The Growth Matrix

ABOUT THIS CONTENT

The growth matrix characterizes three means of achieving growth within the company’s existing businesses.

Table of Contents

The growth matrix characterizes three means of achieving growth within the company’s existing businesses. According to the matrix there are three generic strategies for achieving growth:

  1. Market penetration strategy: to increase current product’s share in current markets
  2. Market development strategy: to find new markets whose needs might be met by existing products
  3. Product development strategy: to develop new products for existing markets

growth matrix

Methodology

  1. Identify sales goals and projections. Review sales goals and projections and compare them with existing performance to determine whether a gap exists, requiring additional growth to meet sales targets.
  2. Choose marketing strategy. Define product offerings and market segments currently served. Employ customer surveys and substitution analysis to identify opportunities to achieve growth within the company’s current businesses.
  3. Choose intensive growth strategy. Define strategic direction in terms of increasing current product share in existing markets, finding new markets for existing products, or developing new products for existing markets. Consider competitor responses and supply and demand interactions in doing so.

Notes

  • Used to identify further opportunities to achieve growth within the company’s present businesses

Strengths

  • Provides a logical structure for thinking about increasing sales given existing markets or existing products

Weaknesses

  • Highly simplistic in scope

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