Boston matrix

Question 1

what is the Boston matrix?

Answer 1

• helps businesses analyze theirportfolio (product range) of businesses and brands
• in marketing and business strategy.

Question 2

what is the rising star?

advantages and disadvantages

Answer 2

• possibly the leading brand in the market.
• The distribution must be efficient to ensure availability. - Maybe in the growth phase.
• Increase production.
• Lower pricing to encourage demand or price skimming.

advantages and disadvantages:
- Needs heavy investment
+ Profitable
-Requires expensive investment to maintain position and fend off rivals

Question 3

what is the problem child/question mark?

advantages and disadvantages

Answer 3

• a fast-growing market but not yet an established product
• introduction phase of the product life cycle.
• Usually lots of competition from rival brands.
• Pricing could be low to incentivize demand

advantages and disadvantages
+ Huge potential for growth and revenue
-Requires investment to grow brand
- Requires heavy investment to develop.

Question 4

what is the cash cow?

advantages and disadvantages

Answer 4

successful products in mature markets with relatively little need for investment. They generate high revenue that can be invested in other areas. They need to be managed for continued profit - so that they continue to generate the strong cash flows that the company needs for its Stars
+ Little further investment
- Could be at the end of the lifecycle

Question 5

what is the dog?

advantages and disadvantages

Answer 5

invest to revitalize or discontinue product as it is in a declining market. Pricing would be low and no promotion. Dogs may generate enough cash to break even, but they are rarely, if ever, worth investing in.
+ Could still provide a small amount of profit/ scope for re-branding
-No profit?

Question 6

advantages of the Boston matrix

Answer 6

⦁ A useful tool for analyzing product portfolio decisions
⦁ Only a snapshot of the current position
⦁ Has little or no predictive value

Question 7

disadvantages of the Boston matrix

Answer 7

⦁ Market growth is an inadequate measure of a market’s attractiveness
⦁ The focus on market share and market growth ignores issues such as developing a sustainable competitive advantage
⦁ The product life cycle varies