Product-Market Expansion Grid
Ansoff has proposed a useful framework called the product/market
expansion grid for detecting new intensive growth opportunities.
There are four strategies, one for each of the quadrants:
When the product is in the current market, it can still
grow. There are three major approaches to increasing current
product's market share:
1. Encourage current customers to buy more.
2. Attract competitors customers.
3. Convince non-users to use the product.
When the current product is launched in a new market,
there are three approaches to develop the market:
1. Expand distribution channels.
2. Sell in new locations.
3. Identify the potential users.
When a new product is launched in the current market,
the intensive growth strategies could be to:
1. Develop new features.
2. Develop different quality levels.
3. Improve the technology.
When a new product is launched in a new market, diversification
makes good sense as better opportunities are found outside
the present business. The diversification strategies are
of three types:
1. Concentric Diversification Strategy: Develop new products
with the earlier technology for new segments
2. Conglomerate Diversification Strategy: Develop new
products for new markets.
3. Horizontal Diversification Strategy: Develop new products
with new technology for old customers.
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