Strategic marketing involves the management of the process of determining the marketing strategy that is to be followed, and of making sure the strategy is followed correctly, in order for a firm to successfully compete against its rivals; it can be defined as "a systematic approach to a major and increasingly important responsibility of...management: to position and relate the firm to its environment in a way which assures its success and makes it secure from surprises" (Ansoff, 1990). In an attempt to assist this process various strategic marketing planning tools and models have been created. Michael Porter, Igor Ansoff and the Boston Consulting Group have each developed models that have come to be well known and respected in the field of business. However, whilst these models are universally acknowledged as marketing strategy tools of merit, they are not without their limitations.
The Boston Consulting Group (BCG) proposed a model named the “Growth-Share Matrix” - a portfolio-management tool that can be used to classify the product portfolio of an organisation. The model compares two variables: the market growth and the market share of a product, and provides a two-dimensional matrix within which are four categories that a product will fall into depending on its position in the marketplace; ‘Star’, ‘Cash Cow’, ‘Dog’ & ‘Question Mark’.
(BCG Matrix Guide, 2010)
The initial advantage to using this model is the ability to prioritise a product portfolio. By defining and categorising current products using the BCG Matrix, an organisation is, for example, able to determine which products already generate high levels of cash and profit. These products require little further investment and/or attention (‘Cash Cows’) and can...