Unit 4 · Sales Promotion · Module 28 of 40

Penetration vs Retention Strategies

Learning objective

Decide between acquiring light buyers and deepening existing relationships.

Concept summary

Penetration grows brands by recruiting many light buyers, which favours reach media and trial offers. Retention protects margin through frequency, loyalty and service. Most categories reward penetration-led growth with a retention floor rather than either extreme.

Application task

Split a fixed budget between penetration and retention for one brand and defend the ratio.