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Bcg Matrix Model Marketing Strategies Marketing Essay

Paper Type: Free Essay Subject: Marketing
Wordcount: 2541 words Published: 1st Jan 2015

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This is a group assignment and we pointed out the key strategic issues in relating to food retail internationalisation. We applied the strategic concepts and analytical techniques to demonstrate critical understanding and application of theories associated with global business policies and approaches, approaches used in decision making process during crucial scrutiny and how to solve problem process.

BCG Matrix Model

It is also called as BCG model which link ups to marketing and it is a prototype well-known for portfolio management tool, which is used for product life cycle. It often used as to prioritize the products within company product mix to get more funding and consideration.

It is build up by B. Henderson of the Boston consulting group in the early 1970’s founded on categorization of items for consumption into four categories footed on groupings of market growth and market share relative to the major participants.

Every product has its own product life cycle and each stage in product life cycle represents a diverse shape of risks and returns, in general a company can maintain a balanced portfolio of products by a balanced product portfolio including both high growth products and low growth merchandises.

BCG matrix results in 4 categories for placing products in an assortment of a corporation.

They are as under

STARS

They have high growth & high market share

In a growing market contain high market share

Are the leaders in the business but need support for promotion a placement

Are likely to grow into cash cows if market share is held in reserve

QUESTION MARKS

They have High Growth and Low Market shares

Growing markets but have low market shares

These are new products and buyers have to discover them

High in demand but low return due to low market shares

Become dogs quickly if they do not increase their market share

BCG CASH COWS

They have Low Growth but High Market shares in a mature market

Cash cows have high profit margin and can produce a lot of cash flow if competitive advantage achieved

Investments are low in them due to low growth, promotion and placement.

Efficiency and cash flow can be increased by investment in the sustaining infrastructure

Businesses strive for them

BCG DOGS

They have Low growth and low market shares

Low growth markets having low market shares

Should be avoided and minimized

Expensive turn around plans usually does not help for them.

Just consider the example of CRRRK Company in which we applied the BCG product matrix model for its 12 major products placed the products in the boxes and provided critical evaluation for with good theoretical reasons.

There are 16 major products lines in CRRRK, which can be listed as below,

PC, Photo & Gaming

Phones

Home Electrical

Sound & Vision

Furniture & Kitchen

Home & Bath

DIY & Car

Clothing & Jewellery

Sports & Leisure

Toys & Gifts

Baby & Toddler

Garden

Groceries

Banking & Insurance

Clothing

Entertainment & Books

CRRRK convey groceries to your door seven days a week and these are at same low prices as the stores offers, money saving tips and club card points all included n it.

As for as the wines concerned you can visit its new & enhanced website and can select from over 100’s wines & champagnes with next day delivery facility and this facility is free on orders over £49/-.

For entertainment CRRRK provides you with 1000s of titles, to buy, rent or down load and all at great CRRRK prices and free delivery. It also covers CDs, DVDs, DVD Rental, Games, MP3, Blu-ray, and under CRRRK Books a great range of books, chart, pre-orders, children’s corner, cookery, book club, e-books at special CRRRK price and free delivery on order of over £15.

In Clothing CRRRK is leading most fashion and new collection is available to buy. If you buy online, you can get free delivery and if it is over £ 50. All women, men, girls, boys, baby varieties are available and more over sale offers to.

CRRRK is offering most of mobile phone handsets, contracts, pay as you go SIMs, mobile accessories, telephones and broadband deals.

In banking & insurance an extensive variety of offers & covers which suit your lifestyle are available.

More over CRRRK offer car insurance, home insurance, pet insurance, travel insurance, life insurance, health insurance, dental insurance, credit cards, loans, savings, car breakdown, travel money, online servicing, motorbike insurance, van insurance, business insurance, mortgages, gas & electricity.

STARS

Travel money, travel insurance, business insurance, home insurance and life insurance are evaluated as stars for this company as they have high growth & high market share in a growing market containing high market share, are the leaders in the business but need support for promotion a placement and are likely to grow into cash cows if market share is held in reserve for them.

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QUESTION MARKS

Motorbike insurance, van insurance, car insurance, car breakdown and online servicing are assessed as question marks for the company as they have high growth and low market shares, have growing markets but have low market shares, these are new products and buyers have to discover them, high in demand but shows low return due to low market share and can become dogs quickly if they do not amplify their market share.

CASH COWS

Credit cards, loans and savings are the cash cows for the company as they have low growth but high market shares in a mature market, contain high profit margin and can generate a lot of cash flow if competitive advantage achieved by them. They require less investment due to low growth, promotion and placement. There efficiency and cash flow can be increased by investment in the sustaining infrastructure and businesses make every effort for them.

DOGS

Health insurance, dental insurance, pet insurance, mortgages and gas & electricity were found as dogs of the company, as they show low growth and low market share. They also show low growth market containing low market share that’s why they should be avoided and minimized by the company at the moment as these plans turned out too much expensive and haven’t helped them out.

Consider the extension of product life cycle and Ansoff growth matrix, identify and discuss how in your own opinion, your chosen organisation have applied these models to help ensure the continued success of the company products and marketing strategies adopted.

If we have a look on extension of product lifecycle we find out that in present tough financial environment most of the organizations started to lemmatise their investment in new system and started focusing more on smaller schemes which will deliver substantial returns in months rather than years.

As we know that when a product reach its maturity stage of the life cycle, any company may decide to carry out different strategies to lengthen the life of the product and if the product is predicted to continue to be successful or an upgrade is soon to be released the company can use various methods to keep sales, the company will develop extension strategies, repackaging and redesigning, introducing into new market and new promotion options adopted.

The extension strategies like price reductions, promotion, new markets, repackaging and redesigning are considered.

In repackaging and redesigning a company will slightly alter a product to make it seem new and attract new attention to the product and it renews sale level and the product continuing get the interest.

As we know that companies tries to launch their old products into new markets. These are companies who always looking for new markets for their old products to extend the product life cycle and may result into big hit.

Companies always revise promotional activities such as advertising to help to hark back customers about the benefits of purchasing the product. It can help to increase demand, at least for a little while longer.

If we look at Ansoff’s Product/Market Matrix we will find out that,

It is a well recognized marketing tool forwarded by Harvard Business in ‘Strategies for Diversification’. To marketers it offers tactical options to achieve their objectives. In it there are 4 main groups for choice.

Ansoff’s Product/Market Matrix

It demonstrates that in market penetration a company / marketer market its existing products to existing customers. It means that marketer increase revenue by promoting the existing product and repositioning the variety, however the products are not changed and he do not seek any new customer.

In market development marketer will market the existing products range into a new market and the product stays the same but it is promoted to a new spectators, export of the product, or marketing of it in new regions can be best examples of it.

In product development new products are marketed to existing customer, by offerings / replacing by new products and then marketed to existing customers.

In diversification marketer will market completely new products to new customers and in it there are two types of diversifications i-e.

Related and

Unrelated

In related diversification marketer remain in a market or industry with which he is known and in unrelated diversification marketer have no previous industry or market experience.

Considering the extension of product life cycle and Ansoff growth matrix, we have identified that CRRRK Company had applied these models to help ensure the continued success of the company products and marketing strategies adopted by it.

CRRRK Company in present tough financial environment started to lemmatise its investment in new system and started focusing more on smaller schemes which will deliver substantial returns in months rather than years. Take the example of PC, photo & gaming and phones where it started to almost stopping its investment in new structure and started focusing more on smaller schemes for these products.

CRRRK Company started to reduce prices, more focusing on promotion, trying to find new markets for existing products, repackaging and redesigning of most of the existing products and product lines, take the examples of mmotorbike insurance, van insurance, car insurance, car breakdown and online servicing products for which CRRRK has adopted all of above discussed strategies.

In repackaging and redesigning CRRRK slightly altered products to make like new and attractive and got new attention to the product and renewed its sales level and the products again got the interest from customers.

CRRRK Company is trying to launch its old products into new markets and it has given good results in increasing the product life cycle and resulted into big hits, you can take the examples credit cards, loans and savings.

CRRRK Company trying to revise promotional activities such as advertising to help to hark back customers about the benefits of purchasing the product to increase demand and the best example for it is health insurance, dental insurance, pet insurance, mortgages and gas & electricity.

Evaluate the usefulness of marketing and strategic models in relation to the continued success or failure of your chosen organisation

An executable marketing plan also contains a directly aligned sales plan and it is essential for a marketing plan to be based upon established marketing models, at the moment marketing experts are making bags of money by only giving advice to businesses men.

Basically there are three basic models which can be easily cultured and implemented i-e.

AIDA

It stands for attract, interest, desire and action, we can define them separately as,

Attract is the consideration of your believes

Interest is the intention for target market

Desire is the products / services

Action from contacting you or even better buying your products or services

4 or 5 P’s

In it product, price, place, promotion and performance, these can be explained as,

Products will be integrated within the marketing

Prices must be economical / value added

Places where determined for their greatest exposure

Promotion or how it becomes most effective

Performance must be measured for the marketing activity

2 or 3 Q’s

It stands for quality, quantity and qualifying

Quality of products and services

Quantity of marketing messages

Qualify message through use of testimonials

Considering the extension of product life cycle and Ansoff growth matrix, we have identified that CRRRK Company had applied these models to help ensure the continued success of the company products and marketing strategies adopted by it.

CRRRK Company in present tough financial environment started to lemmatise its investment in new system and started focusing more on smaller schemes which will deliver substantial returns in months rather than years. CRRRK Company trying its best to make use of AIDA (attract, interest, desire and action). Take the example of PC, photo & gaming and phones where it started to almost stopping its investment in new structure and started focusing more on smaller schemes for these products.

CRRRK Company started to reduce prices, more focusing on promotion, trying to find new markets for existing products, repackaging and redesigning of most of the existing products and product lines. CRRRK Company is also making use of 4P’s (product, price, place, promotion and performance). CRRRK Company is also considering 3 Q’s (quality, quantity and qualifying). Take the examples of motor-bike insurance, van insurance, car insurance, car breakdown and online servicing products for which CRRRK has adopted all of above discussed strategies.

In repackaging and redesigning CRRRK slightly altered products to make like new and attractive and got new attention to the product and renewed its sales level and the products again got the interest from customers.

CRRRK Company is trying to launch its old products into new markets and it has given good results in increasing the product life cycle and resulted into big hits, you can take the examples credit cards, loans and savings.

CRRRK Company trying to revise promotional activities such as advertising to help to hark back customers about the benefits of purchasing the product to increase demand and the best example for it is health insurance, dental insurance, pet insurance, mortgages and gas & electricity.

 

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