Ansoff's Matrix Flashcards
What is the Ansoff’s Matrix?
A marketing planning model that helps a business determine it’s product and market strategy
What are the 4 sections of the matrix?
- Market penetration
- Product development
- Market development
- Diversification
What type of strategies are all of the sections in the matrix?
Growth strategies
What is Market penetration?
Aims to sell existing products into existing markets
What is the aim of market penetration?
To increase market share
What are the key points for market penetration following it’s aim?
- Get existing customers to buy more
- By selling more existing products to the same target customers
What are evaluative points of market penetration?
- Business focusses on markets and products it knows well
- Can exploit insights on what customers want
What is product development?
Aims to introduce new products into existing markets
What are the key points for product development?
- Strategy is driven by investment in new product development
- Requires consistent, long term investment in research & development
What are evaluative points for product development?
- A strategy that often plays to the strengths of established businesses
- Strong emphasis on effective market research and successful innovation
What is market development?
Seeking to sell existing products into a new market
What are the key points for market development?
Various ways of approaching this strategy:
- New geographical markets
- New distribution channels (eg. E-commerce)
What are evaluative points for market development?
- Existing rpoducts may not suite new markets (depends on customer needs)
- Logical strategy when markets are in decline
What is diversification?
Markets new products into new markets
What are possible approaches to diversification?
- Innovation and R&D: develop new solutions
- Buy an existing business in the market
