3.1.2

• What are the four growth strategies proposed by Igor Ansoff?


  1. Market penetration
  2. Product development
  3. Market development
  4. Diversification
• What does market penetration involve?

  Further exploitation of the product which already exists
• What strategies may be involved in market penetration?

  Pricing strategy, distribution, or promotional methods
• What does repositioning a brand entail?

  Finding a new use for that product
• What is the risk level associated with market penetration?

  Low risk
• What is product development according to Ansoff?

  Introducing new methods into a proven market
• What is a key factor in product development?

  Understanding the market
• What costs are involved in product development?

  R&D costs
• What advantage may be gained through product development?

  Competitive advantage
• How does the risk of product development compare to market penetration?

  It is riskier than market penetration
• What does market development involve?

  Heavy marketing investments
• What may market development aim at?

  A new target market
• What is crucial for success in market development?

  Loyal relationships with customers
• How could franchising be used in market development?

  To open up new markets
• What is a potential risk of market development?

  Falling behind competitors who invest in new product development
• How does the risk of market development compare to market penetration?

  It is riskier than market penetration
• What does diversification involve?

  Selling new products to new markets
• What are the costs associated with diversification?

  High costs for R&D and then marketing
• What is the risk level of diversification?

  Riskiest of the four strategies
• Who proposed the strategic matrix for gaining competitive advantage?

  Michael Porter
• What are the three ways to gain competitive advantage through distinctive capabilities according to John Kay?

  1. Through architecture: relations between the business and stakeholders
  2. Through reputation: the business's image built through experiences and quality
  3. Through innovation: ability to lower costs or improve/introduce new products
• what is this diagram?