How Companies Can Recover Lost Market Share

When companies start to lose market share, they can take several actions to regain competitiveness.

Analyse

1. Market Research: Identify why market share is declining—changes in consumer preferences, competitive actions, or operational inefficiencies.
2. Customer Feedback: Gather input to understand pain points or dissatisfaction.
3. Competitor Analysis: Monitor competitors’ strategies to identify what they’re doing differently or better.

Reinforce Product Value

1. Product Improvement: Enhance features, quality, or reliability.
2. Diversify Offerings: Introduce complementary products or services.
3. Focus on Differentiation: Highlight unique selling points that competitors can’t match.

 

Example of Diversify Product Offerings: McDonald’s expanded its menu to include healthier options like salads and wraps when customers started opting for healthier fast food alternatives. This helped regain lost customers and attract new ones.

Pricing and Promotion Adjustments

1. Competitive Pricing: Offer discounts, bundle deals, or loyalty programs.
2. Aggressive Marketing: Invest in advertising campaigns to build brand awareness.
3. Promotional Offers: Short-term campaigns to attract customers back.

Example of Lower Prices or Offer Promotions: Procter & Gamble cut prices on staple products like detergent and diapers to compete with private-label brands like those sold by Walmart. Temporary promotions drew customers back.

Strengthen Customer Relationships

1. Improve Customer Service: Deliver exceptional support to retain existing customers.
2. Engage Customers: Build community engagement through social media or loyalty programs.
3. After-Sales Strategies: Ensure satisfaction post-purchase to drive repeat business.

Example of Focusing on Customer Retention: Spotify introduced personalized playlists (e.g., Discover Weekly) to keep users engaged and reduce churn as competitors like Apple Music gained ground. The strategy improved loyalty and usage rates.



Example of Launching Targeted Campaigns: Domino’s Pizza introduced its “Oh Yes We Did” campaign, acknowledging quality issues and emphasising improvement, leading to a turnaround in sales and regaining market confidence.

Expand Distribution Channels

1. Online Presence: Optimise e-commerce platforms and invest in digital marketing.
2. Partnerships: Collaborate with retailers, distributors, or affiliates.
3. Global Markets: Explore new regions to grow the customer base

Example of Expanding Distribution Channels: Starbucks increased its availability in grocery stores and through delivery apps to regan customers lost to competitors offering more convenient coffee options.


Example of Entering New Markets: Tesla began targeting overseas markets like China and Europe to compensate for slowing growth in the U.S., helping to expand its global footprint.

Innovate and Modernise

1. Embrace Technology: Use AI, automation, or analytics to optimize operations.
2. Green Initiatives: Adopt sustainable practices to appeal to eco-conscious consumers.
3. Product Design: Innovate to meet evolving consumer needs.

Example of Improving Product Quality: Samsung made significant investments in improving its smartphone features, such as better cameras and durability, following the 2016 Galaxy Note 7 recall crisis. Enhanced quality helped restore consumer trust.



Example of Leveraging Technology: Nike integrated digital technology with products (e.g., Nike+ running app) to stay relevant in a competitive fitness market, regaining market share from brands like Adidas and Under Armour.

Internal Realignments

1. Team Training: Equip staff with new skills to adapt to market changes.
2. Cost Optimisation: Streamline operations to maintain profitability.
3. Strategic Focus: Refocus on profitable segments or core competencies.

 

Example of Acquire Competitors: Facebook acquired Instagram and WhatsApp to counteract potential losses in market share as younger users started shifting to alternative platforms.

Rebranding or Repositioning

1. Brand Refresh: Update visual identity or messaging to align with modern trends.
2. Repositioning: Shift market positioning to target underserved audiences.

Example of Rebranding or Refreshing Marketing: PepsiCo redesigned its packaging and marketing campaigns to attract younger audiences when Coca-Cola began outperforming it in specific segments. New branding helped reposition Pepsi as a modern, trendy choice.

These actions are tailored to address specific causes of market share loss, whether due to competition, changing consumer preferences, or operational inefficiencies.

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