ansoff-matrix

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Ansoff Matrix:

Ansoff Matrix 2880 Strategy Yr 13

Background:

Background Long-term business strategy is dependant on planning for their introduction Ansoff Matrix represents the different options open to a marketing manager when considering new opportunities for sales growth

Variables in the matrix :

Variables in the matrix Two variables in Strategic marketing Decisions: The market in which the firm was going to operate The product intended for sale In terms of the market, managers had two options: Remain in the existing market Enter new ones

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In terms of the product, the two options are: selling existing products developing new ones

PowerPoint Presentation:

Existing PRODUCTS New INCREASING RISK INCREASING RISK Existing MARKETS New MARKET PENETRATION Sell more in existing Markets MARKET EXTENSION Achieve higher sales/market share of existing products in new markets PRODUCT DEVELOPMENT Sell new products in existing markets DIVERSIFICATION Sell new products in new markets

PowerPoint Presentation:

Existing PRODUCTS New INCREASING RISK INCREASING RISK Existing MARKETS New MARKET PENETRATION Sell more in existing Markets

MARKET PENETRATION:

MARKET PENETRATION This is the objective of higher market share in existing markets E.g. in 2000, Mitsubishi announced a 10% reduction in prices in the UK in order to encourage purchases

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Existing PRODUCTS New INCREASING RISK INCREASING RISK Existing MARKETS New MARKET PENETRATION Sell more in existing Markets MARKET EXTENSION Achieve higher sales/market share of existing products in new markets

MARKET EXTENSION:

MARKET EXTENSION This is the strategy of selling an existing product to new markets. This could involve selling to an overseas market, or a new market segment Nintendo are making hand held games consoles (e.g. DS) appeal to the adult/grey market by introducing games such as Brain Train

PowerPoint Presentation:

Existing PRODUCTS New INCREASING RISK INCREASING RISK Existing MARKETS New MARKET PENETRATION Sell more in existing Markets MARKET EXTENSION Achieve higher sales/market share of existing products in new markets PRODUCT DEVELOPMENT Sell new products in existing markets

PRODUCT DEVELOPMENT:

PRODUCT DEVELOPMENT Least risky of all four strategies This involves taking an existing product and developing it in existing markets E.g. Coca-Cola. This has been developed to have vanilla, lime, cherry and diet varieties (amongst others) in the SOFT DRINKS market

PowerPoint Presentation:

Existing PRODUCTS New INCREASING RISK INCREASING RISK Existing MARKETS New MARKET PENETRATION Sell more in existing Markets MARKET EXTENSION Achieve higher sales/market share of existing products in new markets PRODUCT DEVELOPMENT Sell new products in existing markets DIVERSIFICATION Sell new products in new markets

DIVERSIFICATION:

DIVERSIFICATION This is the process of selling different, unrelated goods or services in unrelated markets This is the most risky of all four strategies E.g. the Virgin group

Summary:

Summary Risks involved differ substantially The matrix identifies different strategic areas in which a business COULD expand Managers need to then asses the costs, potential gains and risks associated with the other options

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