Diversification: Marketing and Growth Strategy
I. Introduction
Strategies are very essential for every business organization in order to be successful. Often times, most companies view marketing trend to be one of the most important aspects in implementing their strategies since with an excellent marketing strategy, consumers are easily captured. Also, as strategic opportunities present themselves incessantly and which change as the years go by, a business organization may have more than one strategic opportunity at a time depending on its stability and profitability and its extent to take the risk of such opportunity.
In this paper, the Ansoff’s Product-Market Growth Matrix will be delved into, specifically the four different growth strategies such as the market penetration, market development, product development and diversification. The first three growth strategies (market penetration, market development and product development) will be briefly defined, while diversification will be comprehensively discussed as a strategy/marketing tool or a corporate growth strategy. In the discussion of diversification, its definitions, kinds/classifications, and the companies which utilized this strategy tool and became successful will be cited.
II. Igor Ansoff and his Product-Market Growth Matrix
H. Igor Ansoff was a Russian American, applied mathematician and business manager, and is known as the father of Strategic management. In 1957, Ansoff developed the Product-Market Growth Matrix, which was a tool he created to plot generic strategies for growing a business via existing or new products, in existing or new markets and as a method to classify options for business expansion (http://en.wikipedia.org/wiki/H._Igor_Ansoff).
Through Ansoff’s Product-Market Growth Matrix, alternative corporate growth strategies were presented and that it focused on the company’s present and potential products and markets/customers. Ansoff model also considered the ways to grow through existing products and new products, and
Strategies are very essential for every business organization in order to be successful. Often times, most companies view marketing trend to be one of the most important aspects in implementing their strategies since with an excellent marketing strategy, consumers are easily captured. Also, as strategic opportunities present themselves incessantly and which change as the years go by, a business organization may have more than one strategic opportunity at a time depending on its stability and profitability and its extent to take the risk of such opportunity.
In this paper, the Ansoff’s Product-Market Growth Matrix will be delved into, specifically the four different growth strategies such as the market penetration, market development, product development and diversification. The first three growth strategies (market penetration, market development and product development) will be briefly defined, while diversification will be comprehensively discussed as a strategy/marketing tool or a corporate growth strategy. In the discussion of diversification, its definitions, kinds/classifications, and the companies which utilized this strategy tool and became successful will be cited.
II. Igor Ansoff and his Product-Market Growth Matrix
H. Igor Ansoff was a Russian American, applied mathematician and business manager, and is known as the father of Strategic management. In 1957, Ansoff developed the Product-Market Growth Matrix, which was a tool he created to plot generic strategies for growing a business via existing or new products, in existing or new markets and as a method to classify options for business expansion (http://en.wikipedia.org/wiki/H._Igor_Ansoff).
Through Ansoff’s Product-Market Growth Matrix, alternative corporate growth strategies were presented and that it focused on the company’s present and potential products and markets/customers. Ansoff model also considered the ways to grow through existing products and new products, and
Links: The chart below shows the growing and overall interest in Apple’s various product lines over the past eight years (2004-2011). (Source:http://royal.pingdom.com/2011/06/13/the-diversification-of-apple/)