marchand matrix

8/13/2019 Marchand Matrix

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Maxwell Marchand

Ansoff Matri


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Function

Ansoff Matrix developed by Igor Ansoff, a Russian

American mathematician and business manager

Made as a framework for identifying corporate

growth opportunities

Four generic growth strategies:

-Market Penetration-Market Development

-Product Development

-Diversification


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Growth Strategies

Increase sales to the existing

market

enetrate more deeply intoexisting market

!ew roducts

developed forexisting market

"xisting products

sold to new markets!ew products sold

in different markets


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Marketing Penetration

Aim

#o maintain or increase share of the current market with current products #o secure dominance of a growth market or restructure a mature market by driving out competition

Risks

$ow risk

rofits

$ow rewards

Includes

Involves an increase in sales of existing products to existing markets %elling more of the same thing to the same people

roblems

&ifficult to achieve growth through market penetration if market is saturated' In a stagnant market, increase in sales is only possible by grabbing market share from rivals( )ence competition will be intense

Marketing Penetration is achieved by:

(Increased usage by existing customers

(Attracting customers away from rivals

(*ain Marketing share at expense of rivals

("ncourage increase of fre+uency of use

(&evise and encourage new applications

("ncourage non buyers to buy

Examples of Market Penetration:

%tarbucks coffee starting out was small, marking

to people who wanted coffee in a local area'


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Product Development

Aim

Risks Moderate

rofits

Moderate

Includes

%elling the same product to different people, entering new markets or segments with existing products,*aining new products, new segments, new markets, and entering overseas markets

roblems

-ringing existing products to new markets

Moderate risk, .ostly

Product Development is achieved by:

(!ew products to replace current products

(!ew innovative products

(roduct improvements

(roduct line improvements

(roduct line extensions

(roducts at different +uality level to existing products

Examples of Product Development:

A company extending their branding to another

product' "xample: Arm / )ammer extending to

include sale of toothpaste


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Marketing DiversificationAim

Risks )igh0 because of dealing with two unknowns

rofits )igh range of profitability

Includes %elling new products to new markets

roblems

!ew products sold to new markets!ew products for new consumers

1ery Risky

Marketing Development is achieved by:

(!ew products to new markets'

(!ew products for new customers

Examples of Market Development:

Mc&onalds starting Mc.afe'


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Market Development

Market Development is achieved by:

(%ame product to different people

("ntering new markets or segments with

existing products

(*aining new customers, new segments, new markets

("ntering oversea markets

Examples of Market Development:

"xpanding their market to undeveloped 2in

terms of the business and marketing3 areas and

parts of the world( example: .oca .ola

expanding their reach to Russia'

Aim

Risks Moderate0$ack of familiarity with customers

rofits

Medium range of profitability

Includes "ntering existing markets

roblems

%ame product to different people

"ntering existing markets with

Moderate Risk


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Advantages & Disadvantages

Disadvantages of the Ansoff Matrix:

(is highly simplistic and does not factor in the externalenvironment,

Advantages of the Ansoff Matrix:

( Increasing the brand loyalty, this will encourage customersto buy their brand instead of some other' 4ell known brands

use this strategy, such as5 6ellogg7s corn flakes'

( "ncourages customers to buy the product more regularly'( #he brand may bring out different si8e +uantities of theproduct, which will encourage customers to buy more of the

product'

marchand matrix

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