Boston Matrix

• A Boston Matrix is often used to plot the range of products that an organisation offers. It helps the organisation to identify where products might need to be introduced or changed.
• High Market Share

  High Market Growth

  • Stars
• Low Market Share

  High Market Growth

  Question Marks
• High Market Share

  Low Market Growth

  • Cash Cows
• Low Market Share

  Low Market Growth

  • Dogs
• Market Share

  • Ie the percentage or proportion of the total available market or market segment that is being serviced by a company.
• Market Growth

  • Takes place when the number of people buying or using the product increases.
• Description:

  Star - Has a high market share in a high market growth e.g. iPhone.
• Imapct:

  Star - Stars need constant investment to keep ahead in a competitive market. Stars allow a business to become a market leader. Over time, Stars will decline into either question marks or cash cows.
• Description:

  Cash cows - Products that have a high market share of a low market growth e.g. Microsoft Office Software.
• Impact:

  Cash cows - cash cows should require little marketing expenses due to lack of competition. Funds generated can be used to strengthen stars and improve riskier ventures, such as question marks.
• Description:

  Question Marks - products that have a low Market Share in a market with high growth potential e.g. manufacturers of less popular items.
• Impact:

  Question Marks - Question Marks can be invested in due to their position in a promising market. They need development of a strong marketing Mix if they are turned into stars.
• Description:

  Dogs- Products that have a low Market Share of a market with low growth e.g. less popular brands in declining technology industries.
• Impact:

  Dogs - Dogs can adversely affect profits. Dogs should be divested due to lack of market share and the declining market for the product. They cannot be turned into stars.
• Use of the Boston Matrix:

  • Helps the business to make decisions about which products to invest in or which ones to withdraw. for example, "dogs" should be withdrawn but "stars" should be invested in.
• Use of the Boston Matrix:

  • Helps the business to spot gaps in its product portfolio.
  • Helps the business to identify where they need to research.
  • It only shows the product portfolio at one period in time.