Ansoff Matrix Flashcards
Product Development
This involves the development of new products for existing markets improve or relaunch the product into existng markets
Benefits of Product Development
creates brand loyalty
it can attract new customers to the business
the business can create an USP
the business can develop its product range this allows the business the business to spread it risks acroos a range of products
Drawbacks to product development
There can be an increase in the business overall costs- Cost such as market development research and development
There is an increased risk
They may lack an competitive advantage in the market
Market development
Finding and developing new markets for existing products to meet the needs of the markets
Benefits of Market Development
Attracts new customers and investors
allows the business to improve the quality
The business can invest any profits back into the busines
Drawbacks of Market development
There is a moderate degree of risk
the impact of exchange rates
There can be increase costs
Market Penetration
Concentrating of the sales of existing products to existing markets
Benefits of Market Penetration
Can increase their market share
increase their brand image
a business can achieve purchasing economies of scale
Drawbacks of Market Penetration
Can have short term impact
Can be challenged
less potential for a reward
Diversification
It involves offering a new product in a different area.
It is when a business expands its activities outside its
normal range,
Benefits of Diversification
It allows the business to enter new markets
New opportunity and has investment funds
There is a potential growth
allows the business to adding to their Product Portfolio
Drawbacks of Diversification
There is a higher degree of Risk
fewer economies of scale
