Glacita, Zandra Andrea Mktg 1 THU 12:30-3:30

July 11, 2013

Intensive Growth Strategies: Ansoff’s Product-Market Expansion Grid

Market penetration strategy
Example: Market penetration strategy is when the product is in the current market, it can still
grow. Just like the Pakistan State Oil penetrates in Pakistan market from 40% to 65% in the
duration of 4 years by developing new retail outlets.

Market development Strategy

Example: When the current product is launched in a new market and a perfect example is
Chinese products developed new market for their product worldwide.

Product Development Strategy

Example: When a new product is launched in the current market Develop new features for
example in McDonalds is always within the fast-food industry, but frequently markets new
burgers

Diversification Strategy
Example: When a new product is launched in a new market, diversification makes good sense
as better opportunities are found outside the present business and Canon diversified from a
camera-making company into producing whole new range of office equipment.

The BCG Growth-share matrix

Question marks -

Fresca is a brand that is growing rapidly but with the mix between that they consume large
amounts of cash to grow and that it’s insecure if it will be repaid. A question mark has the
potential to gain market share and become a star, and eventually a cash cow when the market
growth slows.

Stars –

Powerade has units with a high market share in a fast-growing industry. Your product is well-
established when here and a real opportunity. The hope is that stars become the next cash
cows.
Dogs –

Coca-cola has units with low market share in a mature, slow-growing industry. These units
typically "break even", generating barely enough cash to maintain the business's market share.
There are still rationals for owning a dog unit and it could provide the social benefit of jobs and
synergies that assist other business units.

Cash cows-

On the other hand, vanilla coke units with high market share in a slow-growing industry. These
units typically generate good amount of cash. They are regarded as stable in a mature market.
Since they provide relatively safe cash generation due to the market development every
corporation would love to own as many as possible. The name “cash cow” origin from that the
units are to be "milked".