BOSTON CONSULTING

GROUP MATRIX

PREPARED BY HARDI SAGLANI

WHAT IS BCG MODEL IN MARKETING?

The Boston Consulting Group (BCG) growth-share matrix is a

planning tool that uses graphical representations of a company's
products and services in an effort to help the company decide
what it should keep, sell, or invest more in.
WHAT DOES QUESTION MARK REPRESENT IN

BCG?

Question mark symbolize Remain Diversifies in BCG matrix. The

BCG growth-share matrix is used to help the company decide
what it should keep, sell, or invest more in. The BCG growth-
share matrix breaks down products into 4 categories: dogs, cash
cows, stars, and "question marks".
 WHAT DO CASH COWS REPRESENT IN BCG

MATRIX?

Cash Cows symbolize Stable in BCG matrix, Cash cows are the
leaders in the marketplace and generate more cash than they
consume. These are business units or products that have a high
market share but low growth prospects.
WHAT DOES DOG REPRESENT IN BCG?

A dog is a business unit that has a small market share in a

mature industry. A dog thus neither generates the strong cash
flow nor requires the hefty investment that a cash cow or star
unit would (two other categories in the BCG matrix). A dog
measures low on both market share and growth.
WHAT DO STARS REPRESENT IN BCG?

The vertical axis of the BCG Matrix represents the growth rate of
a product and its potential to grow in a particular market.
 BOSTON CONSULTING GROUP MATRIX (BCG) ON COCA-

COLA

Introduction of Coca-Cola: Coca-Cola (also known as Coke) is a

popular carbonated soft drink sold in stores, restaurants and
vending machines in over two hundred countries. It is produced by
The CocaCola Company, which is also occasionally referred to as
Coca-Cola or Coke. It is one of the world's most recognizable and
widely sold commercial brands. Coke's major rival is Pepsi. Although
Coke has been the target of urban legends decrying the drink for its
supposedly copious amounts of "acid", or the "life-threatening"
effects of its carbonated water but still it is the most in-style soft
drink.
About its safety and the ethics of the company that
produces it, it is widely accepted as the most dominant soft
drink in the world today. Originally intended as a patent
medicine when it was invented in the 19th century, Coca-
Cola was bought out by shrewd businessman Asa Griggs
Candler, whose aggresive marketing tactics led Coke to its
dominance of the world soft drink market throughout the
20th century. Although faced with accusations of perverse
side-effects on the health of consumers and monopolistic
practices by its producing company Coca-Cola has remained
a poular soft drink well into the first decade of the 21st
century.
BCG GROWTH MATRIX ANALYSIS

The BCG matrix approach is based on the product life cycle

concepts which can be utilized to identify what priorities
should be given in the product portfolio of a business level.
To make sure that the company is creating long-tern value, an
industry should have a portfolio of products which contains
both high-growth products in need of cash inputs as well as
low-growth products which establishes a lot of profit or cash.
BCG matrix relies on 2 dimensions: market growth and
market share. The basic notion behind it is that the higher the
market share of a specific product has or the faster the
product's marketability grows, the better it is for the industry.
Placing appropriate products in the BCG matrix, results in 4
categories, in the business portfolio of an industry.
 THE FOUR CATEGORIES INCLUDE THE STARS, CASH COWS,

DOGS, QUESTION MARKS

STARS: HIGH GROWTH, HIGH MARKET SHARE

Stars are leaders in business.
They require heavy investment to maintain its large market
share.
It leads to a large amount of cash consumption and cash
generation.
Attempts should be made to hold the market share otherwise
the star will become a cash cow.

The star products of Coca-Cola are Thumbs up, Maaza, Kinley

 THE FOUR CATEGORIES INCLUDE THE STARS, CASH COWS,

DOGS, QUESTION MARKS

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.
They are located in an industry that is mature, not growing or
declining.

The products which Cash Cows are Limca, Coca-Cola.

THE FOUR CATEGORIES INCLUDE THE STARS, CASH COWS,

DOGS, QUESTION MARKS

QUESTION MARKS: HIGH GROWTH, LOW MARKET SHARE

Most businesses start of as question marks.
They will absorb great amounts of cash if the market share
remains unchanged.
Question marks have potential to become star and eventually
cash cow but can also become dog.
Investments should be high for question marks.

The question marked products of Coca-Cola are Fanta, Sprite.

 THE FOUR CATEGORIES INCLUDE THE STARS, CASH COWS,

DOGS, QUESTION MARKS

DOGS: LOW GROWTH, LOW MARKET SHARE

Dogs are the cash traps.
Dogs do not have potential to bring in much cash.
Business is situated at a declining stage.

The products which are at Dogs are Diet Coke, Minute maid.
The five forces measure the competitiveness of the market
deriving its attractiveness.

The 5 forces are (1) Threat of New Entrants, (2) Threats of

Substitute Products or Services, (3) Bargaining Power of Buyers,
(4) Bargaining Power of Suppliers, (5) Competitive Rivalry Among
Existing Firms. The following is a Five Forces analysis of The Coca-
Cola Company in realtionship to its CocaCola brand.
 CONCLUSION

Star Strategy: Invest profits for future growth and for earning more of
market share and profits.
Cash Cow Strategy: Use profits to finance new products and growth
elsewhere.
Question Mark Strategy: Either invest heavily in order to push the
products to star status, or divest in order to avoid it becoming a Dog.
Dog Strategy: Either invest to earn market share or consider disinvesting.

Thus the BCG matrix is the best way for a business portfolio analysis. The
strategies recommended after BCG anaylsis help the firm decide on the right
line of action and help them implement the same.
THANK YOU