BCG Matrix:

The BCG Matrix was created by the” The Boston Consulting Group” (BCG) and it became one of the
most well-known portfolio management decision making tools in the early 1970's. It is based on the
product life cycle theory, and it is used to prioritize the product portfolio in a company or department.
There are two dimensions - market share and market growth. The basis idea in using the Matrix is that the
higher the market share a product has, the higher the growth rate and the faster the market for that product
grows.

Ref: Web 2

In the above illustration, we prospect our product Colgate Junior to be in QUESTION MARK box. As
the product is being launched by a company already running successfully in oral care industry i-e
Colgate Palmolive, so the product has intensive growth rate and market acceptability. As far as market
share is concerned, a newly introduced product will have a low market share but with the passage of
time Colgate Junior will gain rigorous sales through our promotional strategies. At that echelon, we
will be moving towards the star box. So STAR will be our ultimate and prior location.

Briefly, the strategy would be intensive cash investment to keep the product on the track and then
transforming the product to the maximum revenue generator. . The profit share will increase parallel to
the ratio of growth. Time is the main factor to gain require target of market share & growth. As a result
of 'economies of scale' (a basic assumption of the BCG matrix), it is assumed that these earnings will
grow faster the higher the share