increased Frequency | Get existing users to use more often | Convincing coffee drinkers to add a second daily coffee |
New Use Cases | Discover new applications for existing products | Baking soda as deodorant (not just leavening) |
Category Creation | Invent entirely new categories | Smartphones creating demand phones + iPods + cameras couldn't meet |
Real-World Examples
Company | Growth Mechanism | Market Impact |
Apple (iPhone) | Created smartphone + app ecosystem category | Expanded TAM by 500% in 10 years |
Slack | Created enterprise chat beyond email | Enterprise messaging from non-existent to essential |
Red Bull | New user acquisition + lifestyle positioning | $15B+ energy drink market from near-zero |
Airbnb | New use cases (residential stays) + new users (budget travelers) | Expanded hospitality TAM by $100B+ |
DoorDash | Made all restaurants delivery-capable + impulse ordering | Created $150B+ food delivery category |
Common Mistakes
1. Confusing Growth with Scale. Market-growth creates new demand. Increased ad spend drives penetration, not growth. Different positioning required.
2. Targeting Price-Insensitive Audiences Too Early. Get volume first with adventurous adopters. Red Bull started with young men, not executives.
3. Under-Investing in Education. Market-growth requires teaching customers the category problem exists. Slack spent as much explaining "why chat" as "why Slack."
4. Oversizing Market Definition. "Grow the entire digital marketing market" is too ambitious. Stripe didn't grow all payments—they grew online payments by making integration frictionless.
5. Ignoring Supply-Side Constraints. Can't grow demand if supply can't meet it. Zoom worked because infrastructure scaled with COVID demand.
Related Concepts
- Market-Penetration Strategy — Competing for existing demand
- Market-Innovation Strategy — Changing how customers perceive the category
- Market-Development Strategy — Expanding to new segments
- Economies of Scale — How growth reduces per-unit costs
Frequently Asked Questions
How is this different from product marketing?
Product marketing promotes your product to existing audiences. Market-growth expands the audience itself.
Which industries suit this best?
Young industries with low penetration: SaaS, emerging tech, new consumer behaviors. Mature industries need penetration or development instead.
How do I measure market growth vs. share gain?
Compare your growth to total category growth. Both growing at 40% = market growth. You at 40% with category at 15% = share gain.
What's the ideal positioning?
Position as the easiest entry point. Zoom didn't position as "Skype killer"—they positioned as "video that just works."
How long for ROI?
24–48 months for meaningful category expansion. Payoff in years 3+ when category normalizes.
Should I partner with competitors?
Often yes, especially early. Rising tide lifts all boats. Zoom and Google Meet both benefited from each other's growth efforts.
Sources & References
- Levitt, T. (1960). "Marketing Myopia." Harvard Business Review.
- Christensen, C. M. (1997). The Innovator's Dilemma. HBS Press.
- Kim, W. C. & Mauborgne, R. (2005). Blue Ocean Strategy. HBS Press.
- Blank, S. & Dorf, B. (2012). The Startup Owner's Manual. K&S Ranch.
- Mullins, J. & Komisar, R. (2009). Getting to Plan B. HBS Press.
Written by Conan Pesci