Growth & Ansoff Matrix

MAKING BUSINESS DECISIONS
Learning Objectives  To understand and explain the Ansoff model for
strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study

and the strategy it wants to adopt. Ansoff Matrix will suggest one of four options. Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study . Definition: Depending on the aims & objectives of the business. of a number of options. It is based on comparing the relative merits of selling existing products and new products in existing markets and new markets. a business could adopt to increase its sales.GROWTH & ANSOFF MATRIX Ansoff Matrix A tool that is used by businesses to identify which.

Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .  If the business has no other options but to keep going with its existing products.  If direct competition is declining as businesses leave the market the gap they leave can be filled with existing products.  If the business is a strong market leader it can force competition out of the market.MARKET PENETRATION The starting point  Requires relatively less investment  Less risky Why adopt this strategy?  If the market is growing sufficiently to enable the business to increase its own sales.

MARKET PENETRATION Achieving market penetration Market Penetration Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .

 If existing markets have reached saturation. Why adopt this strategy?  If the product or brand is so strong that it will readily & easily find acceptance & sales in new markets.MARKET DEVELOPMENT Raising the risk level Strategy is to seek new channels of distribution for the product or to sell it in different geographic areas.  Market research identifies that new markets are emerging & there is a need for the existing product. How can it be achieved? Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .

Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .  If it is trading in a market where there is not many products.  It has a wealth of new product ideas. limited choice.  confident that new products will be as good as existing products  confident that a market exists for the new products.  If it has a niche marketing strategy. If it is operating in a market where the products have a very short life cycle. confident that product carrying its brand name will be successful in existing markets. Why adopt this strategy?  If have strong distribution & understanding of customers.PRODUCT DEVELOPMENT New products into existing markets To be successful:  confident name is strong to get its customers to buy the products that it introduces.

PRODUCT DEVELOPMENT Achieving product development PRODUCT DEVELOPMENT Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .

 To spread risk – does not want to keep all of its eggs in one basket. Why adopt this strategy?  The product range & existing markets no longer offer any opportunity for growth.  When existing products or markets are declining.  Opportunities for diversification are worth the risk.  Able to equally apply success to different products in different markets How can we increase the chances of success? Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .DIVERSIFICATION The highest risk strategy of all This is a strategy that has been pursued by many businesses.

ANSOFF MATRIX Draw the Ansoff Matrix for Toyota and suggest specific strategies they could use to achieve all 4 options for growth. 10 minutes Learning Objectives GROWTH & ANSOFF MATRIX  To understand and explain the Ansoff matrix for strategic growth decisions  To apply Ansoff matrix analysis to Toyota case study .

giving the business a number of different strategic options Existing Products Existing Markets Market Penetration Expand organically and make cars more fun Expand by acquisition of a competitor New Products Product Development Develop more hybrid and eco friendly cars New Markets Market Development Diversification Expand overseas (Asia) Develop “smart communities” .Ansoff’s Matrix can be applied to Toyota.

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