PORTFOLIO

MANAGEMENT
What is PORTFOLIO
MANAGEMENT?
 PORTFOLIO is the
Collection of Products,
Services, or Brands that
are offered for sale by a
company.
Balancing Portfolio is one of
the most crucial jobs of
Marketing Managers.
Marketing Manager’s primary
job is to manage and balance
his/her portfolio.
• B.C.G. Analysis
• Contribution Margin
Analysis
• GE General Electirc Multi
Factorol Analysis
• We can do one thing at a time

• We have limited resources

• Specialization
B.C.G. Analysis
 B.C.G. Analysis

B.C.G. Analysis is a technique

used in Brand marketing, Product
management, and Strategic
management to help a company
decide what products to add to its
product portfolio.
Based on Two factors

• Relative Market Share

• Market Growth Rate
Relative Market Share

“…is that share which a

company has in total market
available for a particular
product”.
• The quality
• The Product
• The Acceptance
• The Marketing Efforts
• The Marketing Organization
• The Prices
 Market Growth Rate

“….is the development of an

industry or a particular
product”.
FOUR KINDS OF
PRODUCTS

Products with high
market share but low
growth are referred to
as "cash cows".
 Products with high
market share and high
growth are referred to
as "stars".
 Products with low
market share in a low
growth market are
referred to as "dogs"
 Products with low
market share but high
market growth are
referred to as
"question marks" or
"problem children".
 Balance various inputs and
types of products in portfolio.
A company should have a balanced
portfolio. This implies having at
least one "cash cow" which can
generate revenue that can be
used to develop one or more
"question mark". This process,
referred to as "milking your cash
cow“.
G.E. Multi Factoral
Analysis
One dimension comprises
nine industry attractiveness
measures; the other
comprises twelve internal
business strength measures.
Contribution Margin
Analysis
Marketing Management is a

• Very dynamic Science

• Science which changes
quickly and we have to keep
pace with it.
• Technology
• Resources
• New Findings
• Discoveries
• Inventions etc
Marketing Manager never
sleeps.
What will happen to profits if a
new product is added or an
existing product is
discontinued?
 Marketing Manager should be
watchful of Profits and we have to
be very sure what actions are we
taking. Actions must ensure
Profits.
 Calculations take into account
additional revenues, additional
costs, effects on other products in
the portfolio (referred to as
cannibalization), and consumer’s
reactions.
We Marketing Mangers must be
very careful in balancing our
portfolio from
• Profits point of view
• Image point of view
• Reputation point of view
• Convenience point of view
• Consumer’s point of view
 60% of the failure of
Organizations is because of
wrong Portfolios.
• Ability to Pay

• Willingness to Pay