Ansoff Matrix- 3.8.1.

Question 1

What does Ansoff Matrix do?

Answer 1

Used in strategy stage of marketing planning process.

Identifies which strategy business should use, informs which tactics should be used in marketing activity.

Adopt 2 strategies to reach different markets.

Question 2

Draw the Ansoff Matrix diagram?

Question 3

What are the 4 sections in the Ansoff Matrix?

Answer 3

Market penetration, product development, market development, diversification,

Question 4

Describe market penetration.

Answer 4

Low risk strategy- sell existing products in existing markets, customers known and established= market penetration.

Only possible in growing markets.

Question 5

Describe product development.

Answer 5

Develop new products for existing markets.

Higher risk than market penetration.

Success dependent on organisation able to conduct research and insight into customer/ market needs, internal capabilities (innovation).

Question 6

Describe market development.

Answer 6

Existing products into new markets.

Riskier than market penetration, difficult to understand complexities of new markets.

Question 7

Describe diversification.

Answer 7

Developing new products for new markets.

Riskiest of all 4, organisation moving into unfamiliar market.

Risk mitigated by undertaking ‘related’ diversification- highest returns.