Actions

Difference between revisions of "Product/Market Grid"

m (The LinkTitles extension automatically added links to existing pages (https://github.com/bovender/LinkTitles).)
m
 
Line 1: Line 1:
−
The [[Product]]/Market Grid of Ansoff is a [[model]] that has proven to be very useful in [[business]] unit [[strategy]] processes to determine business growth opportunities. The Product/Market Grid has two dimensions: products and markets. Over these 2 dimensions, four growth strategies can be formed.
+
The [[Product]]/Market Grid of Ansoff is a model that has proven to be very useful in [[business]] unit [[strategy]] processes to determine business growth opportunities. The Product/Market Grid has two dimensions: products and markets. Over these 2 dimensions, four growth strategies can be formed.
−
*[[Market]] Penetration. Sell more of the same products or services in current markets. These strategies normally try to change incidental clients to regular clients, and regular client into heavy clients. Typical systems are volume discounts, bonus cards and [[Customer]] Relationship [[Management]]. Strategy is often to achieve economies of scale through more efficient [[manufacturing]], more efficient [[distribution]], more purchasing [[power]], overhead sharing.
+
 
 +
*[[Market]] Penetration. Sell more of the same products or services in current markets. These strategies normally try to change incidental clients to regular clients, and regular clients into heavy clients. Typical systems are volume discounts, bonus cards, and [[Customer]] Relationship [[Management]]. Strategy is often to achieve economies of scale through more efficient [[manufacturing]], more efficient distribution, more purchasing power, and overhead sharing.
 +
 
 
*Market Development. Sell more of the same products or services in new markets. These strategies often try to lure clients away from competitors or introduce existing products in foreign markets or introduce new [[brand]] names in a market. New markets can be geographic or functional, such as when we sell the same product for another purpose. Small modifications may be necessary. Beware of cultural differences.
 
*Market Development. Sell more of the same products or services in new markets. These strategies often try to lure clients away from competitors or introduce existing products in foreign markets or introduce new [[brand]] names in a market. New markets can be geographic or functional, such as when we sell the same product for another purpose. Small modifications may be necessary. Beware of cultural differences.
 +
 
*[[Product Development]]. Sell new products or services in current markets. These strategies often try to sell other products to (regular) clients. These can be accessories, add-ons, or completely new products. Cross-selling. Often, existing communication channels are used.
 
*[[Product Development]]. Sell new products or services in current markets. These strategies often try to sell other products to (regular) clients. These can be accessories, add-ons, or completely new products. Cross-selling. Often, existing communication channels are used.
−
*Diversification. Sell new products or services in new markets. These strategies are the most risky type of strategies. Often there is a credibility focus in the communication to explain why the company enters new markets with new products. On the other hand diversification strategies also can decrease [[risk]], because a large corporation can spread certain risks if it operates on more than one market. Diversification can be done in four ways:
+
 
 +
*Diversification. Sell new products or services in new markets. These strategies are the riskiest type of strategy. Often there is a credibility focus in the communication to explain why the company enters new markets with new products. On the other hand diversification strategies also can decrease [[risk]], because a large corporation can spread certain risks if it operates in more than one market. Diversification can be done in four ways:
 
**Horizontal diversification. This occurs when the company acquires or develops new products that could appeal to its current customer groups even though those new products may be technologically unrelated to the existing product lines.
 
**Horizontal diversification. This occurs when the company acquires or develops new products that could appeal to its current customer groups even though those new products may be technologically unrelated to the existing product lines.
 
**Vertical diversification. The company moves into the business of its suppliers or into the business of its customers.
 
**Vertical diversification. The company moves into the business of its suppliers or into the business of its customers.
 
**Concentric diversification. This results in new product lines or services that have technological and/or [[marketing]] synergies with existing product lines, even though the products may appeal to a new customer group.
 
**Concentric diversification. This results in new product lines or services that have technological and/or [[marketing]] synergies with existing product lines, even though the products may appeal to a new customer group.
−
**Conglomerate diversification. This occurs when there is neither technological nor marketing synergy and this requires reaching new customer groups. Sometimes used by large companies seeking ways to balance a cyclical [[portfolio]] with a non-cyclical one.
+
**Conglomerate diversification. This occurs when there is neither technological nor marketing synergy and this requires reaching new customer groups. Sometimes used by large companies seeking ways to balance a cyclical portfolio with a non-cyclical one.
−
Although the Product/Market Grid of Ansoff is already decennia old, it remains a valuable model for communication around business unit strategy processes and business growth. The Matrix is also known as: the [[Ansoff Matrix]], the Product Market Expansion Grid, and the Growth Vector Matrix.<ref>What is Product/Market Grid [https://www.12manage.com/methods_productmarketgrid.html 12 Manage]</ref>
+
Although the Product/Market Grid of Ansoff is already decennia old, it remains a valuable model for communication around business unit strategy processes and business growth. The Matrix is also known as the [[Ansoff Matrix]], the Product Market Expansion Grid, and the Growth Vector Matrix.<ref>What is Product/Market Grid [https://www.12manage.com/methods_productmarketgrid.html 12 Manage]</ref>
 +
 
 +
===See Also===
 +
*[[Market Analysis]]
 +
*[[Market Cap]]
 +
*[[Market Driven Organization]]
 +
*[[Market Forces]]
 +
*[[Market Research]]
 +
*[[Target Market]]
 +
*[[Product/Market Fit]]
 +
*[[Product/Market Grid]]
 +
*[[Marketing]]
 +
*[[Marketing Effectiveness]]
 +
*[[Market Maturity]]
 +
*[[Marketing Plan]]
 +
*[[Marketing Strategy]]
 +
*[[4S Web Marketing Mix Model]]
 +
*[[5C's of Marketing Strategy]]
 +
*[[7 Ps of Marketing]]
 +
 
 +
 
 +
===References===
 +
<references />

Latest revision as of 19:05, 3 November 2022

The Product/Market Grid of Ansoff is a model that has proven to be very useful in business unit strategy processes to determine business growth opportunities. The Product/Market Grid has two dimensions: products and markets. Over these 2 dimensions, four growth strategies can be formed.

  • Market Penetration. Sell more of the same products or services in current markets. These strategies normally try to change incidental clients to regular clients, and regular clients into heavy clients. Typical systems are volume discounts, bonus cards, and Customer Relationship Management. Strategy is often to achieve economies of scale through more efficient manufacturing, more efficient distribution, more purchasing power, and overhead sharing.
  • Market Development. Sell more of the same products or services in new markets. These strategies often try to lure clients away from competitors or introduce existing products in foreign markets or introduce new brand names in a market. New markets can be geographic or functional, such as when we sell the same product for another purpose. Small modifications may be necessary. Beware of cultural differences.
  • Product Development. Sell new products or services in current markets. These strategies often try to sell other products to (regular) clients. These can be accessories, add-ons, or completely new products. Cross-selling. Often, existing communication channels are used.
  • Diversification. Sell new products or services in new markets. These strategies are the riskiest type of strategy. Often there is a credibility focus in the communication to explain why the company enters new markets with new products. On the other hand diversification strategies also can decrease risk, because a large corporation can spread certain risks if it operates in more than one market. Diversification can be done in four ways:
    • Horizontal diversification. This occurs when the company acquires or develops new products that could appeal to its current customer groups even though those new products may be technologically unrelated to the existing product lines.
    • Vertical diversification. The company moves into the business of its suppliers or into the business of its customers.
    • Concentric diversification. This results in new product lines or services that have technological and/or marketing synergies with existing product lines, even though the products may appeal to a new customer group.
    • Conglomerate diversification. This occurs when there is neither technological nor marketing synergy and this requires reaching new customer groups. Sometimes used by large companies seeking ways to balance a cyclical portfolio with a non-cyclical one.

Although the Product/Market Grid of Ansoff is already decennia old, it remains a valuable model for communication around business unit strategy processes and business growth. The Matrix is also known as the Ansoff Matrix, the Product Market Expansion Grid, and the Growth Vector Matrix.[1]

See Also


References

  1. ↑ What is Product/Market Grid 12 Manage
Retrieved from "https://cio-wiki.org//index.php?title=Product/Market_Grid&oldid=11003"