Question

Bud’s Bucket ice cream company produces a chemically enriched ice cream and decides to penetrate the gourmet market by offering its same ice cream at premium prices. What might happen as a result of its market penetration strategy?

Answer 1

Answer:

It may turn off it's current customer base and cause them to purchase a competitors ice cream.

Explanation:

Market penetration strategy is the process of selling current products to an already existing market so as to obtain a higher market share by taking the market shares from the other competing companies.

Market penetration strategy uses low prices to generate demand for a product and increase market share. Bud's bucket ice cream decides to penetrate the gourmet market by offering its same ice cream at high prices instead of reducing the price, this might lead to a reduction in their current customer base.