BCG MATRIX.pptx
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The document discusses the BCG matrix, which is a tool created by The Boston Consulting Group to help companies analyze their product portfolio. The BCG matrix categorizes products as stars, cash cows, question marks, or dogs based on their market share and market growth. Stars are products with high market share in a high-growth market, while cash cows have high market share in a low-growth market. Question marks have low market share but are in a high-growth market, and dogs have low market share and are in a low-growth market. The document outlines strategies for managing products in each of these categories.
BCG MATRIX.pptx
- 1. BCG MATRIX Presented By : Vasudha Pant MFM 3
- 2. BCG MATRIX • Created by The Boston Consulting Group (BCG) • Based on the product life cycle theory • Used to prioritize the product portfolio in a company or department. • Helps understand a frequently made strategy mistake -Having a one size fits all approach Strategy • The basis premise -the higher the market share a product has, the higher the growth rate and the faster the market for that product grows.
- 3. BCG MATRIX ?
- 4. BCG QUESTION MARKS (high growth, low market share) - These products are in growing markets but have low market share. - Question marks are essentially new products where buyers have yet to discover them. - The marketing strategy is to get markets to adopt these products. - Question marks have high demands and low returns due to low market share. - These products need to increase their market share quickly or they become dogs. - The best way to handle Question marks is to either invest heavily in them to gain market share or to sell them.
- 5. BCG STARS (high growth, high market share) - Stars are defined by having high market share in a growing market. - Stars are the leaders in the business but still need a lot of support for promotion a placement. - If market share is kept, Stars are likely to grow into cash cows.
- 6. BCG CASH COWS (low growth, high market share) - Cash cows are in a position of high market share in a mature market. - If competitive advantage has been achieved, cash cows have high profit margins and generate a lot of cash flow. - Because of the low growth, promotion and placement investments are low. - Investments into supporting infrastructure can improve efficiency and increase cash flow more. - Cash cows are the products that businesses strive for.
- 7. BCG DOGS (low growth, low market share) - Dogs are in low growth markets and have low market share. - Dogs should be avoided and minimized. - Expensive turn-around plans usually do not help.
- 8. Limitations • High market share is not the only success factor • Market growth is not the only indicator for attractiveness of a market • Sometimes , dogs can earn even more cash as cash cows
- 9. THANK YOU