Presented by:P.

DEEPIKA NAIDU RAJ PATIL

Developed by Igor Ansoff. Framework for understanding corporate growth opportunities. First published in his article "Strategies for Diversification" in the Harvard Business Review (1957). This is a framework which focuses on two dimensions namely product & market.
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Existing product Existing market

New product

New Market

Market penetration Product Increase the sales in development existing market. New product developed for existing market. Market Diversification Development New products sold Existing product sold to new market. to new market.
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Gives direction for exploring business. Systematic way to analyze business strategy. It also help to forecast returns and risk involved in strategy.

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Aim- to increase the share of current market with existing product.

How to increase market penetration Encourage increase in frequency of use. Attract customers away from rivals. Encourage non buyers to buy. Implement new application in product.
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Market is not saturated. Growth in market. Competitor share of market is falling. There is scope for selling more to existing customers.
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Aim:-Selling the same product in a new market or segment.

How to make market development: Gaining new segments and new markets. Entering overseas markets. This requires changes to marketing strategy such as different pricing policy, new promotional strategy, new distribution channels.
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Untapped markets are opening. The firm has excess capacity of production. If there are attractive channels to access new market.

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Aim:- to develop a new product for existing market.

How to make product development: New innovative products. Product improvements. Product at a different quality level of the existing product. New product to compliment existing product.
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Competitors are having better product. Company having strong R&D capabilities. Market is growing and there is a rapid change.

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Aim:-new products for new markets.

Diversification

Related diversification

Unrelated diversification

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The new product is of same type or category but launched in new market.
E.g. Piaggio launching 3 wheelers in India. 3 wheeler is the new product for Piaggio. Product is an automobile. It is launching in new market. E.g. Dell launching its laptop in India. Its a type of computer. Launching in India.
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The product and the market are completely new for the company. Not of same category. Also known as Conglomerate diversification. E.g. Kingfisher launching its new airline services. E.g. ITC group coming up with stationeries (classmate).
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Market penetration:-low risk but the chances of success are less due to competition. Market development:- moderate risk as customers are not familiar. Product development:- new product development is costly and moderate risk. Diversification:-high risk as both product and market is new.
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Market Penetration

Product development

Market development
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Diversification
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Example of

Market Penetration

Product development

Market development
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Diversification
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Example of

Market Penetration

Product development

Market development
13 June 2011

Diversification
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