3.1 Theories of cooperate strategy Flashcards
Ansoff’s Matrix
A marketing planning model that helps a business determine its product and market strategy.
Market penetration
A growth strategy where a business aims to sell existing products into existing markets.
Market penetration aim
To increase market share by getting existing customers to buy more.
Market penetration evaluate
Focuses on products and markets it knows
Exploit insights
Examples of market penetration
McDonalds promotions
Aldi opening new stores
Product development
A growth strategy where a business aims to introduce new products into existing markets.
Product development evaluate
Plays to strengths of established businesses
Idea of being the first to the market.
Examples of product development
iPhone
Nike shoes
Market development
A growth strategy where business seeks to sell existing products into new markets.
Examples of Market development
New geographical markets
New Distribution matters
Different pricing strategies
Diversification
A growth strategy where business seeks to sell new products into new markets.
What risk does market penetration have?
Least risk
Disadvantage of the method of market penetration
Least potential for growth
What risk does product development have?
Moderate risk
Why does product development have risk?
Expenses with research and development.
What risk does market development have?
Moderate risk
Why does market development have risk?
market research is needed
What risk does diversification have?
Most risk
Why does diversification have risk?
Research and development costs
Market research costs
Whats an advantage of diversification?
Stimulates growth potential
Porter’s strategic matrix
Theory about the strategic positioning of a business.
Low cost producer
Being the cheapest consumers can buy.
How is a low cost producer achieved
Economies of scale
Finding cheapest suppliers
Unique innovation
Differentiation
Something unique about business that consumers will pay for.
