A market with existing product range but in a new market
(marketed to a new audience)
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What is the aim of market development ?
-Increase market shares&sales
-Finding new geographic areas/alter packaging/new distribution channels
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What is product development?
Changing an existing product or developing a new one in an existing market
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What is the aim of product development?
-To increase market share/grow but using existing customers
-Used when products need to be differentiated
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What is diversification(new product/market)?
-Develop a new product in a new market
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What is the aim of diversification?
To increase market share, but require a business to attract a new customer base for its new product range
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What is related diversification?
Strategy that a business uses existing products but alters them slightly and enters into a new market
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What is unrelated diversification?
The business is targeting new markets with completely new products
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What are 3 advantages of using ansoff matrix?
-Simple analysis of all the possible strategies available
-Shows what happens to market share and growth for each strategy
-Allows management to focus on the risks associated with each strategy
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What are 3 disadvantages of ansoff matrix?
-Too simplistic,doesnt take into account the economic reality at the time
-Doesn't analyse the resources needed to achieve strategies(land etc..)
-Costly and time-consuming to draw up
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What does the Boston Matrix show?
The market share and growth of the various products within a business's product portfolio
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What are the 4 strategic options involved in the Boston Matrix?
-Stars
-Problem children
-Cash cows
-Dogs
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What are stars?
-High market share & high market growth
-Require minimal financial support
-High profits/surplus revenue
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What are problem children(aka question marks)?
-Low market share and high market growth
-Profit/losses
-Dependent on the level of financial support for their success
-Shows which products generate the most cash flow/least cash flow
-Helps the business with appropriate timing for product launch
-Shows which products have high market share/which have grown in market
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What are 3 disadvantages of the Boston Matrix ?
-It ignores qualitative data(consumers opinions)
-Trying to predict cash flows is difficult
(affected by unexpected events)
-No guarantee of success
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Other cards in this set
Card 2
Front
What are the 4 growth strategies of the ansoff matrix?
Back
-Market penetration
-Product development
-Market development
-Product/market diversification
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