Ansoffs matrix

• What is Ansoffs Matrix

  a famous marketing planning model that helps a business determine its product and market strategy.
• Market penetration


  This is a growth strategy where a business aims to sell existing products into existing markets

  Key points: • Aim: to increase market share • By selling more existing products to the same target customers • Get existing customers to buy more • Widen the range of existing products

  Evaluating market penetration: • Business focuses on markets and products it knows well • Can exploit insights on what customers want (and competitors) • Unlikely to need significant new market research • But will the strategy allow the business to achieve its growth objectives?
• Product development


  business aims to introduce new products into existing markets

  Key points: • This strategy is driven by investment in new product development • Usually requires consistent, long-term investment in research & development • Technological innovation provides significant opportunities for product development strategies

  Evaluating product development: • This is a strategy that often plays to the strengths of an established business • A great way of exploiting the existing customer base who may respond positively to new product
• Market development


  sell its existing products into new markets.

  Key points: There are various ways of approaching a strategy of market development – such as • New geographical markets; e.g. exporting to emerging markets • New distribution channels • Different pricing policies to attract new customers in different segments

  Evaluating market development: • A logical strategy where existing markets are saturated or in decline • Often riskier than product development – particularly expansion into international markets
• Diversitifcation


  markets new products in new markets.

  Key points: Possible approaches to diversification: • Innovation & R&D: develop new solutions • Acquire an existing business in the market • Extend an existing brand into the new market

  Evaluating product development: • Inherently risky strategy • No direct experience of the product or market • Few economies of scale (initially) • However, if successful, overall risk of the business is spread