A well-known portfolio management tool, BCG Matrix is used in product life cycle theory. Each product goes through different stages, represents a different profile of risk and return. BCG matrix is generally used to prioritize which products within company product mix get more funding and attention.
It classifies the products in 4 four categories based on combinations of market growth and market share relative to the largest competitor.
Having a balanced product portfolio includes both high-growth products as well as low-growth products.
A high-growth product is the new product for which we are trying to get some market by putting efforts and resources to market it, to build distribution channels, and to build sales infrastructure. And this product will be a hit in near future.
A low-growth product is already established product, whose characteristics do not change much, customers know what they are getting, and the price does not change much either. There is no point putting more budgets for its marketing.
BCG model for ITC
Product Mix of ITC can be broadly categorized as follows:
2. FMCG- others - Ashirvad Atta, Sunfeast, Candyman, Bingo,Superia, Wills LifeStyle, Fiama Di Wills, Expressions, Classmate, , Kitchens Of India, Mint-o
4. Agribusiness:-eChoupal, Agri Exports, Leaf Tobacco
5. Packaging and Paperboards
Star * Hotels * Packaging and paperboards * Growth
Agri-business | Question Mark * FMCG- Food |
Cow * FMCG-Cigarettes | Low
Dog * ITC Infotech |
1. STAR (high growth, high market share):-
* Hotels: - As there is increase in per capita income the demand for luxury hotels is also increasing. ITC is a recognized brand with its welcome-group, welcome-heritage and fortune hotels. Having 105 hotels all over the world it captures huge market share.
* Packaging and paperboards:- in this segment also ITC recorded... [continues]
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