MARKETING

MANAGEMENT
www.esnips.com/web/g
himm
DEVELOP A MARKETING PLAN FOR
A PRODUCT OF YOUR CHOICE.
Refer to Sample Marketing Plan
Page No. 57-58
Marketing Management: A South Asian
Perspective
BCG Matrix
BOSTON CONSULTING GROUP (BCG) MATRIX is
developed by BRUCE HENDERSON of the BOSTON
CONSULTING GROUP IN THE EARLY 1970’s.
According to this technique, businesses or products are
classified as low or high performers depending upon their
market growth rate and relative market share.

Market share is the percentage of the total market that is

being serviced by your company, measured either in
revenue terms or unit volume terms.

RELATIVE MARKET SHARE (RMS)

RMS = Business unit sales this year

Leading rival sales this year
Example
Market Share of the World's Largest Music Companies

COMPANY MARKET SHARE IN 2007

Universal Music Group 27%
Time Warner Music 17
Sony 16
Bertelsmann's BMG 14
EMI 10
Independents 17

RMS = Business unit sales this year = 16 = 0.59%

Leading rival sales this year 27
Market growth (MGR) is used as a measure of a
market’s attractiveness.

MGR = Individual sales - individual sales

this year last year
Individual sales last year
 Analyzing Current SBU’s:
Boston Consulting Group
Approach
Relative Market Share
High Low
Market Growth Rate

Stars Question
Question Marks ?
High

Marks
• High growth & share ••High
Highgrowth,
growth,low
lowshare
share
• Profit potential ••Build
Build into Stars orphase
into Stars or phaseout
out
• May need heavy ••Require
Requirecash
cashto
tohold
hold
investment to grow market
marketshare
share
Cash
Cash Cows
Cows Dogs
Dogs
••Low ••Low
Lowgrowth
growth&&share
Lowgrowth,
growth,high
highshare
share share
Low

••Produce cash ••Low

Lowprofit
profitpotential
potential
Produce cash

8
STARS
High growth, High market share

 Stars are leaders in business.

 They also require heavy investment, to
maintain its large market share.
 Attempts should be made to hold the market
share otherwise the star will become a CASH
COW.
CASH COWS
Low growth , High market share

 They are foundation of the company and

often the stars of yesterday.
 They generate more cash than required.
 They extract the profits by investing as little
cash as possible
DOGS
Low growth, Low market share

 Dogs are the cash traps.

 Dogs do not have potential to bring in much
cash.
 Number of dogs in the company should be
minimized.
 Business is situated at a declining stage.
QUESTION MARKS
High growth , Low market share

 Most businesses start of as question marks.

 Why question marks?
 Question marks have potential to become
star and eventually cash cow but can also
become a dog.
 Investments should be high for question
marks.
ITC- TOBBACO
 ITC is a leader in terms of volume,
of Rs. 11000 crores, 97 billion
sticks cigarette market.
 The segment is witnessing
stagnancy with volumes declined
in last three years.
 In last five years, Rs. 1000 crore
has been pumped into the
cigarettes business. Now,
additional Rs. 500 crores are
planned to be invested.
 There is an inevitable shift of
consumers away from the
CASH COW 
smoking habit.
In spite of dropping volumes, ITC
is able to maintain its profitability
by increasing margins.
ANSOFF’S MATRIX
 Selling more of an existing
product to an existing market.
This is going deeper into a
market so it is called market
penetration (More Promotion).
 Selling an existing product to a COCA COLA
new market. This is called
market development.
 Selling a new product to an
existing market. This is called
product development as it
means making changes to a
product, for instance a new
flavour like Coca-Cola Vanilla.
 Selling a new product to a new
market. This is called
diversification. Ex. diet coke
being targeted at people who are
health conscious.
Market Penetration Strategy

This focuses growth on the existing

product range by encouraging higher
levels of take-up of a service among the
existing target markets

Example: A supplier of fresh orange juice

encouraging its customers to drink orange
juice on occasions when they might
otherwise consume milk.
Market Development
Strategy
This strategy
builds upon the
existing product
range, which an
organization has
established, but
seeks to find new
groups of
customers for it.
Product Development
Strategy
An organization may choose to develop new products for
its existing markets.
Again referring to mobile phones, many companies have
developed innovative products to offer as additional
accessories to existing customers, including “hands-free”
car kits, traffic information services and on-line information
services.

NIVEA Visage Soft Facial Cleansing Wipes show product

development. Women who bought NIVEA skincare
products were looking for new ways to clean and care for
their skin.
READ

MARKETING INFORMATION SYSTEM (MIS)

PAGE NO. 63-66

MARKETING MANAGEMENT-A SOUTH ASIAN

PERSPECTIVE
THANK YOU