Principles of Marketing by ProfessorBurgerQueen
Partnering to Build Customer Engagement, Value, and Relationships
- Strategic planning is the process of developing and maintaining a strategic fit
between the organisation's goals and capabilities, and its changing marketing
operations
- The business portfolio is a the collection of businesses and products that make up
the company
- Portfolio analysis is a major activity in strategic planning whereby management
evaluates the products and businesses that make up the company
The BCG Growth-Share Matrix (Boston Matrix)
- Dog - Low market growth rate, low relative market share
- Cash Cow - Low market growth rate, high relative market share
- Question Mark - High market growth rate, low relative market share
- Star - High market growth rate, high relative market share
- In this classic portfolio planning approach, the company invests funds from mature,
successful strategic business units (cash cow) to support promising ones in
faster-growing markets (question mark and star)
- The company must decide how much it will invest in each strategic business unit,
and decide whether to build, hold, harvest, or divest
- Strategic Business Units (SBUs) can be a company division, product line, or single
product/brand
Problems with Matrix Approaches
- Difficulty in defining SBUs and measuring market share and growth
- Time consuming
- Focus on current businesses, not future planning
- The Ansoff Matrix helps marketers identify opportunities to grow revenue for the
business through developing new products & services, or tapping into new markets
- Market Penetration - Existing markets, existing products & services
- Market Development - New markets, existing products & services
- Product Development - Existing markets, new products & services
- Diversification - New markets, new products & services
Partnering to Build Customer Engagement, Value, and Relationships
- Strategic planning is the process of developing and maintaining a strategic fit
between the organisation's goals and capabilities, and its changing marketing
operations
- The business portfolio is a the collection of businesses and products that make up
the company
- Portfolio analysis is a major activity in strategic planning whereby management
evaluates the products and businesses that make up the company
The BCG Growth-Share Matrix (Boston Matrix)
- Dog - Low market growth rate, low relative market share
- Cash Cow - Low market growth rate, high relative market share
- Question Mark - High market growth rate, low relative market share
- Star - High market growth rate, high relative market share
- In this classic portfolio planning approach, the company invests funds from mature,
successful strategic business units (cash cow) to support promising ones in
faster-growing markets (question mark and star)
- The company must decide how much it will invest in each strategic business unit,
and decide whether to build, hold, harvest, or divest
- Strategic Business Units (SBUs) can be a company division, product line, or single
product/brand
Problems with Matrix Approaches
- Difficulty in defining SBUs and measuring market share and growth
- Time consuming
- Focus on current businesses, not future planning
- The Ansoff Matrix helps marketers identify opportunities to grow revenue for the
business through developing new products & services, or tapping into new markets
- Market Penetration - Existing markets, existing products & services
- Market Development - New markets, existing products & services
- Product Development - Existing markets, new products & services
- Diversification - New markets, new products & services
