Analysis of Ansoff Matrix

13 pages 3097 words
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Table of content
The executive summary...................... 2
1. History of Ansoff Matrix.................... 3
2. Introduction......................... . 3
3. Model Use and the Applicability.................. 5
3.1 Market Penetration........................ 5
3.2 Market development................... 7
3.3 Product Development.................. .. 7
3.4 Diversification................... . 9
4. The Advantages....................... 12
5. The Risks......................... . 12
6. Conclusion......................... 13
7. References.......................... 14
18. Appendix
8.1 Appendix 1..................... 16
8.2 Appendix 2...................... 16
8.3 Appendix 3..................... 17
Executive Summary
This report discuss about the Ansoff Matrix. The matrix contains 4 strategies;
1. Market Penetration
Selling more of the same to the same types of people
2. Product Development
Selling new products to existing customers
3. Market Development
Selling the existing products to new types of consumer
4. Diversification
Selling new products to new consumer
In this report each strategy will be discussed on when to implement the strategy, the risk
level of the strategy and the overall conclusion made from the research about the Ansoff
matrix.
1.0 History of Ansoff Matrix
The Ansoff Matrix was developed by Igor Ansoff. He was called the Pioneer and Father of
Strategic Management. Igor Ansoff was an author of more than 120 published papers and
articles. His research focus in three areas; the concept of environmental turbulence;
the contingent success paradigm and real-time strategic management.
The Ansoff matrix was created by Igor Ansoff as a marketing tool. It was first published in
his article Strategies for Diversification in the Harvard Business Review in 1957. The
matrix gives the marketers several options to grow their business. (Ciper systems
competitive Intelligence Consulting 2006)
2.0 Introduction
Figure : Ansoff Matrix
When a business decides to grow or venture further into the market, the Ansoff matrix can
help the business to decide on its product and market growth strategy. As you can see the
Ansoff matrix covers the two important dimensions; the Product and Market.
The Ansoff Matrix offers 4 generic growth strategies. They are:
5. Market Penetration
Selling more of the same to the same types of people
6. Product Development
Selling new products to existing customers
7. Market Development
Selling the existing products to new types of consumer
8. Diversification
Selling new products to new consumer
To give a clearer explanation of the theory being used, the product; Crocs (See Appendix
1) and the Disney Company will serve as examples.
Market Penetration: Crocs focused on their original market, Canada and Us (The March of
Crocs, 2007)
Market Development: Crocs decide to venture into other market, such Europe Us (The
March of Crocs, 2007)
Product Development: After the market has been saturated for the original crocs, they have
launched accessories, bags and t-shirts. (See Appendix 2)
Diversification: Crocs have no plans to diversify. Walt Disney built parks and resorts to